Jackson

A Tennessee state senator has introduced a bill that would fine the state’s cable companies for running racy television advertising on its cable channels.

Dubbed the “Girls Gone Wild Bill,” the legislation would hopefully curb cable operators’ willingness to run suggestive advertising, according to the bill’s author Sen. Doug Jackson (D-Dickson).

This isn’t the first go around for Jackson’s bill, having failed to pass during the last two legislative sessions.  But Jackson believes the third time is a charm, passing a vote in the Senate Commerce Committee 8-0, with one member abstaining.

The Tennessean talked with Jackson to learn why the bill was necessary:

Jackson has said he got the idea for the proposal after seeing partially censored commercials for “Girls Gone Wild” videos that show young women disrobing and acting out other sexual situations.

“They’re provocative and shocking to a lot of families trying to raise children,” Jackson said.

The bill would make any television advertisements considered “obscene” to be illegal. Obscenity, Jackson said, is not protected by the First Amendment. Under common law, it is established by community standards, and in Tennessee, each judicial district can establish for themselves what is considered obscene.

“A jury in Dickson County could determine the videos being sold are obscene, which makes it an illegal product,” he said.

The legislation has gotten Jackson plenty of attention across the state, as Tennessee media covered the unusual legislation.  But some fear Tennessee could become a laughing stock over bills like these.

Columnist Gail Kerr, also writing for the Tennessean, called the mad rush of oddball legislation a bunch of  “crazy crap”:

You can sure tell the Tennessee General Assembly doesn’t have any money to spend this year.

After a slam dunk, fast special session on education, our esteemed lawmakers have returned to their usual bad habits.

They have filed legislation that would kill Nashville’s honky tonks, debated whether to outlaw putting electronic chips in people and whether to amend the state constitution to assure you the right to catch a catfish.

Sen. Doug Jackson wants a constitutional amendment to assure every Tennessean has the right to hunt and fish. No one is trying to stop you from hunting and fishing. Jackson also is bringing back his “Girls Gone Wild” legislation, aimed at stopping the late night television commercials promoting the raunchy videos. He was inspired by watching the commercials.

One thing’s for sure, state law prevents these folks from taking campaign donations while in session. With two of them running for governor, one running for Congress and a slew up for re-election, they’ll start getting eager to adjourn pretty quick. It cannot happen too soon.

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WKRN-TV in Nashville reports Sen. Doug Jackson’s bill would allow communities to define certain ads on cable television obscene and have them pulled off the air.  (1 minute)

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Some members of the Tennessee Legislature believe the state’s cable companies should not be taking money from companies peddling smut, as WSMV-TV Nashville reports. (2 minutes)

Protesting adult programming on cable and satellite television is a long-standing tradition in Tennessee.  Some elected officials even dislike the prospect of MTV running on state cable systems.  But most agree lawmakers have the biggest problem with cable’s dirty little secret — extremely explicit adult programming aired on pay per view channels.  Most cable systems don’t go out of their way to promote this type of programming, but viewers learn it is there when skimming electronic program guides.  Most adult movies have titles that leave little doubt what they offer viewers willing to purchase it, and plenty do — it’s very profitable for most cable operators.

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David Fowler, a former state senator from Signal Mountain, last November denounced EPB, Chattanooga’s city-owned fiber television and broadband provider, for allowing adult programming on the lineup in the first place. (WDEF-TV Chattanooga) (11/2/2009 – 1 minute)

El Paso, Texas

More than 14,000 residents of El Paso are under investigation for potential cable theft.  That remarkable number comes from El Paso, Texas TV station KFOX-TV.  Reporter Martina Valverde notes that Time Warner Cable is now engaged in a city-wide system audit to identify and disconnect illegitimate cable connections.

“Our paying customers who rely on us for phone service, video service, and Internet service,” Gary Underwood, vice president of communications for Time Warner’s Texas operation told KFOX viewers. “They might not be able to access those services when they most need them because the damage that was caused further down the line.”

The company told KFOX when it discovers an illegal connection, it makes two attempts to convert the customer to legitimate service.  On the third attempt, local law enforcement becomes involved.  Those found guilty face fines of $500.

“We have what’s called a tab audit team. They go out and they look at different areas to see. We have a system of tagging and flagging on these lines to so our folks can identify an authorized versus unauthorized connection,” Underwood said.

Cable theft is not just a problem in El Paso.  Some brazen entrepreneurs go further, pretending to represent providers willing to hook customers up for a one time, flat fee they pocket.

Grande Communications faced one such individual, who last summer slapped a magnetic sign with Grande’s logo on his truck and pitched cable service to apartment complexes and homes around San Marcos, Texas.

