June 13, 2006 at 11:26 PM ET
WASHINGTON D.C. -- Today, if you have a problem with your cable TV service, you can march down to City Hall and complain to the mayor. Or, you can show up at a city council meeting and make an old-fashioned stump speech. And the mayor and city council can actually do something about your problem.
Most towns in America have an Office of Cable Communications or similarly titled board, giving consumers a local place to turn and companies a local office they must answer to.
Quaint? Perhaps. Antiquated? Maybe a little. Time for dismantling? Of course not. However, that's what your Congress is about to do.
The major telecommunications bill careening through Congress right now would shift almost all the responsibility for cable complaints from local governments to the Federal Communications Commission. With some 30,000 local governments currently taking and acting on cable complaints, it's not clear how the FCC would suddenly gear up to all of handle them. But I’ll let you guess.
Why haven't you heard more about this? Because the end of the current cable franchise system is packed into the bill that has generated controversy on many other fronts -- Net Neutrality among them. The distraction has allowed the end-of-cable-franchises-as-we-know-them portion of the bill to sail through the legislative meat grinder without very much debate. That's too bad: We will rue the day that consumers' right to complain, and to find recourse, was taken away from City Hall and plopped onto a big white building in Washington D.C.
Federal pre-emption. It's a term you should get used to, because it’s become the way of doing business in this town. Remember states’ rights and federalism from your high schools textbooks? Now there’s an antiquated idea.
Pre-emption: A way of life
Today in Washington, pre-emption is a rule of thumb. Pre-emption means federal law supersedes state and local laws if they govern the same areas. It’s become standard operating procedure for Congress to pre-empt state laws with its own laws. Pre-emption is all about grabbing power -– typically, a local agency is forced to cede enforcement power to a federal agency. It's generally good for businesses, which get to avoid aggressive state legislators and offices of consumer protection and the like. But pre-emption is usually bad for consumers. It places your protection far away, behind a Web site and a mailing address and a bureaucrat you’ll never meet. Pre-emption makes it impossible for states or cities to create laws that enforce stricter consumer protections than Congress imposes.
Back to today’s subject: cable franchises. If you have a complaint, and you don't think your mayor handled that complaint properly, you can vote her or him out of office. If the FCC doesn't handle your complaint properly you can ... write an e-mail to the president. There’s the problem.
Nevertheless, in the euphemistically titled and recently approved COPE Act (Communications Opportunity, Promotion and Enhancement Act), the House of Representatives has voted to take the power of complaint away from consumers. Oh sure, they can still bitch and moan at City Hall. But this bill names the FCC as the final hammer in any dispute, effectively undercutting local governments.
The Senate is now considering a similar bill. It's an emotional topic -- a hearing Tuesday before the Senate Commerce Committee was packed to standing room only.
Telecommunications firms are lobbying hard for the legislation, operating Web sites like WeWantChoice.org and Consumers4Choice.org. Of course: Who wouldn't rather be accountable to easy lobbying targets in Washington D.C.? Local mayors can be a bother.
The system IS broken
Before I go on, let me say that the system, as it is, is broken. Those who want to change the way cable franchises work have a point. Not long go I covered city council meetings in far flung places like Parsippany, N.J., and Lake Havasu City, Ariz. All across our nation, dysfunctional city halls and Napoleonic mayors hold up cable franchise deals in all sorts of creative ways. They take a sizable cut of the subscription fees (5 percent or so) as free tax money. Some cities hold up cable companies for outright grants to pay for things like fire trucks. The negotiations can drag on for months. It isn’t fair. With their sometimes absurd demands, localities hold back competitive forces and limit consumer choice.
But dismantling the franchise model is a classic throw-the-baby-out-with-the-bath-water solution –- and it’s sharply undermining an important consumer protection mechanism under a smoke screen. Remember, companies who want to provide video and Internet services over a wire to your house have to enter your city. They have to climb your telephone poles. Sometimes, there’s nothing wrong with quaint. We should be working hard to preserve the quaint, local element of cable television, not working to nationalize it.
Yet that's what the COPE Act will do. As you might expect, local government advocacy groups like the U.S. Conference of Mayors and the National League of Cities, are sharply opposed to the bill. Elizabeth Beaty, spokeswoman for a group that represents local cable franchise boards, the National Association of Telecommunications Officers and Advisors, said each community needs to able to set and enforce customer service standards for cable firms.
"No one is going to hold them more accountable than your local government," she said. "Who is more accountable: Your mayor or an unelected professional staff person at the FCC?"
Here’s a typical scenario Beaty offered: A cable company promises to show up between 8 a.m. and noon for an installation. Then, the cable company doesn’t show up. Now what? In some cities, the firms are bound by their franchise agreements to compensate the consumer. Beaty’s concerned that a federal consumer standard might not include such a provision, or it might be hard to enforce. At the city level, it’s easy –- cable providers must pay fines, and obtain a letter of credit that’s essentially a bank account municipalities can draw on if the firm tries to duck its fines.
A bigger hammer?
Telecom companies see all this very differently, of course. Kelly Gannon, a spokeswoman for TV4US, said the bill would actually strengthen consumer protections. Far from taking away the hammer consumers have at City Hall, “They’re being given a bigger hammer,” she said. “The cable companies are more afraid of the FCC than local mayors.”
Washington tougher on corporations than local government? That argument is hard to swallow.
Should the COPE Act become law, Beaty predicts immediate and serious consequences for consumers. For example, she’s wondering how the FCC will be able to handle a cascade of complaints when there are no appropriations in the bill for extra staff. A survey of 100 member cities revealed they had received 34,000 complaints in 2005. That would be a heavy new workload for the FCC. Even if local governnments still act as complaint-takers who pass problems on the the FCC, as some versions of the proposed legislation suggest, that's still an overwhelming number of disputes. It seems obvious on its face that many customer complaints will go unheeded, misdeeds will go unpunished -- and customer service will plummet.
On this point, there is even disagreement among the supporters of the larger COPE Act. While the traditional phone companies support this virtual end of local franchising, the National Cable and Telecommunications Association said it is "neutral" on that portion of the bill. In an interview with me, Brian Deitz said cable firms would actually be sad to see franchising go. Cable companies support local enforcement, he said.
Perhaps that's because his industry doesn't want the phone companies to get an easy ride after they've spent decades fighting City Halls around the country.
The Senate bill that was debated today includes some additional measures to protect consumers’ local rights to complain, and the bill is still in flux. That’s good, because the already passed House bill –- the one you know about because it passed on Net Neutrality –- also passed on consumer rights. Before the Senate passes its version, now’s the time to speak up, before you lose your right to speak up at City Hall about your cable company.