Associated Press

SACRAMENTO, CA — In an effort to give consumers more television viewing choices, the Assembly on Wednesday voted to open the cable business to telephone companies.

The 70-0 vote was a victory for telecommunication companies such as AT&T and Verizon, which had launched an aggressive advertising and lobbying campaign this spring to move the bill through the Legislature.

The bill now will be considered by the Senate, where lawmakers promised revisions to allay concerns that telephone and Internet companies would secure an unfair leverage over cable companies.

Specifically, the bill’s chief sponsor, Assembly Speaker Fabian Nunez, D-Los Angeles, said he would address concerns by cable companies that they are now bound by legal contracts with local communities. In an effort to speed competition, the bill would allow telephone companies to apply for a license from the state, rather than having to negotiate individually with cities and counties.

“The $65,000 question is, should they be allowed to abrogate these contract agreements in order to compete under this new state franchise process,” Nunez said about the cable companies. “We want a level playing field.”

The bill would allow telephone companies to compete with cable companies by offering subscribers a “triple play” package telephone, Internet and video.

The companies promise systems that would deliver Internet content many times faster than traditional digital subscriber lines and offer cable television packages with 300 channels or more.

California AT&T president Ken McNeely said the bundling of telephone, Internet and video services would lead to lower prices for consumers.

“We’re only going to win customers with a better product, a better service and a better price,” McNeely said. “And cable companies wanting to hold on to their customers will match it.”

McNeely pointed to an AT&T commissioned study by UC Berkeley professor Yale Braunstein, who predicted $1 billion in consumer savings.

However, the cable industry and consumer groups have expressed concerns that the Nunez bill would allow telephone companies to cherry-pick the neighborhoods where they want to sell their service. Cable companies have spent billions in infrastructure providing services to low-income residents, requirements of their contracts with local governments.

Consumer rights groups said the bill’s unanimous passage should serve as a warning sign.

“A bipartisan late night deregulation effort should warrant serious concern by the public because it was not crafted for consumers but by, for and of the telecom giants,” said Jamie Court, president of the Foundation for Taxpayer and Consumer Rights.”

Cities also are worried they will lose the franchise fees they have negotiated with cable companies, said Assemblywoman Jackie Goldberg, D-Los Angeles, who voted for the bill and noted she’d watch it closely in the Senate.

Nunez has promised that cities won’t lose any money.

“The driving concept behind getting this thing done… is the consumer has the very best deal possible,” Nunez said.

Gov. Arnold Schwarzenegger has not taken a position on the measure.