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Los Angeles Sues Time Warner Cable
by Karl Bode 02:21PM Monday Mar 17 2014
Time Warner Cable has always had a somewhat contentious relationship with the city of Los Angeles and its residents, ever since the company's sloppy 2007 takeover of Adelphia's networks there. Los Angeles locals are already annoyed by Time Warner Cable's movement of Dodgers games to its own SportsNet LA channel. On an unrelated note, the city of LA has sued Time Warner Cable for failing to pay nearly $10 million in franchise fees, despite netting $500 million annually from customers in the city:
quote:
The 24-page lawsuit, filed in U.S. District Court in Los Angeles, contends that Time Warner Cable "blatantly refused to live up to its obligations to the city" to pay franchise fees to operate its cable network over city-owned rights of way while collecting more than $500 million a year from customers in the city. Feuer said the city has been negotiating with Time Warner Cable for several years. "The negotiations haven't been fruitful and we have to do something about that," Feuer said.
Perhaps Comcast will be a less contentious city partner? Los Angeles recently announced they're just starting to take a look at the idea of bringing in somebody else to build and operate a faster broadband network capable of 1 Gbps broadband speeds -- speeds Time Warner Cable has long stated nobody needs or wants.

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wizardry

@ohio-state.edu

A question

Am I correct in interpreting franchise fees as an indirect tax upon the residents of LA? Such that the city can avoid having to directly collect it from residents in yearly levies, and TWC has a quasi-justification for the numerous hidden administrative fees?
Skippy25

join:2000-09-13
Hazelwood, MO

2 recommendations

Re: A question

Would I be correct in stating that your question has an obvious answer to anyone that knows anything about business or economics?

No matter what the cost is be it people, resources, gathering of resources, taxes, penalties, research and development, etc they are ALL cost of delivering goods or services and thus are included in the price people pay.

n2jtx

join:2001-01-13
Glen Head, NY

Re: A question

said by Skippy25:

Would I be correct in stating that your question has an obvious answer to anyone that knows anything about business or economics?

No matter what the cost is be it people, resources, gathering of resources, taxes, penalties, research and development, etc they are ALL cost of delivering goods or services and thus are included in the price people pay.

--
I support the right to keep and arm bears.

n2jtx

join:2001-01-13
Glen Head, NY
said by wizardry :

Am I correct in interpreting franchise fees as an indirect tax upon the residents of LA? Such that the city can avoid having to directly collect it from residents in yearly levies, and TWC has a quasi-justification for the numerous hidden administrative fees?

Yes. Companies do not produce or consume anything themselves. They are legal entities. The humans employed at a company consume things and make product. Likewise, taxes, fees, etc. that a company pays come from people. If the city levies $10 million against TWC, TWC doesn't get a second job and earn more money to pay it. They fold the cost into their bills and the people who slog to work every day pay it.

The non-human entity that actually "makes" money is the U.S. Government by printing and coining it.
--
I support the right to keep and arm bears.

Anonymous_
Anonymous
Premium
join:2004-06-21
127.0.0.1
kudos:2
Reviews:
·Time Warner Cable

Re: A question

said by n2jtx:

said by wizardry :

Am I correct in interpreting franchise fees as an indirect tax upon the residents of LA? Such that the city can avoid having to directly collect it from residents in yearly levies, and TWC has a quasi-justification for the numerous hidden administrative fees?

Yes. Companies do not produce or consume anything themselves. They are legal entities. The humans employed at a company consume things and make product. Likewise, taxes, fees, etc. that a company pays come from people. If the city levies $10 million against TWC, TWC doesn't get a second job and earn more money to pay it. They fold the cost into their bills and the people who slog to work every day pay it.

