Wed, 06/07/2006 - 7:49am

Copyright 2006 Denver Publishing Company
Rocky Mountain News (Denver, CO)
June 7, 2006 Wednesday
Final Edition
By Joyzelle Davis
From Lexis Nexis

A City Council panel on Tuesday agreed to formally discuss Qwest Communications' proposal to offer video services in Denver but expressed skepticism the two sides could avoid an impasse over key issues.

Qwest wants to choose the neighborhoods where it will provide service. Council members indicated they'd be uneasy without a commitment that the telco will eventually serve the entire city. The panel members also want Denver voters to have an opportunity to approve any proposed franchise agreement, which Qwest opposes.

"My view is the council cares a lot about equal access, and absent such assurances it will be hard for us to accept a franchise with Qwest," said Kathleen MacKenzie, chairwoman of the technologies services committee. But she added that she likes the idea of spurring competition and it's worth holding at least one discussion to gauge everyone's ability to compromise.

Talks could begin this month.

MacKenzie said she's "intrigued" by Qwest's willingness to consider incentives such as the extension of its six-year franchise term if the telco hits certain percentage targets to expand service.

Qwest Colorado President Chuck Ward said after the meeting that he also views the incentives as "an opportunity" for discussion.

"If we're successful in the market, we'd get the benefit," he said.

Comcast, the incumbent Denver cable provider, opposes the idea. Comcast senior director of government affairs John Aragon said such incentives are "all carrot and no stick" and the lack of a buildout requirement would give Qwest an unfair competitive advantage.

Denver's charter requires voter approval of any cable franchise agreements. Qwest claims that a 2001 court ruling concerning a similar requirement in Boulder determined that such referendums violate federal law.

Qwest last month received approval for its nonbinding model franchise agreement with the 33-member Greater Metro Telecommunications Consortium, which includes Denver. The model franchise agreement gives Qwest a framework to begin discussions with member cities.

Elsewhere in Qwest's 14-state region, the company has made overtures in recent months to cities including Colorado Springs, St. George, Utah, and Bellevue, Wash., to provide video services, Ward said. Salt Lake City granted Qwest a franchise late last year.

Qwest offers video services in Highlands Ranch, Lone Tree and in the Phoenix area.

The Denver discussions come against a backdrop of possible congressional action to create a national video franchise, which would end the city-by-city franchising process.


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