Can the City regulate cable rates? Federal law prohibits local governments from regulating cable rates, except for the lowest cost tier of service.
What are open video systems (OVS)? Open video systems (OVS) are systems that provide cable programming, and may also provide voice and data transmission. OVS refers to a regulatory structure that was created in the 1996 Federal Telecommunications Act, to encourage more competition in the cable industry.
What are the major terms of the Franchise Agreement? Overall, the Franchise Agreement with Comcast represents a departure from the previous franchise agreement with Cable Co-op, reflecting the changing nature of the cable television industry and the transition from a locally owned cooperative to a multinational corporation. Comcast provides a standard set of cable services across the country, and therefore some of the services to which citizens had grown accustomed were altered or discontinued under the Comcast franchise. Many of the changes have been positive, including Comcast agreeing to spend millions of dollars investing in a cable plant upgrade, including laying new fiber optic cables. This resulted in the expansion of channel capacity, long term system reliability and the availability of additional video services.
The major terms of the Franchise Agreement are as follows:
Term: The term of the Agreement is 10 years, beginning July 25, 2000.
Cable System Upgrade: The system was upgraded to a hybrid fiber/coax communications system with a minimum bandwidth of 750 MHZ. This brings improved service and reliability to the community. The system is capable of carrying local phone service, high-speed data access and multi-channel video service.
PEG channels: The existing PEG channels are 27, 28 and 30 (for local and public access programming), 26 and 29 (government), 75 (Foothill College), and 76 (Stanford University).
Institutional Network: Comcast has provided support for an institutional network linking public schools, libraries, public buildings, and community centers in the Joint Powers communities, with the capability of providing voice, video and data communications. In addition, Cable Co-op paid $250,000 to the City to help fund a portion of the cost for the equipment necessary to make the network functional.
Public, Educational and Government (PEG) funding and support: Comcast will pay $0.88 per residential subscriber per month, or approximately, $275,000 annually to maintain and enhance PEG access services provided by the Media Center. The level of support increases if the residential subscriber base goes up. Federal law does not prohibit Comcast from passing this $0.88 fee on to the subscriber.
In addition, Comcast provides, free of charge, basic cable and cable modem service for all educational institutions (including public schools) and for all public buildings in the JPA area. Comcast also provides free cable modem equipment to all public schools and libraries in the JPA.
What can the City do? Federal and state law establish restrictions on what the City is allowed to regulate in a franchise or negotiate for in a franchise agreement. Below is a list detailing what Palo Alto can and cannot do as the local franchise authority.
Cable Franchise Authorities – What they can and cannot do
Can Do
Can require specific cable system capacity and functionality.
Can require support of PEG access through facilities, equipment, and channels (spectrum).
Can establish customer service standards, including ones related to answering telephones calls, response to complaints, and imposition of late fees.
Can require a local customer service office.
Through an enabling ordinance can require a specific definition of gross revenues.
Can regulate the video portion of services offered. Must be willing to negotiate in good faith with additional cable companies.
Can require construction of an Institutional Network (I-Net) linking schools, libraries, and public buildings for voice, video and data communications. For the public access channel, can require placement at a specific location.
When a cable company does construction in public rights of way, can specify that it must do so in a manner that does not disrupt those rights of way unreasonably. Company must apply for and be issued all necessary construction and occupancy permits.
Cannot Do
Cannot require a specific transmission technology.
Cannot specify which channels are or are not carried and cannot specify which channels are on which tier of service (other than PEG access).
Cannot regulate rates (other than lowest cost tier of service).
Cannot require franchise fees of more than 5 percent of gross revenues, as defined in the franchise agreement.
Cannot regulate any voice (telephone) services (regulated by state Public Utilities Commission).
Cannot specify engineering performance standards in those areas where FCC has preemptive authority.
Cannot grant an exclusive franchise.
Cannot regulate data services, including Internet services.
What is "open access?" "Open access" refers to the availability of use of the cable modem platform to the Internet by other Internet service providers. In other words, a cable television customer is not limited to using the cable company's Internet service provider before accessing the Internet. The Courts have decided that the FCC has the right to regulate this.
What is a cable franchise agreement? The provision of cable television services is the result of a franchise agreement between the City of Palo Alto, representing the Joint Powers Agency partners, and Comcast. The franchise agreement is a contract between Palo Alto and Comcast that sets the terms of the provision of cable services, including service standards, public, educational, and government programming requirements, and system requirements. The franchise agreement has specific terms, and is set to expire on July 23, 2010.
What is MPAC? The Mid-Peninsula Access Corporation (MPAC) is the City's designated community access organization. Provides community media services to the public, educational and government sectors, including public access television for Palo Alto, Menlo Park, East Palo Alto, Atherton and portions of San Mateo and Santa Clara Counties. On August 20, 2001, MPAC merged with SVCC and was renamed the Midpeninsula Community Media Center, Inc. (Media Center). The Media Center operates three noncommercial cable channels carried on the Comcast system featuring lectures, performances, debates, town meetings and programming from a wide range of community groups and organizations. The Media Center trains people in video production and studio operations so they can communicate through the video medium and over Channels 27, 28 and 30. The Media Center staff videotapes all of the government meetings that are cablecast on Municipal Cable Channel 26 and 29.
What is PEG? PEG stands for public, education and government access services. In Comcast's franchise area, these services are provided by the Media Center, Stanford University and the Foothill/DeAnza Colleges
What is SVCC? Created as part of the asset purchase agreement between AT&T and Cable Co-op, Silicon Valley Community Communication, Inc. (SVCC) was a non-profit corporation responsible for providing facilities and equipment to the Media Center. SVCC merged with the Media Center in 2001.
What is the additional $0.88 PEG fee on my cable bill? The Franchise Agreement requires Comcast to pay the City $0.88 per residential subscriber per month to maintain and enhance PEG access services provided by the Media Center. Comcast has chosen to pass this $0.88 fee on to subscribers, which it is not prohibited to do under Federal law.
What is the JPA? JPA stands for Joint Powers Agency. There is a Joint Exercise of Powers Agreement between the City of Palo Alto, East Palo Alto, Menlo Park, Atherton, and portions of San Mateo and Santa Clara Counties (representing Stanford). This agreement gives the City of Palo Alto the authority to administer the Comcast cable franchise on behalf of all of the agencies.
