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from: Times-Reporter

Lawmakers Seek to End Local Franchise Agreements in Ohio

May 11, 2007
By Paul E. Kostyu

Cable television bills could go down if backers of legislation passed in the Ohio Senate are right. If they’re wrong – expect to pay more or not be able to get service at all.

Senate Bill 117, which overwhelmingly passed this week, creates a state franchising system for cable systems and ends local agreements with individual companies. It’s a fundamental change in how cable companies operate in Ohio.

If it becomes law, SB 117 will “promote economic development, create jobs and improve our technology infrastructure and will provide real consumer choices,” said bill sponsor Sen. Jeff Jacobson, R-Dayton.

But the Ohio Municipal League contends it will allow cable companies to abandon their franchise agreements. That could cost townships and municipalities money. And the Consumers Union, the New York-based publisher of Consumers Report, criticized the measure for its lack of enforcement teeth. In fact, SB 117 specifically says the Public Utilities Commission of Ohio and the Department of Commerce have no authority to regulate the cable industry. But the department can investigate alleged violations of the law.

“This is a way for AT&T to enter the cable market but not be held to the same consumer protections that cable companies have been,” said Joel Kelsey of the Consumers Union. “Granted, cable companies have used their monopoly market power to stick it to customers in rates and services. This (bill) needs to have consumer protection.”

Kelsey said Ohio’s legislation, like that in other states, will allow companies “to cherry pick the most profitable neighborhoods and strand people on the wrong side of the digital divide.” He said inner city and rural poor areas will be affected the most.

“From what I can discern this will mean cable companies such as Massillon Cable will no longer have sole right to providing services in areas such as Massillon,” said Massillon Councilman Dave McCune in an e-mail message.

Any revenue impact on the city is uncertain at this point, according to Councilman Tim Bryan.

Sen. Gary Cates, R-West Chester, and one of four votes against the bill, said “work still needs to be done to bring the municipalities on board.”

Members of the Communication Workers of America backed the bill. Frank Mathews, president of the CWA State Council of Ohio, said the legislation “creates an environment where telecom companies are encouraged to invest in innovative new technologies. This is all about jobs.”

Sen. Ron Amstutz, R-Wooster, voted for it but said he was hesitant because he’s not sure the bill “nurtures competition and choices for consumers. I get nervous whenever government says we need to adjust regulation to make it better for the future. Sometimes we end up impeding rather than encouraging.”

Sens. Kirk Schuring, R-Jackson Township, John Boccieri, D-New Middletown, and Jason Wilson, D-Columbiana, voted for SB 117, which now goes to the House.