PRESS RELEASE

Fairfax County Apartment Residents Have Chance at Better Cable Service

"Residents of multiple dwelling unit buildings in Fairfax County are treated like second class citizens when it comes to cable television. But the Board of Supervisors can do something about that. They can enhance competition and improve service and hold down rates," said Bill Burhop, Executive Director of ICTA, a trade association that represents smaller private cable providers that compete with the huge franchised companies.

Some 28 percent of the county's residents live in MDUs (rental apartments, condominiums, etc.) and their cable service is dependent on contracts entered into 15 - 20 years ago between the building owner and the franchised company. Those contracts were signed when cable was just starting, when there were no competitive alternatives, when technology was greatly different and when MDU owners understood little about the impact of what they were signing and how it would influence their buildings' tenant-viewers.

Many of these contracts include "Perpetual Provisions" that bind the MDU to the franchised company for the duration of the contract, plus the duration of the franchise and any extensions, renewals and assignments - virtually forever.

First, these provisions mean that no competitor can offer a better deal to the MDU tenant-viewer. Second, the law hates contracts of indeterminate duration such as these provisions. Third, the legal principle of "fresh look" is perfectly applicable. It says that when the circumstances underlying a contract (such as time since entered, technology, financing, levels of sophistication of the parties and provider alternatives) have changed dramatically, then the parties should be given the opportunity to review and alter the terms of the contract.

In the Fairfax County instance, these provisions will just go on and on because the franchise has 14 years left and will be transferred from Media General to Cox Communications and who knows what other franchised company in the future.

"Perpetual contracts preclude cable television competition and that leads to poor service and higher rates. Competition breeds better service and lower rates. The Board of Supervisors has the power and the opportunity to address the problem and enhance competition. There is legal precedent. It's been done elsewhere in the country. Now is the time for multiple dwelling unit residents to get a better deal. That can only happen if there is competition through the elimination of perpetual contracts," said Burhop.

Attached is a list of MDU owners that want to provide better tenant-viewer services and support the elimination of perpetual contracts.

The Board of Supervisors will vote on a motion offered by Supervisor Dix to address this issue on Monday, August 2, at 3:00 p.m.

Attached:
List of MDU Owners
ICTA Letter to Supervisors