Economic Development & Commerce Committee Home

February 6, 2008

Chairman Kevin J. Martin
Federal Communications Commission
445 12^th Street, S.W., Room 8B-201
Washington, D.C. 20554

RE: In the Further Matter of Exclusive Service Contracts for Provision of Video Services in Multiple Dwelling Units and Other Real Estate Developments, MB Doc. No. 07-51 (FNPRM FCC 07-189)

Dear Chairman Martin:

The nation’s governors support governance of the communications industry under a regulatory framework that employs a balanced federalism approach that preserves state authority and creates a level playing field for all industry participants. While governors regret the Federal Communications Commission’s (“FCC”) recent decision to vacate exclusive multiple-dwelling unit (“MDU”) service contracts and marketing agreements between cable operators and MDU owners, the FCC now must be consistent in the above-captioned matter to prevent granting an unfair competitive advantage to some providers at the expense of others.

Governors believe that states and territories must have the authority to enforce laws prohibiting anti-competitive actions within local markets to ensure that providers do not use market power to stifle competition. Congress recognized that states are fully capable of deciding how to govern contractual relationships between providers of video programming service and MDU owners. In 1984, Congress considered, and rejected, a provision that would have explicitly prohibited exclusive agreements, suggesting that Congress wanted these issues left to state law and the marketplace. Some 20 states have already passed laws that prohibit one form of exclusivity or another. Others have considered and rejected such an approach. Notably, no state that passed a prohibition on exclusive agreements reached back to abrogate existing contracts.

Governors urge the FCC in this matter to apply consistent treatment to all providers of video programming services, and we remain committed to working with federal policymakers and the communications industry in support of continued development and growth of a competitive communications industry for the benefit of consumers and the national economy.

Sincerely,

cc. FCC COMMISSIONERS