Unwitting customers who signed up for the deal were offered special discounts by Grande when their illegal cable connection was discovered.

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KFOX-TV in El Paso, Texas ran this report last night claiming more than 14,000 residents were under investigation for cable theft in the community. (1 minute)

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Last summer, Grande Communications had to contend with someone illegally hooking up customers around San Marcos, Texas. KXAN-TV in Austin ran this report July 24th. (2 minutes)

In Maine, bankrupt FairPoint Communications managed to scrape up enough cash to launch a lobbying effort to get a bill introduced, tailor-written to prohibit stimulus award winners from… helping provide improved broadband service to Maine residents.

Marrache

Incredibly, Sen. Lisa Marrache, D-Waterville, the assistant Senate majority leader, has introduced a bill that would ban the system from using any tuition money to help pay for efforts to expand broadband access. Marrache mouthed FairPoint’s talking points as she suggested poor college students’ tuition money would be diverted for broadband projects. She claimed the bill was introduced because constituents FairPoint’s lobbyists and employees were calling her about it.

The fact Marrache so misunderstood a public-private partnership between the University of Maine, Great Works Internet, and two private investors to improve the Internet “backbone” in Maine should be of grave concern to her constituents. Unless some campaign contributions from FairPoint and its executives make their way to Marrache’s next campaign, voters must be wondering whether the majority leader has a grip on the technology matters before her.

Indeed, the University of Maine explained the “middle mile” improvement program was not going to steal students’ lunch money, but rather dramatically improve broadband capacity for all comers — something FairPoint couldn’t be bothered with while breaking promises to expand broadband service themselves.

Jeff Letourneau, associate director of information technology at UMS, told the Bangor Daily News, “as for tuition subsidizing our broadband efforts, that does not happen and will not happen.”

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WABI-TV in Bangor reported on the announced funding of broadband projects in Maine designed to improve rural broadband service statewide (12-17-2009 — 2 minutes)

Ironically, the network that will be built with the help of the broadband stimulus program will be open to any and all providers, including FairPoint, on a wholesale cost basis. But of course FairPoint would not own and control it, so it’s bad for them, and they’re trying to convince Maine lawmakers it’s bad for Maine residents as well.

Great Works Internet has had a running dispute with FairPoint

But then, FairPoint has had a vendetta of sorts against Great Works Internet for months, trying to overcharge the independent ISP for connectivity it obtained under provisions established in the Communications Act of 1996.

Also running interference for FairPoint is Rep. Stacey Fitts, R-Pittsfield, who serves on the Legislature’s Utilities and Energy Committee. His bill prevents any “undue” competition by UMS with existing broadband providers. In other words, he has written the FairPoint Entrenched Provider of Mediocre Broadband Protection Act. Fitts said he has concerns that the university’s efforts could have unintended consequences on private companies (read that FairPoint) that “already provide access.” It will have directly intended consequences on GWI by further disadvantaging them and potentially sinking their efforts to provide better service in Maine.

“If the university is able to bypass some of the competitive markets, and cherry pick, it could affect the ability to deliver broadband to others,” he said.

Exactly how it affects the ability of FairPoint to deliver what it has failed to demonstrate it is capable of delivering is a question Fitts doesn’t answer.

Fitts

“I know this will cause a lot of discussion in committee,” he told the newspaper. “But we need to have that discussion.”

Maine Public Radio covered the introduction of Rep. Fitts’ bill, and the debate swirling around it. (3 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

Constituents need to have a discussion with him. Unless he wants to be known as the representative from FairPoint, he might want to get out of the way of a project that has a chance of improving broadband in his state, as opposed to the empty promises from a bankrupt provider. If he wants to tie himself to FairPoint’s record of failure, voters can choose someone else to represent them at the earliest possible opportunity.

Those with a need for high speed broadband have tried, and failed, to obtain better service from FairPoint. As Stop the Cap! has reported in exhaustive detail, FairPoint was preoccupied in delivering third world phone service at the time, finally collapsing on the courthouse steps under the weight of its bankruptcy filing.

Bills like these in Maine are further evidence that Congress needs to act on the federal level to pass the Community Broadband Act, which would overturn these kinds of bought-and-paid-for protectionist bills passed in several states. Communities must have the right to bypass companies in the broadband shortage business.

