The Little Rock, Ark., government has taken the first step toward allowing AT&T Inc. into town with infrastructure improvements that will enable its Internet-delivered video service.
On July 11, Little Rock’s board of directors approved, on first reading, an ordinance that does not require the telephone company to obtain a franchise as a condition for placing its equipment in the municipality’s rights-of-way. The ordinance needs two more official readings in order to become effective, according to city officials.
The measure would take effect Aug. 8, unless a super-majority of the board votes to skip a reading, in which case it could take effect as soon as July 27.
The ordinance states that the applicant, AT&T Arkansas, does not believe it is required to obtain a separate franchise for IP-delivered services. The telco believes the city only has the right to regulate the time, place and manner in which AT&T occupies the municipal right-of-way.
The city is “willing and able to provide an appropriate franchise to AT&T Arkansas that would not adversely impact the terms and conditions of the City’s current franchise agreement with Comcast Inc.,” according to the ordinance.
AT&T Arkansas does not wish to accept this offer. But instead of engaging in litigation, the ordinance said, and to promote the introduction of new technology, the city and AT&T agreed to the ordinance.
The stance is similar to the thinking behind the operating agreement made with Anaheim, Calif., where city officials reserve their right to seek a franchise should a court or federal regulators mandate that one is needed.
In many communities around the country, regulators are raising questions about whether AT&T’s planned video service is subject to regulation. AT&T argues that the service, delivered in packets of information at the demand of a consumer, does not meet the federal definition of a cable service and is not subject to franchising.
Disputes over city regulatory authority have sparked lawsuits in California and Illinois.
In addition to Anaheim, AT&T came to right of way use terms with North Chicago, Ill. last month. Like Little Rock, the North Chicago deal will allow AT&T to compete with Comcast.
The pending ordinance in Little Rock is for a three-year term. AT&T would pay 5% of gross revenue as a franchise fee, among other terms.
Meanwhile, the town of Lakewood, Ohio, population 53,971, approved a similar video provision agreement, for five years, on July 17 on a 6-1 vote.
