The 1990s saw the University of Wisconsin Badgers end their long Rose Bowl drought in style, winning the big New Year’s Day game in 1994, 1999 and 2000.
Except for the lucky few who could make it out to sunny Pasadena, most of us watched the Badgers win from our homes on cable TV. And that makes us the perennial losers. We’ve been losing millions of dollars a year to the cable TV monopolies that continue to overcharge us because in most areas of the state, the local monopoly is the only cable game in town.
The Badgers will not be playing in Pasadena on New Year’s Day 2008, but cable customers in Wisconsin are heading for a Rose Bowl moment of our own, providing the state legislature doesn’t drop the ball. Legislators are on the verge of passing the Video Competition legislation that would streamline Wisconsin’s archaic cable TV franchising system and speed the entry of statewide competition.
New competitors, notably the big phone companies that have expanded into home video service, would no longer have to go from town to town negotiating separate video franchise agreements. Any qualified provider would only have to apply for one statewide franchise to offer service anywhere in Wisconsin.
The Assembly passed this legislation, AB-207, in May by better than a two-to-one margin. On Nov. 8, the Senate also passed the bill with some minor changes, and it now gone has back to the Assembly for concurrence. Once that happens, the next and last stop is for the governor’s signature.
That day can’t come too soon. Wisconsin families have been hammered with big annual cable rate increases for years. Satellite service requires an expensive upfront outlay for equipment and it has never made enough of a competitive dent in the market to put a lid on the cable monopolies’ appetite for price increases.
Nationally, cable prices went up by a staggering 93 percent from 1995 to 2005. Over the past three years, though, 18 states have either passed or introduced Video Competition legislation similar to the bill now pending in Madison. In areas where phone companies are already competing with the cable companies, monthly cable bills have actually dropped by an average of 23 percent.
According to data from the Wisconsin Policy Research Institute, bringing competition like that to the Wisconsin cable market would save consumers as much as $149 million a year in lower cable prices. And this isn’t a case of "if you build it, they will come." AT&T is already here with a competitive home video offer. They are offering a competitive choice in parts of the Milwaukee area. Passage of the Video Competition bill would encourage them and other companies to offer the service in more places across Wisconsin without years of delay.
Special interests who like the status quo are trying to derail the Video Competition bill with claims that a statewide franchise system would somehow jeopardize the benefits of "local control." In fact, a statewide system provides more benefits.
It would set uniform customer service standards for cable and satellite service quality, with stiff penalties for violations. Local governments would still get the same franchise fees from video providers doing business in their towns, with the potential of getting more franchise fees from multiple providers. Video providers would be required to carry local educational and government programming, just as they are under the current local franchise system.
Let’s remember too that those local authorities already have no control over what matters most to consumers – cable rates. The only control over those will come from viable competition. We can finally have that competition statewide if the legislature brings the Video Competition bill into the end zone.
Harry Alford is president and chief executive officer of the National Black Chamber of Commerce in Washington, D.C.