The Chicago-area village of Itasca, Ill., has decided to
withdraw its proposal to use government funds toward $100 rebates for residents who switch
to satellite television.
Local cable incumbent AT&T Broadband & Internet
Services had objected to the town's use of public funds to promote one form of
multichannel-video competition over another.
Last month, the town said it would earmark $10,000 for the
first 100 residents who signed up for direct-broadcast satellite starting in
mid-September. The municipality wanted to promote competition as a way to help curb
cable-rate increases. No overbuilder had expressed interest in the town.
Itasca will still have an opportunity to promote
competition, AT&T Broadband of Chicago spokeswoman Pat Keenan said, through a
cable-competition fair scheduled for Sept. 18.
In what may be a sneak preview of things to come once cable
goes retail, AT&T Broadband will host a booth alongside DBS providers DirecTV Inc. and
EchoStar Communications Corp.
AT&T Broadband said it would come to the fair with a
consumer offer "at least comparable" with what its competition has proposed,
although the offer won't necessarily be exclusive to Itasca residents.
"We have to be fair," Keenan said. "We have
a whole market to worry about," not just Itasca residents.
EchoStar spokesman Marc Lumpkin said the village's decision
to rescind its rebate offer doesn't affect the company, as it was never directly connected
to the town's proposal. Lumpkin would not confirm whether EchoStar would offer Itasca
residents free systems.
DirecTV had planned to augment the town's $100 rebate
offer, in addition to promoting free installation and programming discounts. At press
time, DirecTV could not say whether it would change its offer.