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Note: The new AT&T Tennessee president, Gregg Morton, repeats the telco mantra "competition means lower prices" while offering no evidence that this has been the case anywhere. Instead he offers up the cost of the infrastructure upgrades AT&T has planned in states that have given in to telco state franchise demands, as if that is somehow a form of corporate benevolence. In reality, these upgrade costs come at the expense of the local cities and the loss of revenue from past local franchising agremments. AT&T and other telcos are saving much more than they are investing in infrastructure upgrades - the city losses are their gains.

from: The Tennessean

Sunday, 09/16/07
State's new AT&T chief could revive franchise bill

Look for a new leader on the 21st floor of AT&T's Tennessee headquarters in the downtown tower.

Gregg F. Morton is the new president of AT&T Tennessee, replacing Marty Dickens, who retires Oct. 1. Morton, 50, is a career BellSouth employee who held several legislative affairs and public relations jobs with the company in South Carolina and Washington, D.C. He previously was president of AT&T in South Carolina. AT&T bought BellSouth late last year.

One issue Morton faces is whether to make a second attempt to persuade the Tennessee legislature to pass a bill allowing a statewide TV franchise here for Internet Protocol-based TV service. The company abandoned its first attempt to get that passed earlier this year. An alliance of cable companies that compete with AT&T and city governments afraid of losing local control joined forces to kill the bill in the General Assembly.

AT&T favors such a one-stop shopping approach — rather than getting regulatory approval one city at a time to roll out its new service. Morton talked about what's ahead for AT&T with staff writer Naomi Snyder.

You have this background in legislative affairs. Tennessee was not able to pass that law giving a statewide franchise for video service. Is AT&T going to come back and try to get that passed during the next legislative session?

Our customers sure would like to see that happen. We're still evaluating our options and looking at our plans. But we are hearing more and more, as people learn more about the issues, that competition means choice and it means lower prices. I think last year the issue got away from that (idea). Nobody really cares what AT&T wants or gets out of this. Nobody cares what cable says. The consumer wants to know what's in it for them. This is a wonderful opportunity to bring competition, choice and lower prices. You're going to hear me say that over and over again.

What did you mean we got away from that in the discussion?

I don't mean we got away from that. I mean maybe that you guys (the media) got away from that. It got covered like it was this battle between AT&T and cable and all these lobbyists were hired. That's not really what's critical to me here. What's critical is consumers and providing them new services, better prices, competition. I think there are 19 states now that have passed video franchise reform. I'm coming from South Carolina where we announced a $250 million capital investment on the heels of video legislation, and in North Carolina it was $350 million. And in Georgia it was $500 million. We're going to make an announcement very soon in Florida. You can see quickly that Tennessee is becoming surrounded by states that have done this. I've been asking the question, why not Tennessee?

(AT&T lobbyist) Jim Spears was quoted some time ago saying that if the bill didn't pass during the legislative session, the company would roll out its TV service to the major metro areas.

There are no plans to do that. I wasn't here and it may have been discussed. But there are no plans to do that at this point.

Would you envision AT&T rolling out TV service in Tennessee without getting this bill passed?

I don't know how we can. We do have some experience in providing cable service, primarily over in Georgia. Our experience is that it takes on average 13 months to negotiate a franchise. There are hundreds of municipalities or local governments we would have to negotiate with. There is not a business plan that supports that. We have got to have the ability to go in quickly and not get held up city, by city, by city. We have to make sure it's a win for the cities as well, and we think that's what the statewide franchise legislation will do.

What do you think AT&T's strengths are?

I think our strengths are the technology we have, the partnerships. If you look at the iPhone, the partnership with Apple, it has worked very well. Our network is the only one that will allow you to watch a video while you're talking to someone on your cell phone. We're the largest wireless company in the world. We're the largest broadband company in the United States. People look at just about every industry measurement and AT&T is the leader. We're the largest in terms of revenue.

Where does AT&T need to improve?

Well, if you look at our business, you see that traditional landlines continue to go down because of competition, largely through cable or other providers such as Vonage (which allows phone calls over a high-speed Internet connection). Again, it comes back to video. Our future is wireless. Customers want — in fact, they demand — to be able to talk to anyone they want 24 hours per day, no matter where they are. The future is clearly wireless and broadband (Internet). There has been a lot of talk in the press about what is going to be that killer application. We think video will be that killer application that will cause people who don't currently have broadband to want to subscribe to it. We think video is going to be a huge driver, first of broadband adoption, and that will allow us to build out video further.

So with the video service, you'll have to have a broadband (Internet) connection? And you'll have to subscribe to AT&T's broadband service in order to get the TV service?

Correct.

So you think people who are not now subscribing to broadband will subscribe to it because they want to get the TV service?

We think there are a lot of people who have satellite and they like some of the technical aspects of satellite better than cable. We think some of those people will switch from satellite to our service. That's important today because cities don't get revenues from satellite customers. Every customer who switches from satellite to our U-verse (TV) product will be paying franchise fees to the city. The net of it all to the cities will be more revenue, not less.

South Carolina is obviously important to you. Are you planning to go back there at some point?

South Carolina is home. It's where I grew up and my wife grew up and where our kids grew up. I think at some point we'd probably go back to South Carolina. But 50 years old is what, the old 35? I'm still a young man and I hope to work a long time.