Texas Governor Signs Telco State-Level Franchise Bill

Sep 8, 2005  •  Post A Comment

The video dreams of SBC Communications and Verizon Communications got a huge boost Wednesday after Texas Gov. Rick Perry signed into law a bill that permits the telephone companies to seek a franchise at the state level, rather than town by town.

The bill, which passed the state legislature last month during a special session, enables the two companies to quickly begin rolling out their respective phone-line-based video product quickly in the state. It was seen as a setback for the state’s cable operators, which had sought to block the bill.

The new law allows the phone companies to seek a statewide franchise agreement to offer video, instead of obtaining an agreement from every town and city in the state where it wants to offer video services.

Phone officials have acknowledged that if forced to obtain a franchise agreement from every jurisdiction where they want to offer video service they would face a slow and arduous process that could blunt their aggressive growth plans for the video service.

Although the outcome was not surprising to most in the industry, sources have said that many people were watching the Texas legislature closely, since it might provide a model for other states. Other states that are taking up the issue include New Jersey and New York.