Login | Register
Mostly Cloudy ~ 88°F  
[Shelbyville Times-Gazette]
Shelbyville, Tennessee ~ Saturday, July 5, 2008
Print Email link Respond to editor Read more columns by John I. Carney

Cable competition may be a good thing


Wednesday, April 9, 2008
Well, it now looks as if AT&T will be able to offer its "U-verse" cable television service in Tennessee after all.

It's probably much too soon to tell when, or even if, the service will be offered in Bedford County.

In case you haven't been following the issue, here's the situation. Up until now, when a new cable television provider wanted to come into an area, it would have to negotiate what is called a "franchise agreement" with the local government in return for the right to use public right-of-way. The local government might insist, for example, that the cable TV system pay a franchise fee, that it offer free service to schools and fire halls, or that it air city council or county commission meetings on a public access channel. The cable company might make promises about what percentage of city households will have access to a cable signal or about upgrading all of its lines to high-speed.

In most cases, of course, there's been only one cable system. Most of the T-G's coverage area is served by Charter Communications, a nationwide chain controlled by Microsoft co-founder Paul Allen. Cable does have competition, of course, in the form of satellite television (DirecTV and Dish Network). But some people, depending on their location, can't get satellite, while others, because of their location, can't get cable.

The rise of digital services and the Internet has meant that what cable companies do and what telephone companies do has started to grow closer together. The same digital infrastructure that carries high-speed Internet traffic can also carry voice telephone and cable TV channels. Both Charter and AT&T offer high-speed Internet service. Meanwhile, Charter is starting to compete with AT&T in the home telephone business, and AT&T would like to return the favor by offering cable television through its service lines.

But AT&T, since it already has a presence on the public right-of-way, wants to avoid having to go and negotiate franchise agreements on a city-by-city, county-by-county basis. Instead, it wants to get a statewide franchise that would allow it to begin rolling out U-verse. Cable TV companies object, saying that it's unfair for AT&T to get to play by different rules. They have claimed that AT&T only wants to offer U-verse in the most profitable neighborhoods. Local governments have also objected, saying that they have the right to negotiate with, and win concessions from, new cable operators.

AT&T argues that times have changed since those cable franchises were negotiated and that its service would be good for the public by giving cable TV competition.

The compromise agreement worked out last weekend will, if passed by the General Assembly and signed by the governor, allow AT&T to seek a statewide franchise, but in return would require it to offer U-verse service to a certain percentage of Tennessee homes, including a certain percentage of low income homes. The plan would also give local governments in areas covered by the new TV service a 5 percent franchise fee on the TV service's gross receipts -- which in many cases is higher than the fees negotiated by local governments with cable companies under the old system. The average cable franchise fee is 3 percent, and some local governments are getting nothing at all.

The bill is now moving through the state legislature. As I said, there's no telling at this stage of the game how soon it will affect Bedford County, if it does.

Even so, whether you love or hate AT&T, love or hate Charter (and either company has its detractors), I tend to think that it will be a good thing to have more competition in the years to come.

John I. Carney is city editor of the Times-Gazette and covers county government and other topics. His home page is lakeneuron.com.