Colorado Overbuilds Await Public Votes
By JOE ESTRELLA -- Multichannel News, 7/31/2000
Voters in Colorado Springs, Colo., will decide in November whether to introduce two relative newcomers to the city's telecommunications market.
The City Council voted un-animously last week to place proposed cable franchises for WideOpenWest LLC and SunWest Communications Inc. on the November ballot.
It also voted to ask the electorate to sign off on a proposed franchise renewal for Adelphia Communications Corp., which became the incumbent operator after buying Century Communications Corp. last year.
If all three are approved, Colorado Springs would become the latest community in the state with at least three cable-service providers.
The Adelphia proposal is unique in that it removes the traditional 5 percent franchise fee that caused a similar measure to be voted down last year.
"Colorado Springs is very conservative when it comes to government revenues," city spokesman Ron Mitchell said.
The fee has been replaced by per-subscriber quarterly grants that would go toward supporting PEG-access (public, educational and government) channels in the community.
Each of the companies will have deals with built-in incentives. For example, Adelphia's 10-year franchise will be extended to 15 years once it completes construction of a municipal institutional network. WOW's 10-year deal will also be extended to 15 years if construction on its network does not exceed four years, while SunWest will have five years in order to earn a five-year extension.
Mitchell said approving franchises for WOW and SunWest did not indicate dissatisfaction with Adelphia, which has been given high marks for its performance since taking over the former Century system "But we'll be creating competition, and that's viewed as a positive," he said.
Officials for Adelphia were unavailable for comment.
But in an interview with the Colorado Springs Gazette, regional manager Jeffrey Butler questioned whether any overbuild could survive head-to-head competition with an incumbent.
"Overbuilding is just a hard way to go, and nobody has demonstrated that it's viable," Butler told the Gazette.
Officials at WOW were eager to add Colorado Springs, with its affluent residents and high-tech economic base, to a list of state franchises that includes the communities of Aurora, Greenwood Village, Commerce City, Jefferson County and Loveland.
Voters in Denver and Boulder, two of the state's most lucrative markets, also vote on franchises for WOW Aug. 8.
"We're looking forward to getting Denver and Boulder locked in," WOW spokesman Mike Steinkirchner said. "There's a lot of momentum for us out there right now."
