Recently Frontier Communications announced that they would be increasing their rates for FiOS TV plans by 46% percent. Frontier says that this is a result of rate hikes by the cable networks.

The increase is already in effect for new subscribers and will take place in February for current subscribers. As an alternative, Frontier is offering its customers the opportunity to switch to DirecTV for free and as an incentive they will receive DirecTV service for free for the rest of 2011 (an entire year free).

The City of MLT says that the switch to DirecTV, a satellite provider, means that cities cannot collect franchise fees or education/government fees from the television services provided.

From the MLT City Manager’s weekly report:

Unfortunately, cities such as ours have little legal recourse against Frontier. We lack authority to regulate rates under federal law. In the short term, the rate increases mean higher franchise fees, but as Frontier customers choose the cheaper option of DirecTV the cities should expect a decrease in franchise fees. Though the cities lack authority to tax satellite providers, the state does. There are several states that have already imposed this tax, and have prevailed in court against satellite providers, most recently the state of Ohio. Cities such as ours have a couple of responses:

• A letter signed by the Mayor on behalf of our community and/or a city council resolution expressing our disappointment at Frontier?s abdication of its commitment to provide FIOS TV service;
• and Suggest to AWC that B & O tax authority be granted to cities by the legislature.

For more information and to see exactly how much FiOS tv will now cost you, read the article recently published by the Herald.