CenturyLink made a hard push for entry into the Minneapolis cable market Monday, telling members of the City Council that it is ready and willing to compete with Comcast — even if its cable offerings won't be available to all residents right away.
In a hearing with the council's Ways and Means committee, CenturyLink representatives said their company intends to roll out its Prism TV service over several years, as it has done in Phoenix, Denver and Omaha. While Minnesota state law requires cable franchise holders to provide service to all residents in the franchise territory, CenturyLink maintains that more recent changes to federal communications laws trump state regulations.
Comcast — and a handful of residents who spoke at Monday's hearing or submitted letters — argue that CenturyLink's plan would allow it to unfairly skirt the rules and leave many parts of the city without multiple cable options. The council is now deliberating over both arguments and will later weigh in on whether CenturyLink should be offered a new franchise.
Comcast is the Twin Cities' largest cable provider and the sole holder of a franchise in Minneapolis. The company's current agreement expires in 2021 but is not exclusive, leaving room for other providers to elbow into a changing market. CenturyLink is now looking to move into cities across the metro area.
CenturyLink officials told the council that although there is some competition from companies providing dish or subscription-based television services, the city hasn't had multiple cable franchise options for more than three decades.
"You don't have anybody else knocking on your door, and you probably won't," said Jim Campbell, CenturyLink's regional vice president for regulatory and legislative affairs. "And I think it's the residents of Minnesota that will win at the end of the day."
If the council approved a new deal, CenturyLink says, it would first roll out its cable service to 30 percent of the city's households. Future expansions would depend on the success of the Prism TV service, which is distributed through a fiber-optic network. Subscribers can watch live programming on smartphones and tablets, in addition to their televisions.
Prism TV is currently available in 14 U.S. cable markets, accounting for about 2.3 million homes. About 300,000 people have subscribed.
CenturyLink has declined to publicly share its plans for where the service would first be offered. That drew questions from Council Member Elizabeth Glidden, who said knowing the company's plans was an important part of the council's considerations.
Campbell told Glidden that CenturyLink does have maps and would share them individually with council members but didn't want to release information that could get out to competitors. He said the company has expanded its service more quickly than promised in other cities.
"That's where I feel like we're in a bit of a conundrum here," Glidden said, adding, "I'll say that's a concern, that [the map] information isn't submitted."
The council has received letters opposing CenturyLink's proposal, including one from 23 Somali-American residents who argue that the company's limited rollout would hurt city leaders' racial equity goals. A second, nearly identical letter from another man identifying himself as a Somali community leader, Mahamoud Wardere, made the same argument.
Pete Rhodes, who runs a media company called Black Music America, said he's also concerned about who will be able to get CenturyLink's services.
"Unfair and inequitable service distribution impacts already under-served communities," he said.
A representative for Comcast spoke briefly during Monday's meeting, pointing council members to a letter the company sent to the city Monday.
In it, the company says it welcomes the competition from CenturyLink but disputes its legal arguments.
"Of particular concern is CenturyLink's build-out commitment that appears to stand in direct conflict with state law," wrote Emmett Coleman, Comcast's vice president of government affairs. "While CenturyLink says its service will be 'available' to over 30 percent of households within the City, it gives no indication of where within the City it will offer cable service. Which households or communities within the City will CenturyLink choose to serve?"