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WLBZ-TV in Bangor showed what broadband brings to Maine’s health care system and other business.  (3 minutes)

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MaineBiz Sunday spent nearly an hour going in-depth into broadband challenges in Maine, the problems with FairPoint Communications, the dispute with GWI, and more.  Appearing on the show, which originally aired last November: Fletcher Kittredge CEO of GWI, Phil Lindley of the ConnectMaine Authority, Steve Hand of Know Technology and Rep. Cynthia Dill of District 121 in Cape Elizabeth. (36 minutes)

Coming up…

Comcast Is Allergic to the Word “Free” Except When They Are the Recipient

Frontier's broadband stimulus requests were also shot down when West Virginian cable operators objected

Even companies whose raison d’être these days is to provide better phone and broadband service to rural Americans are being turned down. Frontier Communications, who wants to take control of 617,000 phone lines in West Virginia from Verizon was, in part, promoting rural broadband stimulus funding as a benefit of the deal. After all, a phone company specializing in serving the underserved would stand a better chance of securing broadband stimulus money than a telephone behemoth like Verizon.

Apparently not. The feds turned down their $55 million dollar broadband stimulus application, too.

Frontier applied for two stimulus grants, one to provide fiber optic connections to schools, libraries and health care facilities, the other to fund broadband expansion in West Virginia.

West Virginia’s incumbent cable companies teamed up and just said no.

Opposition piled on from Armstrong Cable Services, Comcast, JetBroadband and Suddenlink urging federal officials to deny Frontier’s applications. They claimed the phone company was trying to secure taxpayer money to provide broadband service in their territories, making the application redundant.

“They had said this was a reason to grant approval, that this would really boost broadband deployment,” Patrick Pearlman, deputy director of the state PSC’s Consumer Advocate Division, which is opposing the Frontier-Verizon sale told the Charleston Gazette. “They went on about how they’re going to get all this money and bring all this, but apparently they couldn’t count on the feds.”

Frontier didn’t blame themselves for the failure, of course. They blamed state officials for holding up their deal with Verizon.

“This is one of the reasons why we have asked this and other commissions to act expeditiously in their review of the proposed transaction,” Daniel McCarthy, Frontier’s chief operating officer told the Gazette.

State regulators should take the rejection as a lesson learned if they believed Frontier’s claims that approving the deal would result in an improved position for broadband stimulus funding. It was not to be. Even small cable companies will pounce on applications that suggest competition might be on the way.

More and more, it appears likely the grand plan for vastly improved broadband will be reduced to funding a handful of showcase rural broadband projects that solve some of the nation’s broadband deficiency woes, but after telecommunications industry and their lobbyist friends are done chewing up the project, plans of expanded broadband providing Americans with better choices at reasonable prices will remain a broadband pipe dream.

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TDS Telecom’s grant for broadband expansion is an example of showcasing hit or miss rural broadband projects.  The company secured $8.6 million to expand broadband Internet services to TDS customers in one Chatham Telephone Company exchange in northern Michigan.  Considering TDS serves largely rural customers in 30 states, winning expansive broadband improvement for all Americans is about as likely as winning the Powerball jackpot. TDS CEO Dave Wittwer explains the stimulus funding to customers in this video. (1 minute)

Burlington Telecom (BT), the city owned-and-operated fiber-based cable, broadband, and telephone provider is mired in debt and is not financially viable in its current form.

Those are the findings of a “blue ribbon” committee tasked with answering questions about the future of the financially-troubled municipally-owned provider serving 4,600 Burlington customers in Vermont.

In an 11-page public report, the committee recommended the city partner with a commercial entity that would assume a majority interest in BT.  As a minority stakeholder, the city could eventually recoup the 17 million dollar investment it has made in the company.

Although some residents have lobbied the city to abandon the 100 percent fiber network to stem ongoing losses, the committee advised against it.

“The city has a considerable asset in BT, and should not give this asset away at a fire sale price,” notes one independent consultant working with the committee. “BT is too important to be jettisoned, in part because it keeps the competition honest.”

Burlington Telecom building and staff

But carrying forward as-is is not a good idea either, the report concludes.

“BT is not viable in relationship to its current debt load of $51 million and its ability to generate earnings to repay this debt. BT cannot meet its principal and interest obligations at this time,” the committee concluded, noting that the company’s current business plan can’t meet future financial challenges either.

As if to underscore that notion, BT this month asked the city of Burlington for a $386,000 loan from to make an interest payment to CitiLeasing by Wednesday, to prevent the company from technically defaulting on its $32 million municipal lease purchase.  On Friday, a judge issued a restraining order forbidding such a loan unless the Vermont Public Service Board agrees.

The committee noted that the reasons for BT’s financial problems weren’t rooted in its “first-class” fiber optic network, or its usefulness to the city.

