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Qwest looks to expand TV offerings
Comcast wants it held to build-out provisions
By Jeff Smith, Rocky Mountain News
Saturday, November 19, 2005

Qwest Communications is trying to bring television service into homes throughout the Denver area, going head to head with Comcast Corp.  The Denver telco is negotiating a cable-TV model franchise agreement with the Greater Metro Telecommunications Consortium, which represents 30 metro governments.  Qwest also recently has approached a number of municipalities individually, including Aurora, Denver and Greenwood Village.

"Qwest has approached many metro cities (with interest) in a cable franchise agreement," Darryn Zuehlke, telecommunications director for the city of Denver and vice president of the Greater Metro Telecommunications Consortium, said Friday.  "GMTC has a franchise committee negotiating a model franchise agreement that all of its members can use."

Comcast said it welcomes competition, but there's a huge sticking point.

The area's dominant cable TV provider argues Qwest should be subject to the same build-out provisions that require Comcast to upgrade its network throughout a community.

"We can't pick and choose," said John Aragon, Comcast's senior director of government affairs.  "If Qwest is able to pick and choose, that changes the cost structure.  They want to primarily focus on new neighborhoods . . . and affluent neighborhoods."

But Qwest, which would offer the video services by upgrading its existing fiber and copper-wire telephone infrastructure, argues that as a second provider it shouldn't be subject to the same build-out provision.

"Second entrants into the phone arena have not been required to build out their entire network," said Qwest spokeswoman Carey Madsen.  "We feel the same standard (as in the phone market) should apply to TV services."

Madsen added Qwest already provides satellite TV across its 14-state local phone region through partner DirecTV.

Zuehlke said members of the consortium have concerns about the build-out provision and so far are requesting it be in the model agreement.

"We have a responsibility as well to make sure all citizens have access to the Qwest cable (TV) services," he said.

But the parties, which have had several meetings, are still negotiating.

"We're hoping to finish it off fairly quickly," Zuehlke said, because he said Qwest is eager to move forward.

Qwest so far has avoided build-out provisions in other areas where it is offering video services, including Highlands Ranch, Lone Tree, Phoenix and Omaha.

On Thursday, over Comcast's objections, Salt Lake City granted a cable franchise to Qwest without a build-out provision.  Qwest also has started a fiber-to-the-home video project in a new neighborhood in South Jordan, Utah.

Madsen said Qwest isn't ready to announce new TV markets in Colorado, "but we want to bring competition to customers as soon as possible."

She noted the video services will allow customers to integrate telephone features such as caller ID with their TV screen, so a viewer can decide whether to take a call.

"Customers appreciate the technology and the benefits it can bring," Madsen said.  "The bottom line for customers is they want to have a choice in providers."

Comcast said it agrees, as long as there is fair competition.

"We are happy to compete with Qwest if the terms and conditions of their agreements are the same," said Scott Binder, Comcast Colorado's senior vice president.

But if Qwest is allowed to cherry pick affluent neighborhoods, that's a different story, Binder said.

Qwest TV services

  Existing neighborhoods in Highlands Ranch, Phoenix, Omaha:  Fiber-optic cables to the neighborhood, then traditional copper cable inside a customer's home. Called VDSL.

  New neighborhoods such as RidgeGate in Lone Tree and Daybreak in South Jordan, Utah:  Fiber-optic cable to the home, with the video/data signals transmitted through the home via an Ethernet connection.
Source: Qwest

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