National Assn. of Telecom Officers & Advisors’ Pres. Lori Panzino-Tillery will testify at Fri.’s FCC meeting that local franchise authorities want video competition. Panzino-Tillery will say “local governments are pro competitive,” said Exec. Dir. Libby Beaty. Verizon has said local franchise authorities slow its plans to sell FiOS fiber pay TV (CD Nov 17 p3). Panzino-Tillery is division chief of franchise programs for San Bernardino County, Cal. FCC officials’ hopes for a Tex. PUC commissioner to testify at the video competition hearing in Keller may be stymied. A PUC spokesman called it a “challenge” to have commissioners attend. “Our open meeting laws require that there be a posting if at least 2 commissioners will be together, so at most it would be one commissioner, and we're still working on that,” said the official. Ideally, all 3 commissioners would attend, but there aren’t 7 days left to notify the public that they would appear together, he said.

Proposed Va. video franchise reform isn’t a done deal, said Libby Beaty, exec. dir.-National Assn. of Telecom Officers & Advisors. Bills passed by both houses of the state legislature may not result in law because local govt. officials haven’t been involved in the process, she said: “I don’t think it’s a finished matter… There has certainly been a lot of discussion.” SB-706 and HB-1404, passed Mon., were the result of work by Verizon and the Va. Cable Telecom Assn. to reach a compromise on issues including system buildouts (CD Feb 8 p10). Analysts at firms including Sanford Bernstein and UBS have said they expect franchise reform to become law in the state.

Executives from Verizon and Charter are among those the FCC invited to testify at its Fri. agenda meeting, said a person familiar with the gathering who asked not to be identified. The meeting on video competition was moved to Keller, Tex., where Verizon started FiOS TV sales Sept. 22 (CD Feb 6 p12). Marilyn O'Connell, Verizon senior vp- broadband solutions, and Charter’s Joi Philpott, vp-govt. affairs & franchise relations, are expected to attend. The list of witnesses, however, may still change, said the source. A Tex. PUC commissioner and 2 local franchise authority officials may also appear. PUC and company officials had no comment. AT&T Chmn. Edward Whitacre will conduct a demonstration of the firm’s IPTV service in Irving, Tex., said a source. A company spokesman wouldn’t comment on whether Whitacre would appear, saying only “AT&T will provide the FCC chairman and commissioners and staff with a tour of our video operations center and demonstration.” The tour will highlight “the investment we're making in broadband technology,” he said. FCC staffers are also expected to visit a home in Keller that gets FiOS TV.

Google is profiting from free-riding on others’ network investments, said John Thorne, Verizon’s deputy gen. counsel. While telecom firms have boosted spending on building networks that the search giant will use to provide services, Google is doing little such spending, he told a panel at George Washington U. He said Google offers an example of problems with the 1996 Telecom Act, which were discussed by Thorne and other panelists at a seminar marking its 10th anniversary.

Sens. Burns (R-Mont.) and Inouye (D-Hawaii) proposed franchise reforms friendly to cable and to city desires to keep some local control over a process Verizon calls cumbersome. The “principles for video franchising reform” drew praise from the National League of Cities. Video services should be regulated similarly regardless of the provider, the Senate Commerce Committee members said. “State or local franchise authorities should retain the authority to supervise rights of way use,” a written statement said late Thurs.

Comcast executives focused on VoIP plans during a conference call to discuss last quarter’s results, which fell short of some analysts’ estimates. Company sales rose 9.2% to $5.72 billion. Profit declined 69% to $133 million. The company will add about a million VoIP customers this year, said Co-CFO John Alchin. VoIP is a “key initiative for 2006 and beyond,” said COO Stephen Burke. He spoke at length about preparations to roll out the service, which Comcast is doing later than some cable peers. Spending on the product will reduce cash-flow growth in 2006, said Alchin. Comcast expects cable cash flow to rise as much as 11% this year, less than the 12.6% prediction of Banc of America Securities analyst Douglas Shapiro and slightly below the forecast of Janco’s Matthew Harrigan. Last quarter was “slightly disappointing,” wrote UBS analyst Aryeh Bourkoff: “Guidance for 2006 EBITDA growth was lower versus estimates due to VoIP rollout expenses, which should wane beyond 2006.” He said Comcast’s $5 billion stock buyback plan was “encouraging.” Broadband sales rose the most of any product in the 4th quarter, 24% from a year earlier to $1.06 billion. The firm added 22% broadband customers, for 8.52 million total. Asked about prospects for net neutrality regulations, CEO Brian Roberts lashed out. “We continue to believe that proponents of so called net neutrality are pursuing a solution in search of a problem,” he said, adding Comcast has never blocked access to websites. “We're certainly going to try to fight anything like that.” The firm will “try to advocate for our right as a network manager, to manage the network, to make sure that the customer experience does not get degraded,” said Roberts.

Time Warner Cable, set to buy Adelphia systems, had the highest sales increase of any of the parent company’s businesses last quarter. Broadband customers rose 23% from a year earlier to 4.8 million. VoIP subscribers quadrupled to more than 1 million. Cable revenue jumped 13% to $2.5 billion as the company’s networks also expanded, offsetting weakness at AOL, which lost 13% of its subscribers, posting a 7.8% slump in sales. Asked by an analyst on a conference call about the company’s stance on net neutrality, executives said they supported “market” based approaches, without shedding more light on the topic. Time Warner’s cable networks had a 22% cash flow increase to $811 million. Results largely met analyst estimates, but CEO Richard Parsons spent part of the conference call carping about the company’s lagging share price. The company is likely to complete the $17.6 billion purchase of Adelphia with Comcast in the 2nd quarter, said Parsons. At that time, the firm hopes to spin off its cable unit, a transaction that may be subject to bankruptcy court approval. Late Tues., the FTC said it wouldn’t block the deal, now facing FCC review (CD Feb 1 p12). Parent Time Warner had a 21% increase in total profit to $1.37 billion.

The lack of ratings for some TV programming, including sports, is an issue the Senate Commerce Committee is looking at, said Chmn. Stevens (R-Alaska). “We're still going to deal with that,” said Stevens of program ratings, saying it “only works with programs that are rated by the programmers.” His comments to reporters after a video content hearing Tues. followed complaints at a recent forum from legislators including Sen. Allen (R-Va.) that family tiers offered by cable operators lacked popular programs including ESPN. Sports shows often aren’t rated.

Small cable operators are split on whether they would sell channels individually if they had the chance, which Cablevision supports. Mediacom and Cable One officials said they're open to considering a la carte programming. Bresnan Communications joined larger operators, including Charter and Cox (CD Jan 27 p5), in opposing a la carte. “If you look at all the research that has been done, a la carte will lead to decreased choices for consumers and increased prices and less diversity,” said Steven Brookstein, Bresnan exec. vp- operations: “We are not a supporter of a la carte for that reason.”

Charter, Cox and DirecTV, bucking proposals by rivals, don’t support a la carte video offerings. Company officials cite reasons from technical difficulties to fear of govt. mandates. That’s despite calls from RCN and EchoStar executives for programmers to allow pay TV firms to sell channels individually, to offer customers more choice. EchoStar CEO Charlie Ergen visited the FCC last week, urging Chmn. Martin to impose an a la carte condition on the $17.6 billion Adelphia cable transaction (CD Jan 25 p7). Speaking on the Hill last week, he also called for a la carte.