The Iowa senate this week is expected to take up legislation that would change the way cable television companies get a franchise to provide service in a community. Right now companies negotiate for the rights to provide service in a city or town, but Michael Sadler, a lobbyist for Qwest, says that’s resulted in a monopoly for Mediacom in many parts of Iowa.
If Iowans want more choice and lower prices for their video entertainment, and want new technologies and investments in "big broadband," he says regulation must change, along with the technology. Sadler says negotiating agreements one city at a time is costly and inefficient, and if the law was changed to allow a statewide franchise, more competition would be possible and the cost would go down.
Sadler says Texas passed the first statewide franchise bill in 1995, and he says Charter Communications dropped its rates there forty-percent when A-T-and-T announced it was coming into the market. Sadler says, "I think the data is there that shows this is good for consumers." But Iowa League of Cities spokesman Terry Timmins opposes a change, saying it would let Mediacom renegotiate its service agreements with local towns, which include services like fiber-optic lines provided to local schools emergency dispatch.
Timmins says Qwest, as a new provider coming into communities, should be willing to live up to current franchise requirements in the cities. Those rules, he says, have been negotiated and bargained over, and represent the needs of those communities.
"These are bargained-for benefits for our citizens," Timmins says. He says a new provider coming into the marketplace shouldn’t try to get the incumbent out of those requirements, should agree to operate under the same requirements. Timmins says customers may also lose customer-service agreements in their current contracts, but Sadler says Qwest would likely provide the same protections in order to be competitive.