Ministers stoke franchise fire

A group of Chicago-area ministers has thrown additional fuel onto the growing fire under SBC Communications' hopes of avoiding having to get local cable TV franchises for its IP-based video service.

The Ministerial Alliance Against the Digital Divide (MAADD) claimed at a January press conference that by avoiding franchise requirements, SBC will be able to practice “digital redlining” and focus its $6 billion in network upgrades under Project Lightspeed solely on affluent neighborhoods.

SBC has already petitioned the FCC to treat IP video as it treats IP voice service and not impose regulation.

“We are coming to the market with the same technology, but instead of offering voice, we are offering video service,” said an SBC spokesman. “IP service is all bits. Logically, we don't see how we have to separate voice bits from video bits.”

The spokesman said the redlining charge was part of an effort by the cable industry to slow SBC's entry into video entertainment service.

Not surprisingly, SBC is facing staunch opposition from the cable industry and from municipal officials in its quest to keep local regulatory hands off IP video.

“To the extent IP video looks exactly like the cable service that is offered today, there is no reason not to regulate it in the same way,” said attorney James Baller, senior partner in The Baller Herbst Law Group, which has represented many municipalities. Without a franchise agreement, SBC cannot be compelled to provide public access, local programming or institutional networks, nor will it pay franchise fees or meet customer service requirements, he said.

“And there's likely to be a whiplash effect for any city that agrees not to require a franchise,” Baller added. “The next day, the cable company will be screaming to get out of its franchise.”

The FCC is coming up on a February deadline to rule on SBC's petition but could seek an extension and postpone the decision until May, the company spokesman said.

Verizon Communications is securing cable franchises in the communities in which it is building a fiber network, but it is not offering IP Video.

“That's what makes the difference,” said the SBC spokesman. “Verizon is offering a standard broadcast cable service.”