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Phones vs. cable

Friday, Feb 23, 2007

A battle of the titans is looming at the Statehouse, with AT&T (through its front group which advertises here) and the big cable companies squaring off.

A bipartisan group of state lawmakers on Thursday touted a proposal they say would save money for Illinois’ cable television subscribers.

But opponents of House Bill 1500 do not believe those claims. Gary Mack, a spokesman for the Cable Television and Communications Association, called the plan “a Trojan horse” and “absolutely terrible legislation.”

The debate figures to shape up as a showdown between traditional telecommunications businesses, specifically AT&T, and cable TV companies. Because of technology advances in recent years, the two industries overlap in some areas, such as high-speed Internet service. […]

At a state Capitol news conference, Brosnahan said that cable rates have increased by 93 percent nationwide in the past 10 years. In Illinois, he added, they rise by about 7 percent a year. […]

Mack rejected that assertion, saying: “We already have competition. They are able to get into any market that they choose.”

I haven’t written much about this yet, but I plan to soon. Also, there’s more to the story than the above article reports, and I’ll try to post some stuff in the subscriber-only section.

I’m not sure what sort of debate we’ll have on this, but I suppose you could talk about your cable bills and the benefits of competition. Remember, though, it’s not as simple as it looks. If it was, AT&T wouldn’t be ready to spend a fortune to pass it.

- Posted by Rich Miller        

  1. - Squideshi - Friday, Feb 23, 07 @ 9:05 am:

    Two words–Community Internet.

  2. - So-Called "Austin Mayor" - Friday, Feb 23, 07 @ 9:44 am:

    Cable TV versus the phone company?

    Make ‘em fight to the death.

    Then shoot the victor.

    – SCAM

  3. - He Makes Ryan look like a saint - Friday, Feb 23, 07 @ 9:48 am:

    There needs to be competition. It will help the consumers.

  4. - Patriot - Friday, Feb 23, 07 @ 10:12 am:

    I have AT&T Yahoo internet service. Installation is easy. No new holes in my walls. No service interruptions. Price is right. My son has cable internet and is always complaining about service interruptions and inept cable installers. The last time a cable installer was in my home he only did half of the job and I had to finish the job at my expense. Cable companies contract with outside installers who are not very knowledgeable. I will stick with AT&T.

  5. - one of the 35 - Friday, Feb 23, 07 @ 10:19 am:

    Check out what happened in Itaska Wednesday morning. they placed replica junction boxes in the right of way, painted them pink, and then waited for resident phone calls. The pink boxes served as an illustration of the forthcoming infrastructure necessary for the phone company to enter the cable TV business. The phone company responded by cutting phone service to Itaska Village Hall and other Village facilities. Itaska was hauling the phone company into court yeaterday morning to obatin an injunction. should get interesting.

  6. - Bluefish - Friday, Feb 23, 07 @ 10:58 am:

    Does anyone truly believe that AT&T’s service will be that much cheaper? They’re not in this for “competition”, they’re in this for big profits. Offering cheap video service is not profittable.

  7. - Anon - Friday, Feb 23, 07 @ 11:28 am:

    Cable and the reconstituted AT&T monopoly are fighting over who will provide you with phone, internet and TV. AT&T would install this tech only where it’s profitable meaning Chicago and some burbs, at least for the short term. They want to bypass local franchising powers so that they don’t have to go every burb to ask permission to offer cable TV there, and be forced to cut deals for local access programming, etc.

    Cable has been offering $99 a month for all three services for first year. AT&T will do roughly the same.

    Those offers don’t apply to current customers. So once you pick either service, are you really going to save any money?

    Are you going to flip from one to the other every year and face the hassle of buying or leasing new equipment and making sure you can get your phone number transferred?

    Lawmakers and company execs who promise competition and consumer savings are full of hot air. This is a turf war, pure and simple. And cable has been winning because it has faster broadband and less regulation. Plus, people are dropping their land lines.

  8. - VanillaMan - Friday, Feb 23, 07 @ 12:22 pm:

    What do you do when your business discovers that technology has given rise to new competition you didn’t expect, and is sapping your profits?

    Call the politicians you bought and make them stop it.

  9. - Utility Infielder - Friday, Feb 23, 07 @ 1:00 pm:

    Boy I could have used this information a month ago. After finally getting fed up with my $90 cable bill I jumped to ATT for that $33 per each (phone,internet,satallite). Actually the Satallite is free for the first year then I guess they will stick it to me for the second of a two year mandatory contract. So I thought the answer is every two years you re-evaluate your services. Just like your cell phone.

  10. - Jerry - Friday, Feb 23, 07 @ 2:46 pm:

    I don’t buy it for a second. Cable already has competition. Its called satellite. And it hasn’t stopped them from pushing prices into the stratosphere.

    I’m slowly getting to the point of cutting the cable company off. I’ll live with my rabbit ears and I’ll get DSL. Maybe, sometime down the line, I’ll get satellite.

    One of these days someone will start allowing “ala carte” programming, and then cable will get cheaper, because we won’t have to pay for all those crap channels that we don’t watch.

    Personally, all I want are ESPN and ESPN2, Comedy Central, MSNBC, Discovery, TBS, TNT, BBC America, and about 5 other channels, plus the locals (cbs, nbc, abc, wgn, wttw, wciu). I have no use for HGTV or the Golf Channel or the History Channel, or Fox News, or about 70 other channels that are used by the cablecos to justify my huge bill every month.

