National Video Franchising Clears First Hurdle

Congress has flashed its first signal on cable franchise reform, as members of the House Energy and Commerce Committee agreed in principle to create a national cable franchise structure for phone companies looking to offer video services. Under the agreement, reached Wednesday night, cable operators will continue to be bound by local franchising requirements until phone rivals have reached 15% local-video-market penetration. This provision differs from franchise reform legislation under consideration at the state level, as well as in Texas, where legislation authorizing statewide franchising has passed. Under these statutes, cable companies can seek statewide franchising when their current local franchising agreements expire. The details of the Congressional version have yet to be clarified, although it seems regulators would still wield a heavy hand on dictating the pricing packages cable companies could offer in comeptitive response. But as the Multichannel News report emphasizes, legislative language has yet to be written.