Cable Talk

The nuts-and-bolts of cable television license agreements in Worcester

The City of Worcester is currently in a renewal process with Charter Spectrum relative to its license agreement to provide cable television services within the city.  

To be clear, the license agreement is for cable television services only and is not related to internet or phone service at all. 

The renewal process drew widespread attention when the Cable Television Advisory Committee voted unanimously in March not to recommend renewing Charter Spectrum’s license agreement. 

As that news made the rounds, it became clear that there are some misunderstandings in the community about what the license agreement involves, which I’d like to clarify here.  

The advisory committee’s vote came as part of the City’s ascertainment period, when it collects information that it will use to negotiate the renewal of the license agreement.  

Charter Spectrum’s 10-year license agreement expired in October 2023. The City was able to negotiate a one-year extension, with the previous license simply staying the same, while we work to complete the ascertainment period so we can start formal negotiations.  

The City started preparing for the renewal process in March 2020, understandably running into some delays due to the impact the COVID-19 pandemic had on meetings and the advisory committee’s ability to meet quorum.  

I rely on the advisory committee to do the pre-work when it comes to the license agreement, which included a survey of cable customers in Fall 2022, three public forums in April 2023, and several committee meetings to hear public input and get questions answered about how Charter Spectrum is upholding its current license agreement. The City also hired a consultant to determine how well the telecommunications company complied with its previous license agreement.  

I appreciate the work of the advisory committee and their recommendations when it comes to the license agreement, however in addition to their recommendations, I must consider the options the City has, as well as federal and state regulations when it comes to cable providers.  

Currently, Charter Spectrum is the only telecommunications company with a cable television network in Worcester. Another company can come into the city, as the license agreement the municipality has with Charter Spectrum is non-exclusive. However, that company would either need to purchase Charter Spectrum’s existing cable network or build its own. As the world moves away from cable and toward streaming, there is less of a financial incentive for companies to build their own networks.  

When the previous license agreement was executed in 2013, there were 48,000 cable service subscribers. In the decade since, the number of cable subscribers has dropped by more than half, with close to 23,000 subscribers in 2023.  

That dip in subscribers impacts the revenue the City receives as part of the license agreement. The City receives 5% of Charter Spectrum’s revenues from subscribers in the city. That percentage of revenue goes toward funding the City’s Cable Services department and the Public Access, Educational Access, and Governmental Access (PEG) Channels.  

In FY2015, the City received nearly $2.09 million from Charter Spectrum. By FY2024, that amount dropped to $1.97 million. PEG Channels are more important than ever, because as local news outlets decline, they are one of the last places residents can go to learn what’s going on in their local community.  

Funding for PEG and Cable Services is one of the areas the City is able to negotiate in the license agreement, as well as image resolution and service options for senior citizens.  

During the public forums, many of the comments from attendees related to programming and rates. Municipalities aren’t able to negotiate either, as rates and programming were deregulated at the federal level.   

The City could deny Charter Spectrum’s license agreement, but we would have to enter into lengthy legal proceedings. If we won, we would leave cable subscribers without any option in the city and lose funding for PEG Channels and Cable Services in Worcester.  

I am currently working with the Cable Services department to move through the renewal process and will use the tools at my disposal to do the best I can to get the best license agreement for the City while adhering to federal and state guidelines.