from: Nashville City Paper [1]

If denied, AT&T says it won’t ask again
By John Rodgers, jrodgers@nashvillecitypaper.com
May 07, 2007

AT&T’s lead lobbyist says that if the telecom giant is not successful this year in passing its bid for statewide television franchising, it won’t try again next year but could offer its services to Nashvillians in the near future.

AT&T has been lobbying hard for a piece of legislation in the halls of the state Capitol that will allow telecommunications companies like it to obtain a statewide video franchise to offer television services. Currently, franchises are garnered through local governments.

The telecom’s move for a statewide franchise has met fierce resistance from the cable industry and local governments, who say that a statewide franchise for AT&T would give the company an unfair business advantage versus cable and remove local franchising control — and all that comes with it — from cities and counties.

AT&T officials’ main talking point is statewide video franchising will bring competition to “monopoly” cable companies and not hurt local municipalities.

So far, local government representatives and the cable industry say they’re winning the fight. AT&T’s bill is still in both the House and Senate Commerce Committees, and the legislative session is in its closing weeks.

Jim Spears, AT&T’s lead lobbyist, remains optimistic. But if AT&T is not successful during this session of the state Legislature, the telecom would not try again next year and the state would lose the “hundreds of millions” the company is planning to invest.

“That money that’s been earmarked for Tennessee is only if this legislation passes,” Spears said. “If this legislation doesn’t pass, our whole strategy regarding video changes and that money that’s been earmarked for Tennessee will go to another state that has passed this franchise and Tennessee will lose that investment. That’s a given.”

Assuming it passes its statewide video franchise, Spears said AT&T’s three-year plan is to offer its television service in the state’s four urban areas plus “upwards to 70 small cities and towns across the state of Tennessee, from east to west.”

If it doesn’t pass its statewide franchising bill, Spears said AT&T would plan on obtaining local franchises — the same that Comcast has in Nashville — in the four major urban areas but not in the other smaller cities and towns.

“Right now they are in that three-year plan, and if this bill doesn’t pass, those upwards to 70 cities, they are going to be put on the backburner,” Spears said. “They are going to be pushed down in the deployment schedule. Because then we’re going to turn right around and go to the four major metros where the density is.”

AT&T’s fallback plan if they don’t get a statewide franchise is a “vindication” of the Tennessee Municipal League’s argument concerning the ability of AT&T to get a local franchise currently, said Chad Jenkins, a TML lobbyist.

“The whole reason this bill is being brought is to allow them to circumvent the existing laws and cherry pick on their own terms the customers they want to serve,” Jenkins said.

AT&T does not make its three-year plan public and those upwards of 70 cities and towns it plans to provide video services to in order to not release its business plan to competitors.

Jenkins said AT&T should release its list of where it plans to offer its video services.

“We ought to know who there going to serve,” Jenkins said.

Stacey Briggs, the executive director of the Tennessee Cable Telecommunications Association, said all AT&T has planned to do all along — regardless of state or local franchise — is go to the four major cities: Chattanooga, Knoxville, Memphis and Nashville.

“I don’t think anybody ever seriously believed they were going anywhere else anyway,” Briggs said. “At least if they go to the big four to get a serious franchise, there’s a hope that the low income areas will be served.”

Tuesday, AT&T’s bill is scheduled to be heard in both the House and Senate Commerce Committees. The parties involved will also meet today, Spears said, to try and continue negotiations.

Independent of the statewide video franchising debate, House Speaker Jimmy Naifeh (D-Covington) said he hopes to end the legislative session by the end of this month.