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Article

Title: Bad deal for cable customers

Author: Court, Jamie Article Type: Company
Source: San Francisco Chronicle, pE2(1) Publication Date: Jun 25, 2006
URL of Publication: http://www.sfgate.com

AT&T is spending millions of dollars in advertising, lobbying, and campaign contributions to promote what it calls 'more choice and greater competition in the cable television industry. Critics note that there would certainly be more choices, but they would be for AT&T and not for consumers. The California Assembly has unanimously passed a telephone and cable deregulation bill that would eliminate the obligations of telecommunications firms to obtain franchises from local elected officials before developing video and Internet pipelines in their communities. Telephone and cable firms would both just have to file an application with the state to build and offer their services with relatively little restriction. The bill received approval from legislators largely because of the money spent by AT&T. For example, the company hosted a golf fundraiser for Assembly Democrats and the Assembly Speaker, Fabian Nunez, which raised $1.7 million for their reelection. Additionally, Arnold Schwarzenegger, the governor of California, has received $374,000 in campaign money from the telecommunications industry. When the so-called 'free market' touted by AT&T becomes reality, consumers will see prices for new Internet and video services increase substantially. Local franchises currently negotiate rates that cable firms can charge for basic service. Under the new program, companies can charge whatever they want, and consumers will have to hope that competitive pressure keeps prices down. Critics note how well this approach has paid off at gasoline stations.

Companies:
AT&T Inc

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