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Telcos Celebrate Franchise Wins

California Governor Arnold Schwarzenegger Friday signed the state's new video franchise reform legislation.

The law makes it easier for competitors like telephone companies to get into the multichannel video business in competition to cable.

Verizon was quick to praise the passage saying it would allow it to "commit hundreds of millions of dollars in additional investment to accelerate fiber deployment."

The signing ceremony came a day after a judge in Texas rejected a challenge to a similar law there.

Cable operators in the state filed suit, arguing that cable operators there "will suffer injury, including, but not limited to, actual and potential loss of revenues, damage to reputation and goodwill, and other harm."

It also said the state-issued franchises "will result in an uneven competitive playing field, thereby unfairly and unlawfully impairing incumbent cable operators ability to compete."

The Texas district court Judge dismissed the suit without a trial, saying it was too soon to tell what impact the law would have and whether there would be disparate treatment. 

With prospects dimming for a national franchise reform law, kneecapped by the network neutrality issue, telcos continue to push for changes to state law that do essentially the same thing.