Denver -- The Federal Communications Commission has granted
Colorado-based LyncStar Integrated Communications LLC an open-video-system license to
serve Austin, Texas.
The OVS license will allow the SMATV
(satellite-master-antenna-TV) operator to serve some 3,000 multiple-dwelling units in the
area, while getting around Time Warner Cable's objections to its entry into the
LyncStar CEO Alex Burney said last week that the company
has already begun installing its fiber optic plant in the city's rights-of-way, and
it plans to have 1,000 units up-and-running by the end of this month.
Under the FCC's OVS rules, LyncStar will not need a
traditional cable franchise, but it must adhere to all of the same local requirements
imposed on Time Warner.
It will be operating under an exclusive contract to serve
local apartment complexes that are owned and managed by AIMCO (Apartment Investment and
Management Co.) and Walden Residential Properties Inc. -- two of the nation's largest
real estate trusts, with more than 400,000 MDUs nationwide.
Originally, LyncStar had hoped to obtain a traditional
cable franchise, which it applied for late last year. However, it withdrew its application
after Time Warner objected to a deal that did not contain the same build-out provisions
that are included in the MSO's agreement with the city.
"Like most major conglomerates, they jealously protect
their monopoly," Burney said. "But we've run into this everywhere -- with
other Time Warner systems and Tele-Communications Inc. -- and it's despicable in the
Time Warner officials in Austin have responded by insisting
that the MSO only wanted all cable franchisees to be treated equally.
Under its original franchise agreement with the city,
LyncStar would have been allowed to install fiber optic plant in the city's
rights-of-way in order to connect its local apartment complexes. It later would have been
required to build out its system to include consumers who requested its service and who
lived a predetermined distance from its network.
However, faced with Time Warner's complaints, Austin
officials tried to amend LyncStar's franchise to require a nine-year plan that called
for building out 10 percent of the city over five years.
The company declined, instead choosing to ask the FCC for
its OVS license.
"Our first choice is always to go the local-franchise
route," Burney said. "But we didn't want to mislead or deceive the city.
We're a small private operator. And frankly, we don't know what things will be
like in five years, let alone 10 years from now."
Meanwhile, city officials, who did not contest the OVS
application, believe that they'll ultimately get LyncStar's name on a franchise.
The city is examining other locations where cities have granted limited franchises,
including a deal between Midland, Texas, and LyncStar.