Leesburg Council Questions Streaming Impacts

As the town works through the renewal of Verizon’s cable television franchise agreement, questions were raised about the impacts of the growing popularity of streaming services.

Broadcasts through apps like Netflix and Hulu aren’t subject to franchise agreements and the town’s chief telecommunication advisor said that’s not likely to change.

During a briefing Monday night, Matt Ames said many of the rules that govern the ability of localities to regulate—and garner revenue from—cable providers were established in the 1980s. Also, the state government has ruled that the sales and use tax does not apply to streaming services, he said.

Councilman Neil Steinberg requested the briefing to understand what happens if traditional cable providers like Comcast and Verizon move to all-streaming services. Ames noted that already Verizon is seeking shorter term cable franchise agreements and out clauses while increasing its investment in wireless services.

While it is likely localities will have less control over the providers, Vice Mayor Marty Martinez said governments should be getting more revenue from them, including online retailers like Amazon, because they rely on local connections.

“We’re giving them a free ride. We’re paying for the infrastructure,” he said.

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