City officials say eliminating the old system of cable-franchise districts could encourage competition among providers, although doing so also might leave some areas of town with fewer cable options than others.
Mayor Ed Murray is asking the City Council to change how Seattle deals with cable-television providers in a bid for more competition.
The proposed elimination of the city’s cable franchise districts is part of a package of Cable Code amendments that Murray’s Department of Information Technology (DoIT) has sent the council.
Many of the amendments are minor revisions.
The proposed amendment to eliminate Seattle’s cable franchise districts, on the other hand, could significantly impact cable-TV options across the city.
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Years ago, as providers first began laying cable in Seattle, policymakers split the city into geographic districts.
The idea was to prevent providers from cherry-picking certain neighborhoods for service while leaving out others. If a provider negotiating a franchise agreement with the city wants to serve View Ridge, for example, it also must serve Lake City, because both neighborhoods belong to Cable Franchise District III. And the provider must cover the entire district within seven years.
But the district system is no longer needed, Seattle’s chief technology officer, Michael Mattmiller, who heads DoIT, and Tony Perez, director of the Office of Cable Communications, told the council’s technology committee Wednesday.
Though most Seattle residents have only one choice when it comes to cable providers — Comcast’s franchise agreement includes all but one of the districts, while Wave Broadband primarily serves a single district — access is nearly universal.
The system’s major effect today is to discourage new providers from entering the Seattle market because of the district build-out requirements, according to Mattmiller and Perez.
“We think we need to amend the Cable Code because the status quo is a situation where about 80 percent of the city has only one choice for a cable TV provider,” said Viet Shelton, Murray’s communications director. “We want to foster more competition, which will hopefully lead to better service and lower prices.”
Mattmiller, Perez and City Councilmember Bruce Harrell, who chairs the technology committee and supports the elimination of the district system and seven-year build-out mandate, say they remain committed to equity.
They say the revised code will include language prohibiting providers from denying service based on race or on a neighborhood’s income level, and they argue the city will continue to work against cherry-picking via franchise-agreement negotiations.
Providers don’t consider income level a determinant factor in deciding where to build service anyway, said Mattmiller.
“We should be open to listening where a new competitor wants to build service,” Perez said Wednesday. “It could be the entire city. It could be sections of the city.”
In the background are the city’s talks with CenturyLink about fiber-optic cable. In February 2014, DoIT sent a draft of its proposed Cable Code amendments to Comcast, Wave and CenturyLink, according to a Jan. 29 memo to the council.
“Completion of the cable amendments was delayed due to the unexpected decision by CenturyLink to build fiber-to-the-home in some parts of Seattle,” the memo says. “CenturyLink expressed concern about certain code provisions such as strict build-out requirements. Staff engaged in extensive discussions with CenturyLink during the spring and summer of 2014.”
CenturyLink launched its new fiber Internet service in Seattle in August 2014, focusing first on Ballard. The company didn’t need to negotiate a franchise agreement because Internet service isn’t yet regulated as a public utility.
The company’s new Prism TV, like its gigabit Internet service, is delivered by fiber. To offer Prism TV in Seattle, CenturyLink would need to negotiate a cable-franchise agreement with the city.
“We have received interest from multiple providers who are interested in expanding their network or entering the Seattle cable-television market, but have not received any franchise applications,” Mattmiller said.
In a statement, a CenturyLink spokeswoman said, “CenturyLink supports the city’s efforts to update existing regulations and encourage competition.”
A Wave Broadband spokesman said in a statement, “As the largest provider of gigabit service in Seattle, Wave would be in favor of rule changes that make it easier for us to continue expanding these services; however, we do not want changes that would increase the cost of doing business.”
A Comcast spokesman said the company hadn’t yet had time to review the revisions closely enough to comment.
The CenturyLink Washington Political Action Committee contributed $700 — the maximum amount allowed under city law — to Murray’s 2013 mayoral campaign. It gave $700 to Harrell’s council campaign and $700 to the campaign of Councilmember Sally Bagshaw, who sits on Harrell’s technology committee.
Comcast, which could see increased competition if the district system is eliminated, contributed $700 to Murray’s campaign and $350 to Bagshaw’s.