Dallas, Arlington Respond to Hikes

Author:
Publish date:
Updated on

AT&T Broadband & Internet Services will raise its
rates in Dallas, adding $1.79 per month to the average cable bill beginning in June.

But a narrow 7-6 vote by the City Council not to fight the
basic-cable component of the increase was seen as a sign that local officials remain irate
over service problems plaguing the former Tele-Communications Inc. system.

"I think a 7-6 vote speaks for itself," Dallas
Controllers Office director Eric Kaalund said. "The reason why everybody wanted to
deny the rates was because the City Council is still tremendously irritated with TCI's
service."

According to published reports, Mayor Ron Kirk felt that
the Federal Communications Commission would overrule the city if it rebuffed TCI's new
rates.

So the cost of basic cable -- the only tier local
regulators can influence -- will jump 4.8 percent, or 51 cents per month, to $11.13, while
unregulated expanded basic will soon cost $31.25, up $1.25, or 4.2 percent.

TCI spokesman Matt Fleury said the lower-tier increase was
the most allowed because basic costs had not increased in Dallas in two years. "The
situation was a little unique because basic rates had been static," he added.

With the franchise set to expire in September 2000, the
city has begun a technical and needs assessment in order to prepare a proposal holding
AT&T Broadband's feet to the fire on such issues as a system upgrade and improved
service, Kaalund said.

Fleury said AT&T hopes to reach a franchise agreement
so that it can launch an upgrade in Dallas similar to ones under way in surrounding
communities.

Meanwhile, nearby Arlington, Texas, set the stage for
another battle at the FCC last week when it sought to curb basic rates for 60,000 cable
subscribers.

In a decision covering rates effective June 1, the city
ordered AT&T Broadband to scale back its planned rate for basic cable by 13 cents per
month. The MSO planned a basic rate of $10.79 per month beginning June 1 in areas with
rebuilt plant. Under the city's order, the rate would fall to $10.66.

Local officials did approve higher rates for service
upgrades and equipment costs, including the price of remote-control devices and set-top
converter boxes.

The city's action raised the specter that AT&T
Broadband would appeal the order to the FCC, which could grant an emergency stay allowing
the company to charge the higher rate until the issue is resolved.

City officials were predictably hopeful that AT&T
Broadband would not go that route. TCI appealed each of Arlington's last three rate
orders, winning emergency stays each time. The commission has not acted on any of the
three appeals, which date back to 1996.

AT&T Broadband officials would not say whether the
company would appeal to the FCC.

Related