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06-09-14-R
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06-09-14-R
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Executive Summary <br />FRC’s Review of Comcast’s Formal Renewal Proposal <br />© Front Range Consulting, Inc.Page 5 <br />could easily invest these profits in the NSCC franchise area by providing the level of capital and <br />operating support contained in the RFRP and/or reducing the pass-through burden on the <br />subscribers and still return significant profits to the corporation. <br />I-Net Facilities <br />Comcast has rejected the RFRP requirement to basically maintain the current HFC and fiber I- <br />Net and has instead suggested that the I-Net would only be maintained for only PEG transport <br />and that the balance of the use of the I-Net will be based on “fair-market value.”9 As an initial <br />matter, Comcast is incorrect that the Cable Act limits the use of an I-Net to only PEG transport. <br />Again referring to the legislative history of the 1984 Cable Act, it is clear the Congress intended <br />PEG requirements to be separate and distinct from I-Net requirements. The legislative history <br />concludes: <br />A franchising authority, under 611(b), may require as part of its request for proposals <br />the number of channels that an operator must set aside for public, education or <br />governmental use. <br />Subsection 611(b) also permits franchising authorities to require that channel capacity <br />on institutional networks be designated for educational or governmental use. The term <br />“institutional network” means a communication network which is constructed or <br />operated by the cable operator and which is generally available only to non-residential <br />subscribers.10 <br />FRC believes it is clear that PEG needs are separate from I-Net needs based on this legislative <br />history and therefore should reject Comcast unsupported position. Comcast I-Net proposal <br />unfairly restricts the needs of the franchising authority. Comcast also fails to consider that the <br />full construction costs (as determined by the cable operator) of these I-Net facilities have been <br />fully recovered from subscribers as part of the PEG fee included in Comcast’s regulated service <br />rate. For Comcast to now re-take these paid for I-Net facilities and subsequently charge the <br />NSCC/NSAC for these services at market based rates will allow Comcast to earn a profit on <br />these fully paid for I-Net facilities. Such a self-serving proposal does not meet the needs and <br />interests of the subscribers in the NSCC franchise area. <br />9 Proposal at 10. <br />10 See H.R.REP.NO. 98-934, at 46 (1984),as reprinted in 1984 U.S.C.C.A.N. 4655, 4656.
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