Last year Cable One put a proposal to the City of Rio Rancho to extend the franchise agreement that they operate under. The extension that they asked for was a long term extension and the action was allowed under section 6.1 paragraph H. of the existing agreement.

What Cable One was apparently trying to do was to avoid all of the scrutiny that they would have to deal with if they went through the process as defined in section 6.1 paragraphs A - G. These sections call for a complete review of the franchise operations and a community needs assessment. By asking for the extension when they did, Cable One was trying to avoid the review and the community needs assessment that would have indicated that their operations and service levels were not meeting the community needs. After a substantial public out cry concerning the service of Cable One, they dropped their request for an extension. This is a good thing but there are certain aspects of what transpired during this process that are important to note.

At the Cable Regulation and Usage Committee meeting on August 12, 2002, Mr. Hernandez, Cable One manager for Rio Rancho, said that Cable One feels that they know what the needs of Rio Rancho are based on their experience around the country. Towards the end of the meeting Mr. Hernandez said that he was surprised at all the concern he was hearing from people about the Internet services that Cable One was planning on offering. What is interesting about this statement is that earlier he was so adamant about knowing what the needs were of Rio Rancho residents. It seems as if Cable One does not know the needs of Rio Rancho after all but rather are trying to squeeze us into what their business model is rather than developing their services to fit the needs of the community.

Cable One has had the ability to provide Rio Rancho with digital service for several years. They have provided close to 80% of the 86 cities for which they provide cable service, with digital cable service for some time now. They have waited until they wanted to enter into negotiations on an extension of their contract with Rio Rancho to offer digital services to us. Now that they have started implementing digital services and internet access they are planning on using the "see what we did" argument in the upcoming franchise negotiations. In our mind they have been a day late and a dollar short on the whole process and should not be given kudos for doing something now that they should have done much earlier.

The current service provided by Cable One to the residents of Rio Rancho is NOT in the best interest of the City for several reasons. The service lacks competitive pricing or services that Rio Rancho deserves. If you take a moment and review the tables on the Facts section, specifically the tables that show the comparative costs and service levels of Cable One compared to Comcast, you will see that the difference in Internet access speed and cost is considerable.

Cable One tries to make the argument that the speeds advertised by Comcast are not realizable speeds because as usage on a particular segment goes up the average speed will go down. They say that they intend to advertise speeds that they can maintain but are not willing to guarantee those speeds because of potential segment traffic. Essentially what they are doing here is saying that their competitor's performance is flawed and Cable Ones is better but then say that they won't stand behind their service because of the same issues they blame on their competitors.

Rio Rancho has experience with Cable One and it has not been a favorable one. The customer service levels that Cable One has historically provided are very poor. Calling the office to get service or questions answered often resulted in less than polite interaction. There are also many areas of Rio Rancho that have not had cable service installed in their neighborhoods. These are not new developments either but rather older sections of the City. The nature of the development in Rio Rancho has caused Cable One to fall back on the 20 year franchise agreement that specifies where and how Cable One expands their service. This has prevented new areas in Rio Rancho from being offered cable services. In this respect Cable One has not provided the service that Rio Rancho deserves with respect to a cable operator.

Recently Cable One has improved their customer service. Again, in our opinion, to offer the "see what we did" argument in upcoming franchise agreement negotiations. There is nothing that would prevent them from reverting back to the days of poor service and inadequate technology implementation. All we have to go on is history and promises. History is factual, promises aren't worth much. Corporate management has said that they are dedicated to Rio Rancho but those are just empty promises. Their history proves otherwise.

Cable One feels that they have a lock on the Rio Rancho cable business. They operate in a monopolistic environment and consider the franchise agreement a done deal. Cable One claims that they operate under a non-exclusive agreement and therefore the market dictates whether or not another company can come in and compete with them. Although the franchise agreement with the City is non-exclusive another cable company cannot come into the city because of the cost of entry into the market. A new cable company would have to lay all new cable and then try to win over the existing cable customers from Cable One which would be a difficult proposition at best. As such Cable One enjoys a virtual market monopoly in Rio Rancho. They have had 20 years to grow their business and infrastructure in Rio Rancho. Saying that another company can come in and achieve what it took Cable One 20 years to do and be competitive is outrageous. Cable One now wants Rio Rancho to reward it with another virtually exclusive franchise agreement.

One of the arguments that Cable One will use in the upcoming negotiations is that they have invested over $7 million dollars in the upgrades to the Rio Rancho system and should be given a long term franchise agreement to enable them to recoup their investment. First of all this figure should be verified. Secondly they want to be treated as a private business and left alone to practice their own business model without regulatory interference but then want special consideration to help reduce the risk of their business model. They shouldn't be allowed any consideration because of their past treatment of Rio Rancho. They delayed keeping us up-to-date for years because of their business model and now will want us to give them consideration for keeping us in the dark for longer than we should have been.

There are some options that Rio Rancho should consider with regard to cable services. There are several municipalities that have taken control over their own destiny with regard to cable services by doing it themselves. This allows them to become self sufficient and to also realize greater benefits because all of the money stays in the city. This should be reviewed by the city at this stage because of the current size of Rio Rancho and the potential growth it is on the verge of.

If Cable One is the choice of the city to operate under a franchise agreement, the agreement should not be a long term one. Cable One has shown what happens when they have a long term agreement and it is not in the best interest of Rio Rancho. The technology is also changing rapidly and with a long term agreement Cable One would be under no obligation to keep the Rio Rancho system modernized. The City should negotiate a short term, no longer than 5 year, agreement with performance standards that if met would lead to an extension of the agreement or another agreement. If those performance standards are not met, then penalties should be imposed.

The shorter term franchise agreement is also dictated by the rapidly advancing developments in technology and how society deals with and utilizes it. A recent decision by the 9th Circuit Court of Appeals shows how changes are occurring. Allowing a long term agreement prevents the city from ensuring that it has the flexibility to deal with ever changing environment.

We encourage all residents to contact their City Council representative and let them know that the cable franchise in Rio Rancho is important and should be given its due consideration in evaluating various options. Cable One has not performed well and if history is any guide will not perform well unless it is in their best interests. The franchise agreement should enable the city to enforce performance and hold the franchisee accountable.

The City Council must hear your voice. Please use the Contacts section to contact your City Council representative, the Mayor, and the City Administrator with your views on the subject.