Knology customers would have to read the paper or KnoxViews to know this. They still cannot watch City Council meetings on Knology.

It is ridiculous.

I have Knology and yes, this is an issue for me.

But I might be switching back to DirecTV here soon anyway.

SciFi HD + Battlestar Galactica = \o/

Obviously I think this is a good solution for the situation at hand, or to be a bit more precise in language, I think this is the optimal among the set of possible outcomes for the citizens given the cirumstances. Knology owes the city approximately $400k in "damages" for noncompliance with the original contract, which is still in effect. This contract required that a buildout be completed throughout the city by this time. There are reasons for this that have to do with the nature of the industry and the abilty of a cable company to raise large amounts of captital in the post dot-com collapse era. But, on the other hand, there is an existing contract.

One option would be to move to collect this amount and continue to collect $5,000 a monthly from Knology for the duration of the contract. CTV would still not be provided to existing customers and further buildouts would be problematic at best given the extreme cost to Knology to build out the entire city when compared to payment of the monthly fine. Moreover the service to the community centers would almost certiainly not happen.

The negotiated contract amendment represents the best option two that seemed possible. Knology takes the $400k++ and immediately puts it into construction and service to more of Knoxville. They provide CTV in a short period of time to their customer base and they provide free internet and cable to a number of community centers. They are contractually bound to invest this money this year. Moreover they commit to continuing the buildout with specific dollar requirements regardless of success at signing folks up. However the contract binds them to spend money on buildout on a success model. That is, the more customers they sign up the more they build out. The city receives franchise fees, of course, from both old and new customer groups.

Option one maximizes immediate payment to the city coffers but offers little or no hope of meaningful further service and therefore minimal increase in competition in this market. It does not provide service to comunity centers and leaves the CTV situation unresololved. It also punishes Knology for not fulfilling their contractual obligations.

Option two keeps a viable option for citizens and provide the basis of further service extensions throughout the city.

Faced with this situation I think option two is preferable. That is why we presented it to council. Of course council has a lot of questions and concerns and there will be further discussion before second reading in two weeks.

I would quarrel a bit with the "free pass" characterization. However I do rather like Randy's framing of the "PIF" concept. Thanks. I hearby nominate it for "Acronym of the week."

The vote by Council last night was first reading of an ordinance, so it comes back in two weeks for a second reading. It would amend the original ordinance, which is the franchise agreement between the city and Knology. Six Council members (including myself) voted in favor of this amendment on first reading, and three voted against it. I can't speak for the others who voted for it, but I did so only so Knology would have one more opportunity to contact me (which they haven't yet) and give me their take on it.

As best I can tell, they've built out a pitifully small area of the city so far, and have done nothing recently. It appears they will never get to the district I represent (South Knoxville, UT campus and Fort Sanders), but I want to give them a chance to tell me personally what they can and will do.

They still seem to be very tight with information on where they've built out so far, and unwilling to provide any reasonable projections on where and when they will build to meet these proposed revised obligations. If that proves to be the case, then it's not acceptable. If they can't in good faith provide reasonable answers, then the conversation may be over with. That said, I want to give them the opportunity. They have two weeks to respond to my request.

I spoke with their general manager about the CTV issue over a year ago and he claimed that they can't get permission to dig to get a cable into the Andrew Johnson building. I smelled BS but let it go.

It seems that part of the problem is that the city waited 3 years to police the situation. I realize that flexibility is important. But the compromise always seems to be borne my the community in these things. Knology bears no brunt other than to do now what it has managed to put off. And that just rubs the public the wrong way. I think it would have been wise of the city to have turned up the heat or sought a competitor when it became clear that the contract was not being fulfilled. A more timely reaction would have deflated those fine accumulations that are being framed as capital investment.

It seems we must always accommodate the best interests of those whose role it is to serve us in Knoxville. I wish we would demand more. The market meets mediocre demand with mediocre products and services. Knoxville deserves better than we get -- or settle for.
~m.

It's always easier to negotiate contractual teeth during the bidding process, rather than later.

The contract had teeth in the form of fines that were never collected. I've noticed in the past that the city is reluctant to enforce contracts, leading to a sort of easier-to-get-forgiveness-than-permission cavalierness in those with whom it makes agreements.

Take the convention center, which has had problems from the beginning with carpeting, etc. The water feature outside has been "temporarily under construction" for repairs for well over a year. If I were to spend that kind of money on something personally, I'd see to it that all warranties and specifications were met. But with our city, it seems real issues are negotiated away once they arise, leaving the public shortchanged. We rarely get what we bought around here, and too passively settle for what we receive.

I realize litigation could be costly. But it would be refreshing to have the city legal department pursue something on occasion rather than declaring why it can't.
~m.

I figure Knology has done the math and $5K per month in fines is cheaper than building out service. Especially when they don't pay them.

Now somebody needs to do the math and figure out what lack of competition in the market cumulatively costs subscribers per month over rates in similar markets that don't operate under a monopoly.

My guess is $5K a month would be a drop in the bucket. In other words, these delays have cost/are costing us a good deal more than Knology.
~m.

And the math on franchise fees the city is missing out on.

what do you mean deep pockets? I work for knology and my pay check proves they do not have deep pockets.