CenturyLink (NYSE: CTL) has made a plea to the U.S. House Energy and Commerce Committee to reform the 1992 Cable Act so new entrants in the video services race can more effectively negotiate prices for content.
Emerging video players like CenturyLink lack the buying power of incumbent cable operators like Comcast (NASDAQ: CMCSA), which have more clout with content owners to negotiate more favorable terms. This means that broadcasters don't have a lot of incentive to offer reasonable terms to newer players, which the telco says "effectively deprives consumers of the benefits of competition."
"CenturyLink believes the Cable Act should be amended to give providers the right to carry national programming from an adjacent or alternate market during a breakdown in retransmission consent negotiations, thus preserving competition and protecting consumers from programming blackouts," said David Bartlett, vice president of Federal Government Affairs for CenturyLink, in a blog post. "Consumers benefit from more choices and more competition, not less."
As broadcasters have continually raised content costs, it is having an effect on not only CenturyLink and other video players that have to pay higher prices for retransmission of local broadcasting signals, but also for consumers who see their video bills continue to rise every month.
Despite coming later to the video game than its ILEC brothers AT&T (NYSE: T) and Verizon (NYSE: VZ), CenturyLink has continued to make progress in rolling out its Prism IPTV service. As of the end of the third quarter of 2014, Prism IPTV was available to about 2 million homes in a dozen markets. During that quarter, it passed over 240,000 homes with Prism TV.
One market that may get to see the IPTV service later this year is Portland, Ore. The telco in December said it reached a deal for a new franchise agreement with city officials with plans to deliver service sometime in 2015
In addition to IPTV, CenturyLink told investors earlier this month that it is considering offering a complementary online video product that it could deliver throughout all of its markets, including those where it has not built out its Prism IPTV service today.
- see this blog post
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