from: The Atlanta Journal-Constitution [1]
Governor signs video franchise bill AT&T wanted
By SCOTT LEITH
The Atlanta Journal-Constitution
Published on: 05/31/07
AT&T, which harbors hopes of becoming a big force in selling TV services, got a boost Wednesday from the state of Georgia.
Gov. Sonny Perdue signed a bill that revamps how video franchises are granted, a move that should make it easier for AT&T to compete with cable in providing TV.
AT&T lobbyists have sought similar changes in many states, with mixed results. In Georgia, House Bill 227 sailed through the General Assembly.
After the governor's sign-off, AT&T announced plans to invest $500 million in Georgia over the next three years to upgrade networks. AT&T, which markets its cable-like TV services under the name U-verse, also expects to hire hundreds of workers to help handle the launch.
For AT&T, franchising changes are critical precursors to the company's ramp-up to battle cable operators.
Cable TV generally has been regulated by local authorities. Georgia will join a number of other states that have mostly dropped local rules in favor of statewide franchises. The shift will let AT&T and others, including cable companies, get single franchises instead of seeking or renewing hundreds of individual ones.
AT&T's lobbyists spent plenty of money and time persuading Georgia lawmakers. AT&T, which bought the former BellSouth in December, contributed $200,000 to Perdue's 2007 inaugural fund, more than any other donor.
"This was a big effort for the company," Sylvia Anderson, president of AT&T Georgia, said about the push to approve HB 227. "It was exceedingly important to us."
The bill's chief sponsor, state Rep. Jeff Lewis (R-Cartersville), said the law will increase competition. "If history is any indicator, a year from now Georgians should be paying less on their cable bill," he said.
Perdue also said the law will give consumers "greater choice in video services."
The cable industry has largely opposed changes to decades-old franchise rules. Nancy Horne, president of the Cable Television Association of Georgia, hopes AT&T will offer U-verse to "all Georgia consumers, not just those in economically advantaged neighborhoods." Some critics worry newcomers to the video market will focus on the most lucrative neighborhoods.
Franchising reform first gained traction in 2005, starting in Texas, as phone companies eyed the video business. This year, changes passed in more states, including Georgia and Florida.
But not everything has gone AT&T's way. In Tennessee, an AT&T-backed overhaul was stymied.
So far, AT&T offers U-verse services in relatively few markets. The company has about 30,000 U-verse users nationwide.
Last week, AT&T announced the rollout of U-verse in parts of Michigan, including metropolitan Detroit. Michigan's governor signed a bill into law in December to revamp the state's franchising system.
AT&T hasn't said when it will offer U-verse on a widespread basis in Georgia or elsewhere in the Southeast, though little activity is expected this year. The company has said it will launch U-verse in "a market" in the Southeast by the end of 2007.
Georgia's new statewide franchise system will be in place in 2008.
SIDEBAR
Georgia is the latest state to enact a law that simplifies how TV franchises are granted. AT&T stands to be a big beneficiary as it prepares to compete with cable providers such as Comcast. An overview of franchise overhaul efforts:
LEGISLATION ALREADY ENACTED
Texas, Virginia, Indiana, Kansas, South Carolina, North Carolina, New Jersey, California, Michigan, Missouri, Florida, Georgia, Iowa
LEGISLATION PENDING
Nevada (awaiting governor's signature), Massachusetts, New York, Connecticut, Illinois, Wisconsin, Ohio, Pennsylvania
LEGISLATION FAILED THIS YEAR
Colorado, Idaho, Utah, Tennessee, Washington, Minnesota
Sources: Staff research, AT&T, National Cable & Telecommunications Association