Phone companies battle for TV access

The effort by the major telephone companies to pump television programming into consumers’ homes over the companies’ own networks has become a politicized issue for lawmakers facing reelection.

TV4US, a coalition of 30 companies and interest groups led by AT&T and the National Association of Manufacturers, is pressing selected members of the House Energy and Commerce Committee to support franchising legislation.

TV4US is paying for newspaper advertisements in the congressional districts of Reps. Charlie Bass (R-N.H.), Greg Walden (R-Ore.), Lee Terry (R-Neb.), Barbara Cubin (R-Wyo.), Bart Gordon (D-Tenn.) and Jay Inslee (D-Wash.), all of whom sit on the Commerce Committee, said Peter Arnold, the group’s executive director.

In Washington, D.C., and Michigan, TV4US has run advertisements on television, and it has run print ads in Capitol Hill publications including The Hill. (TV4US’s website is at www.wewantchoice.com.)

The advertisements encourage voters to ask their lawmakers, over cable-industry objections, to support a national franchising law that would let telephone companies offer television programs without having to negotiate one-at-a-time franchising agreements with municipal governments. Proponents of a national franchising law argue that by opening up the national market in one fell swoop it would promote competition and drive down prices.

None of the lawmakers targeted by TV4US faces a competitive race.

Few lobbyists expect Congress to pass legislation this year because the franchising issue forces lawmakers to choose between the cable and telephone industries, picking winners and losers. But postponing a choice lets lawmakers play the cable and telephone industries off each other to rake in campaign contributions, some on K Street suggest.

Given the intensity of the rivalry between the industries, a telecom lobbyist said, the scenario is "a dream match-up" for lawmakers’ fundraising.

"They can milk this through the year," he said. "It’s the oldest parlor game in D.C. to play industries with deep pockets against each other."

In the D.C. area, Comcast Cable refused to run a TV4US advertisement, Arnold said. Comcast is not obliged to run advertisements for competitors.

Lawmakers have reason to be concerned about the cost of cable TV. In October 1992, just before the November election, the House and Senate voted to override a veto by President George H.W. Bush of a bill that clamped down on cable rates. The overwhelming defeat, amid whooping and hollering in the House, furthered the image of a weakened president. Bill Clinton went on to win the presidential election.

Cable companies strongly oppose a national franchising law and remain adamant that the former Bell companies should reach agreements the same way they did – one at a time with local authorities. They fear that the phone companies would be allowed to "cherry pick" by offering service only where it is profitable.

Several lawmakers on the Senate Commerce Committee who face reelection this year have accepted campaign money from both cable and phone companies. Sens. Bill Nelson (D-Fla.), Ben Nelson (D-Neb.), Conrad Burns (R-Mont.) and George Allen (R-Va.) have accepted contributions from AT&T’s, Verizon’s and Comcast’s political action committees.

Some telecom lobbyists dismiss the idea of a scenario in which lawmakers stall legislation to swallow up more campaign cash. They point out that Rep. Joe Barton (R-Texas), chairman of the House Energy and Commerce Committee, proposed a national franchising bill earlier this week and Sen. Ted Stevens (R-Alaska), chairman of the Senate Commerce Committee, has spoken favorably about considering a similar bill.

"The outlook seems to be improving, and Stevens has repeatedly said and announced to his colleagues that he would have a telecom bill after Easter. That is promising," another telecom-industry lobbyist said.

The lobbyists said that, given the limited time, if a bill emerged from the Senate it would be brought to the floor quickly.

The cable industry appears to be taking a wait-and-see attitude, as momentum is not on its side, especially in an election year. Some states, such as Virginia, Texas and Indiana, already have passed laws letting phone companies bypass negotiations with local governments. In Kansas, the House and Senate passed franchising legislation, which the governor is expected to sign into law.

Barton’s bill caught the attention of Speaker Dennis Hastert (R-Ill.), who lavished praised on his proposal in a statement Monday, saying, "Competition drives down prices and encourages innovation."

Hastert thanked Barton and Rush "for putting consumers first as we prevent outdated regulations from stunting the growth of new pay-TV services and drive down costs by giving people more choice."