Who benefits from cable bills?

HAMPTON – Two bills introduced in Congress that aim to provide residents the freedom of choice in cable television have some municipalities up in arms.
Town Manager James Barrington told selectmen that the bills have the potential to eliminate funds for the operation of Channel 22.

The bills, S 1504 and HR 3146, have been introduced at the urging of telephone companies trying to break into the cable market.

Currently, residents can only purchase cable television service from a company that has acquired an exclusive franchise in their town. In Hampton, the company is Comcast.

The bill would eliminate that requirement of a franchise agreement with a town, allowing other companies to come into town and offer their services.

Barrington learned about the proposed legislation from the New Hampshire Municipal Association (NHMA), which sent out an alert to all municipalities.

“These are bad pieces of legislation that will help the cable TV industry at the expense of the nation’s taxpayers,” Barrington said.

The NHMA alert was launched by another alert sent by attorney John Pestile, who represents municipalities across the country on cable and telecommunications matters.

According to Pestile, there are many deficiencies in the bills. Both bills have a clause that cable companies would still have to pay the local government a franchise fee and provide channels for government access, but it doesn’t include financial support for government channels or offer any ways to ensure that the fees due are paid.

Pestile said the Senate bill has language that could allow phone companies that decide to provide cable to claim they do not have to pay any fees. The bills may also allow cable companies that decide to provide phone service to claim that they are now phone companies and are therefore exempt from the cable franchise requirement.

“If successful, Hampton would lose over $125,000 per year that offsets our tax rate, and another $40,000 per year that funds the operations of Channel 22,” Barrington said.

Proponents of the legislation say that is not the case.

FreedomWorks, a national organization fighting for lower taxes, less government and more freedom, is running a national campaign in support of the bills. It says that competitive providers are required to pay the same franchise fees currently paid.

If the bills pass, they say consumers will be able to pick from a wider range of options, including those that offer more local or special-interest programming and cheaper prices.

Instead of just having Comcast, consumers can pick another provider that may be cheaper than the one they currently have.

Barrington said this bill is being supported by the same lobby that convinced Congress in the early 1990s to deregulate the cable TV industry on the theory that it would create competition, improve services and hold down prices.

“The past 15 years have demonstrated exactly the opposite results in the cable TV industry,” Barrington said. “In practical application, companies do not compete against one another in small markets. We’ve seen rates increase every year; the scheduling lineup changes at least as often as the rates.”

Barrington urged citizens to call their congressmen and senators to vigorously oppose the bills.

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