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from: Jackson Sun

AT&T seeks state bill
Legislation would create franchising agreement

By NED B. HUNTER
nhunter@jacksonsun.com

Proponents of a state bill that would create a single franchising agreement with AT&T and all local communities will attempt to get the legislation passed when the General Assembly reconvenes in January.

Known as the Competitive Cable and Video Services Act, (HB 1421), the legislation would create a single statewide franchise that would allow AT&T to provide video services to local municipalities via the Internet without contracting with each of the state's local governments individually.

AT&T argues that the law is necessary to create competition and speed up getting services to local communities by eliminating the need to negotiate with more than 300 separate local governments.
"When providers come into the market, rates go down," said Gregg Morton, AT&T president-Tennessee. "We are asking for the opportunity to compete."

But the executive director of the Tennessee Cable and Telecommunications Association said AT&T's purpose behind the legislation is to avoid spending the millions of dollars it would cost to upgrade its old copper wiring infrastructure.

"We have spent $1 billion (statewide) to upgrade the networks and continue to spend on upgrades," Stacey Briggs said. "AT&T, we have heard, is spending between $200 million to $300 million to upgrade their network."

But Morton countered that the former "Ma Bell" giant doesn't need to spend as much on upgrading its system, because the company won't install fiber-optic or standard coax cable lines to provide its service. Instead, AT&T will send its video service over the company's existing copper lines that were part of the former BellSouth infrastructure.

"With advances in (data) compression, we can get a lot over the existing copper lines," Morton said. "(But) to have to build an entire footprint would kill us."

By using its existing infrastructure, AT&T could reach smaller rural communities that do not have, and may never have, cable service because of their size, said state Sen. Bill Ketron, R-Murfreesboro. Ketron is the main sponsor of the cable legislation. The bill does not ask for any state funding for AT&T.

"The faster we get broadband into our rural communities, the faster those communities can be connected to the world," Ketron said. "Not only from our children in education in being connected but in providing the economic link to industrial development to those communities."

Briggs argues otherwise.

"They have said they intend to serve 70 communities, and there are over 500 to 600 franchises," Briggs said, "so right there it tells you they do not intend to serve everyone."

AT&T's service is not cable television, Morton said. Rather, it is a television broadcast, called U-Verse, transmitted over a video network that uses Internet technology rather than cable technology.

It is not, he said, Internet service.

Ketron's bill was parked in the state Senate's General Subcommittee last year. He said he will resurrect his bill during the legislature's next session.

"States like Florida, Georgia, Missouri and South Carolina have all passed this type of bill," he said, "and if we don't move quickly in that direction, Tennessee will be left quickly behind."

On the state House side, the bill has been revised and is in the Commerce Committee. One revision states that AT&T must pay the same franchise fees that other local providers are paying, Morton said.

But Jackson Mayor Jerry Gist still opposes the legislation. He fears the bill's passage would eliminate local control over the quality of service the telecom giant might provide.

"We would have no control whatsoever over customer service," Gist said, "and we do not want to give that up, because local government is the closest contact to residents for service."

Last March, City Council members voted to send a resolution to local state representatives asking them to oppose the legislation.

Morton said the bill's passage would mean AT&T's investment would create about 2,000 jobs statewide. He said the first phase of construction would take between two to 2 1/2 years to complete after the bill passed; some customers, however, would see service in mid-2009 if the legislation is passed quickly.

Morton said cable companies don't want the bill passed because AT&T's U-Verse will cut into their customer base.

"Cable will say we are looking for an unfair advantage," Morton said. "We are not. We are asking for the opportunity to compete. We may fail."

Briggs said otherwise.

"The purpose of the bill is to avoid what cable has been doing for the last 10 years, which is upgrading the network," she said.

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- Ned Hunter, 425-9641