House committee approves bill to end local franchising

The House Energy and Commerce Committee approved a measure April 26 that clears the way for telecommunications companies to roll out video services, such as IPTV, without first securing franchise agreements from thousands of cities, towns and municipalities across the country.

The Communications Opportunity, Promotion, and Enhancement Act of 2006, which passed on a vote of 42-12, must first win approval in the full House and go through reconciliation with a Senate version before becoming law.

In place of the local franchises, the bill calls for a national approval process to streamline the process for both cable and telephone carriers seeking to provide subscription television. The bill aims to increase competition, give consumers greater choice and ultimately lower prices.

The bill’s chief sponsors included Committee Chairman Joe Barton (R-TX), Bobby Rush (D-IL), Telecommunications and the Internet Subcommittee Chairman Fred Upton (R-MI) and Chip Pickering (R-MI).

“At the end of the day, families will potentially save several hundred dollars for what they spend each year on Internet, phone and cable services,” said Upton.

Besides the national franchise provision, the video-related provisions of the bill call for:

  • Requiring cable and telephone companies to offer broadband services without requiring consumers take telephone, television or other services the provider offers.
  • Preserving the right of municipalities to collect up to a 6 percent fee from pay TV providers. Part of this fee will go toward ensuring local communities can continue to offer public, educational and governmental stations.
  • Establishing penalties of up to $500,000 for broadband providers that block lawful content.
  • Allowing localities to retain control of their rights-of-way and ensure local jurisdictions still receive the franchise fees they collected under the current system.
  • Requiring broadband operators take additional steps to ensure their networks aren’t used to transmit child pornography.

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