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Qwest cable help pushed
Bill would bypass municipal franchise requirements
By Andy Vuong, Staff Writer
Denver Post
Friday, January 12, 2007

State Rep. David Balmer said Thursday he will introduce legislation that would allow Qwest to seek a statewide cable-franchise agreement.

Qwest currently has to seek franchise agreements with individual municipalities before it can offer video service to compete against cable companies such as Comcast.  So far, the Denver-based company has reached agreements with only a few communities in Colorado.

Balmer, a Republican from Centennial, said the legislation is aimed at increasing competition.

"Competition in the marketplace always results in lower prices for consumers," Balmer said.  "We saw competition bring lower prices to the voice-telephone sector 10 years ago, and now it's time to bring competition to the cable-TV sector."

Balmer said he will introduce the bill "shortly" but has until the end of the month to do so.

The key issue between Qwest and individual municipalities has been network build-out requirements.  City leaders want Qwest to offer its video service to every home, a requirement also placed on Comcast, the incumbent cable-TV provider in the metro area.  Qwest wants the freedom to pick which neighborhoods it will offer its video service to.

The build-out requirement "is a barrier to competition," said Chuck Ward, Qwest's state president.  He said Qwest shouldn't have to build out to every home, because it is the second entrant into the market.

Ward said Qwest's video service is available to roughly 30,000 homes in Douglas County, where it has a franchise agreement, but the company has been able to win only 2,900 video customers from Comcast in five years.

"I can't assume I'm going to get all of Comcast's customers," Ward said.

Comcast spokeswoman Cindy Parsons said Qwest is looking for special treatment from policymakers.

"There is every opportunity for new entrants to enter the market today under the existing rules without any special franchising deals or special legislative loopholes," Parsons said.

Darryn Zuehlke, director of Denver's telecommunications office, said the current process shouldn't be changed.

"Our negotiations with Qwest have actually been going relatively well," Zuehlke said.  "The local franchising process is not broken and doesn't need to be fixed."

Zuehlke said the Denver City Council insists that Qwest offer its service to every resident but is flexible on the time frame in which that requirement is met.

Some states, including California, have already passed statewide franchising legislation.

Other states in Qwest's 14-state service territory will also likely see similar legislation this year, including Iowa, Minnesota, Utah and Idaho, Ward said.  In addition, Qwest's Oregon president Judy Peppler has said a franchising bill will be introduced there this year.

Staff writer Andy Vuong can be reached at 303-954-1209 or avuong@denverpost.com.

http://www.denverpost.com/business/ci_4996960