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27.12.06

LA needs to follow federal lead on cable competition

Once again, Louisiana remains behind the curve as, at the federal level, the Federal Communications Commission partially did what Gov. Kathleen Blanco denied the state only months ago.

The FCC recently relaxed regulations to increase the amount of competition allowed in provision of cable television, the point of HB 699 in the 2006 regular session of the Louisiana Legislature. They will make it easier for non-cable companies to get franchising agreements with local governments, after a study showed areas with those kinds of providers produced lower rates to consumers, as opposed to having satellite providers as the only competition.

Local governments have opposed allowing other communications concerns such as telephone companies to compete for franchising agreements because the present agreements often serve as a stealth way for these governments to squeeze extra revenue out of the pockets of those paying for cable TV by arranging for fees to be passed along. One way to accomplish this was by buildout provisions – forcing new providers to create supply in unprofitable way, rather than let the market determine where supply occurred. The FCC ruling put a lid on differential treatment of existing and potential providers in bailout and in passing along fees by local governments.

The Louisiana law would have gone much further – except that after passage of the Legislature Blanco vetoed it. Unfortunately, author state Rep. Billy Montgomery, despite his nearly two decades in office, didn’t have enough clout to prevent this.

It’s a bill that needs reviving in the 2007 session, perhaps by somebody more capable than Montgomery, especially because Congress can pass laws overriding regulations and now that it is controlled by the party that seeks to empower government and to disempower people, Democrats, they could attempt to do so and hope Pres. George W. Bush doesn’t bother to veto it. Sending it to Blanco a second time, especially during an election year where she’ll need all of the help she can get at the polls, might get her to sign it this time.

4 comments:

Nick said...

While we're at it, we should think about allowing electric companies to compete as well. In Lafayette city limits, we always had one option, LUS. Meanwhile, Houston and other parts of Texas de-regulated the electricity market, and people are liking the results of competing prices.

arnold said...

I don't know about LA but here in Michigan, local governments have always welcomed competition and sought out AT&T and other providers to come in to our communities and begin serving. They refused. Why? Because local governments are the only ones making sure that this essential utility of the 21st century is made available to all. Can you imagine if we had let the market decide 100 years ago who should get electricity, phone, gas, etc? Oh wait, we did, thus the reason for govt to step in and create groups like the TVA and Rural Electric Cooperative. This is not just about people getting cable tv so they can watch HBO, its about making sure everyone has access to what we all have come to understand is a essential tool for individual and economic success in the 21st.

Jeff Sadow said...

You're serious? You actually believe what you wrote? Cable television is an "essential tool" in people's lives? Right .... So they can watch C-SPAN to monitor the government? Or get their porn fix?

By the way, over a century ago when some other utilities were being created that you mentioned, they typically went years, even decades, without government ownership or regulation. And the TVA was created in the Depression primarily as a make-work enterprise and economic development catalyst more than to bring electricity to an area of the country where it was unprofitable then to provide. (My gradfather worked as an engineer for the TVA for awhile.)

Nick's view is much more grounded. With modern technology, electric competition is increasingly possible. Maybe this is something Foster Campbell ought to be promoting?

Nick said...

Nah...Campbell's too busy promoting his idea of running "Big Oil" out of Louisiana. Besides, who needs to oil industry? Louisiana is just booming with economic development in various fields, right?