Friday, July 09, 1999
City cable systems irk private business
Bill would impose fees on government
BY KEVIN ALDRIDGE
The Cincinnati Enquirer
MASON — Private cable companies say they are prepared to battle cities for customers, but only if it's on a level playing field.
“We don't have a problem with competition,” said Ed Kozelek, executive vice president of the Ohio Cable Telecommunications Association (OCTA). ""We will compete against anybody, as long as it is under the same terms and conditions imposed on us.”
Mr. Kozelek was responding to the Warren County Municipal League's plans to investigate the feasibility of forming a countywide municipal-owned cable system. The municipal league last week called for the creation of a five-member committee to study the issue.
The municipal league's move came a day after Time Warner announced it would drop rates 34 percent for customers in Lebanon. Time Warner reduced its rates to compete with Lebanon's popular city owned cable system.
Lebanon and Wadsworth are the only two Ohio cities with their own cable systems. In Wadsworth, Time Warner dropped its prices by $15 a month to match the city's rate.
“That just goes to show that if they have that much built-in profit margin then they should lower the rates for ev eryone else, too,” said Dick Staten, president of the Warren County Municipal League.
Mr. Kozelek questioned the economic feasibility of city owned cable systems, calling them “risky ventures.”
“We have not been able to identify one city owned system that has been able to break even financially,” he said. “So what (governments) do is make it up by either raising electric rates to above what they should be or subsidizing the venture through tax dollars, or both.”
He said the OCTA supports legislation that would place parameters on municipalities starting their own cable companies. Cosponsored by Sen. Richard Finan, R-Evendale, House Bill 188 and Senate Bill 67 would require governments to comply with the same laws and pay the same fees and taxes as private cable companies.
Tennessee and Georgia have enacted similar legislation to regulate competition between government and the private sector, Mr. Kozelek said.
“If local governments are willing to get into the entertainment business, providing a nonessential, discretionary service, they need to play by the same rules,” said Mr. Kozelek.
Mr. Staten disputed that cable is a “nonessential, discretionary service.”
He suggested electronic meter reading and automated fire and severe weather alarms as other benefits of a cable system.
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