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from: Braintree Forum

Views differ on cable franchise negotiations

By Robert Aicardi
GateHouse Media
Wed May 02, 2007, 04:22 PM EDT

Saying that he knows first hand how important local franchise negotiations are to a community, Michael Modestino, a former cable advisory committee chairman, believes that Verizon is attempting to bypass this process and avoid having to deal with communities where they wish to offer cable television services.

Richard Colon, Verizon’s regional director for external affairs, says that although the company continues to negotiate with communities under existing state regulations, on average this process takes anywhere from 12 to 15 months to complete, and consumers should not have to wait that long to receive the benefits of true cable choice.

Modestino and Colon expressed their views to the Forum separately.

According to Modestino, by finding a sponsor in the state House and Senate to file legislation that it wrote, Verizon is making clear its intention to avoid local control.

“This practice is unacceptable and, quite frankly, insulting to consumers and business owners alike,” he said.

Modestino argued that every community relies on local franchise agreements as a means of ensuring that the community and the company are able to foster a healthy working relationship.

Local control also provides a means of mitigating additional revenue and allocating resources for schools, libraries, and public access channels, he added.

“I do not believe that a large corporation like Verizon should be allowed to author and introduce legislation that sets the industry standard in the state for cable franchising regulations,” Modestino said. “The process should be regulated at the local level by communities who know what is in their best interest.”

Colon countered that Verizon supports changes to outdated regulation created 35 years ago to address a nascent industry and make sure that initial CATV system builders had the resources to complete community buildouts.

“Today’s technology and the industry itself have changed dramatically,” he said. “Regulation must keep pace with these changes to ensure that true competition and its associated benefits are delivered to consumers without the delays associated with an antiquated process.”

Colon disputed Modestino’s contention that local control provides a means for additional revenue for schools, libraries, and public access channels.

“State law requires that cable license revenue only be used for cable related purposes, such as public access programming and equipment upgrades,” Colon said. “Beyond a free cable television connection required by state law, public schools and libraries do not receive direct benefits from cable franchise revenue.”

Proposed state legislation would allow Verizon and other companies the ability to provide competitive choices to consumers more quickly.

“True cable choice creates lower prices and fosters investment and improved services,” Colon said.

According to Colon, the legislation keeps municipalities whole by providing up to the federal cap of five percent for franchise fees. In addition, capital grants of up to one percent of gross revenues are part of the proposal.

A requirement to carry public access programming and strong anti-red lining language are also part of the bill.

“In a democratic society, we all have the right to work with our legislators to author and introduce legislation,” Colon said. “Why should large corporations that contribute significant investment dollars into our state’s economy be treated differently?”

He concluded, “Certainly communities know what is in their best interest, but I suggest that ultimately, individual consumers know what is best. Who would argue with the need for lower cable prices and more choice?”