Issue date: September 15, 1999
Menlo Park and Atherton subscribers to Cable Co-op will soon vote on the sale of the cable television system to AT&T, the giant phone company which just recently charged into the market with its purchase of TCI, the Bay Area's largest cable company.
The terms of AT&T's $90 million offer for Cable Co-op are more than generous: After all debt is retired and money set aside for employees, contingencies, system upgrades and a rebate to subscribers, nearly $17 million will remain to establish a media center and fund for local programming. And while the change in ownership means local control over content selection and channel placement will shift to AT&T, production of local shows and public access programming could continue for years to come given prudent investment of the $17 million surplus.
In truth, the Cable Co-Op board, which accepted AT&T's offer last week, had little choice. Faced with a mountain of debt, the board simply put off the inevitable by scheduling a $28 million balloon payment in January of next year. When the city of Palo Alto turned down a request for funding and an outside purchase offer was withdrawn, the door was opened for talks with AT&T.
The most contentious issue to decide if the sale is approved by members is how Cable Co-op's own local production company and Midpeninsula Access Corp., MPAC, will operate as the purchase moves forward. Currently the two units act independently, but with different missions. MPAC's goal is to get diverse voices on the air by teaching volunteers to use its equipment, while the Co-Op offers a handful of professionally produced local shows, including the Reel Review, Newswatch and Conversation Piece.
Another bone of contention is channel placement, as Cable Co-op has generously reserved Channel 6, a very desirable location, for local programming. So far, AT&T has indicated that it is likely to place a commercial station on Channel 6 to match similar arrangements in other South Bay communities, which means local programming may be forced to move to a much higher channel number.
Since it began its ambitious run in 1987, Cable Co-op has had lofty goals, but never enough capital or adequate subscriber base to put them in place. Now, as media giants joust for control of the information highways, tiny cable companies are simply too small to compete. The Cable Co-op board did well to negotiate the generous AT&T offer. Its final effort should be to assure subscribers that the $17 million nest egg will be invested wisely, so that local, community programming can continue for years to come.
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