Charlotte Eyes Two Cable Newcomers

Author:
Updated:
Original:

The city of Charlotte, N.C., may decide soon as next month whether to green-light a pair of franchises that would introduce competition into the local cable market.

The city is considering applications from Carolina Broadband and Seren Innovations Inc.-newcomers that want to offer cable and Internet access to some 155,000 consumers served by Time Warner Cable in Charlotte and surrounding Mecklenburg County.

The two would be joined by DeCom Corp., a Massachusetts-based outfit headed by cable-industry heavyweight Douglas Dittrick, which has been authorized by the Federal Communications Commission to build an open-video system in Charlotte.

All three companies also plan to compete with BellSouth Corp. for local and long-distance telephone customers.

"We're hoping to have two cable-television franchises ready for the City Council by its July meeting," Charlotte cable administrator Doris Boris said.

DeCom does not require a franchise, but does have to strike an OVS agreement with the city, she added.

Boris said the city studied one-dozen other communities with competitive cable providers prior to issuing a request for proposals last year. "We found that competition had a positive effect on everything from rates to customer service," she added.

The best-known among the three companies eyeing Charlotte is Seren, a subsidiary of Northern States Power Co., Minnesota's largest electrical and natural-gas utility.

Seren already offers a bundled package of telecommunications services in four communities in Minnesota, as well as in the east San Francisco Bay area. It's also preparing to enter the Colorado market.

But the MSO is still only in the "exploratory" stage in determining whether Charlotte meets its usual criteria of a midsized market with attractive demographics.

Perhaps the most intriguing of the new market entrants is DeCom. The company is privately held by Douglas Sales Management, a Midland Park, N.J.-based outfit specializing in consulting and direct sales for the cable industry, which lists Dittrick as president and CEO.

Dittrick, a two-time chairman of the National Cable Television Association, founded America Television & Communications, which later became part of Time Warner Cable. He also ran Viacom Cable and Tribune Cable.

"Between us, we've probably owned 100 cable systems over the years," said DSM chairman Jay E. Ricks, a former partner with Washington, D.C.-based law firm Hogan & Hartson.

In its FCC filing, DeCom stated it was prepared to build a system capable of offering 200 digital and 80 analog channels to Charlotte and Mecklenburg County residents.

Under the Telecommunications Act of 1996, DeCom's OVS license allows it to offer telecommunications services in Charlotte without obtaining a franchise from local officials, in exchange for providing 30 percent of its capacity to its competitors.

Although it technically does not need a local franchise, DeCom is nevertheless "considering" a draft proposal from the city, Ricks said. "The market has a lot of high-tech, lots of Internet usage and it is growing," he added.

Officials with Carolina Broadband-a company with plans for a network of systems throughout the region-were unavailable for comment at press time.

Related