FCC Approves Franchise Reform in Partisan Vote > Interesting.

Interesting.

If you like cable being a government protected monopoly, then franchise agreements are good. Franchise agreements are in serious need of reform.

Show which cities where the general population has more than 1 choice for cable tv. Most people only have 1 choice for cable tv. The franchise agreements keep it this way as a general rule.

reply to jslik

Considering today's decision, don't you think that this FCC (or the telcos, for that matter) would be hauling cities into court if they were truly keeping other providers out?

reply to jslik

reply to jslik

reply to cwh
I’m always a little irked when people say a franchise is a government controlled monopoly. A franchise is just a permit allowing you to do business within a city. It DOES NOT guarantee any kind of exclusivity. Anybody could go to city hall and ask for a franchise if they had the money to meet their service requirements.

I know Grande is in San Antonio & Corpus Christi as a second cable TV provider... long before Texas passed the telco’s state-wide franchise law. Other overbuilders include WOW, Americast, and RCN throughout the country.

From experience I can say that building any kind of cable/network infrastructure is outrageously expensive which is why its not that prevalent. Investors are wary about fronting hundreds of millions of dollars to offer a competitive service that traditionally only gets 20-30% of the homes passed.

There is a need for franchise reform but I’m totally opposed to these blanket nation-wide (or to some extent state-wide) franchises which totally strip the local municipalities of regulative controls should the local cable or telco division get really bad.

reply to cwh

Leave us not forget basics. The fact is that many, if not most cable companies were awarded EXCLUSIVE franchises for their service area by local authorities in exchange for building out their systems and providing service to the ENTIRE proposed service area.

This created a de facto monopoly, since once the company had the system built and was protected from competition for years, it became ever more difficult and expensive for potential competitors to build their own systems.

reply to cwh

said by cwh [/bquote :

They dont actively keep people out, but the franchise agreement s do not encourage other providers to even attempt to compete with the incumbent provider.

reply to cwh
I'm guessing you don't have much experience in cable tv and utilities do you?

You've been told here many times very factual statements.

Other companies are in fact allowed to come in and over build. However, it's not financially attractive to a new company to come in and build. Current cable operators are passing about 40% of the homes. There are other choices now as well.. satellite. Add a second very expensive cable over builder and how much of that pie is available for them? Can they afford all the expense and loss?

Further, negotiated costs of carriage for networks are going to be more expensive for the smaller operator.. and all operators are small when they start.. even Verizon.

There is a reason why Comcast, Time Warner and others gobbled up smaller operators back in the 90's.. it's becasue it allowed the local systems to offer more services.. larger numbers mean better buying power. Does that help keep the new and smaller guy out? YOU BETCHYA! It's also that in which was able to spread system upgrades, and better services to us.

Finally, franchise agreements are NOT in place to "ENCOURAGE OTHER PROVIDERS" to come in or compete. Franchise agreements are designed, primarily, to outline how the system operator will operate their service within the municipalities in which they serve. They are also there to say how much "the don" wants from them and what free-bees they are going to pay up in order to be there to operate their networks.
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I think you missed the point of everything I have said. The unintended consequence of franchise agreements is that it discourages competition. The agreements only add to the financial risk of competing against an incumbent provider.

I didn't misread it. I still don't understand how the FA discourages, intended or not, competition?

There's far more to competition than just an agreement.

Let's remove the agreement. What do you have? Do you have a provider that will come in and wire up the whole town or just part? Do you have a quality of service enforced? If you do have one provider in the city and they are REQUIRED to wire the whole city, why should another provider only be allowed to wire just part? Don't you think that's a little unfair? What that tells the incumbant, or in this case, the firs one in, is that although they dropped a fortune in the town, another provider can come in and cherry pick some of that customer base away with little investment.

Unless a second company comes in and wants to wire the entire franchise foot print, or city of service, what good is the competition?

What *I* am getting at is that the potential penetration of homes passed and the cost to wire that area has the most to do with it. In order to wire up an area and be profitable and be able to operate, there has to be enough customers to sustain the business. If you have a second operator come in and isn't making much of a profit, what do you think the ability of that provider is going to be when it comes to providing quality service? Think they can afford to keep the plant in top operational condition?

Seriously.. the franchise agreement has very little to do with competition what so ever... that is, unless the FA denied others all together.. and we know that isn't going to happen.

Now.. if another provider wants to come in and only wire part of an area.. the incumbent provider should have the same rights.

Bottom line.. a city should set a standard set of conditions for providing service in their town. In other words, if you want to provide VIDEO SERVICES, I don't care HOW it gets to the TV set, you must meet the following conditions and pay X amount in FA fees.. that's it. Everyone plays by the same set of rules. I don't see what's so hard about this and I further don't understand why one agreement should be any different than another providers.
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The only portion I would like to respond to is the section you state that new builders should be able to start small and expand with demand.

I COMPLETELY disagree with you.

You can't have separate but equal. If you require another business to perform a certain way, you must make the others as well. Otherwise, the first company in who was required to build out a network, put their money behind their network, comply by a set of rules and takes years to get a ROI, it's not fair to them to allow someone else to come in and simply pick an area, and chip away at their hard work and investment.

I don't care if it's phone or cable.. it's not right.

How would you like it if you had a cable or phone system that you put so much up to build maintain and operate and I was allowed to come in, pick some of your hot spots and take those customers... then move on to other areas and take more. That's the franchise allowing me to come in with a disadvantage and take your customers away.

Either compete, or get out. Period. Look, it's NOT all about the consumer. The business has rights too. You can't abuse business and I fully support ANY business who would challenge this kinda of eroding of customers.

To allow a small company to come in on a shoe string does NOT equal good choice for consumers.. There are FAR too many reasons to explain here and now... one reason I DID already mention was that the smaller company needs to ensure they have the resources to actually provide service and maintain the system.

I for one want my franchise body to ensure that they are allowing an operator in that can actually back their system up. I don't want to wake up and find out that my carrier went dark over night because of financial problems. If that happens, you also over burden the OTHER carrier who WILL get a flood of calls to have service migrated which leads to an expense to the other operator as well.

It's not as easy as you think.. and still, no... you set a standard for all to abide by. There is a reason why we generally have one line carrier in each city. I also don't support red lining.. something that people also have a problem where as well.

What you are suggested is legalizing redlining.
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