AT&T, cable crafting compromise

Monday, March 24, 2008 at 1:41am

Lengthy negotiations between AT&T, the cable industry and local governments over AT&T’s bid to offer television services in Tennessee are close to complete, and the final product may cause a first for the telecom giant in the southeast.

To make an agreement happen, AT&T has given in on where it’s required to offer its services under a statewide franchise.

Going into the talks, one of the biggest points of contention was where a statewide franchise holder would have to offer video services.

Local franchise holders are often bound to “build out” to cover a certain area of a city or county, and therefore can’t “cherry pick” wealthy residents.

The cable industry has argued that a pure statewide franchise would allow AT&T to only cater to high-income customers.

In the tentative agreement, Tennessee would be the only southeastern state to require AT&T and other statewide television franchise holders to offer its services to a certain percentage of a geographical area within a certain time frame.

Some low-income customers would also have to be covered.

“That’s what the build out is going to look like,” said Rep. Randy Rinks (D-Savannah).

Since late last year, lobbyists and lawyers from the cable industry and AT&T have gathered in House Speaker Jimmy Naifeh’s conference room on Capitol Hill to try to hammer out a deal over statewide video franchising rights.

Currently, television franchises are obtained at the local level, such as Comcast in Davidson County.

AT&T, in its effort to get into the television services business and compete with cable, wants to pass legislation allowing for a statewide — instead of local — franchise. That would allow the telecom giant to offer services anywhere in the state and not have to strike local agreements.

During last year’s legislative session, AT&T spent millions lobbying for the bill, but the cable industry and its local government allies fended it off. The cable industry, defending its business model designed on local franchises, also spent millions lobbying against AT&T’s effort.

Naifeh (D-Covington), determined to not watch the same spectacle again, started gathering AT&T and cable, and then local governments, together to try to work out a deal.

Those talks are winding down, and the compromise bill could be produced as soon as this week or within the next two, said Rinks, one of the half dozen or so lawmakers involved in the negotiations.

“There’s been a lot of progress that I think has been made,” Rinks said.

Lt. Gov. Ron Ramsey (R-Blountville) also said a compromise bill would likely be released this week and he’s “very optimistic” statewide franchising legislation would be passed this year.

Another part of discussions, prevalent on the minds of rural lawmakers and Gov. Phil Bredesen, is using AT&T’s bid for a statewide franchise as a vehicle to expand broadband Internet access to rural areas.

Greater broadband Internet access would greatly aid economic development in rural Tennessee, officials say.

And parties involved are planning on offering an incentive for AT&T and other telecom companies to “extend broadband to where it’s not now,” Ramsey said.

“You get certain credits,” Ramsey said of the discussed legislation. “That’s one change the House made that I think is a great change to the bill.”

While not commenting specifically on the talks, Bob Corney, an AT&T spokesman, said the telecom is “pleased that things are moving in the right direction.”

“What we want is an opportunity to put our product before Tennesseans and compete,” Corney said.

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By: BADCOPS on 12/31/69 at 7:00

There needs to be a system where we pay for what we watch. Customers need not be charged for 200 channels they do not watch. It should be our package not theirs as we are the one paying.AT&T needs to also improve their customer service. This is a major problem as many contractors and those who do billing are less than qualified to do their jobs. Over billing, bad service, high prices need to go. Until then I will stay with Directv.

By: TITAN1 on 12/31/69 at 7:00

I'll stick with Comcast, more than happy with their service.

By: idgaf on 12/31/69 at 7:00

The more the merrier for US. Let the market place shake itself out.Comcast did not build their monopoly they bought it and have abused consumers ever since raiseing rates whenever they want to.

By: SpincycleGB on 12/31/69 at 7:00

Competition in this field would be a great thing. The company that offers ala carte packages will win my business. I don't want to pay for a bazillion channels I don't want. Would rather have a selected collection of 20-25 channels in my custom ala carte package. The technology is there. Bring it to the people.

By: HokeyPokey on 12/31/69 at 7:00

idgaf, do either you or your ghostwriter know the difference between a legal monopoly (the old AT&T) and a de-facto monopoly like Comcast?

By: HokeyPokey on 12/31/69 at 7:00

bad, when you go down to the Krogers' to buy a gallon of milk, do you think you're just paying for the milk? Did you wonder who's paying the rent on the building? The utilities? The help (such as it is)? Who pays for the shelves that hold all the other products?Tell you what, spud, next time you go in for that gallon of milk, you tell that clerk right then and there that you only want to pay for the carton, the milk inside, the delivery chain that got it to the store, the manufacturer and the farmer.And that kid over there looking at Cosmopolitan? You don't want to pay for the lights to let him look at that nasty stuff.How's that for ya?

By: Cowboy84 on 12/31/69 at 7:00

HP, you don't go into Kroger and have to buy everything in the store, you pick just what you want to buy, that's what lots of people are asking for from Comcast or AT&T.

By: Dragon on 12/31/69 at 7:00

If you buy bread and milk, you must buy brussel sprouts. It's part of the package and if everyone had a choice, it would hurt the brussel sprout producers and they might go out of business. Then we wouldn't have enough "diversity".

By: HokeyPokey on 12/31/69 at 7:00

Dear friends, you really don't understand, do you? Bless your hearts.If you think that you, as an individual subscriber, are paying for channels you don't watch, what do you think the actual viewers of those channels are paying for? Do you think they get them for free? Here's something you might not know, the only channels everybody doesn't pay for are the shopping channels, the Jesus channels (Jesus' followers pay to have those channels run) and every channel above 100.You don't want to pay for those channels above 100? Fine. Don't subscribe to them.You don't want to pay for the satellite value channels you don't watch? Fine. Don't subscribe to the satellite channel.Is this really because you think you're having to pay for something you don't watch, or for something you don't want someone else to watch?

