Cable TV Faces Changes; Community Weighs In

by Joan R. Simon

(October 3, 2006) As any television watcher knows, Cablevision is the sole provider of cable TV to the Larchmont/Mamaroneck community. You either sign up with Cablevision, or you get a satellite dish, or you scrape by with an antenna hookup and a handful of stations.

But times could be changing – for providers, consumers, local stations and municipalities.

The 10-year franchise agreement that the Larchmont-Mamaroneck Tri-Municipal Cable TV Board of Control negotiated with Cablevision expired in April and a new contract is being worked on. This time, though, Cablevision has some competition. Verizon, which recently installed new fiber optic equipment in the area, is also in negotiations to provide their version of cable access (FiOS TV) (see: Verizon Agrees to Move Its "Big Boxes"). Just last week, the Town of Greenburgh was the first community in Westchester to sign on with Verizon, in addition to Cablevision, and they received in return some very desirable state-of-the-art technology and equipment. Since the contracts a community negotiates with cable companies can yield both fees (5% of gross receipts) and capital support (for equipment, facilities and technology upgrades), two contracts for Larchmont-Mamaroneck would probably be better than one.

Wish List For the Next Contract

As the negotiations stretched on, LMC-TV recently sought input from the community to bolster its bargaining power and to comply with federal regulations. Last week LMC-TV hosted nine information sessions with groups ranging from seniors and school officials to local government and faith-based organizations. The dialogue among the more that 150 participants was two-way, with Susan Buske, a telecommunications consultant (www.buskegroup.com), informing the public of the wide-ranging possibilities for a new 10-year contract, while soliciting from the attendees a wish list of improvements to local television access and intra-community communications.

What might a new contract bring to the community? Some of the possibilities are:

• An I- Net (Institutional Network) that would link the schools, municipal offices and police and fire departments within one closed system for easy communication, data sharing and emergency notification;
  
  
• Added live broadcast capability (currently there are only 7 locations where live broadcasts are possible);
  
  
• Internet streaming of LMC-TV programs;
  
  
• VOD (Video on Demand) programming on LMC-TV;
  
  
• Interactive programming on LMC-TV;
  
  
• Emergency Alert System to be run on every cable channel when emergency notification is needed;
  
  
• State-of-the-art technology for LMC-TV, including fiber optic equipment, and updated facilities
  

Past Contracts

LMC-TV owes its existence to cable contracts. In 1983, Cablevision’s predecessor provided the community with bandwidths for Channels 75, 76 and 77. These stations are devoted exclusively to local public, educational and governmental (PEG) programs. Over the years, the cable company has also paid for broadcasting equipment and technology enhancements. In addition, the cable company has paid the municipalities 5% of their gross receipts from cable service within the community.

What kind of money are we talking about? 12,000 households in Mamaroneck and Larchmont subscribe to Cablevision. If you do the math, the estimated revenue is substantial: 12,000 x $65 (average cost of service) x 12 (months in a year) x 10 (years) = $93,600,000 in gross receipts for Cablevision, just for the cable access part of their business.

Are Local Contracts On The Way Out?  

The traditional 10-year contracts between municipalities and cable providers, however, may not survive. On Tuesday, October 3, Governor Arnold Schwarzenegger signed a cable franchise reform bill which allows cable providers in California to negotiate one state-wide contract, relieving them of the need to deal with individual communities and their particular requests. Congress is also considering a similar bill, which has already passed the House of Representatives and is working its way through the Senate. The bill’s supporters say it would promote competition among cable providers and reduce costs; opponents argue that local municipalities, like Larchmont-Mamaroneck, would no longer be able to negotiate terms specific to their community’s needs.

Next Local Steps

Nevertheless, until and unless Congress changes the requirements, Larchmont-Mamaroneck needs to sign a contract with at least one cable carrier. The next steps, according to LMC-TV’s executive director, Erik Lewis, are “to collate the data and write a report. It will analyze what the community’s expressed needs are and evaluate how well Cablevision has served the community and how well LMC-TV has served the community.” The report should be due in about a month.

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