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Subject:  Re: Municiple Regulation Date:  1/29/1999  3:54 PM
Author:  Scollag Number:  3904 of 55215

There are well over 10000 cable franchises in USA alone, so we certainly need to concentrate only on those major markets in which trouble is already looming.

The 1996 Telecoms Act, I believe, specified that in all cases where franchise authority approval for a sale or transfer is required, the franchise authority has 120 days to act upon the request for approval containing such information as is required [snip]...
The request will be deemed granted if the franchise authority fails to render a timely decision within the 120 day period, unless the parties agree to an extension.
(I have taken this information the website of Pepper and Corazzini,

Good news: The merger was announced on 24th June, I think. Even if TCI were slow in submitting the necessary material, I suspect that the 120 days must have expired in almost all cases by now.

Bad news: The FCC apparently acknowledges the right of the franchising authority to require approval, presumably if such a right is stipulated in the franchise agreement.

If I have this straight, the cable company owns the plant. They City gives them a franchise to operate the plant. The owners of the cable plant, without the franchise, would not have to give up their plant. They own the infrastructure. Would they have to share the plant? Would the competing company have to install a new plant?

I can imagine two scenarios: a complete standoff, leaving the area without service (unlikely), or a transfer of the franchise and plant to another cable company, with appropriate compensation to the incumbent. I gather that MSOs trade franchises routinely to streamline their own operations.

However, the potential revenue from every franchise has increased dramatically. Valuation would be difficult, especially since for sure TW would be trying to buy their way into the area. Litigation is indeed the most likely outcome.

As for neighbourhood profitability considerations, I understand that this is precisely the reason the franchising authorities exist: to ensure that the community as a whole receives adequate and proper service. Each franchise proposal, from what I have gleaned from some comparisons, contains specifications for various criteria such as bandwidth, channel diversity, and upgrade plans.

Regarding Tacoma and those areas of Seattle poorly served by TCI, it seems to me that TCI deserves all it gets if it has violated its own agreements wrt these areas, and I am not surprise that the authorities want blood.

The problem now is how to resolve the dispute satisfactorily.

I wonder if AT&T hasn't seriously underestimated the contempt in which TCI is held by some of the communities it serves. Clearly there is NO time left to change the brand image as AT&T would wish.

Final Good News (it bears repetition): TCI has said that the merger would not be in jeopardy unless one quarter of the franchises failed to approve the change in control.
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