from: The City Paper [1]

Historic’ AT&T bill headed to governor
By John Rodgers, jrodgers@nashvillecitypaper.com
Updated: Thursday, May 1, 2008 10:33 am

Calling it a “historic day in Tennessee,” the Senate unanimously approved a bill this morning paving the way for AT&T to start offering television programming in Tennessee and compete with the cable industry.

The House passed the bill earlier this week. It is now headed for Gov. Phil Bredesen’s signature.

“This bill will change the way the citizens of our state communicate,” said Sen. Bill Ketron (R-Murfreesboro), the lead Senate sponsor of the bill.

The compromise legislation creates a state-issued franchise process, a change in how the state regulates television programming and something AT&T says it needed to get into the television services business.

Currently, cable companies like Comcast reach franchise agreements with local governments. Before coming on board the compromise effort, the cable industry lobbied hard against AT&T’s effort, saying the telecommunications giant shouldn’t have special rules created just to benefit them.

Proponents of the legislation say it will offer Tennesseans choice in their television services and provide competition, which will ultimately benefit Volunteer State residents but may not lower cable prices.

Once the bill becomes law, AT&T will be required to apply for a state-issued franchise and offer its U-verse television service to roughly 600,000 Tennessee households within three and a half years of reaching a franchise agreement.

Of those roughly 600,000 households, 25 percent must be low-income.

Requiring low-income Tennesseans to be offered AT&T television was part of the compromise. Opponents of AT&T’s move had argued the telecommunications giant wanted to create a state-issued franchise to “cherry-pick” wealthy customers and bypass poorer ones.

The “cherry-picking” argument was made through television ads aired by the Tennessee Cable Telecommunications Association.

Sen. Thelma Harper (D-Nashville) said she found it “insulting” that the cherry-picking argument had a racial tone to it.

“I found it a little bit insulting that some of the companies promoted the race issue because they used black folks to do it, to say, ‘well, we’re not coming to your house or we’re not coming to your community,’” Harper said. “I really think it’s time out for that, that we should focus on what the issue is. The issue is assuring that the communities across the state of Tennessee will have access to everything that everybody else has.”