Its pending purchase of Adelphia Communications Corp. brings with it the commitment of improved customer service and broader programming choices for 500,000 additional subscribers in the city of Los Angeles and 1.6 million throughout Southern California. But along with those improvements comes a lobbying juggernaut that could become a formidable presence in regulatory matters involving rates and fees.
The $17.6 billion purchase, expected to win approval early next year, would raise Time Warner’s profile from a bit player in the western San Fernando Valley to a dominant cable company regionwide. The New York-based media giant will gain both the subscribers of Adelphia and Comcast Corp., which is in partnership with Time Warner on the purchase and has agreed to swap its Los Angeles assets as part of the deal.
All told, Time Warner gets the entire cable market in the city of Los Angeles, with the exception of Cox Communications Inc.’s 9,000 subscribers in Pacific Palisades.
“There’s no doubt that providing a high standard of customer service will be a high priority,” said Roger Keating, the top Time Warner cable executive in Los Angeles. “Where there are gaps today we’re going to be maniacal about fixing those gaps.”
But lawyers and analysts who represent cities where Time Warner does business say that the company can be a tough adversary by pushing governments to lift or lighten local regulations.
“They attempt to minimize regulation as much as possible,” said William Marticorena, a partner at Rutan and Tucker LLP, which represents municipalities with Time Warner franchises in the South Bay, the Coachella Valley and Orange and San Diego counties. “I certainly have found Time Warner to be more entrenched and more hard-nosed on many franchise agreements than other cable operators.”
That includes pushing for less stringent federal standards on customer service and lessening obligations for public, educational and government programming. In general, the industry has argued that increased competition from unregulated satellite television providers and even broadband and emerging cellular phone technologies bolsters their case for less regulation.
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The full story
is available in the May 30 edition of the Los Angeles Business Journal.