    And I look forward to the day Chicago has its community wi-fi.

  11. - Leland Milton Goldblatt - Friday, Feb 23, 07 @ 3:36 pm:

    The cable companies are allowed to have phones.

    But the phone companies are not allowed to have cable TV?

    You tell me what is faire. If we don’t allow the phone companies something, we will soon loose upkeep on all the wires.

    Issues won’t matter, just look to see who gets more money from the cable companies or the phone companies.

  12. - zatoichi - Friday, Feb 23, 07 @ 4:30 pm:

    The technology will rule here and it is moving very fast. Cable, wi-fi, satellite, phone lines, radio signal, HD antennas and who knows what else in the future. Let ‘em battle it out. I’ll go with whoever gives the best service.

  13. - BIG R.PH. - Friday, Feb 23, 07 @ 5:12 pm:







  14. - NW burbs - Friday, Feb 23, 07 @ 5:38 pm:

    I agree with Jerry — let us consumers pick and choose which channels we want; just like iTunes has done for “album” sales (customers can pick which songs they want instead of buying a whole album).

    Those who don’t like sex, drugs & rock-n-roll can get rid of F/X, MTV, etc. Those who don’t like propoganda wrapped as news can get rid of FNC.

    This bill, if you read through it, is similar to what AT&T is trying to do nationally against Net Neutrality (both at the Federal level — when the GOP was in charge — and state by state in the legislatures).

    They want to provide cable content over phone lines, but they also want to be able to charge Internet content providers for Internet “use” — and apply a toll to the information superhighway.

    They really want both, but they’re only promoting the “TV 4 Us” angle (not a 10pm newscast goes by without one of those commercials, it’s as bad as Rich’s other advertiser: ComEd’s “CORE”). It’s not “TV 4 Us” — it’s profits for a content carrier (the “new” AT&T).

  15. - Rich Miller - Friday, Feb 23, 07 @ 6:19 pm:

    “BIG R.PH.” please don’t post a comment with all caps. Instead of “highlighting” your post, it makes you look like a bellicose idiot. Last warning.

  16. - Vlad Zworykin - Saturday, Feb 24, 07 @ 12:25 am:

    Yes, there’s lots underneath to think through. In just 2 years, all analog TV transmissions are scheduled to end nationwide. All TV will be digital. If you are on cable, dish, or ATT DSL broadband, you might not notice much of a change other than an updated set-top box from the cable company. If you only watch local Tv off an outside antenna, you will need a new set-top tuner box at least, and most people will be getting brand new sets.

    While all this is going on, there has been a huge battle going on with cable and phone companies and local TV stations over what’s called ‘must carry’ rules. Basically this is the rule that forces say Dish and Insight to give you the local broadcast TV station as part of your service. More than 2/3 of viewers watch their local station off cable these days, instead of an antenna on the roof like dad used, because the reception is so much better.

    At stake are millions or even billions of dollars in fees paid for the advertising and for sharing the limited bandwidth (available channel space) of the cable, phone, and sat providers.

    Meanwhile, the new digital TV technology allows a station the choice of sending out one lovely high-definition picture, or chopping up their channel space into up to six lower-definition multiple channels with quality on a par with what you get now, or some mix of those options. That means every local Tv station has the capacity to become a sort of mini-cable Tv system of it’s own, sending out six times the number of programming choices. With “must-carry” rules, the existing cable company would need to spend way more money to increase their capacity sixfold to carry all the new local TV stuff, stuff which would likely be some of the same programming in direct competition with the cable company, from competitors they cannot charge a fee to for being on the cable. Confused yet? ATT thinks that since they are technically not a cable company, they can thumb their nose at must-carry, save megabucks from that to apply to cut-rate loss-leader introductory pricing, and pocket huge profits, after a time even huge-er as they then jack the rates back up to parity with what’s left of cable..

    A shakeup in the must-carry and local access/municipal access coverage rules is in the offing. As in “offing” any local control of that service. Time was, before Mike Powel put the FCC up for sale, cable providers and Tv stations by law had to provide a certain portion of channel space for local access, and they had to respond to local community standards and prove they were contributing to the public goon when they borrowed the airwaves WE own. Or their license would be given to another competitor. Now, they want to cut all of that, drop any local oversight as well as local access, cherry-pick what customers they DO want, then lock you into expensive service contracts while keeping out any competitors.

    When they talk about competition for cable, in terms of the infrastructure it works about as well as competition for electric power has in Illinois (seen your bill this month?) The cable company that puts the infrastructure in FIRST becomes a defacto monopoly; it’s not like they can string multiple sets of cable TV cables all over town to give you a choice. The competition in cable comes from the local city or town (representing YOU) either renewing or killing the franchise-holding company’s contract, and giving some other company a shot at running the same infrastructure. We could lose that local control. ATT wants the same infrastructure advantage in delivering broadband; own the infrastructure, own the market, snuff competitors. Just try getting DSL in Springfield from anybody other than ATT. You can’t, even the so-called competitors just lease the same lines from ATT and add their own markup to your DSL.

    We need to tread carefully here and listen to all the pitches very closely: this is one place where it is way too easy to just buy the politician’s votes despite what constituents want.

Sorry, comments for this post are now closed.

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