Massachusetts Bill Faces Delay

A vote on a bill that would reform cable franchising in Massachusetts, much criticized by local officials, may be headed for a 90-day delay.

The bill’s sponsor, state Sen. Steven Panagiotakos (D-Lowell) has recommended that a task force study the measure, which would move franchising authority to the state’s Department of Telecommunications and Energy. He began publicly suggesting the bill needed more work even before a June 5 hearing on the Verizon Communications Inc.-backed bill before the Joint Committee on Utilities, Telecommunications and Energy.

Though the committee did not vote on the task force, Verizon officials believe committee members will take the sponsor up on his suggestion, pushing a vote on the bill into September.

“A task force is a very good idea,” said Phil Santoro, media consultant for Verizon, adding that the bill has a “lot of things going for it” but there are points worth deliberating.

Despite the task-force suggestion, the committee proceeded with the hearing, which had to be moved to the largest forum in the capital to accommodate all of the its friends and foes. Attendees made their allegiances clear with lapel buttons ranging from “Consumers want choice” to “Don’t mess with access.”

Donna Cupelo, Verizon president for Massachusetts and Rhode Island, noted that her company invested $600 million in the state to upgrade infrastructure last year, but only plans $500 million this year. The difference is being invested in states that have changed their regulatory structure, she noted.

Legislators questioned the need for an immediate bill, citing press reports quoting Verizon officials telling investors that city-by-city franchising has not been a problem for the company.

Verizon has negotiated 49 local franchises, and 19 more should be completed by year-end. Santoro said the company anticipates launching FiOS TV service to all of those communities by the end of the year.

In other states:

• As of June 5, Verizon has authority to launch video services in Rhode Island. It’s first self-described service area includes Coventry, East Greenwich, Exeter, North Kingstown, Warwick, West Greenwich and West Warwick. Santoro said the company will launch services sometime before the end of the month.
• Georgia Gov. Sonny Perdue signed the franchise-reform bill approved last month by the legislature. Now, new and incumbent providers have the choice of negotiating local franchises or applying to the Secretary of State for operating authority.
• Connecticut legislators, on the last night of their session June 6, approved a franchise reform bill that will subject AT&T Inc.’s U-verse video product to some regulation.

This is notable because, in a controversial 2006 decision, the state Department of Public Utility Control concluded that the telco’s Internet-delivered product is not the same as a cable service and therefore not subject to regulation. That ruling is being challenged in federal court by the New England Cable Telecommunications Association.