FOR IMMEDIATE RELEASE
Press Release # 001
Wednesday, August 10, 2011
Nick Sbordone (212) 788-6602
NEW YORK CITY ANNOUNCES INCREASED ACCESS TO FREE PUBLIC BROADBAND, EXPANSION OF WI-FI IN PUBLIC SPACES, AND ENHANCED TELEVISION SERVICES IN ALL FIVE BOROUGHS OVER NEXT NINE YEARS
Provisions Part of City’s Cable Television Franchise Renewal Agreements with Time Warner Cable and Cablevision Systems
Department of Information Technology and Telecommunications (DoITT) Commissioner Carole Post today announced a range of public benefits, estimated at approximately $60 million, associated with renewal of the City’s cable television franchise contracts with Time Warner Cable and Cablevision Systems. The agreements provide for the creation of 40 public computing centers and commercial grade Internet service to public libraries, a $10 million investment in approximately 30 parks and public spaces across the five boroughs for Wi-Fi service, a near doubling of the number of Public, Educational and Government (PEG) channels currently available, and approximately $10 million in funding for capital upgrades to NYC Media. The cable companies have also agreed to provide increased funding grants to the borough-wide community access organizations that operate public access channels in each of the five boroughs. In addition to paying the City a franchise fee of five percent of the revenues generated in the City from its cable television services – the maximum percentage permitted by Federal law – Time Warner Cable and Cablevision Systems have also agreed to enhanced customer service protections and to support improvements to the City’s internal telecommunications system. The franchise contracts, which will run through July 18, 2020, were unanimously approved today by the City’s Franchise and Concession Review Committee.
“We aggressively leveraged the City's franchising authority to negotiate new cable television contracts that are unique and innovative in the benefits they deliver to New Yorkers,” said DoITT Commissioner Carole Post. “With expanded access to Wi-Fi in parks, new computer centers, broadband expansion to the City’s industrial areas, and new public access channels, these agreements provide New Yorkers the world-class tools, services, and access they need to more fully participate in the digital economy. I thank the staff who worked so diligently on these efforts, which will benefit the City’s more than two million cable subscribers for years to come.”
As the City’s telecommunications agency, DoITT negotiates and administers franchises with private companies that use the City’s streets and sidewalks to provide public services. These franchises include contracts for cable television service. From Time Warner Cable and Cablevision combined, the City collected over $100 million in franchise rent in Fiscal 2011, representing payment for the companies’ use of the City’s streets. While Federal law caps at 5% the maximum amount of revenue municipalities across the country can receive from cable companies, DoITT has negotiated approximately $60 million in additional commitments from Time Warner Cable and Cablevision Systems for the following:
Expansion of Broadband in Underserved Communities – Time Warner Cable will create 40 public computer centers, in partnership with local not-for-profit organizations, to provide free broadband access to low-income communities across the City. Cablevision Systems will provide free, commercial-grade Internet service to all public libraries in its service area.
Expansion Broadband in Underserved/Industrial Areas – The companies will commit to invest nearly $2 million per year to bring communications infrastructure to currently-underserved commercial/industrial/manufacturing locations in support of the City’s economic development initiatives. In addition, time Warner Cable will provide communications infrastructure to the Brooklyn Navy Yard and substantially expand the reach of its system into non-residential neighborhoods to serve new business customers.
Wi-Fi in City Parks – Together, Time Warner Cable and Cablevision Systems will spend approximately $10 million over the next two years to equip areas within 32 parks across the five boroughs with Wi-Fi service, and will maintain the systems through 2020. This service will be free to all users for up to 30 minutes a month, with a nominal fee of 99 cents per day thereafter, and free at all times to Time Warner Cable and Cablevision broadband subscribers.
Provision of Wi-Fi in City parks by the cable companies is in addition to the AT&T-sponsored Wi-Fi service currently being implemented at 26 locations in 20 New York City parks across the five boroughs.
Increased Public, Educational and Government Channel Capacity – The City’s Public, Educational and Government (PEG) channels will be enhanced as follows:
- Nine (9) current channels plus eight (8) new channels phased in over next several years
- At least one channel will be high-definition
- 25 hours of video-on-demand for educational/government programming
- More than $9 million to fund NYC Media’s capital (plant and equipment) upgrade
- Assistance in publicizing NYC Media programs and activities
Strong Customer Service Protections – The customer service protections included in the renewal agreements with Time Warner and Cablevision will build upon and closely mirror the protections incorporated in the Verizon FiOS franchise granted in 2008. These protections include:
- Online appointment confirmation
- Ten-day time period for resolution of complaints
- Telephone answering standards (answer within 30 seconds)
- Billing dispute resolution procedures
- Time periods by which outages and services interruptions must be corrected and repairs made
- Four-hour appointment windows and customer credits for missed appointments and certain outages
- Upgraded Call Centers and New Service Centers
NYC Media Lab Funding – Time Warner has also agreed to provide more than $1.5 million in funding to support new media research in New York City.
