Modesto, Calif., Finally Franchises AT&T

After months of delays related to problems with Cable One Inc., Modesto, Calif., officials have belatedly approved a franchise for AT&T Broadband, the community's new cable operator.

The City Council on May 7 granted AT&T a 10-year deal, with a five-year option if the MSO completes a $23 million upgrade within 24 months. If not, the project must be completed within three years.

The new franchise officially ends Modesto's stormy relationship with Cable One, which previously agreed to trade 108,000 of its San Joaquin Valley customers — including those in Modesto — for 107,000 AT&T subscribers in three states.

AT&T spokesman Brian Dietz said the MSO has six months to report back to the council with a plan for upgrading the local network.

"AT&T is excited about coming into Modesto," Dietz said. "The city has been very welcoming to AT&T. We're sure we're going to have a positive relationship going forward."

Modesto's relationship with AT&T is likely to be warmer than the one the city had with The Washington Post Co.-owned Cable One.

Late last year, the council declared Cable One in breach of its franchise and assessed $61,000 in fines against the company for hundreds of electrical violations, poor picture quality and unpaid franchise fees. It also authorized city manager Jack Crist to tap a service bond Cable One had posted.

AT&T Broadband's Dietz said the new deal also calls for an upgrade to the city's institutional network, which will be used to connect various municipal buildings, schools and libraries. The cost of upgrading the I-net will be separate from the cable-network build.

At press time last week, Modesto city officials had not returned repeated calls for comment.