Cable Television Franchising in Broadband Environments

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1 Cable Television Franchising in Broadband Environments Presented by: Tom Robinson, President 73 Chestnut Road Suite 301 Paoli, PA Phone (610) Dick Nielsen, Senior Engineer Maryland Rural Broadband CATV Franchise Webinar June 4,

2 Introductions Tom Robinson, President Dick Nielsen, Senior Engineer Webinar Participants 2

3 Franchise Agreement o A document granted by a local franchising authority (LFA) granting authority to a provider to construct and operate a Cable TV system within the Rights of Way (ROW) of jurisdictions represented by the LFA. o Franchise renewals are subject to Section 626 of the Federal Cable Act o Must be non-exclusive 3

4 Local Franchising Authority (LFA) o May be a single jurisdiction (i.e. City, County, Town, Township, Borough, State, etc.). Essentially, the jurisdiction that controls/manages the public rights-of-way. o May be multiple jurisdictions (i.e. 5 member cities, 2 counties, a city/county intergovernmental authority, etc.) o The LFA has authority over Cable TV service only. However, High Speed Internet (Broadband) is available via the same network as CATV 4

5 A Comprehensive Franchise Agreement is Critical o Franchise terms are generally between 5 15 years with 10 year terms most common today. o If something isn t in the Franchise, and clearly defined, it is up for debate, at best, between an LFA and Provider. o If something is overlooked, left out of the Franchise or is poorly written, it may be 5-15 years before it can be revisited. o Generally terms cannot be unilaterally changed 5

6 Franchise Fees o Franchise Fees are a charge agreed to, in a Franchise, that the Cable TV provider pays to the LFA or jurisdictions for use of the Rights of Way. o Generally it is a percentage (not to exceed 5%) of the CABLE TV provider s Gross Revenues o Only Gross Revenues related directly or indirectly to Cable TV are subject to the Franchise Fee 6

7 Franchise Fees (cont.) o Gross Revenues must be clearly defined o Franchise Fees can be used by the LFA for any purpose o There is not a minimum allowable Franchise Fee o Providers could ask for a lower or no franchise fee 7

8 Needs Ascertainment Process o The LFA can ask for, or require, the operator to fulfill indentified needs These potential needs will be discussed in more detail later but must: o Be clearly identified as needs o Be met by the operator taking into consideration the cost This allows for negotiation on most identified needs, whether the operator will fulfill the need and to what level 8

9 PEG Fee o Support for Public, Educational and Governmental Access facilities and equipment (capital costs) o Collected as a flat amount per subscriber or as a percentage of Gross Revenues (similar to Franchise Fees) o Negotiated based on demonstrated community needs 9

10 10

11 Density Clauses o Helps to determine the reach of the cable system o Density clauses must be clearly written o i.e. homes per road mile or plant mile? o Does it include both main line distribution plant and drop footage? o Density clauses include the footage from existing plant to a new development o This may add miles of plant (with no homes passed) to reach a new development 11

12 Density Clauses o Density clauses should also include how areas that don t meet the density requirement may be served. i.e., cost sharing of construction costs o Bringing cable TV to more homes also brings HSI-Broadband o Joint trench and pertinent zoning/development requirements can also help facilitate system deployment 12

13 Right of Way Use Requirements o The basis for a franchise is the use of the LFA s Rights of Way This use must be in a workmanlike, safe and aesthetically pleasing manner It is important that the Franchise require compliance with all local codes It is important that the Franchise require compliance with current safety codes o National Electrical Code (NEC) o National Electrical Safety Code (NESC) 13

14 Right of Way Use Requirements o The franchising authority should have the ability to inspect infrastructure in the ROW for, and enforce, compliance with the franchise and local ordinances o The franchising authority should also have the ability to periodically inspect the operator s inside facilities (headend and hub buildings) 14

15 Connecting Public Facilities o The franchising authority can require/negotiate identified needs to be served by the operator. This can include connecting public entities to the system Subscriber Network Cable Modem accounts Institutional Network (I-Nets) 15

16 Institutional Networks (I-Nets) o Definition of an I-Net is in Cable Act Section 611 (47 USC 531) (f) which states: the term institutional network means a communication network which is constructed or operated by the cable operator for use by government and educational entities and which is generally available only to subscribers who are not residential subscribers I-Nets are used for remote video origination and for transportation of data communications among nonresidential subscribers 16

17 System Capacity / Upgrades o Identified needs may include the need for new or additional services High Definition channels and services Standard Definition channels and services Capacity for non-cable services without compromising capacity for cable TV services Unknown needs (technology changes) over the course of a franchise 17

18 Public, Educational and Governmental Access Channels - PEG o Identified needs may include the need for new or additional channels for PEG Access 1 or more channels for Public Access? 1 or more channels for Educational Access? 1 or more channels for Governmental Access? Discreet channels (different channels for separate cities or school districts) Programming can include emergency information 18

19 Public, Educational and Governmental Access Channels PEG o Equipment and technologies will be identified during the Needs Ascertainment process High Definition equipment needs Cameras and switching equipment Lighting and sound equipment Fixed and remote/portable equipment 19

20 Public, Educational and Governmental Access Channels - PEG o Access Origination Locations Facilities where live programming can originate May include: o City Halls / County Council/Commission chambers o Board of Education Chambers o Libraries o Sporting venues o Community Media Centers 20

21 Public, Educational and Governmental Access Channels - PEG o Access Origination Locations Technology must be considered and written into the Franchise o Standard Definition vs. High Definition o Production equipment needs at each facility Transport technology, i.e. fiber optic transport or coaxial cable transport 21

22 Customer Service Standards o Require compliance with FCC Customer Service Standards (at a minimum) o Require clearly defined metrics, measurement techniques, record keeping and reporting requirements o Incorporate penalties for not meeting customer service standards 22

23 Additional Information and Questions & Answers 23

24 Thank You! 24

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