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Competitive Franchising Opportunities and Challenges · PDF fileCompetitive Franchising Opportunities and Challenges Mike Bradley (651) 379-0900 ext. 101 . ... Sigmund Freud.” Victor

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Competitive Franchising Opportunities and Challenges

Mike Bradley (651) 379-0900 ext. 101

[email protected]

mailto:[email protected]

Federal Cable Laws on New Entrants

Federal Cable Act Section 621 (47 U.S.C. 541) Award of Franchise

May not Unreasonably Refuse to Award an Additional Competitive Franchise. 621(a)(1)

Build-Out Shall allow the applicants cable system a reasonable period of time to become capable

of providing service to all households in the franchise area 621(a)(4)

Franchise Required a cable operator may not provide cable service without a franchise. 621(b)(1)

Federal Cable Law on New Entrants First FCC 621 Order

Identified and Preempted Unreasonable Barriers to Entry Build-Out Requirements PEG and I-Net Requirements

47 C.F.R. 76.41

Application Content Requirements Shot Clock Municipal Time Constraints

90/180 Days

State and Local Laws on New Entrants

State Laws Cable Specific Requirements ROW Franchise Specific Provisions Statutory City Provisions

Local Laws Municipal Cable Code

Cable Applications and Process Incumbent Cable Franchise

Level Playing Field/Competitive Equity Franchising Policies and Procedures ROW Code City Charter

Competitive Cable Franchising Issues Build-Out Term (incentives) Economic Redlining - Discrimination Level Playing Field

Franchise Fees, Area Served, PEG Access Television I-Net (if any) Ownership of the System

Applicability of Cable Franchise ROW Provisions Diverse Programming Customer Service ROW Management

Preparing For Negotiations with New Entrant Review Commitments of Incumbent

Review Level Playing Field

Provisions of Incumbent Franchise(s)

Assess Needs

Identify Unmet or Under-met Needs New Entrants Commitments in

other LFAs

Before anything else, preparation is the key

to success. Alexander Graham Bell

Listening to New Entrant

Build-Out of New Entrant

Delivery Technology of New Entrant

New Entrants Proposals

Challenges of New Entrants

Most people do not listen with the intent to understand; they listen

with the intent to reply.

Stephen R. Covey, The 7 Habits of Highly Effective People: Powerful

Lessons in Personal Change

Example of Reasonable Build-Out

Complete Equitable Build-Out Goal is to Build-Out the entire

City over 5-year term

Based on market success

Significant investment targeted to areas below the median income in the City.

build-out issues are one of the most contentious between LFAs and prospective new entrants, and that build-out requirements can greatly hinder the deployment of new video and broadband services.

621 Order at 31.

Example of Reasonable Build-Out Initial Minimum Build-Out

Commitment 15% of the City over 2 years.

Operator must make its best effort to complete the initial deployment in a shorter period of time.

Deployment to households in every part of the City.

Must include a significant number of households below the medium income of the City.

Operator permitted to serve more households.

Due to the risk associated with entering the video market, forcing new entrants to agree up front to build out an entire franchise area too quickly may be tantamount to forcing them out of -- or precluding their entry into -- the business.

621 Order at 35

Example of Reasonable Build-Out

Quarterly Meetings Operator must meet with the City

Quarterly Must show to the Citys

satisfaction Number of households capable of

being served and actually served. Compliance with anti-redlining

requirements. Maps and documentation showing

exactly where within the City the Grantee is currently providing cable service.

Example of Reasonable Build-Out Additional Build-Out Based

on Market Success. Build-Out Commitment will

increase if its penetration rate is at least 27.5% in the areas that it is offering service.

Example: If offering service to 60% of the City and Operator has penetration of 30% in that area, then the Build-Out commitment will increase 15% to 75% of the City.

Additional Build-Out commitment continues until all households are served.

reasonable for an LFA in establishing build-out requirements to consider the new entrants market penetrationand taking into account its market success

621 Order at 89.

Negotiating PEG Commitments

PEG Channels Match Incumbent Account for Narrowcasting

Signal Quality SD/HD/UHD Degradation of Signal

Remote Cablecasting Open Modem Wireless Cards

A negotiator should observe everything.

You must be part Sherlock Holmes, part

Sigmund Freud.

Victor Kiam

Negotiating PEG Commitments Electronic Programming Guide

Access to EPG Vendor Provision of Detailed Programming Information

Video-On-Demand Number of Hours Quality of video e.g. HD

PEG Origination Feeds I-Net Point of Delivery of Origination Feeds No I-Net Duplication

PEG Metro-Wide Interconnection Network Unique Program Sharing

Negotiating PEG Commitments PEG Funding

Match Incumbent Restrictions Operational and Capital Support

Confidence Feeds Ability to Monitor Every Channel

Complimentary Cable Feeds Type of Service City Halls School Districts Other Government Buildings Address Multiple Providers Home Run Wiring

Other Issues Addressed Term

Tied to Build-Out Economic Redlining or Cherry Picking

Prohibited By Law Addressed in Current Franchises

Level Playing Field Franchise Fees PEG Support Area Served

Culturally Diverse Programming Limited Authority

Existing Incumbent Franchise Similar in Most Respects

Presenter Biography

Mike Bradley Bradley Hagen & Gullikson (651) 379-0900 ext. 101 [email protected]

Mike Bradley is an attorney, with over 20 years of experience, practicing in the area of cable franchising and telecommunications. He is the founding partner of Bradley Hagen & Gullikson, LLC, a law firm based in the Twin Cities and is Special Counsel to the Seattle-based law firm the Lighthouse Law Group. Mike has represented cities in cable franchise negotiations with Comcast and other competitive cable providers. His firm also acts as a cable franchise administrator, reviewing franchise compliance, and processing complaints and discount requests. Recently, Mike assisted the City of Oklahoma City in successfully defending a class action law suit challenging the Citys authority to receive a cable franchise fee. The case is now pending before the Oklahoma Supreme Court. Mike is also representing the City of Minneapolis and many other cities with CenturyLinks applications for cable franchises. Mike is a NATOA, WATOA, and MACTA member. He serves on the Board of Directors of American Community Television (ACT), an organization that advocates for municipal franchising authority and PEG. Mike is also the past chair of the Communications Law Section of the Minnesota State Bar Association and was elected to serve on the Board of Directors for the Ramsey County Bar Association. Mike is an AV rated attorney by Martindale Hubble and has been recognized as a Rising Star Attorney and Super Lawyer by Minnesota Law and Politics.

Competitive FranchisingOpportunities and ChallengesFederal Cable Laws on New EntrantsFederal Cable Law on New EntrantsState and Local Laws on New EntrantsCompetitive Cable Franchising IssuesPreparing For Negotiations with New EntrantListening to New EntrantExample of Reasonable Build-OutExample of Reasonable Build-OutExample of Reasonable Build-OutExample of Reasonable Build-OutNegotiating PEG CommitmentsNegotiating PEG CommitmentsNegotiating PEG CommitmentsOther Issues AddressedSlide Number 16