from: Broadcasting and Cable [1]

Local Groups Petition FCC to Stay Ruling on Video-Franchise Reform

"Groups say FCC decision will "severely restrict the ability of local governments to protect their citizens, rights-of-way, community channels, and public safety networks."

By John Eggerton -- Broadcasting & Cable, 12/21/2007 1:45:00 PM

Local franchise authorities, including the National Association of Telecommunications Officers and Advisors, have asked the FCC to stay its Oct. 31 decision extending to incumbent cable operators essentially the same video-franchise reforms it gave telco video providers in an earlier ruling.

In a petition for the stay and reconsideration of the decision, the local government groups—more than a half dozen of them, including the National League of Cities and the U.S. Conference of Mayors—argued that the commission failed to preempt "most-favored nation" clauses (which specify that the a new entrants can't get better terms than the incumbent) or to base its decision on "appropriate economic impact analysis." The groups further pointed out that they had filed a lawsuit against the initial decision granting franchise relief to telco video providers.

"In the absence of a stay," they said in the FCC filing, "petitioners’ members will be irreparably harmed." The governments have said that the FCC decision will "severely restrict the ability of local governments to protect their citizens, rights-of-way, community channels, and public safety networks."

They argue in the request for a stay that by not preempting existing most-favored nation clauses, the commission "upended the franchise negotiation process.”

“It has given incumbent operators free reign to unilaterally modify their existing contractual obligations, including PEG and I-Net support,” the filing states. “It will permit incumbents to circumvent the Commission’s stated objective that any modifications to existing agreements be assessed on a “case-by-case” basis."

They also said that the commission had not made clear whether the decision applies to all cable incumbents or just those whose states had not adopted their own video franchising laws. The decision on telcos, they point out, expressly confined it to states that had not passed such laws.

"Just like the Grinch, I’m hoping some hearts and minds can be changed in this most auspicious of seasons," said NATOA Executive Director, Libby Beaty, in announcing the challenge. "And, just in case they are not, we’re encouraged to know that the US Court of Appeal for the Sixth Circuit will be providing some clarification in the coming months.”

The National Cable & Telecommunications Association had no comment at press time.