Coalition pushes FCC franchise process

A day after the Federal Communications Commission issued its annual report on video competition, Consumers for Cable Choice filed a request asking the FCC to update its cable franchising process.

In an 8-page submission, motivated by the FCC’s Notice of Proposed Rulemaking on video franchising, Robert Johnson, C4CC president, asked the commission to expedite the local franchising process and to establish federal rules for what constitutes unreasonable franchise terms. Both actions would increase choice for consumers and bring about numerous other benefits, he said.

“With this NPRM, the Commission recognizes the importance of streamlining the franchise process so that consumers can have more options for their video service,” Johnson said in a prepared statement. “The Commission should take this opportunity to promote new standards for local franchise authorities that promote competition and eliminate the regulatory burdens that are currently hindering deployment of new fiber and other competitive technologies.”

Telcos have been supportive of changing the franchise process to allow for state—or in some cases—national franchises. Cable operators, however, claim such moves give their telco rivals an unfair advantage. On Friday, the FCC’s report on video competition showed cable’s share of the multichannel video programming market dropped from 71.6% last year to about 69.4 percent. The second and third largest providers are DBS operators, which gained a few percentage points from 25.1% in 2004 to 27.7% in 2005. Telcos and other alternative sources were noted but don’t have significant market share.

The FCC report was issued at the FCC’s meeting in Keller, Texas, where Verizon launched its FiOS video offering. Texas also was the first to adopted state-wide franchises, a move that is still being fought at several levels by cable operators.

USTelecom president Walter McCormick said in a statement that it was fitting that the FCC choose to adopted the report in Keller.

“The local franchising process is seriously flawed and has significantly delayed the deployment of video services to consumers across the country,” he said. “The outdated franchise process must be reformed to eliminate the unnecessary barriers to entry that limit video choice and to allow innovative service providers to bring more video competition to consumers.”