Washington -- Sen. John Ensign (R-Nev.) said Tuesday that passage of his telecommunications-reform bill would cause cable incumbents facing new competition from phone companies to slash their rates across the country.
Ensign -- whose bill (S. 1504) would ease phone-company entry into local markets by eliminating local franchising -- claimed that the cable incumbent in Keller, Texas, cut its rates by 50% when Verizon Communications Inc. began to provide video service a few months ago.
“I think this would happen all across the United States because, guess what, competition leads to better services at lower prices,” Ensign said in a speech here at the Heritage Foundation, a conservative think tank. “There is no question that if my bill was enacted, that’s exactly what we would see.”
Charter Communications Inc. spokesman David Andersen said the company launched a promotion in Keller many months before Verizon’s arrival. Under the plan, new subscribers receive a 240-channel digital package and high-speed-Internet access for $50 per month for the first 12 months. The digital package normally costs $68.99 per month.
Ensign said he did not expect his bill to become law this year, adding that he had no plan to try to pass a streamlined bill that would remove video-franchising requirements.
“You cannot get time on the floor to do a little piece here and there,” he said. “Next year, I think this is going to have to be one of the top priorities for the Senate to get done.”
The National Cable & Telecommunications Association weighed in on the matter with a prepared statement.“Prices are determined by the costs associated with delivering advanced digital services and many of the costs are increasing significantly, including the increased cost of gas for fleets, more employee training to assist customers with sophisticated services and production of award-winning programming that is consistently increasing viewership,” the NCTA said.
“While customers today already have three or four choices for a home-video service, the entrant of a new competitor will not have a significant impact on marketplace conditions,” the trade group added.
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