In summary, the committee and its consultants blamed the problems on these factors:

• HBC found BT overpaid for its fiber network, spending $1,000 per home passed, when fiber build-out prices have dropped in the past few years.

• BT is spending too much money on customer installations.  HBC reports BT could save more than $600 off the $1,600 the company pays to hook up each customer.

• The company uses the same door-to-door marketing company Comcast uses to get new customers.  Additionally, BT contracts with a third party service company to handle installations and service calls.  This work should be done in-house, HBC recommends, as paying a company based on how many installations are performed provides a built-in incentive to cut corners and quality.

• BT’s broadband products are too slow for a compete, handing incumbent cable provider Comcast an unnecessary competitive advantage.  Fiber can blow cable modem service out of the water when competing on speeds, but BT foolishly charges too much money for too slow service topping out at just 8Mbps/8Mbps, for a whopping $71.80 a month.  BT calls that “the ultimate Internet experience.”  It’s not.  HBC predicts broadband will become BT’s most important service, so it is critical for the company to make the product more attractive to customers.

• BT is mired in politics that has nothing to do with its service to the community, and it creates unnecessary distractions that commercial providers do not have.  Some who oppose the municipal fiber project or the current city council use BT as a political football.

• Because it is a public entity, too much financial and strategic business information is open to public review, which includes BT’s competitors.  That gives Comcast and FairPoint advance notice of BT plans, pricing, and growth strategies.  Restructuring as a semi-private entity under local government oversight would help guarantee competitive business information stays out of the hands of the competition.

• BT lacks an effective marketing strategy to convince residents and businesses to change providers.  Without a compelling lineup of services, and a marketing effort to sell them, customers will be reluctant to go through a disruptive switch to BT service.  The provider’s bundled service packages are often compelling (a triple play with basic television and phone service only costs $89 a month, less than $20 more than standalone broadband service), but they often lack the services, speed, and channels consumers want.

• The company does not pay enough attention to customer service strategies.  Customers complain BT does not accept cash payments from walk-up customers, who are told to return with a money order.  From a confusing automated attendant that answers customer calls to inconvenient hours and appointment scheduling, BT needs to hire marketing experts to help restructure how it serves potential and subscribing customers.

Burlington Telecom's fiber broadband speeds are the same uploading and downloading, but there is plenty of room for improvement in speeds at a lower price

• BT utilizes a 200-megabit backbone at a cost of $6,000 a month and a 350-megabit backbone at a monthly cost of $16,331. It is HBCs belief that backbone costs can be reduced considerably, as much as $6,000 per month should be saved through re-negotiation. Costs should be in the neighborhood of $25 to $30 per megabit, as compared to the $40 per megabit of speed now being paid by BT. HBC buys twice as much bandwidth per month than BT and pays only $7,000 more for the additional capacity.

• Finally, the company leaves a lot of potential earnings on the table.  It doesn’t provide local-ad insertions on cable channels and doesn’t leverage its excess broadband capacity with businesses by selling them web hosting, co-location, and speed critical services.  It doesn’t provide value-added services that cable companies now offer, such as caller ID on TV.

The Burlington mayor, Bob Kiss, expressed skepticism at some of the conclusions in the committee’s findings.

Kiss believes refinancing BT’s debt would give the telecom company more time to implement better marketing and service improvements, which could attract new customers and revenue.

For Burlington business leaders, the entire affair is an embarrassment.  Many believe significant harm will come from a city gaining a reputation for defaulting on its obligations.

The conclusion many have reached is that Burlington Telecom was naively planned, without sufficient regard to realistic projections of expenses and revenues, and lacks expertise to effectively compete with other local providers.  Building an advanced fiber network for your community is only as good as the services offered at a price that makes sense.  Alienate customers with ineffective marketing or out of touch product packaging, and your future will be in doubt.

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p style=”text-align: center;”>WCAX-TV in Burlington has followed the BT saga for months.  This video includes five reports covering the company’s future viability (13 minutes)

1. Burlington Telecom Saga Continues (12-15-2009)
2. Burlington Telecom Forces Changes In Burlington City Government (02-01-2010)
3. Burlington Telecom Not Financially Viable (02-05-2010)
4. Burlington Council Gets Blue Ribbon Committee Report (02-11-2010)
5. Burlington Telecom’s Fate Under Discussion (02-11-2010)

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WFFF-TV in Burlington reports the telecom company’s future is unclear. (1 minute)

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WPTZ in Plattsburgh covered the contention over an upcoming interest payment BT needs to pay by Wednesday.  (3 minutes)

Read our complete coverage on Burlington Telecom.