Never Negotiate with Terrorists (or City Councils)

It warms my heart to see AT&T playing hardball with local governments that are trying to micromanage the rollout of its next-generation video services:

What’s not to love about a brand-spanking-new fiber deployment (even if it’s only to the node, and not the curb)? Consumers will get higher Internet speeds, better service over new infrastructure, plus more choice when it comes to television. If you’re a local government that is used to revenues from cable franchises, the fact that AT&T is not willing to enter into local franchise agreements to deliver its IPTV service is a serious drawback. The Chicago suburb of Roselle is firing back at AT&T over the issue, passing an ordinance that will require the telecom to halt work on Project Lightspeed for 180 days…

AT&T is responding to Roselle’s action by essentially threatening to take its ball and go home.

“Roselle passed an ordinance and our lawyers are looking at it,” said Mike Tye, AT&T Midwest vice president for legislative affairs. “We’re dismayed that Roselle halted a network upgrade to bring enhanced services to its citizens. But we have finite capital and will allocate it to communities that want us there,” Tye said.

Although statewide franchise reform is certainly a good idea, AT&T may very well have a stronger bargaining position than municipalities even without reform. There are doubtless thousands of Roselle residents who want what AT&T is selling. Roselle’s elected officials might want to keep in mind that AT&T sends a bill every month to the vast majority of Roselle voters. A series of “Dear Customer…” inserts in those bills explaining that their city council is preventing them from getting competitive TV service might change some minds. And if not, I’m sure there are plenty of other municipalities whose elected officials would be happy to have AT&T provide new and better service to their constituents.

SHARE: