Davidson’s Town Manager outlines why the town is considering buying the former Adelphia cable system. A vote on the proposal is scheduled June 11.
By LEAMON BRICE
The reasons local towns want 
to purchase the now bankrupt Adelphia cable and Internet system seem to have been lost as debates over dollars and cents and philosophical differences have raged on. Local ownership offers a multitude of advantages that have been given little attention in public meetings or media coverage. That is why I write this letter today.
First, let’s address the financial risks and rewards. If the system weren’t profitable, why would Time-Warner Cable want it? The existing Adelphia system reaches only 35% of homes and virtually no businesses. The potential growth of customers, and therefore profits, is astronomical.
The national average for cable penetration (the percentage of homes served) is 65 percent. Housing and business growth continues at an incredible pace in the North Meck/South Iredell area. The approximately 10,700 current customers are just the tip of a very valuable future iceberg.
THREE GOALS
Money, however, is not the reason local towns decided to exercise their right of first refusal to purchase this system. Three primary goals have driven local officials to embrace this opportunity. The Mission Statement of the new system, MI-Connection, addresses these goals:
Local control. The Towns of Davidson, Mooresville, and Troutman will provide state-of-the-art, locally-owned essential communications infrastructure delivering robust products, economic development opportunities and superior customer service.
Ownership of this infrastructure is key. In our business plan, we budgeted services such as Video on Demand (VOD), additional channels, and phone service in 2008. In the future, we will have local control over these types of infrastructure needs and product offerings. Money made in our communities will stay here to upgrade the system and benefit citizens. We won’t send profits to shareholders. Our shareholders are our citizens, and we will be accountable only to them.
Lure for businesses. Second, we know that economic development is essential to any community’s long term sustainability. The most beneficial economic development activities are those that keep businesses in the community. We will build more fiber-to-the-premise infrastructure in order to meet the needs of our local businesses trying to compete in a global economy.
Better service. Most important to many citizens is excellent customer service. Everyone has experienced the frustration of corporate customer service. We’ve become accustomed to waiting 30 minutes on hold to get a simple question answered (this will average one minute with MI-Connection).
We’ve come to expect taking a half-day off work to get new or upgraded telecommunication services (this will decrease to a half-hour window). The fiscal efficiency which is most beneficial to corporate shareholders is not necessarily most beneficial to the end-user. Are there some economies of scales realized? Of course. But the trade off is lackluster customer service.
Your home town has the chance to provide the technically advanced products you want, the economic development tools needed, and the customer service that you deserve.
RELATED COVERAGE
I don’t understand why the towns cannot simply hold Time-Warner accountable to meeting the standards Leamon has laid out. Surely the towns are able to do this under their licensing agreements. If Time-Warner fails to meet those standards, then the consortium could take over. My personal customer service experience with Time-Warner, which has happened on more than one occasion, is that if I have a connectivity issue I call them, they answer quickly, and even if the problem is diagnosed to be caused by my PC (which is usually the case) and not their system, they help me to fix it. So, the notion that corporate customer service equates to a 30 minute wait does not hold true, at least for me. Also, in this day and age it is very uncommon that a house visit would be required as most things can be resolved using remote diagnostic tools.
The key questions that have not been answered to my satisfaction are why the towns feel that Time-Warner could not do the job (it is not fair to compare every cable provider to Adelphia), and how the consortium will handle content decisions. I have seen our town’s board govern by responding to complaints, and I wonder how they will deal with the inevitable complaints about “24″, “The Sopranos”, “Miss USA” and if Jerry Falwell were still alive, “The Teletubbies.” We watch none of those programs, but I know that the first two are quite popular and critically acclaimed, and I think people should be able to watch them. Hopefully our content will not be reduced to The Weather Channel and TV Land or other shows that are 100% inoffensive.
Anyway, in spite of what seems to be overwhelming public objection of this plan, this is a fait acompli, so we can only hope it works out for the towns and their residents, or at least hope that satellite provides a good alternative.
This says it all. As disconnected mega-corporations increasingly abandon customer service to squeeze a few pennies more profit from their captive audiences, public ownership of the critically important communications infrastructure is an opportunity we must not miss.
Mr. Leamon Brice indicates in his article that “We won’t send profits to shareholders.” Indeed they won’t! Instead, the town will require taxpayers to subsidize the service. Mr. Brice further states that, “We will build more fiber to the premise infrastructure.” While it is very desirable to have, it is terribly expensive to accomplish in existing neighborhoods. The issue that Leamon didn’t address is, AT WHAT COST? What are the estimates for fiber to premise build out and who pays?
It is patently ludicrous to believe that the little town of Davidson is in any sense prepared to compete in the communications marketplace with the likes of Time Warner and Comcast Cable. There are technological hurtles and telecommunications business issues that quite frankly no one at the town has the experience to address and no at the little company in Bristol is prepared to deal with either. Sweeping changes are coming to the cable industry. A decade from now the cable business of today will seem an anachronism. Who do you want leading the charge into this sea of change? Local government? That makes absolutely no sense.
If the town goes through with this deal, and it appears that they are determined to do so regardless of the obvious high risks, the resulting costs overruns, technological ineptitude and poor service will result in significantly higher taxes for a vastly inferior product. That is the legacy Mr. Brice and the town commissioners will leave in their wake.