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Cities: Data-Fee Ruling Affects Service

10/06/2002 8:00 PM Eastern

Revenue shortfalls caused by an inability to collect franchise fees for cable-modem service have affected localities' ability to ensure compliance with customer-service standards, municipal officials recently told a top federal regulator.

At the National Association of Telecommunications Officers and Advisors recent convention here, officials vented to Dane Snowden — the chief of the Federal Communications Commission's consumer-protection bureau — about the problems they've faced since March. That's when the agency declared that high-speed data was an information service, and not a cable service on which franchise fees may be levied.

Many cable operators interpreted the FCC's declaratory ruling to mean that they were required to stop collecting fees on cable-modem revenue. That left some larger governments with budgetary shortfalls of $200,000 or more — and confused as to who should respond to consumer complaints regarding modem service.

Tricky business

In all realms, customer service has become more of a gray area for local regulators. Cities can't demand information about modem-service activity, cable operators claim, so overseeing customer service on that product has become almost an impossibility.

And as consolidating MSOs transfer service jobs into multi-jurisdictional call centers, local service can be affected by a distant event, such as a tornado or a power outage — and operators said they can't be penalized for substandard service, because the distant tornado was an extraordinary event.

And since local regulators can't look at the books to determine cable-modem revenues, they fear that operators might be putting data costs on the backs of video customers.

Even big agencies are having trouble under the new circumstances. California Public Utilities Commission chairwoman Loretta Lynch said her agency can't get state-specific service information out of SBC Communications Inc. unit Pacific Bell.

Certified local-exchange carriers "have hundreds of high-paid people to write reports for them in a way so we don't find the problems. The onus should be on them to do it right, not for us to find it.

"It's not surprising the current financial scandals are in recently deregulated industries: energy, telecommunications," Lynch added. "They knew they could get away with it. If we don't go after them, customer-service complaints will explode because they know they can get away with it."

Snowden suggested that the cities continue to lobby the FCC and participate in agency activities, such as an Oct. 16 forum on the contentious issue of rights-of-way management.

Municipal officials ruefully noted that they were invited to attend, but were not included on the panels.

 

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