Telecom Bill Consensus on Franchising Upsets Cable Industry
House and Senate lawmakers agree on a narrow telecom bill that includes a federal franchising framework and Universal Service Fund provisions, numerous Hill and lobbyist sources said. The House Commerce Committee is moving more quickly on its bill and could release a draft as early as Fri., Chmn. Barton (R-Tex.) told reporters. Senate Commerce Committee Chmn. Stevens (R-Alaska) vowed to complete his telecom reform hearings, but said staff is proceeding with draft legislation he hopes to have ready by mid-April.
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Cable has “some nervousness” about the House bill, NCTA Pres. Kyle McSlarrow said. “The House is about to introduce a bill that would literally turn back the clock on rate regulation, price controls and disparate treatment of fairly large providers who are well-equipped to compete in this marketplace,” McSlarrow said. Admitting he wasn’t familiar with the bill’s specifics, McSlarrow said he heard it would require cable operators to adhere to local franchising terms until new entrants achieve 15% market penetration. “Fifteen percent is nirvana for the Bells,” McSlarrow told reporters. “They have no intention of getting more than 15% -- they just have to make sure it’s the right 15% of the market,” he said. Bells could pick and choose wealthy neighborhoods to market services, but cable would have to match prices while serving all areas -- a money-losing formula, McSlarrow said: “That is turning back the clock on rate regulation and, besides being manifestly unfair and giving huge subsidies to the largest telecommunications companies in the world, the last people who need it.”
House Majority Leader Boehner (R-Ohio) is among backers of the bill. “With his [support] we have a good chance to have significant legislation passed,” former House Majority Leader Dick Armey told a Progress & Freedom Foundation (PFF) event. Barton’s bill likely will have a federal franchising framework, said Armey, who favors the concept as better for companies. But he told us legislation probably will have to include “some accommodation to the states” acknowledging lawmakers’ concern over states rights.
Congress shouldn’t be picking winners and losers with telecom legislation, Sen. DeMint (R-S.C.) said, plugging his digital bill (S-2113), which models principles PFF advocates for deregulating telecom. Today’s tack on telecom oversight is “obsolete,” DeMint said, arguing to let competition thrive. “This bill has a fundamentally different way of looking at regulation,” DeMint said, adding he hopes to find a House sponsor for a companion version of the bill, co-sponsored by Sen. Ensign (R-Nev.). Asked about the telecom bill emerging in the House, DeMint said he appreciates Barton’s work to “create a politically viable solution.” But he said he’s not ready to accept a regulatory approach to the telecom industry, an approach he said could lead to “unintended consequences.”