Comcast cable contract approval delayed

Dec 16, 2014

The contract between Marion, Mattapoisett, Rochester and the Comcast Corporation has expired, but cable subscribers shouldn’t expect a disruption to their regularly scheduled programming.

“Comcast television customers will not have their cable turned off,” Mattapoisett Town Administrator Mike Gagne said. “Cable will be continued as it currently is as we negotiate a contract for another ten years.”

Tri-town Selectmen met on Monday night and voted to extend negotiations with the telecommunications company. The previous contract expired Dec. 16.

Primarily, the contract secures funding for the tri-town’s cable access channels, operated by Old Rochester Community Television (ORCTV.)

Before Mattapoisett Selectmen voted on the extension, Gagne did question a Comcast official on the recent closing of the company’s offices on Route 6 in Marion and Fairhaven.

He said in the past two weeks a handful of residents approached him about the closings that occurred Friday.

“We’re finding that more and more of our customers have other means to communicate with us and address their needs. Ten or fifteen years ago, our online presence wasn’t as prevalent as it is now,” said Mary O’Keefe, manager of government and community relations for Comcast.

She said new programs have lessened the need for a brick-and-mortar store. Customers can now track technicians in real time, mail back equipment, and troubleshoot online and over the phone.

Marion Town Administrator Paul Dawson said he’s heard from several residents who prefer dealing with the company face-to-face.

Rochester Town Administrator Mike McCue echoed the sentiment.

“I have received several comments from people who are more comfortable doing things in person,” McCue said.

Administrators requested that information on Comcast’s new programs be distributed to customers soon.

On Monday, all three Boards of Selectmen voted to utilize a provision in state law that allows more time for debate without losing the current contract terms.

“This process we are about to undertake is probably known as a friendly denial,” Dawson said. “This is not acrimonious… Comcast is aware of tonight’s vote.”

Under federal law enacted in 1984, municipalities were given authority to grant or renew permission for cable companies operating under their supervision.

That law does restrict communities in several ways.

Cities and towns cannot negotiate rates – those are dictated by federal guidelines – and determining what channels companies offer in the service area is off limits, too.

There is an exception to the channel regulation. Local governments can require cable companies to reserve channels for public, educational and government programs.

In the tri-town, ORCTV is responsible for developing programming on those public channels.

ORCTV is supported by franchise fees, which are obtained by the town from cable providers Comcast and Verizon. Cable providers “rent” town property to lay cable, and towns receive five percent of the operating revenue.

Under the current contracts, Comcast provided ORCTV $125,000 over 10 years for equipment and capital expenses along with 4.5 percent of the licensees’ local gross annual revenue. Verizon, which is also licensed in the tri-town, offers identical terms in its contracts.

“This contract is what provides our funding,” ORCTV Executive Director Rob Chiarito said. “It’s also a review to make sure the station is spending the money for local cable programming and to educate the public.”

Gagne, Dawson and McCue all noted that meetings between Comcast officials and Attorney William Solomon are scheduled before Dec. 25. Solomon was hired by Selectmen to head discussions with the cable provider in April. McCue said the extension was not unusual.

“It does take place in other communities when it’s necessary to iron out the details,” McCue said. “We will work diligently to take care of issues over the course of the next week or so.”

The extension will not affect ORCTV operations in the meantime, Gagne said.

Comcast isn’t the only cable provider in town. The tri-town also has a contract signed with Verizon, set to expire in 2016. That makes the tri-town a special case compared to large parts of the country.

“We’re unusual in that we have two competitors to choose from,” Chiarito said, adding that ORCTV’s founders “wanted to create a choice for consumers.”

The contracts signed between municipalities and cable companies are non-exclusive, meaning other companies are welcome to compete. However, companies looking to enter a new market would have to build a new cable network – a very expensive proposition.

Looking to the future, Chiarito said the Internet is set to drastically change the cable television landscape with competition from online streaming services such as Netflix and Hulu and satellite television. And he’s unsure how that would play out for cable providers.

“If you had basic cable thirty years ago you had about twenty-five channels to choose from,” he said. “Now there are thousands.”

But online, it’s possible to watch what you want, when you want – without commercials for those with a Netflix subscription.

“There’s not a crystal ball to see what the future holds,” Chiarito said. “I’m sure people under a certain age are used to watching television shows when they feel like it. No one knows what the cable landscape will look like ten years from now.”