By: HokeyPokey on 12/31/69 at 7:00

Cowboy, I could type my post to bad again, more slowly, if it would help you understand the principle involved. If the grocery only sold at wholesale prices (what they pay for the goods) they'd be closed in one day.

By: Dragon on 12/31/69 at 7:00

Hokey - you said "Here's something you might not know, the only channels everybody doesn't pay for are the shopping channels, the Jesus channels (Jesus' followers pay to have those channels run) and every channel above 100"Granted, I am on Charter, not Comcast, but the "basic" package (the first 20 channels) contains two shopping channels and three inspirational channels. I could easily pick ten channels since I never watch the others.

By: HokeyPokey on 12/31/69 at 7:00

but, Dragon, you don't pay for either the shopping channels or the Jesus channels. So you probably shouldn't watch them, either ;-)

By: Dragon on 12/31/69 at 7:00

I pay for the basic package, so I pay for each channel in the package. You seem to be saying that I pay for some but the others are free. Did you mean that the Jesus channel doesnt' cost anything to broadcast?

By: OPENmindedONE on 12/31/69 at 7:00

While I would certainly love being able to choose which channels I receive, I would have to also understand that the increased manpower and technology required to make that happen would likely cause rates to go up and then we would all end up paying the same aound we do now or even more. The real bonus here is that those of us who have been stuck with Comcast's ridiculous and lackadaisical malfeasance can escape to AT&T at least long enough to get some decent customer service... until the nasty cycle starts again. Competition helps. Don't even get me started on charter schools.

By: airvols on 12/31/69 at 7:00

Bring on AT&T my Comcast has been down four times this month and once for a week. This is exactly why we need the competition. Comcast is a joke.

By: TRHJR on 12/31/69 at 7:00

Mr.or Ms. Hokey, You must be a economics` Professor @ some Higher learning outfit.. cause I ain`t even figuring out what ya talk`en about.... Cause all I want is the RIGHT to choose....

By: HokeyPokey on 12/31/69 at 7:00

While you folks are salivating over cheap cable, I found two links at another newspaper that might help you figure this one.One is from a techno-head website DSL Reports, and the other is from a national organization of city, county and state officials who deal with cable companies and telelphone companies as their jobs. The NATOA report should add some perspective, I hope.

By: HokeyPokey on 12/31/69 at 7:00

Dragon, you're paying for the infrastructure and the corporate costs of stringing that bit of coax into your house. Of those channels, if any of them are local broadcasters, there's a retransmission consent agreement between cable and the stations that means the operator is paying or giving something to the TV station. You pay your share of that. If there are stations like CNN or ESPN in your 20 channels, they charge the operator for the right to carry their programming and you pay the operator for that. The Jesus channels are bought and paid for channels, just like the Shopping channels. You don't pay for either of those kinds of channels, their owners pay the cable company to deliver your eyeballs to them.

By: HokeyPokey on 12/31/69 at 7:00

TRHJR, I ain't no perfessor and I agree with you wholeheartedly that we need competition and we needed it yesterday.AT&T could have applied for franchises any place they wanted in Tennessee since the day the "new" AT&T was born. They chose not to. It's not Comcast that's keeping competition away, it's AT&T's refusal to enter a marketplace where they know their shoddy technology and inferior service would cause them to lose the battle before it was even begun.If you don't think the technology is limp, dig into some of the AT&T users' websites and do some hard-nosed looking for yourself. You'll find that the service is less stable than Comcast, that you can only watch one HDTV channel in your entire house at one time and that AT&T is either completely incompetent with their customer service or they are deliberately playing bait and switch.Before somebody asks, yet again, I don't work for cable. I have cable, and I have cable phone and I'm about to pick a fight with Comcast because somebody called my unlisted number, called me by name and tried to sell me something.This won't be pretty.

By: TRHJR on 12/31/69 at 7:00

Thats nice... Don`t know which one I `d have service with... But just want the RIGHT to choose... Just the "RIGHT" Then let he best ole Gal win !

By: HokeyPokey on 12/31/69 at 7:00

TRHJR, you have the right to choose from whoever wants to provide service. You don't have a right to choose somebody who does not. And unless you live within 5000 feet of an at&t box that's serving a wealthy neighborhood, you won't have a right to their service either. at&t cannot deliver cable over their existing system, they have to add new fiber and new switching boxes. Those boxes have a maximum range of 5000 feet in any direction, after that they have to build a new one. If you know anything about computer networks in businesses, those boxes are essentially switch closets. There's only so far you can push a signal over an unshielded twisted pair before it's useless.You folks who think that having at&t service in Belle Meade is going to lower your prices if you live elsewhere are simply wrong. Read the data, prices are not dropping in competitive environments, they're rising. Not only that, but cable only looks cheaper when it's bundled with other services, like telephone and internet. You could lower your cable bill today by bundling with phone and data but think about the prison that puts you in, you can't change just one service any more, you have to change them all if you're dissatisfied with what you get from Comcast or at&t.Oh, and you Comcast subscribers, are you on a contract that obligates you to be a subscriber for more than a month? at&t writes contracts on their new services.

By: JeffF on 12/31/69 at 7:00

Comcast is the antichrist and everyone who works for them is a festering pile of doofus. Care to refute Hokey?

By: HokeyPokey on 12/31/69 at 7:00

No,JeffF, I'd rather have an adult conversation, if you don't mind.