Markey Says Barton’s Bill Favors Telcos Over Consumers

Mar 28, 2006  •  Post A Comment

Rep. Ed Markey, D-Mass., on Tuesday said legislation backed by Rep. Joe Barton, chairman of the House Energy and Commerce Committee, that would make it easier for phone companies to roll out video services favors communications industry giants at the expense of consumers.

“For those fighting for a broadband vision for America which is inclusive, innovative and openly competitive, this bill represents a giant step backward,” said Rep. Markey, the ranking Democrat on the House telecommunications subcommittee.

Rep. Barton’s bill, which was first distributed publicly late Monday, would clear the way for phone companies to roll out video operations through a national franchising process, allowing them to bypass the local franchising approval process that cable TV operators had to go through to launch the nation’s existing cable systems.

The bill also would allow cable TV operators to switch from local to national franchises after a phone company launches video services on their turf, or when the cable company’s local franchise expires. Another provision in Rep. Barton’s bill could require companies that offer TV under a national franchise to pay local authorities a fee of up to 6 percent of revenues-an increase from the 5 percent cable TV operators can be required to pay under local franchising agreements.

In his statement, Rep. Markey said he was especially concerned that Rep. Barton’s bill fails to include provisions requiring companies to build out their systems throughout the areas they choose to serve under a national franchise. “By failing to include a build-out provision to ensure service area parity between a Bell company entering a franchise area and the incumbent cable operator, it allows a national franchisee to use public rights-of-way in a community but serve only select neighborhoods within the community,” Rep. Markey said.

Rep. Markey also complained that the bill contains no provision to stop incumbent cable TV operators from raising rates in neighborhoods in which phone companies aren’t offering competing video services to make up for price cuts in areas in which the phone company is rolling out service.

“This represents a grave consumer protection flaw in the bill,” Rep. Markey said.

Rep. Barton, R-Texas, who has scheduled a hearing on his legislation for March 30, declined comment on Rep. Markey’s remarks. But in a statement, House Speaker Dennis Hastert, R-Ill., praised Rep. Barton’s bill for “putting consumers first as we prevent outdated regulations from stunting the growth of new pay-TV services and drive down costs by giving people more choice.”