The current tug-of-war between District Cablevision Inc. and city officials has left many people asking: Will cable television ever come to Washington, D.C.?
After months of intense bidding to get the contract, DCI won the $130 million franchise last December over two competing companies. The firm promised that in four years it would build a system that would provide basic services to every resident in the city. Promising 78 channels and a separate business network, DCI assured the City Council that it could complete all of the underground wiring and provide eight studios for citizen productions.
But recently, DCI announced that it could not get the financial backing to fulfill all of those promises. The firm asked for a dozen major concessions, ranging from reducing the number of channels from 78 to 54 to being released from the requirement that every home be wired if the average cost escalated beyond $500 per unit. The concessions they sought would tack an additional $32 million onto the cable system's basic $130 million price tag.
In addition to the proposed changes, the company has, according to City Council members and Richard Maulsby, the city's top cable official, failed to meet several deadlines set by the city to fulfill the terms of its contract. Betty Ann Kane (D-At Large) called the company's actions "irresponsible" and said she had "no confidence" in the firm.
In an effort to bail out DCI, Tele-Communications Inc., a Denver-based firm, proposed investing $30 million in the company. And Mayor Marion Barry urged the City Council to grant the concessions that DCI is seeking, while reiterating that he will insist that every city resident have access to the system.
Complicating the matter even more is the fact that DCI officials were aware from the start that the investment market had rejected the proposal and two of the nation's largest cable operators had concluded that the proposal couldn't be financed without modifications. Yet, DCI official Robert L. Johnson said he didn't regret rejecting those warnings, in part because he was motivated by altruism -- he wanted the special benefits a minority-operated cable company would bring the city.
As a result of all this, however, many people feel that DCI's mode of operation -- its unkept promises combined with the proposed changes -- has instead given minority business a bad name.
While DCI has operated with a curious mixture of audacity and chutzpah, District residents should not be made to suffer for any miscalculations, ineptness or misjudgments.
But it is important to remember that the District's plight is not so unusual. In several other cities -- Boston and Detroit come to mind, among others -- cable contractors have had to return to city officials and ask for more money and new concessions. And let's face it, if the U.S. government can bail out Chrysler, our government can afford to be a little patient with an undercapitalized firm like DCI.
The mayor and the City Council at this point do not want to have to start the entire bidding process over again, because they sense the growing impatience of the citizens to put the already-delayed system into place.
I tend to agree with Betty Anne Kane, Mayor Barry and others on the need to stand behind DCI at this point.
But there is no way, no way at all, that any consideration should be given to eliminating the mandate that every home in the city be wired for cable television. If this cannot be guaranteed, beyond a single escape clause in the contract, the agreement with DCI won't be worth the paper that it is written on.
If the city has learned one lesson from this, it is that the local government needs to have a better assessment of its own requirements for a cable system, and the cost of its implementation, so that if a prospective bidder comes in with an unreasonably low bid, officials can question the feasibility of awarding the contract.
And in the most unlikely event that the bidding does have to be reopened, I don't think the city should ever repeat the competitive bidding process. Instead of that long and grueling procedure, city cable officials should set clear requirements with a maximum price tag, invite firms to submit bids, put their names in a hat and pick the winner by lottery.