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from: Callahan's Diary

State video franchising: Where are the competitors?

This post and comments at BFD got me wondering: How’s that brave new world of competitive IPTV and sizzling broadband that Ohioans were promised last summer — when the General Assembly overwhelmingly approved and the Governor happily signed SB 117, AT&T’s “cable franchise reform” bill — coming along?

You may remember that SB 117 was supposed to tear down alleged barriers to telephone companies’ investment in fiber-enabled “Triple Play” service (IPTV, broadband and VOIP) by eliminating municipal cable franchising and replacing it with state-issued Video Service Authorizations (VSAs). Fast, hassle-free state issuance of VSAs to all wireline video providers would bring the benefits of “cable competition” — cutting edge IPTV/broadband services, lower rates, big new fiber investments — to communities throughout Ohio. The loss of all Ohio communities’ franchising authority, along with their power to negotiate community services, was a small price to pay for the promised consumer benefits of getting Ohio telcos into the IPTV business.

This blog expressed its doubts here and here (among other places).

SB 117 took effect on September 24, 2007. The Ohio Department of Commerce issued its first VSA 44 days later to (who else?) AT&T.

Since then 27 additional VSAs have been approved. Thirteen are held by existing cable companies — Time Warner, Comcast, Cox, Block, Wide Open West, and smaller operators. The other fourteen have been sought and received by telephone companies.

Aside from AT&T, the biggest of these is Cincinnati Bell. But Cincinnati Bell’s VSA isn’t for Cincinnati or for any part of Hamilton County. It’s limited to Bell’s telephone service areas in Butler and Warren Counties — about 20% of its residential customer base — along with some other Warren County communities served by a cable TV company it owns.

The next biggest telephone company VSA was issued to Horizon Chillicothe Telephone, which serves 26,000 residences in Ross County. But, funny thing: Horizon has been offering Ross County residents “cable TV” (IPTV via hopped-up DSL, just like AT&T’s U-Verse) in competition with Adelphia/Time Warner since 2000, operating under local municipal franchises.

The other twelve telcos that have taken out Video Service Authorizations range in size from Telephone Service Co. in Auglaize County, with 6,380 household lines in 2006, down to Middle Point Home Telephone in Van Wert County with 560. Altogether, these twelve small local, rural companies served a grand total of 24,263 single-party residential lines in 2006.

But what about Ohio’s other big telephone providers: Verizon, Windstream, Embarq, Century? And what about the other 80% of Cincinnati Bell’s service area, including Hamilton County and the city of Cincinnati?

No Video Service Authorizations have been requested by these companies to date… seven months after the day SB 117 took effect and all the municipal cable franchises in their territories became null and void. Despite all the promises, “cable competition” is nowhere in sight for the million and a half Ohio households that they serve.

Here’s a PUCO map of Ohio’s local telephone service areas. (Click for the full size version.) The colored-in areas are covered by VSAs held by telephone companies (”Local Exchange Carriers”) as of yesterday. The uncolored areas — not.

Since the map doesn’t show them, it’s probably useful to name (again) some of the cities and villages in that uncolored area — communities that now have neither local government oversight nor the prospect of IPTV competition for their cable services any time soon, thanks to all those fine folks who voted for SB 117. Here are a couple of dozen: Cincinnati, Athens. Newark. Mansfield. Ashtabula. Brunswick. Portsmouth. New Philadelphia. Lorain. Elyria. Norwalk. Hudson. Medina. Marion. Wapakoneta. Lima. Defiance. Bryan. Van Wert. Oregon. Bowling Green. Ashland. Wooster. Carrollton. Piketon. Lorain. Amherst. Oberlin.

If you live in one of these places — or in Cleveland, for that matter — it’s probably time to call your State Representative and Senator and ask them when you can expect that cable competition they promised you.