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from: NAtional Journal

Telco Firms Scoring at the State Level

From National Journal, March 16, 2007
By Michael Martinez

The Democratic takeover of Congress may have complicated the federal lobbying plans of large telephone companies — but 2007 appears to be going well for them at the state level thus far.

Missouri lawmakers this week cleared legislation to speed the entry of telephone companies into the state’s video market, and similar video-franchising rules changes are pending in about a half-dozen other states.

Meanwhile, Verizon Communications joined forces with Comcast in Maryland to block a requirement that high-speed Internet providers make information about the deployment of their services publicly available.

The Missouri measure sailed through the state Legislature after a similar proposal died last session in the state Senate. This year’s version enjoyed the support of the state’s cable companies, because it would let them opt out of existing deals with localities and get new statewide franchises.

Gov. Matt Blunt is expected to sign the measure into law once he receives it.

Franchising legislation also is on the table in Florida, Georgia, Illinois and Tennessee, and a hearing on franchising is expected in Wisconsin later this month.

Ben Scott, policy director of the advocacy group Free Press, said the deciding factor on franchising has been the cable companies.

“From the 10,000-foot perspective, where cable has been fighting, there has been a battle,” he said. “Where they’re not, legislation is moving.”

In Maryland, meanwhile, state Delegate Herman Taylor pulled his broadband bill last week — and telecommunications companies and others who opposed non-binding language in the bill advocating so-called network neutrality declared victory. Network neutrality involves the principle of equal treatment of all high-speed Internet content.

FreedomWorks, an advocacy group partly funded by the Bell telecom companies, issued a statement boasting its grassroots campaign to defeat Taylor’s measure.

The head of the group, former U.S. House Majority Leader Dick Armey, R-Texas, said the proposal would have amounted to state-level regulation of the Internet.

But Scott, who attended a hearing on the issue last month, said widespread misinformation had led to the bill’s demise.

He said the substance of the measure involved reporting requirements on broadband deployment and redlining — the latter a term referring to the deployment of services to higher-income neighborhoods, but not to low-income areas.

The debate was misconstrued in what Scott characterized as a circus over the network neutrality language.

“I’d never seen so much misinformation and outright lying,” he complained. “And I’m a cynic. I work on Capitol Hill every day.”

In a recent post on his Web log, Art Brodsky — communications director for the advocacy group Public Knowledge — blamed an “uncertainty and doubt campaign from Verizon, Comcast and their acolytes in labor unions, business groups and conservative ‘think tanks’” for the defeat of the proposal.

Scott said the state-level legislative battles have become particularly important as companies expand their business models to include broadband, telephone and video services.

He is concerned that not enough is being done to ensure that services are offered in low-income and rural neighborhoods. “These state franchising bills, unfortunately, are going to write the digital divide into law,” Scott said.