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from: Belleville News Democrat

AT&T's cable service push draws intense debate at Capitol

RYAN KEITH
Associated Press

SPRINGFIELD, Ill. - Jay Rubinic doesn't care how he gets it. He just wants his cable TV.

Rubinic said he's fed up with his current cable provider, Comcast Corp., after a recent outage stretched into nearly two weeks of poor service and frustrating waits for a repairman. But because Comcast has a franchise agreement with Chicago and dominates that market, Rubinic feels he has no other cable choice.

AT&T says it has an alternative: cable programming delivered over telephone lines.

The company is asking Illinois lawmakers to make it easier to compete with established cable companies, saying increased competition would lead to better service, more options and lower rates.

But competitors and other opponents argue the change could lead to worse programming and poor service - or none at all.

"It's a big-stakes game for business," said Barbara Popovic of Keep Us Connected, a coalition of cities, nonprofit groups and public access channels fighting the measure. "We're here to tell you that the stakes are also high for the public."

Large telecommunications companies now have the technology, called IPTV, to offer cable service over their extensive network of lines. It eventually would allow parents to use cell phones to check what their kids are watching and allow viewers to choose any one of 20 camera views of sports events, AT&T Illinois President Paul LaSchiazza said.

"This is game-changing technology," LaSchiazza said. "Cable has a vested interest in keeping competition out of their marketplace."

Led by AT&T, telecommunications companies are making a national push for states to ease laws that make it difficult to roll out the new service.

In Illinois, that would mean ditching a requirement that cable providers negotiate franchise agreements with each city they serve, replacing it with one statewide approval process with the Illinois Commerce Commission.

AT&T says it's too cumbersome to negotiate agreements with hundreds of local authorities, especially when cable companies like Comcast and Insight Communications already have a lock on the market. Advocates of the change say statewide franchising, already adopted by about a dozen states, would help drive down cable rates that have grown more than 90 percent in the last decade nationwide.

"Because the cable companies in large part are being left unchecked, they can raise rates and they don't have the fear of losing a lot of customers," said Rep. Jim Brosnahan, an Evergreen Park Democrat sponsoring the measure.

But cable companies say nothing is stopping AT&T from offering the new services now - it would just have to follow the same rules as cable companies. And while they acknowledge cable prices have risen, they say that's largely because customers now have access to far more channels.

Critics also say such a change could create even more problems for Illinoisans because AT&T and Verizon would not be required to offer service to all Illinois homes. The new competitors could lure away customers who spend the most on programming, and no one would compete for the business of the remaining homes.

"No other company will be able to come in and compete if AT&T has cherry-picked all the best customers," said Jon Danielsen, an Insight district vice president.

Advocates for public access channels, which provide political, educational and governmental programming - called PEG channels - fear the channels could lose the funding and channel designations cable companies are now required to provide.

Mayors throughout the state fear consumers would be left with poor service if local governments no longer have enforcement power, and would have no say on where AT&T could place the large boxes needed for IPTV rollout in their communities.

They're also concerned they'll see a revenue shortfall in local government, because cable agreements now include payments to the cities.

"Why are we trying to fix what I don't believe is broken?" Roselle Mayor Gayle Smolinski asked at a recent news conference.

Those concerns have been echoed by Attorney General Lisa Madigan's office and some lawmakers, who worry the change could produce problems similar to the huge spike in electricity prices caused by deregulation of that industry.

"We don't have a crisis in this," said Rep. Julie Hamos, D-Evanston. "We really could take the time to think through some of the issues that we're worried about."

Lawmakers have spent weeks negotiating the proposal. And telephone and cable companies vying to offer bundled packages of telephone, TV and Internet services have ratcheted up political donations and flooded airwaves and newspapers with ads.

Brosnahan, the bill's sponsor, said he's working out concerns with Madigan's office and others, trying to require that new companies provide service to people and give the attorney general and local governments authority to go after abuses.

"We're not going to make everybody happy, but we're working in the right direction," Brosnahan said. "It's getting better each day."

For Rubinic, the Chicago cable subscriber, competition sounds like a good idea.

"If they can bring the pipe to me, I'll take it, and I think that's the way it should be," he said.

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The bill is HB1500.

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On the Net:

_ Illinois General Assembly: http://www.ilga.gov

_ AT&T: http://www.att.com/gen/press-room?pid5838

_ Keep Us Connected: http://www.keepusconnected.org