Philadelphia, Comcast Hammer Out Details of 15-Year Franchise Agreement

City council members are making known their wish list of what they hope Comcast can deliver, including whether the company can offer free Internet in city recreation centers, prisons and parks.

by Tricia L. Nadolny, The Philadelphia Inquirer / August 11, 2015
Comcast Center in Philadelphiaflickr/Gary Reed

(TNS) -- City Council may not be invited to the bargaining table where Philadelphia officials and Comcast Corp. executives are working out a new 15-year franchise agreement. But the legislative chamber is nonetheless making known its wish list of what it hopes Comcast can deliver.

Council members want to ask Comcast questions that include: Can the company offer big-time support for the city's tech sector? Can it help public school students become America's most "digitally literate"? Can it offer free Internet in Philadelphia recreation centers, prisons and parks?

Two letters Council plans to send to Comcast this week, copies of which were obtained by The Inquirer, lay out those questions and call for increased broadband access as a priority in the negotiations. The letters also criticize the company for launching an expansion of its low-cost Internet program in Palm Beach County, Fla., asking "what digital divide" exists there that does not in Philadelphia.

"It would be great to send a message ... that Comcast's hometown is a platinum example of bridging the digital divide," said Councilman Bobby Henon, whose office drafted the letters. "We want them to be a great partner, not a good partner."

The letters, which Henon said he expected every member of Council to sign, shed light on issues Council could choose to champion when it is asked to approve the franchise agreements between the city and the Philadelphia-based telecom giant in the coming months.

The four agreements, which cover different sections of the city, allow the company access to the public right-of-way, such as the space under streets, to install wires. The first expires Wednesday, the last, Oct. 17. The terms of the current contracts will remain in effect until new ones are signed.

The 15-year deals are nonexclusive, and other providers, including Verizon FiOS and satellite-TV companies, compete with Comcast throughout the city. Under the current deal, the city receives 5 percent of Comcast's cable-TV revenue within the city, a percentage capped by federal law, which amounted to $17.5 million last year, according to municipal officials.

Some issues raised in Council's letters were also raised by Mayor Michael Nutter in April, when he announced the results of a sweeping survey of Philadelphia Comcast users that found more than a quarter were unhappy with their service.

Nutter stressed two things he wanted from Comcast: improved customer service, and dramatic expansion of broadband access, including free service in some lower-income neighborhoods.

Almost immediately after the survey was released, Comcast executives called its findings flawed, and city officials shot back in defense -- an adversarial start to negotiations. Comcast and city officials have been meeting nearly weekly since.

On Monday, both sides declined to share any new details.

Mark McDonald, Nutter's spokesman, said the city planned to present an agreement to Council in time for it to be approved by the end of the year.

Comcast spokesman Jeff Alexander, in response to Council's letters, said the company values its partnership with the city and its residents, and is "extremely proud of the world-class services we deliver throughout our hometown, as well as the significant benefits that result from our franchise here."

"We look forward to continued discussions as we work to finalize a franchise agreement that benefits all involved and, especially, the city we call home," Alexander said in a statement.

Comcast -- which has 2 million customers in the region, including South Jersey -- has stressed that under federal law, contract negotiations pertain only to the cable-related needs of the community. But advocates have pressed the city to use the talks as a platform to seek other benefits, such as funding for the school system.

"City upon city upon city, municipality upon municipality, is using these negotiations to ask for what these communities really need," said Hannah Sassaman, policy director for the Media Mobilizing Project, a nonprofit that focuses on economic and media issues.

Sassaman said after hearing about the letters Council plans to send that it was encouraging to see Council raising the issues.

One letter, directed to the negotiating team from Comcast and to the city, criticizes the company's expansion of its Internet Essentials program, which provides service for poor families with school-age children for $9.95 per month. Last week, the company said it would also offer the program to low-income senior citizens first in Palm Beach County, then other markets throughout the fall.

In a second letter, addressed only to Comcast, Council asks whether the company sees an opportunity to make the Internet Essentials program easily available to any customers who live in public or subsidized housing, or receive other public benefits.

Council also asked about these issues:

How pricing for Comcast services in Philadelphia compares with prices for such services in other cities.

Whether the company could provide Internet access, either free or at a substantial discount, in every recreation center, health center, homeless shelter, women's shelter, municipal building, police building, firehouse, prison and public park, among other locations, in the city.

How Comcast can help make Philadelphia's public school students "among the most digitally literate and job-ready" in the country, through new investments in "hardware, software, service connections, staffing and/or apprenticeship programs."

How the company, as it builds its second skyscraper in the city, plans to support businesses that are either local or owned by minorities or women.

©2015 The Philadelphia Inquirer. Distributed by Tribune Content Agency, LLC.

Platforms & Programs