Texas Cable Industry Urges Caution on Rushing Telecom Legislation Through Special Session

Texas Cable Industry Urges Caution on Rushing Telecom Legislation Through Special Session

AUSTIN, Texas, July 12 /PRNewswire/ -- The Texas Cable & Telecommunications Association (TCTA), which represents 24 cable companies in over 800 Texas cities throughout the state, said today that Texas consumers will be potential losers if telecom legislation is rushed through the current special session of the Texas legislature. Bills pushed aggressively by SBC and Verizon are expected to be introduced in the Senate as early as tomorrow that would allow the big phone companies to set their own rates for residential phone customers. In addition, proposed legislation would shift the franchise system from municipal authority to a state-issued system with no study on how this would impact cities or consumers.

The bills will likely enable companies to pick and choose which customers will receive access to advanced services. SBC's report to investors outlined their plans to market to "high-value customers," while ignoring those Texans considered "low value." Cable companies are required to provide services to all residents in a city or community.

"These multi-billion dollar companies should not seek special favors from the Texas legislature," Tom Kinney, chairman of TCTA and president of Time Warner Cable-Austin, said. "Texas consumers have made it clear that they want the focus of this special session to be on resolving our state's problems with school finance and easing the property tax burden.

"Cable companies are not afraid of additional competition," Kinney continued. "We already compete with SBC and Verizon and expect to do so for many years to come. Cable faces unbelievably stiff competition from satellite and others. We welcome a fair fight, but the big phone companies don't want a level playing field. SBC and Verizon have already made clear that they will bring their new services to Texas, but they should not be able to do so at the expense of contractual agreements in place between local entities and cable companies who have already invested billions of dollars in Texas under the existing rules."

Cable companies face intense competition in the video market. Federal law prohibits cities from granting exclusive franchise rights to one cable provider. Many cities in Texas have granted cable franchises to more than one operator: Houston has granted seven franchises; Dallas, San Antonio and Temple have at least three each. Verizon has been granted franchises in numerous Texas cities recently, and has seventeen franchises pending in the Dallas market alone. Additional competition comes from satellite providers, which have a 23% market share of the Texas TV market.

SBC plainly concedes that it still "intends to reach 18 million households by the end of 2007 and that has not changed" because legislation introduced during the regular session failed.

"In the end, Texas consumers will benefit from new services and additional competition in the marketplace," Kinney said. "But phone companies, which continue to receive millions of state dollars in subsidies, don't need incentives in order to invest in Texas. We welcome competition, but companies should not ask the Texas legislature for special treatment in order to compete. We urge the legislature to study this highly complex issue further before rushing through legislation in a special session that is likely to have a major negative impact on cities and Texas consumers."

The Texas Cable & Telecommunications Association represents 24 cable operators from across the state, including Time Warner Cable, Cox Communications, Comcast, Charter and Northland Communications, among others. These cable operators serve millions of customers in Texas. Franchise fees paid by cable operators to local municipalities total more than $220 million per year. These fees help support local police, fire and other municipal services.

Contact: Meg Meo, (512) 494-2867 or

mmeo@echristianpr.com

Source: Texas Cable & Telecommunications Association

CONTACT: Meg Meo, +1-512-494-2867 or mmeo@echristianpr.com , for Texas Cable & Telecommunications Association

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