Updated Aug. 1, 2007

The proposed purchase of the former Adelphia cable TV and internet system by Mooresville and Davidson remains alive, because of inaction at the N.C. General Assembly on a bill that would effectively prevent the deal. Meanwhile, commissioners in the two towns could vote soon on whether to go forward with the deal.

The Charlotte Observer reported Sunday that action on House Bill 1587 has been delayed until 2009. That could clear the way for the towns to go ahead with votes on the purchase later this summer. The towns have arranged about $75 million in financing to pay for the deal and for system upgrades.

CABLE FINANCING HEARINGS

The towns are also in the midst of required public hearings on the purchase. Mooresville held a hearing last week and a second hearing is planned Monday, Aug. 6, at 6 p.m. at Davidson Town Hall.

At the Mooresville hearing last week, a majority of citizens who spoke said they oppose the deal, according to a report in the Mooresville Tribune.

At a previous hearing in May in Davidson, about a dozen residents spoke or asked questions about the deal. A handful said they favor the town’s proposal to buy the system, but most seemed to be against the idea. A majority – if not all – of Davidson’s Town Board appears likely to support the purchase.

Time Warner Cable is operating the Adelphia system temporarily while the towns try to complete the purchase. If the towns ultimately are unable to do so, Time Warner would take over management permanently. Officials with the company’s Charlotte division say the company is prepared to spend money on a badly needed upgrade of the system.

OPPOSITION TO HOUSE BILL 1587

The towns’ efforts to buy the system, and counter-efforts to impose regulations to restrict them, come amid a broad push by large telecommunications companies to deregulate their industry. Last year, state legislators enacted a new law that takes away municipalities’ right to regulate cable TV and video. Instead, franchises are now granted on a statewide basis, and local officials have no oversight over service or pricing.

Many residents from area towns have spoken out against the proposed cable system purchase, some on philosophical grounds: They don’t think the government should be in the cable business.

Davidson and Mooresville officials argue the deal will give the towns more ability to ensure good customer service and pricing and ensure that profits are re-invested in the system to keep it up to modern standards. Both those areas have been issues in this area, with turnover of system ownership and competing demands for capital from corporate owners’ national footprints.

Davidson’s elected officials have already gone on record against House Bill 1587, which they say “would put roadblocks and restrictions on any local government that wants to provide communications services to its residents.”

A long list of others, from big technology companies to consumer groups to other municipalities have also come out against the bill. Intel has written state legislators opposing the bill. Internet search giant Google Inc., which is building a massive $600 million data center in Lenoir, also wrote to legislative leaders opposing the bill, saying it “threatens the prosperity” of North Carolina.

The Telecommunications Industry Association, which represents tech and communications firms, also is urging the bill be defeated. In a letter to the House Finance Committee, the group said it supports the expansion of high-speed communications networks, which bring services and price competition to the market. The bill would “act as hindrance to ensuring that all North Carolina residents receive these benefits,” the group said in its letter.

ANOTHER COMPETITOR?

Meanwhile, another possible competitor for video services has signaled plans to enter the market. AT&T, which now owns local telephone company BellSouth, said Tuesday, July 31 it plans to spend $350 million in the coming years to upgrade its network in North Carolina so it can sell video programming over local telephone lines.

It’s not the first time the phone company has said it wants to compete with cable companies to offer TV. But it appears AT&T is serious about plans to offer the service, which is already being tested in some markets nationally. In the Southeast, the service probably will come first in large cities such as Atlanta. It’s not clear when — or if — smaller markets might get services.

PREVIOUS COVERAGE

Read previous coverage of the cable TV purchase proposal on DavidsonNews.net, CLICK HERE>