The most serious disease that afflicts public officials is arrested development.
Want proof? A recent survey by the National Association of Telecommunications Officers and Advisors (NATOA) on the impact of state video services legislation on communities and subscribers makes it clear.
The survey focused on franchised cable television issues and totally ignores the multiplicity of video availability from other sources like web streaming, wireless phones, and satellite delivery. To their credit NATOA’s Executive Director Liddy Beaty stated, “this legislation is very new in many places and only time will tell whether, once implementation is complete, it will prove to have benefited consumers . . . ”
But Beaty also said, “State legislation . . . is not resulting in price reduction, the primary reason used to justify state over local regulation.” This statement denies the reality of the experience of many states that have implemented video franchise reform, but also ignores the most important reason for municipal franchise reform – lowering barriers to the entry of multiple intermodal competitors to the video market place.
On March 6th, the Wall Street Journal reported that mobile television services that are currently being tested in Spain will enable people to “ . . . watch digitally broadcast programs on their cell phones as they are being shown on regular TV.”
The NATOA survey didn’t address potential competition from cellular phones.
More and more television networks are providing episodes of their most popular programs and sporting events on the Internet.
The NATOA survey didn’t address competition from Internet streaming.
Advances in the quality of satellite services have made programming even more competitive than ever before. They are fully competitive in terms of the availability of choices and more than competitive with regard to pricing.
The NATOA survey didn’t address competition from satellite services.
And therein is the problem. Local officials are so addicted to regulating, obtaining free services from and deriving revenue from one source of video programming – cable TV - that they are ignoring the fact that regulated cable operators are facing increasing competition from alternative technologies.
For cable companies to continue to compete they are going to have to have more freedom from regulation in order to compete in the market place. And that was at least one of the purposes of the video franchise reform that has made its way through state legislatures in the past few years, and will hopefully transform a few more states this year.