Verizon Lobbies for Cable Regulation on Local Level

BY ANDREA FIGLER Apparently angling for a sideline role as cable regulator, Verizon Communications has been lobbying local governments to impose franchise fees on cable modem services and prohibit exclusive content contracts, such as local news and sports programs. Next month, representatives for the telecommunications company are expected to try and convince the National League of Cities to adopt a policy platform that imposes strict regulations on cable, says Ken Fellman, mayor of Arvada, Colorado. The policy changes sought by Verizon include asking Congress to allow municipalities to collect franchise fees on all services provided by an incumbent cable operator, regardless of their classification. Verizon also wants Congress to prohibit incumbent cable operators from denying competitors access to their exclusive programming. Fellman knows these issues will come in front of the league next month because, as a member of the league’s telecommunications committee, he was there when Verizon pitched these issues in December. The league staff, however, convinced Verizon representatives to wait until March — the official time when the association starts to address policy issues. “I’m confident that they will be back at [the league] in March and urge the committee to include this as one of the issues that they study and vote on in 2003,” Fellman says of Verizon’s push for cable regulation. Representatives from Verizon were not available to comment on these lobbying efforts by press time. Fellman says that some of the issues raised by Verizon may find empathetic ears. “Some of the things — and I mean some of the things — Verizon wants are consistent with what local franchise authorities want,” he says. The Oklahoma Municipal League, for example, passed a resolution in September asking Congress to regulate cable operators as a way to stop the escalating cable rates in communities where the incumbent cable operator is not subject to meaningful competition. The resolution also seeks to collect franchise fees on any service that uses the public right of way and prohibit incumbent cable operators from denying competitors access to programming. The city of Los Angeles also is drafting an ordinance that would prohibit cable operators from denying access to programming. While federal law already prohibits cable operators from denying access to programming delivered via satellite, it doesn’t directly address programming distributed terrestrially, according to a letter from L.A. city attorney Rocky Delgadillo to Mayor James Hahn and the city council of Los Angeles. Therefore, “the city has the police power to impose a condition or requirement for ‘program access’ as a condition for operating a cable company within the city of Los Angeles,” the letter states. Dan Brenner, SVP of law and regulatory policy for the National Cable and Telecommunications Association, disagrees. A blanket prohibition on all exclusivity agreements conflicts with — and is preempted by — federal policy determinations, according to Brenner’s letter sent to city officials last week. To date, city officials are still reviewing the letter as well as the draft ordinance, which was originally pitched by Verizon. Other cities, however, have brushed off Verizon’s push to regulate cable. A committee for the California League of Cities took no action on a similar Verizon resolution pitched Jan. 24, says Brian Mura, assistant city manager for San Carlos, Calif., and a committee member. “I don’t think we need to get in the middle of this fight between the phone industry and the cable industry,” he says.