Craig Moffett, senior analyst, Sanford C. Bernstein & Co.: Good news for cable, satellite; bad news in SBC’s home state for video-hungry telcos. “In the end, the Bell’s defeat — and cable’s ‘victory’ — in Texas says less about their relative lobbying power than it does about the relative ease cable enjoys in making its case. In Texas, cable needed only to persuade Texas’s City Councils and local franchising authorities that a state-wide video franchise would strip them of their powers, and those authorities did the heavy lifting. But just as some investors jumped to the conclusion that a telco ‘win’ in Texas would be a harbinger of state-wide franchising approvals across the U.S., we fear many will jump to the conclusion that the Bells’ ‘defeat’ in Texas spells the end of the state-wide franchising issue. It does not. The Bells will continue to pursue the issue in New Jersey and other states, and we continue to believe that at least some Bell victories are likely.”
UBS TelMeDaily: A big setback. “With little success at the state level, we believe more pressure will be put on federal legislators to develop and pass a bill being marked up by the House Commerce Committee that could provide the Bells with the relief they need to hit the ground running in video in 2006.”
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