So, I had a great chat with my Dad (ODofORinSF) last night. Dad has been in the cable business for quite some time, and of late is involved with buying and building new cable systems in rural (exurban) Texas.
Historically, for a cable or telecom company to provide service in a new town, they must get permission from the town. This is called a local franchise.
The assumption is that municipalities will essentially allow any legitimate, stable provider to have the franchise with a minimum of fuss. This is good for the residents of the town. The reality is, of course, a lot of bureaucracy and opportunism on the part of the towns.
The Texas House of Representatives, after some controversy, has passed a bill which allows providers to obtain the franchise at the state level -- and to avoid the thicket of myriad local laws.
On the face of it, this sounds like a great leap forward. Anything which removes barriers to telecoms competition is great by me. By every estimation, Verizon and SBC will leap at the chance to compete with the cable incumbents.
But let me tell you why Dad’s pissed. The cable companies have had to fight through these thickets for years, at great expense, only to have their main competition swoop in with no such baggage.
Imagine being a tennis player who’s played on a muddy court for years. Then, you are put into a match while an agile rival, who plays on a nice fast surface. Oh, and you need to finish out your match in the mud -- you only get the fast surface when the current game is done.
The cable companies are subject to the same law as the telecoms -- they too can apply for franchises from the state. The injustice is, they must finish out their existing contracts (for years) while newcomers do not.
So what’s the right thing to do here, especially as a free-market Republican? Well, this falls into the sticky area of doing the right thing for the wrong reasons. The bill is wrong because it was written to benefit Texas-based SBC. Make no mistake about that.
However, the bill is doing the right thing. Removing barriers to telecoms competition is essential to our competitiveness as a nation. The cable companies get the shaft, for a time, but consumers win here.
The solution? Pass the bill. Sign it into law. And then, let cable companies sue the s**t out of Texas to allow them to sunset their existing contracts.
NCTA, do not try to redress past injustices by punishing the consumer. Anyone who studies the facts will agree that cable has been treated unfairly. But, let’s have this net out positively instead “fairly”.
Addendum: the FCC is getting into the act. Will be interested to see how this is spun -- “promoting competition” or “kowtowing to big telecoms”?
Comments