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updated 6/14/2006 11:08:17 AM ET 2006-06-14T15:08:17

Legislation to open cable TV markets to more competition, possibly saving consumers hundreds of dollars a year, passed the House Thursday.

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The biggest telecommunications legislation in a decade, approved 321-101, would make it easier for telephone companies to enter the subscription television market. A national franchise process would replace the current system where potential providers must negotiate contracts municipality by municipality, sometimes taking months and years.

Rep. Bobby Rush, D-Ill., co-sponsored the bill.

The vote came shortly after the House rejected a Democratic-backed amendment aimed at better protecting Internet users from pricing or access discrimination that Internet providers might apply. The issue of "net neutrality" dominated debate on the bill.

"This legislation can increase competition not only for cable services, but also unleash a race for who can supply the fastest, most sophisticated broadband connections that will provide video, voice and data services," said House Energy and Commerce Committee Chairman Joe Barton, R-Texas.

He noted that because of the impediments created by the local franchising system, the United States doesn't even rank in the top 10 worldwide in broadband deployment. "This bill should change that statistic."

Rep. Fred Upton, R-Mich, who heads the telecommunications subcommittee, estimated that people could save $30 to $40 each month if given a choice in video services.

But many Democrats said the measure did too little to ensure that broadband services would be extended to lower income and rural areas.

They also said the bill does not adequately address "net neutrality," preventing companies from discriminating against competitors or less affluent consumers by restricting access or charging higher fees.

The telephone and cable companies that provide the service say further regulation is unnecessary and would hamper efforts to expand high speed services.

Demanding assurances of net neutrality are content providers such as Google Inc., Microsoft Corp., and Yahoo! Inc., and Internet users ranging from the Christian Coalition to rock musicians.

Rep. Edward Markey, D-Mass., offered an amendment stating that broadband network providers must not discriminate against or interfere with users' ability to access or offer lawful content.

Without that amendment, said House Democratic leader Nancy Pelosi of California, "telecommunications and cable companies will be able to create toll lanes on the information superhighway. This strikes at the heart of the free and equal nature of the Internet."

It was defeated 269-152. "You can call an amendment net neutrality," said Rep. Paul Gillmor, R-Ohio. "But it's still government regulation."

"Tilting the cost burden onto end users, which would be the inevitable result of neutrality regulations, will only delay much-needed broadband deployment," said Mike McCurry, co-chair of Hands off the Internet, a coalition of telephone, business and small government groups.

Barton's bill would give the Federal Communications Commission authority to enforce net neutrality principles and set fines of up to $500,000 for violations.

The White House said in a statement that it supported the bill and its language on video franchising. But on net neutrality, the administration said the FCC has the power to address potential abuses. "Creating a new legislative framework for regulation in this area is premature," the statement said.

Rush, a black lawmaker who represents the South Side of Chicago, said he was co-sponsoring the bill because it would make it easier for minority entrepreneurs to get access to the telecommunications industry.

Rush said his constituents want relief from the high cost of cable. "We pay more for video services, for high premium packages, than any other group in America. And why is that? Because only on cable do we see people who look like us, speak like us, and who understand us. That is why we pay more for cable."

The Senate Commerce, Science and Transportation Committee is to vote on its version of the bill later this month. The Senate debate also has focused on how best to ensure net neutrality.

Copyright 2006 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

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