Competition For Cable On The Way

State lawmakers on Wednesday reviewed draft legislation that would streamline the process for allowing telephone companies to enter cable TV competition. If approved, telephone companies would seek permission from a state regulation agency, the N.C. Utilities Commission, for a franchise rather than having to deal with local city councils and county commissioners for franchises across the state.

More than 100 onlookers packed into a committee room, many standing against the walls, as lawmakers heard an explanation of the bill and citizens voiced their opinions.

While more than two dozen people commented on the proposed change, most of them were either from The Peoples Channel, a public-access channel in Orange County, or from a Freedom Works, a free-market advocacy group.

“Our members believe in the strength of the free market,” said Kathy Hartkoph of Freedom Works, which supports the competition bill.

But David Casper of The Peoples Channel spoke against it.

“I don’t know why local franchising has to be done away with,” he said. He said that he feared that PEGs (public, educational and government access channels) might have a more difficult time surviving under such a proposal.

“The PEG provision in this seems to be token and almost laughable,” he said.

A number of people argued for the preservation of PEGs, channels that allow for people to provide alternative and independent programming. Some PEG channels also cover local government events, such as city council, county commissioner and committee meetings.

The Peoples Channel considers the bill an affront to its existence. Its Web page issued a call to action, saying, “Telephone companies want to take away our right to communicate!”

One commentator, who said he drove from the town of Jupiter in Buncombe County to attend the meeting, said he wasn’t all that crazy about cable revenues being used to pay for PEG channels.

“PEG money is a hidden tax,” Don Yelton said. “Why should I as a subscriber pay PEG fees?”

Robert Gwyn, a member of the board of The Peoples Channel, followed Yelton.

“I’d love to have this fellow on The Peoples Channel,” he said. “I’d give him a 30 minute daily program. We love controversy.”

Connie Book, associate dean of the School of Communications at Elon University, reminded the committee that cable companies offer some services to local communities that might end when it comes time to renew their contract.

She pointed out that many cable companies provide services such as Internet and cable to schools. Those services could be lost under a statewide franchising plan, she said.

“Remember that there will be new costs that the cities will have to bear if the franchising process changes,” she said.

It would be considered an unfair trade practice for telephone companies to discriminate on cable service based on a residential area’s race or income level.

Industry officials say that cable provided over telephone lines would likely first go to more densely populated areas and then spread to other areas, similar to the way that they began offering broadband Internet service.

The Revenue Laws Study Committee, which is reviewing the proposed legislation, took no action on the bill on Wednesday. However, it could come up early next month.

The bill is likely to come up during the 2006 short session of the General Assembly, which begins in May. If approved, it would take effect Jan. 1, 2007.