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Traditionally, cities required utilities and other users of public rights-of-way to obtain franchise agreements before serving within their boundaries. These agreements provided for use of rights-of-way, included a gross receipts "fee," buildout requirements, and, sometimes even, specified acceptable rates for end-users. Thus, telephone companies, electric and gas utilities, and cable companies each negotiated franchises with individual cities to serve within their boundaries. For video service, the cable act of 1992 eliminated any regulatory purpose for franchises, leaving only the taxation and in-kind service donation to the cities intact. Now, the Bell companies appear poised to enter video markets, bringing new competition against cable and satellite providers. However, the new entrants point out the exorbitant costs and delays associated with negotiating thousands upon thousands of individual franchise agreements. The incumbents, by contrast, point out the inequity of allowing new entry without the same regulatory burdens that they face. Franchise reform has become a front-burner communications law issue, spurred by Bell entry into communications markets. Texas became the first state to pass a statewide franchise process, allowing a single franchise for video entry, while keeping the local taxation aspects of franchising intact. Other states may follow, and there is talk about a federal law concerning franchising.


  • Ms. Elizabeth W. Beaty, Executive Director, National Association of Telecommunications Officers and Advisors
  • Professor Thomas W. Hazlett, George Mason University School of Law
  • Mr. John M.R. Kneuer, Acting Assistant Secretary, National Telecommunications and Information Administration, United States Department of Commerce
  • Mr. Walter B. McCormick, Jr. President and CEO, United States Telecom Association
  • The Honorable Kyle E. McSlarrow, President and CEO, National Cable & Telecommunications
    Association, and former Deputy U.S. Secretary of Energy
  • The Honorable David M. McIntosh, Mayer Brown Rowe & Maw, and former Member, United States House of Representatives, Moderator

Date: Wednesday, May 3, 2006
Location: Capitol Hill Club

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