Tuesday, May 31, 2005 - The Progress & Freedom Foundation Blog

Texas Tussle: Consumers Lose

The Wall Street Journal blames a coalition of cable and municipalities for defeating Texas's proposed statewide video franchising law, which would relieve the Bells' video offerings (and cables' too!) from city-by-city franchise negotiations -- otherwise known as shakedowns. Being subject to local franchising requirements will surely slow down the Bells' video rollout.

In this, consumers lose quicker entry and competition in the video and broadband markets. The Journal portrays the Texas loss as foreshadowing similar losses across the nation -- kind of like France's EU vote, but with much less world-historical consequence.

Were I a cynic, I would lament that we are forestalling video and broaband competition to instead increase in local government tax revenue. Perhaps with the additional revenue, the municipalities can build their own broadband systems since the private platforms are taxed so heavily. But I am not a cynic, so I will look to the last sentence of the Journal article quoting NCTA Head Kyle McSlarrow: "It may be appropriate that Congress affirm that these kinds of services be dealt with a very light economic regulatory touch,..." Now that would be the way to deliver all players from this local tax morass.

posted by Ray Gifford @ 2:16 AM | Broadband , Cable , State Policy