Time Warner, Cablevision Seek NYC Renewals

9/06/1998 8:00 PM Eastern

New York -- Time Warner Cable and Cablevision
Systems Corp. are hoping that a city agency here will grant 10-year renewals Sept. 16 and
avert a possible showdown between the City Council and Mayor Rudolph Giuliani over
franchise authority.

With nearly 1.5 million subscribers in the five boroughs,
the city's seven franchises are among the biggest and most valuable in the country,
generating an estimated $1 billion in combined annual revenue. The franchises expire in

On Sept. 14, the city's Franchise and Concession
Review Committee is scheduled to meet and discuss renewal proposals by Time Warner, which
serves Manhattan, Queens, Staten Island and part of Brooklyn, and by Cablevision, which
operates in Brooklyn and the Bronx.

The committee also scheduled a Sept. 16 meeting, at which
time it might vote on renewals, said Robert Jacobs, vice president and general counsel of
Time Warner Cable's New York City group.

According to Jacobs and other officials close to the
process, in 1993, the City Council gave the FCRC, which is controlled by Giuliani, five
years in which to grant cable franchises. That authority lapses in October.

But the City Council -- New York's legislative body,
which has often battled with Giuliani -- has indicated that it wants more of a say in the
process. Last month, the council asked members of the administration to discuss the
franchise authority with a council committee.

Administration officials declined to attend, so the meeting
never took place, a City Council official said. As of last week, it was unclear what
action, if any, the council intended to take to reclaim franchise authority.

Jacobs said Time Warner's proposal to the city
includes capital grants to help pay for governmental and institutional fiber networks, and
provisions to add to Manhattan's nine PEG-access (public, educational and government)
channels after new or future analog and digital tiers hit certain penetration levels.

Cablevision spokeswoman Susan Pelcher said the company
would not comment on specific franchise terms that are under discussion with city

The cable operators have been holding separate talks with
the nonprofit organizations that manage the city's local-origination channels.

In Manhattan, where there is great demand to appear on the
system's four public-access channels, Time Warner offered to increase its subsidy --
which is now between $3 and $3.50 per subscriber, depending on penetration -- by 25 cents
per subscriber at first and by another 25 cents later. Manhattan Neighborhood Network,
which programs the channels, asked for a $3 increase.

"I think that we're getting closer," MNN
executive director Anthony Riddle said in late August. "We still have some
substantial differences."

Published reports said Cablevision wants to reclaim two of
the four public-access channels in Brooklyn and the Bronx. An official at Brooklyn
Community Access Television, which runs the Brooklyn channels, would not comment on talks
with Cablevision.

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