Steven Bernstetter

The state senate recently approved a bill to increase the competition amongst video service providers, specifically cable companies. The arguments for cable franchise reform are many. An excellent overview of them can be found here. Though this bill falls a little short of full competition, and gives considerable preference to existing cable providers, it is nonetheless a positive step in the right direction. Under this legislation, a state-wide franchising agreement replaces the current stucture of individual municipality licensing agreements, and, according to the Springfieldnews-Leader:

- Cable providers would be prohibited from withholding services based on race or income. Within three years of providing service, cable firms would have to devote at least 25 percent of their services to households that earn less than $35,000.

- Municipalities would be able to require cable operators to designate up to three channels for public, educational or governmental use.

- Municipalities also would be able to collect a fee, no more than 5 percent of gross revenue, from cable providers. Providers would be able to pass this tax onto customers.

So municipalities still get some say in how their citizens receive their cable services, but without creating the artificial barriers to entry found under our current system that stifle competition and drive up prices. Furthermore, the new plan would encourage the laying of broadband and other kinds of communication infrastructure that benefits industries and consumers well beyond mere cable service. In all, this bill proposes changes that will be beneficial to Missouri consumers.

About the Author

Steven Bernstetter