CityNet Funding – Today’s agreements also provide for more than $20 million in new funding for upgrades to Citynet, the City’s institutional fiber network, which provides the communications backbone for dozens of City agencies and more than 300,000 employees.
“Opt-out” provision – As part of today’s agreements, the City also reserves the option to terminate the franchises early if revenues shift significantly toward Internet instead of cable over the term of the contracts. This innovative provision, believed to be the only one of its kind in the country, helps protect City franchise revenue by enabling the City to renegotiate if there is substantial shift in content delivery from cable to “new” and/or emerging technologies. This termination option would be triggered by a 22.5% reduction in franchise revenue receipts as compared to the “peak year” of the new agreements.
“Today’s agreement between Cablevision and the City of New York will ensure that Bronxites have the highest quality service possible, new broadband access in many of our public parks, strong customer protections and a vibrant presence on public access television,” said Bronx Borough President Ruben Diaz Jr. “This agreement is a win-win for all involved, and I am particularly grateful that Cablevision was willing to come to the table and negotiate a deal that continues their commitment to serve the Bronx as a good corporate citizen.”
“I am thrilled that this agreement will not only continue to provide Brooklynites with the high quality public access programming for which BRIC Arts | Media | Bklyn has become known, but additional funding that will result in even more programming and services,” said Brooklyn Borough President Marty Markowitz. “Bravo to BRIC Arts | Media | Bklyn, Time Warner and Cablevision for supporting the important role public access programming plays in our communities, and I particularly thank my chief of staff, Carlo Scissura, for his hard work in helping to make this agreement a reality.”
“We won a terrific victory for New York’s cable subscribers that will benefit the prosperity and civic life of the City at large,” said Manhattan Borough President Scott Stringer. “This agreement provides multiple public goods that will translate into increased access to broadband services and information, greater interconnectedness, and will modernize telecommunications in New York City.”
“This renewal contract is one that will increase communications, public access and provide benefits to our libraries, parks and other public venues, said Queens Borough President Helen Marshall. “With an eye on the future, DoITT, Time Warner Cable and Cablevision have worked collaboratively on behalf of all New Yorkers. I am happy to support this renewal and look forward to reaping its benefits.”
“I am pleased that renewal agreements have been made between the City of New York and its cable television providers, said Staten Island Borough President James Molinaro. “The agreement provides for enhanced services and access, which is a good thing for customers.”
“Time Warner Cable is pleased to confirm that today we’ve reached a new franchise agreement with the City of New York,” said Howard Szarfarc, Regional Vice President for Operations. “This license to operate enables us to continue connecting New Yorkers and local businesses with the latest information, entertainment and technology. We'll continue to roll-out new convenient and popular services as we've done recently with Start Over, Look Back, Whole House DVR, Wideband and Mobile Internet and our new iPad app for live television.”
“We are very pleased to have reached agreement to renew these important franchises with the City of New York,” said Lisa Rosenblum, Cablevision’s executive vice president for government and public affairs. “Cablevision has been delivering enormous value to residential and business customers through its state-of-the-art telecommunications services in the Bronx and Brooklyn for more than two decades. Under these franchise agreements, crafted consistent with the competitive environment, Cablevision looks forward to continuing to provide its customers in the Bronx and Brooklyn with award-winning Optimum television, phone and high-speed Internet products for years to come."
Today’s approval of the cable franchise renewal agreements will also help foster a more vibrant marketplace by solidifying long-term, direct competition among the City’s cable television providers for the first time. This stage was set with the historic citywide cable television franchise the City granted Verizon in 2008.
Time Warner Cable – was first granted cable television franchises for Northern and Southern Manhattan in 1970, which were renewed in 1990 and again in 1998; the Queens, Staten Island and Western Brooklyn franchises were granted in 1983 and renewed in 1998.
Cablevision Systems – was first granted cable television franchises for the Bronx and the non-Time Warner portion of Brooklyn in 1983, which were renewed in 1998.
The Franchise Concession and Review Committee (FCRC) is comprised of two representatives of the Mayor’s Office, one representative each of the Law Department and the Office of Management and Budget, one representative of the Comptroller, and one representative for each of the five Borough Presidents.
DoITT is the City’s Information Technology (IT) utility, ensuring the sustained, efficient delivery of IT services, infrastructure and telecommunications. DoITT establishes the City’s IT strategic direction, security policies and standards; procures citywide IT services, and evaluates emerging technologies; provides project management, application development and quality assurance services; maintains NYC.gov, and Geographic Information Systems; operates the City’s data center, the dedicated wireless network (NYCWiN), the wired network (CityNet), the Citywide Service Desk, and telecommunications systems; administers telecommunications franchise contracts providing fiber, cable television, pay telephones, and mobile telecom equipment installed on City property and streets; leads CITIServ, the citywide IT infrastructure consolidation program; supports the Mayor’s Office of Media and Entertainment, and the Health and Human Services Connect and Accelerator programs; administers 311; and fosters public-private partnerships to improve IT service delivery.