FCC Rules on Cable Franchise Reform

Contact: Richard Morrison, 202.331.2273

The following may be attributed to Wayne Crews, CEI's vice president for policy and director of technology studies:

Washington, D.C., March 5, 2007—The Competitive Enterprise Institute applauds the FCC’s order, released today, to prevent the nation's local franchising authorities from unreasonably impeding the rollout of new multi-channel video and broadband services by competitors to the cable industry. CEI supports liberalization for all sectors of the telecommunications industry, and believes rivals in this dispute all ultimately benefit, as will their customers, from this move and future deregulatory measures that remain necessary.

The right to compete and offer new options to customers should be beyond argument and unconditional; yet, as FCC notes at the beginning of the order, the local franchising process, which can impede competition with tangential and unrelated demands, has become a barrier to entry rather than a guarantor of competition. 

Private efforts to expand infrastructure are too easily blocked by the very regulatory bodies whose role is to facilitate rather than restrict competition.

Failing to liberalize exacerbates pressures for damaging political oversight of telecommunications. Ironically, today’s “net neutrality” advocates would accept new price and entry regulation over networks required to deliver broadband Internet content. Today’s order lessens the saliency of the “excess market power” assertion that otherwise rationalizes dangerous interventions like net neutrality.

Not all parties to today’s order will be delighted. But deregulating all sectors downward and enhancing competition—rather than maintaining old-school regulations and inviting new ones—represents a superior model of telecommunications reform.


For further information on telecommunications reform, please see the following CEI reports:

Communications without Commissions: A National Plan for Reforming Telecom Regulation

This Liberal Congress Went to Market? A Bipartisan Policy Agenda for the 110th Congress