Federal Law and Federal Communications Commission (FCC) regulations prohibit the City from regulating rates in Redmond. Cable companies determine what they charge in various cities and regions of the country.
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In the new franchises with Comcast and Ziply, the City can require higher customer service standards, increase penalties for violating standards, and increase efforts to enforce those standards.
In accordance with Federal Law, the City of Redmond cable franchise agreements are non-exclusive. Other cable companies can choose to build their networks in Redmond, but building a cable network is expensive, particularly where the City does not have its own Municipal Electric System. Other cable companies would need to enter into franchises with the City which are materially similar to the Comcast and Ziply franchises and so far, there has been little interest from other wireline cable television competitors. Dish, and Direct TV are direct broadcast satellite providers and are available alternatives.
Federal Law and FCC regulations limit what the City can do to attract companies since the City must maintain parity between Comcast and Ziply and potential other wireline cable television providers. For most companies, expanding into Redmond would require major financial investment which could be financially unfeasible. There can be negative consequences to overbuilding, and as cord-cutting increases, those potential downsides also increase. Verizon elected to overbuild Comcast in 2008 and Frontier purchased Verizon’s cable system in 2009. At the beginning of May 2020, Frontier's franchise transferred to Northwest Fiber, LLC, doing business as Ziply.
Many municipalities are not as well suited to building and maintaining a cable network as private companies are. There are substantial financial costs and risks to consider, and studies have shown that when a city builds its own network, oftentimes not enough people will switch to or sign up for the city’s municipal cable system in order to make the municipal cable system financially viable.
The City can assist you in this regard. Some cities used to employ full-time staff to respond to issues with cable service providers in their area and to manage cable television franchises. Adding City staff or contracting with a specialized company to field contract compliance issues within Redmond is a possibility.
The City does not actively monitor contract compliance but addresses issues as they arise with the cable providers. The City could contract with a specialized company to monitor service delivery.
There are several possibilities for improving on the old contracts from 2008 and 2013 including:
Federal Law make it very difficult and very expensive to deny renewal and to push a cable provider out of a market once they are established and their infrastructure ,facilities, equipment and cable drops are in place. The most effective ways to improve cable price, quality, and customer service is competition and to negotiate state-of-the-art contracts and enforce them effectively. As previously mentioned, DirectTV and Dish are also available as alternatives to cable in the Redmond area. Additionally, over-the-top-services such as Amazon, Hulu and Netflix now provide alternatives to traditional cable service or can be added to traditional cable service.
This is complicated under Federal Law. In order to require a build-out with reasonable costs, density requirements can be included in franchises by the City. When Verizon negotiated with the City in 2008, the City included build-out exemptions in the franchise (which is now held by Ziply), in order to encourage competition, and be in compliance with Federal Law. Cable agreements which involve building cable lines to specific apartment buildings, or to private neighborhoods (where there are not public easements or City dedicated or City maintained streets), are negotiated between the building owner, or the neighborhood association, and the cable company.