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FCC sides with phone company

Martin says increased competition would result in lower cable TV rates

Federal Communications Commission chairman Kevin J. Martin thinks the agency can and should help phone companies that want to compete with cable operators on video delivery but are facing “unreasonable” hindrances to entering the market.

Speaking at a telecom symposium in D.C. on Wednesday, Martin said that increased competition would result in lower cable TV rates for consumers. But ever since telcos began trying to enter the market in 2004, reports have surfaced that local authorities were making the franchising process “unreasonably difficult,” Martin said.

The commission then developed “an extensive record on the franchising process,” Martin continued. “That record indicates that the process can pose an unreasonable barrier to entry. There are steps that we can take, however, to address some aspects of the franchising process that have proven most problematic for new entrants.”

One such aspect involves delays that occur when local franchising authorities review an application to enter the video delivery market.

“The commission should set time frames for local franchising authority to act on a new entrant’s franchise application,” Martin said.

“There also should be a limit on what localities can reasonably require new entrants to pay in the form of franchise fees,” he added.

Martin also cited “unreasonable build-out requirements” of the franchising process that are hindering telcos from entering the market. He said it was also unfair to require new entrants either to do more building out than an existing franchise-holder has done or to do the same amount but in less time.

Martin cited FCC research that showed cable rates rose 93% between 1995 and 2005.