Fourth cable TV option open

County eyes deal to expand choices in Glen Burnie, Maryland City, Russett

October 28, 2007|By Phillip McGowan | Phillip McGowan,sun reporter

Glen Burnie, Maryland City and Russett would gain an unheard-of fourth option for cable service if the Anne Arundel County Council endorses a deal with Virginia-based Cavalier Telephone Corp.

Cavalier's seven-year proposal is the latest in a flurry of cable proposals to come before the council during the past 16 months. During that time, Comcast Corp. and Millennium Digital Media Services renewed long-term agreements to provide service in Anne Arundel, and Verizon Communications inked its own deal to establish a cable franchise here.

John Lyons, the county's cable administrator, said he's unaware of another jurisdiction in Maryland that has four cable providers, and a spokesman for the cable industry lobby called that occurrence "unusual."

Cavalier formally requested a cable license April 23 and reached a tentative agreement with county officials in early June. If the deal is approved, the telecommunications company would offer cable and Internet connections on DSL lines, along with phone service on traditional lines. It would lease a portion of Verizon's wire system instead of installing its own infrastructure community by community, Cavalier spokesman Craig Pizer said.

Cavalier has more than 5,000 customers in the Richmond and Hampton Roads areas in Virginia. It's also negotiating cable franchise agreements with Baltimore City and Howard and Montgomery counties.

The trend among telecommunication companies is to offer "bundled services" of phone, Internet and cable in one package. Cavalier already offers phone and Internet service in the region, and the need to remain competitive motivated the company to seek a cable license, said Pizer.

"We would lose subscribers without a cable TV service to offer," he said.

The council will hold a public hearing Nov. 5 on the deal with Cavalier, which is seeking to offer cable, phone and Internet services in Brooklyn Park, Linthicum, Glen Burnie, Maryland City and Russett. A vote could occur that night.

County Executive John R. Leopold, a Republican, and council members lauded the competitive choices for cable service and were hopeful that would lead to cheaper rates.

"The more, the merrier," said Councilman Jamie Benoit, a Democrat who represents the communities of Maryland City and Russett.

About 99 percent of the county's households receive cable service from at least one provider. Since Verizon began installing fiber-optic lines last year for its bundled service, known as FiOS, including Glen Burnie, Maryland City and Russett, the percentage of county residents with access to more than one cable provider has grown to more than 65 percent, although county officials couldn't determine a precise number.

About 144,000 households subscribe to cable service, county officials said.

Lyons said that Cavalier, if granted the cable license, would be able to activate its cable services "almost instantaneously" in Glen Burnie, Maryland City and Russett, where there are a combined 58,000 residents.

Rob Stoddard, senior vice president for the National Cable and Telecommunications Association, the lobbying arm for the cable industry, said Anne Arundel is a trendsetter for the type of cable competition the country as a whole will face.

Nationwide, 65 million households subscribe to cable, and 26 million are signed up to satellite service. Viewers in major markets typically have access to at least one cable provider and two satellite TV providers, Stoddard said.

"Anne Arundel is the wave of the future," Stoddard said. "An increasing number of major providers are getting into the multi-channel video marketplace. This will be a challenge for our business, but this will be a win for consumers because there will be more choices ahead."

A heavy concentration of upper-middle-class neighborhoods across the western and northern tiers of Anne Arundel have lured telecommunication companies to invest in the county.

A survey of median household incomes last year from the U.S. Census Bureau's American Community Survey showed that Anne Arundel has the third-highest median household income in the state, at $79,160. More than $6 billion of commercial developments are completed, being built, under county review or in conceptual planning, according to the county's economic development agency.

A wave of thousands of white-collar jobs coming to Fort Meade during the next five years is expected to bring billions of dollars more in development and lure at least some of the workers to settle in Anne Arundel.

Leopold said the county's wave of high-end growth "speaks for itself."

"Decisions have been made and are being made because of the growth in the county," he said.

In June, it appeared the county would be left with two competitors, Verizon and Comcast, after Millennium announced it would pull the plug on service in Anne Arundel and hand over its 38,000 customers to Comcast. But Comcast announced last month that the deal fell through.

Leopold said the transfer of customers didn't occur because Comcast could not get federal approval. A Millennium official told The Sun that the company would recommit to expanding service, even though in recent years it had invested $30 million into new services and lost about 18,000 customers.

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