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from: CNN

FCC to Soon Extend Franchise Relief to Cable Companies

From Dow Jones, October 18, 2007
By Corey Boles

The Federal Communications Commission will shortly extend the same regulatory relief to the cable industry that it granted to telephone companies earlier this year, two agency officials said Thursday.

FCC Chairman Kevin Martin told the other four commission members to be ready to vote on the matter at the agency’s meeting Oct. 31. There is a chance a majority of the commissioners could vote in favor of the item before the meeting, said one of the two agency officials, both of whom requested anonymity.

In December, the agency approved, by a 3-2 margin, changes to the process by which telephone companies moving into the pay-television market applied for licenses from local governments across the country.

In order to offer video service, companies must get franchises from local or state governments in every market they want to operate in, a process that is seen by many to be time-consuming and expensive.

After a failed effort by lawmakers to grant a single national license, the FCC took the initiative to attempt to streamline the franchising process.

The changes set a time limit for city or county governments considering a franchise application, put a limit on the fees they can charge and prevent them from making extravagant build-out demands on companies.

The effort was strongly opposed by local government groups like the National League of Counties, which argued that the FCC was infringing on their jurisdictions. Several of these groups are suing the agency over the rule changes.

The changes were limited to new entrants to the market, such as AT&T Inc. and Verizon Communications Inc., which have been making rapid inroads into the provision of video service. Incumbents like Comcast Corp. and Time Warner Cable had argued that the changes gave their rivals a competitive advantage.

The relief for the phone companies went into effect in March. Commissioner Robert McDowell had extracted a pledge from Martin that the changes would be extended to the cable companies within six months, making for a deadline that expired in September.

The vote is likely to be along party lines, as it was in December for the initial changes, with the two Democratic commissioners opposed.

It is unclear whether the move would impact cable companies immediately or when their franchises come up for renewal, generally every 10 years or so.