[media-credit name=’JEFF SCHORFHEIDE/Herald photo’ align=’alignnone’ width=’648′][/media-credit]A committee of legislators heard testimony Tuesday concerning a bill that would transition control over video franchises in Wisconsin to state government.
The bill aims to increase competition within the cable television market throughout the state by encouraging multiple companies to provide cable access to Wisconsin citizens.
The bill, authored by state Rep. Phil Montgomery, R-Green Bay, addresses about 1.6 million cable customers in the state.
At the public hearing, Montgomery said increased competition in the video franchise market would allow consumers to obtain the best product at a lowest cost.
"The bill is about consumers and choices," Montgomery said. "This is a simple issue. … Families all over the state of Wisconsin want options when it comes to their video service."
Scott VanderSanden, president of AT&T Wisconsin, wrote a statement to the committee, saying the bill would encourage competition that will bring more benefits to the consumer.
Tom Moore, executive director of the Wisconsin Cable Communications Association, said passing the bill would also create a level playing field for all providers.
"Anyone in Wisconsin can readily choose their provider," Moore said in an interview with The Badger Herald. "Do not choose a regulation that will lock today's technology in place because the market and technologies are constantly changing."
Moore said the video industry also constantly faces new competition through rapidly expanding technologies — mainly satellite and the Internet.
Janet Jenkins, administrator of the Division of Trade and Consumer Protection for Wisconsin, said the idea of competition created by the bill is a good one, in theory.
"The primary objective for this bill is to provide competition, which, in and of itself, is a good thing," Jenkins said. "However, not everyone has to or will have a competitor in every location in this state."
Smaller municipalities throughout the state may not be able to entice new cable providers, Jenkins added.
The bill also takes away consumer protections, which are safeguards currently granted to cable customers. If approved, cable companies will no longer be legally required to fix their product within 72 hours of receiving a complaint, nor will they have to give 30 days notice for fee increases.
"Many families will have the same provider they have now charging the same rates because there is not competition, yet will not have any consumer protections," Jenkins said.
Barry Orton, professor of telecommunications at the University of Wisconsin, said the bill aims to eliminate local franchises and replace them with a single statewide franchise — in which local governments would not have any authority.
He said passing the bill would result in an increase in taxes to make up for monies formerly made through franchise fees.
Orton said franchise fees — dollars paid by private companies to local governments in exchange for use of public rights-of-way — provide great benefits to the entire community.
"[Franchise fees] pay for services that benefit all citizens, who jointly own local rights of way," Orton said.
He added passing the bill will result in a decrease of the total amount of income from franchise fees and force many former cable customers to use a satellite product, thereby removing citizens — and income — from the franchise fee base altogether.
"The bill would achieve a 15-25 percent reduction in the franchise fee gross base," Orton said. "[It] will cause local property taxes to rise."