The non-human entity that actually "makes" money is the U.S. Government by printing and coining it.

bad for comcast if they do in fact take over.
since comcast will have to cough up the 10mill

plus SportsNet LA channel will have to be sold to someone else
since it will be anti competitive to have it (too much exclusive content)

Anonymous_
Anonymous
Premium
join:2004-06-21
127.0.0.1
kudos:2
Reviews:
·Time Warner Cable
said by n2jtx:

said by wizardry :

Am I correct in interpreting franchise fees as an indirect tax upon the residents of LA? Such that the city can avoid having to directly collect it from residents in yearly levies, and TWC has a quasi-justification for the numerous hidden administrative fees?

Yes. Companies do not produce or consume anything themselves. They are legal entities. The humans employed at a company consume things and make product. Likewise, taxes, fees, etc. that a company pays come from people. If the city levies $10 million against TWC, TWC doesn't get a second job and earn more money to pay it. They fold the cost into their bills and the people who slog to work every day pay it.

The non-human entity that actually "makes" money is the U.S. Government by printing and coining it.

the fee is all ready on the bill .. maybe you need glasses?

so people are all ready being billed for it .
--
Live Free or Die Hard...

mackey
Premium
join:2007-08-20
kudos:13
said by wizardry :

Am I correct in interpreting franchise fees as an indirect tax upon the residents of LA?

No. Unlike a tax, you don't have to pay this fee. Simply use a provider who does not use city property to deliver their service such as DirecTV or Dish or OTA.

/M
Tromper
Premium
join:2003-09-08
Seattle, WA
Yup that's pretty accurate. It's just another tax by another name. Most municipalities sneak those in there, that & sometimes require the companies to do some kind of municipal improvement, unrelated to the cable infrastructure.
The money for that shows indirectly in the fees they charge you of course.

IowaCowboy
Iowa native
Premium
join:2010-10-16
Springfield, MA
kudos:1
Reviews:
·Verizon Broadban..
·Comcast

1 recommendation

Breach of agreement

I think if Time Warner isn't living up to its obligations of the franchising agreement, then Los Angles has every right to revoke the franchising agreement and their authority to operate in the city.

Without the authority to operate in the city, then Time Warner will have no option but to sell the system to another operator who is willing to comply with their franchising agreement.

tshirt
Premium
join:2004-07-11
Snohomish, WA
kudos:5
Reviews:
·Comcast

1 edit

Re: Breach of agreement

said by IowaCowboy:

...

The city is doing the reasonable next step, since the 2 parties can't agree, send it to court.
pulling the franchise would be a extreme final option.
Just because the city says TWC is non compliant does not make it so.

Caddyroger
Premium
join:2001-06-11
To the west
TWC has one other option. Just turn off the power.
--
Caddy
elray

join:2000-12-16
Santa Monica, CA
Reviews:
·Time Warner Cable
·EarthLink

Its always campaign season...

Egads.

Time Warner is doing a phenomenal job compared to Adelphia, and they tend to offer less costly options than Comcast

This is just the City Attorney grandstanding, as usual.

If the city wants to find an overbuilder to install fiber, that's fine, so long as we don't have to pay a tax for it.

Anonymous_
Anonymous
Premium
join:2004-06-21
127.0.0.1
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Reviews:
·Time Warner Cable

1 edit

Re: Its always campaign season...

said by elray:

Egads.

Time Warner is doing a phenomenal job compared to Adelphia, and they tend to offer less costly options than Comcast

This is just the City Attorney grandstanding, as usual.

If the city wants to find an overbuilder to install fiber, that's fine, so long as we don't have to pay a tax for it.

TWC is doing a shitty job

when TWC took over they drop the upload & download speed and downgraded to docsis 1.x
took about 5-6 years to get the download and upload speed back to were it was

the area still only has 8x1 DOCSIS 3

with outages VERY OFTEN every time it rains and at lest once a week for 8 to 12 hours

my grandpas bill went from $25
to $90 for the same channels.. since TWC took that is over 350% increase .

they also NEED to pull the 100mbps ad since it's NOT available here. they should be able to override the ads at the local cable plaint that service this area