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Cox, city agree on reducing access channels

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The city of Tucson has put up an unnecessary obstacle in its license-renewal talks with cable-television operator Cox Communications. The city has much to lose and little to gain by not accepting a fairly negotiated deal that would serve the needs of cable viewers in Tucson and other Southern Arizona communities.

Cox and the city have been negotiating the license renewal for about a year. The drawn-out, sometimes acrimonious talks appeared to be nearing an end March 2, when the City Council met in executive session and later voted 5-2 to accept an agreement reached between Cox and city negotiators.

But the optimism brought about by the vote lasted only a few days. The next week, the deal fell through after the city insisted on including a provision that would allow it to buy the cable company's infrastructure at the end of the five-year deal.

Cox maintains that it will reject any license agreement that contains a buyout provision.

The buyout clause is unnecessary. The city argues that such a provision will ensure that Cox meets the needs of its customers, but we believe Cox's satellite-TV rivals and viewers already keep Cox in line. It's in Cox's best interest to keep customers happy rather that see them defect to the dish companies.

City Attorney Mike Rankin, who is charged with working out the legal language in the license agreement, said the buyout provision can be invoked only if Cox abandons services to customers, violates the agreement substantially or if the city and cable company are unable to agree on a new deal after five years.

Anne Doris, vice president and system manager for Cox in Southern Arizona, said in a March 9 press release that the buyout provision was inserted at the "11th hour" of negotiations. She also said Cox had expressed in earlier discussions with the city that such a provision would be a deal-breaker.

"The buyout provision has been in every cable license renewal for the last 20 years," Rankin said. "To pick this issue to be a deal-killer just confounds me. I don't understand why they would let this provision hold up a deal that the City Council has otherwise blessed."

Doris said Cox is adamantly opposed to a buyout provision because it doesn't make sense in an age when cable companies offer more than just pay TV. Unlike 20 years ago, cable systems today also offer high-speed Internet and telephone services.

From a business standpoint, it doesn't make sense for a company to invest in infrastructure if there's a risk that someone could buy it away in five years.

Rather than ensure Cox customers get the best service available, we believe a buyout option would be a disincentive for Cox to pour more money into its system.

The buyout provision is also a bad idea because Cox's system serves not only Tucson, but Green Valley, Sahuarita and Benson. By the end of the year, it will also serve Sierra Vista, Tombstone and several other small communities. Doris said residents of small towns get the same level of service as those in Tucson because they can piggyback on the same platform.

Doris said it would be burdensome for Cox to be bought out in Tucson and still have to provide service to smaller communities.

The deal the council OK'd would give the city three analog channels (those viewable without a digital set-top box), one digital channel and 2,000 hours of on-demand programming. In addition, the University of Arizona and Pima Community College would have one digital channel apiece.

That package of public access, education and government channels is better than what the city would get under a new state law that takes effect July 1. It would also give Tucson more PEG programming than any other city in the state.

In addition, the city would receive more money from licensing fees under the Cox deal than it would under the new state law.

The tentative agreement would be good for the city financially and for Cox subscribers, especially those who watch PEG channels. We urge the city to drop its demand for a buyout provision and accept the deal the City Council voted to accept.