AT&T investing in statewide cable
Posted: Monday, July 7, 2008 11:20 am
By: By The Associated Press
The Messenger 07.07.08
By ERIK SCHELZIG
AP Business Writer
NASHVILLE (AP) — AT&T Inc. has announced plans to invest $400 million in Tennessee as part of its effort to offer statewide cable television, Internet and phone services.
The company applied for a statewide cable franchise with the Tennessee Regulatory Authority on Tuesday — the same day a new state law went into effect to allow companies to bypass the old system of requiring individual cable permits for each city or community.
The new law was the result of a two-year legislative fight among AT&T, the cable industry and local governments that saw millions spent on lobbying and advertising campaigns.
Cable companies had argued that it would be unfair for AT&T to be able to circumvent existing rules to be able to offer their services statewide.
Gov. Phil Bredesen said he expects the AT&T plan to help expand broadband access around the state, and praised the company for the timing of the franchise application.
“They certainly indicated this was important to them and they would move quickly, and I think this is a very good sign,” Bredesen told reporters after a ceremonial bill signing event.
AT&T wants to roll out its U-verse package, which delivers TV content to consumers using the Internet, rather than through traditional cable or broadcast formats. The $400 million would be spent over coming years on upgrading AT&T’s fiber network.
The Dallas-based company said it plans to offer the services in its current service area in Tennessee — including 56 cities, and unincorporated areas in 29 counties — within two years of the getting approval.
“It will take time to enhance our network to offer these exceptional services, but we will move as quickly as possible to compete for Tennessee customers,” Gregg Morton, president of AT&T Tennessee, said in a release.
AT&T serves more than 1 million customers in Tennessee, according to the application.
State regulators have 45 days to process the application under the new law, said TRA spokesman Phil West. No public hearings are planned, he said.
The new law includes a build-out requirement that seeks to prevent companies from only serving the wealthiest areas. Companies have 3 1/2 years to make service available to at least 30 percent of the households in their franchise area — and 25 percent of those have to be low-income.
Providers that don’t meet the requirements face stiff fines
The law also requires AT&T or any other new providers to pay a 5 percent franchise fee on gross receipts to the local municipality or county where they operate.
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