Statement of Congressman John D. Dingell, Ranking Member
Committee on Energy and Commerce

COMMITTEE ON ENERGY AND COMMERCE
MARKUP ON H.R. ____, THE “COMMUNICATIONS OPPORTUNITY, PROMOTION, AND ENHANCEMENT ACT OF 2006”

April 25, 2006

Mr. Chairman, we all want consumers to benefit from competition for video, voice, and broadband services. Unfortunately, this bill promises many consumers more harm than good. If this bill were to pass in its current form, they could lose cable service or face higher prices, shoddy service, and deteriorating facilities.

First, some consumers may actually lose cable service. The cable industry admits that once cable companies switch to a national franchise, they may not continue serving all of the households they currently are required to serve. Are we willing to have our constituents lose service?

Some may claim that cable operators with facilities in the ground are not likely to withdraw service. Is that the case in areas such as New Orleans? What if a tornado or other disaster strikes part of a franchise territory? After this bill, those residents may lose their only provider of cable service. How is that consistent with universal service principles?

Second, even if service is not withdrawn, the bill lets operators avoid maintaining or upgrading facilities in certain neighborhoods. In fact, the cable industry’s witness at our hearing could not promise that cable operators would maintain their current levels of service. Do we want different levels of service depending on the demographics of a neighborhood? Are we prepared to let facilities in some parts of town deteriorate while others in the same town receive cutting-edge services?

Third, the bill removes a current requirement on cable operators that as part and parcel of using the public rights-of-way, the operators must provide service to all households in a franchise area. And no such requirement is placed on new entrants. The bill will create the digital equivalent of gated communities in our cities, towns, and countrysides. Why should companies be able to use the public rights-of-way but not eventually extend service to the entire public?

Fourth, the bill risks consumers paying higher prices. When a national franchisee enters the affluent part of town, the competing cable company may respond with lowering prices in that area. What happens on the other side of town? Again, the cable industry concedes that the cable operator may raise prices for customers who lack competition. Do our constituents know that for all the winners in the affluent parts of town, there will be many losers in other areas?

Another issue that has received nationwide attention is “net neutrality.” The bill before us permits the private taxation of the Internet. Private tax collectors could single out certain Web sites to pay extra fees while they select others for preferential treatment. The open and innovative Internet has flourished under network neutrality legal protections until last year. Why should this Committee turn over control of the free flow of the Internet to the whims of cable and telephone companies?

Mr. Chairman, much of this bill reflects the progress made in the negotiations conducted earlier this year. But important differences remain. Even though some consumers will see more competition from this bill, far too many will be worse off than they are today, and still others will simply be left out of this new competitive world. I cannot support the legislation as drafted.

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(Contact: Jodi Seth, 202-225-3641)