US phone firms look to alter rules on cable

09 Jun 2006

(Associated Press via NewsEdge) Looking to quickly leap into the business of delivering TV broadcasts, US telephone companies are leading efforts to rewrite the rules that for decades have given local governments control over who provides cable television in their areas.

Under bills passed or being considered in at least 14 states and Congress, pay-TV authority would shift to state governments or even a national process. That would mean both phone and cable companies no longer would have to negotiate individual franchise deals with hundreds of communities.

Supporters are touting the bills as pro-consumer, saying competition from Verizon's and AT&T 's video services will lower prices.

But several groups and municipalities are crying foul, arguing that the bills give away too many consumer protections to two companies that are almost monopolies.

The fear is that new entrants will offer their services in more affluent neighborhoods that tend to spend more, while ignoring working-class or poor areas. That means wealthier areas mainly would see the benefits of competition _ lower prices, better services, faster upgrades.

Consumer groups however are upset that the legislation lets new video providers choose which communities they want to serve. Currently, cable companies generally are required to serve all neighborhoods in any city they enter the so-called 'buildout' requirement.

c 2006 The Associated Press

c 2006 Dialog, a Thomson business. All rights reserved

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