Overbuilders' plight: price of content, government lobbyists

Liberty Media Chairman John Malone, speaking recently about Verizon's FiOS TV, expressed a low opinion of overbuilders. "I've never seen overbuilds work ... it always ends up badly." That's because overbuilders face a slew of obstacles beyond just building a new business in an area where the incumbent holds most of the high ground.

And yet overbuilders are still met with enthusiasm by one-cable towns that like the idea of competition. "This is absolutely fantastic," said Avon Lake, Ohio Councilman Larry Meiners, upon hearing that Wide Open West (WOW) would come to town to compete with Time Warner Cable.

Things get stickier, though, when the communities themselves step into the fray. In North Carolina, Time Warner Cable is leading the charge to put a state moratorium on municipal overbuilds. Two dozen communities are at least looking at the option right now as a bill that breezed through the state Senate awaits a hearing in the House where its chances of success appear to be considerably lower.

Finally, in Lafayette, La., things just continue to get nastier between city-owned LUS Fiber, Cox Communications and the National Cable Television Cooperative (NCTC). In a convoluted bit of legal action, the city filed court motions to dismiss a lawsuit filed by NCTC (which offers discounts for programming content) to block Lafayette from complaining against the group with the FCC. Got that? In short, the city wants the FCC to step in because it claims that Cox Communications wields a powerful hand in the NCTC and is blocking LUS from becoming a member of that organization and getting bulk content discounts that match those available to Cox.

For more:
- see this story
- Charlotte Observer has this story
- and the Advocate this story

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