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from: Times Gazette

Cable / phone fight heats up again
Friday, November 16, 2007
By Brian Mosely

The cable television industry is gearing up for another fight in the Tennessee State Legislature against AT&T, which is planning to promote a bill next year that the cable industry claims would hurt consumers by dismantling the local franchise law.

However, AT&T claims that a handful of cable companies continue to enjoy a monopoly on video service and that the current method of obtaining local cable franchises is "a lengthy, expensive process that just doesn't make sense."

Stacey Briggs, president and executive director of the Tennessee Cable Telecommunications Association, was in Shelbyville Wednesday and said that AT&T's plan for statewide video services legislation would "strip controls that protect local governments and consumers."

AT&T pulled the bill it had submitted last year after it failed to get out of Senate and House commerce committees during legislative sessions in Nashville.

Last March, Shelbyville City Council passed a resolution stating its opposition to last year's bill concerning cable franchising rights. However, the council also passed a motion to offer AT&T a franchise agreement with the city.

AT&T wanted to change Tennessee state law to permit companies willing to compete with cable TV providers to get a statewide franchise to provide cable services themselves, rather than seeking a local franchise in each city or county.

However, City Manager Ed Craig stated that towns would lose if the bill was passed. When cities are negotiating a franchise agreement themselves, they can insist on a "build out" option, where services must be provided to all parts of the city; specify service standards; and require that service be provided to schools and municipal buildings.

Currently, Charter Communications contracts with Shelbyville and other area communities to use the public rights-of-way to offer cable service. In return, Charter pays the towns a franchising fee. Craig also stated last year that only 7,000 customers nationwide were using the AT&T video service.

Briggs said AT&T wants customers to believe that barriers block its entry into the video market, but she said the phone company is able to walk into any city hall in Tennessee and apply for entrance into the market and have it granted within 90 days.

Published reports have quoted Gregg Morton, president of AT&T's Tennessee operations, as saying that a change in the law is necessary to create competition and speed up getting services to local communities by doing away with the need to negotiate with city governments, leading to lower prices.

Morton claims that AT&T is not challenging utility right of ways, would provide more public-service channels than cable and would not "cherry-pick" customers.

Both the Tennessee Municipal League and Tennessee County Services Association oppose the phone company's proposed legislation.