FCC to Take Up Cable Franchise Rules Next Month, Chairman Says

The FCC will consider the cable franchise rules at its next meeting, which is set for Thursday, Nov. 3, according to the commissions Chairman Kevin Martin, who delivered a keynote address today at TELECOM 05.

Martin, who joined the group via live satellite video, said the FCC will take up the question of whether the FCC has a role in supporting the 1992 Cable Act, which prohibits local authorities from granting exclusive video-delivery franchises as well as unreasonable refusal of a second franchise in a serving market.

Martin said he has been hearing from new entrants like telephone companies that securing franchises has been difficult. New entrants into the video market should be encouraged, not impeded, he said.

Walter B. McCormick, president and CEO of USTelecom, sponsor of TELECOM 05, said the movement was most welcome to USTelecom members.

The FCC chairman also said the agency cant wait that much longer before we take some action on revamping the $7 billion Universal Service Fund collection and distribution mechanisms. I cannot promise a perfect framework, but it will be technology neutral, he said, explaining the current funding method based on interstate revenues is outdated and does not reflect changes in the marketplace such as the addition of wireless long-distance, service bundles and the shrinking long-distance market.

Martin is on record advocating a new funding system based on telephone numbers, which he calls easy to administer and competitor/technology neutral. Other plans call for a hybrid system, keeping some of the old and adding the phone number based mechanisms. Others seek to remove the safe harbor for wireless companies and to add new provider types to the list of contributors.

The chairman said he also wants to revisit the manner in which funds are distributed, saying there are too many qualifying recipients. I dont think it makes sense to continue supporting multiple providers in these markets where it is difficult to sustain one, he said, adding this is especially true of providers that are not subject to the same obligations or cost structures as the incumbents.

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