Petaluma Subs May Get Extra $2 Bill

The 17,000 cable customers in Petaluma, Calif., may get two
cable bills in March -- one for about $29.56, and the second for $2.

The $2 tab is a protest by AT&T Broadband &
Internet Services of a decision by the Petaluma City Council to boost support to
PEG-access (public, educational and government) channels by 300 percent. That second bill
will include a caveat that consumers will not have their cable service cut if they fail to
pay it.

Paying will require "a second envelope, a separate
check, a separate stamp. Few will go through the effort to pay it. We're concerned
about that," said Gene Beatty, assistant city manager and member of the PEG advisory

Petaluma is in the Napa Valley, north of San Francisco.
Residents there currently view three dedicated PEG channels.

The current pass-though, which appears as a line item on
bills, is 50 cents. That generates about $102,000 per year just from cable subscribers.

Beatty said Petaluma Community Access is able to fund three
full-time positions to staff a recently constructed studio. Programming is produced in
partnership with the local schools. The access corporation has trouble meeting its
obligations, he added.

"We're trying to reach the entire community.
We're doing outreach to the non-English-speaking community We really need five
[employees] to be successful," Beatty said.

Franchise renegotiations were concluded last year as the
city approved the transfer of the local system from Tele-Communications Inc. to AT&T
Broadband. City officials said the franchise enables the city to boost the amount of PEG
support if need is demonstrated. So this past fall, the city approved the increase to $2.

This is a problem for AT&T Broadband. When the operator
hiked its rates in June, that notification included a promise to consumers that they would
not see a price hike for one calendar year.

"We're very concerned that the increase will be
perceived as coming from us," said Andrew Johnson, executive director of public
affairs for AT&T Broadband's Western region.

That impression was supported by a survey of consumers,
done by an outside firm on behalf of the cable operation. Most respondents showed no
awareness of the City Council action, Johnson said.

The company made a strategic decision to foot the cost of a
second mailing. Other options, such as ads in the local paper, would not reach all
affected consumers, Johnson added.

The local paper, The Press Democrat, editorialized
against AT&T Broadband's plan. The Alliance for Community Media also complained,
calling AT&T Broadband a "schoolyard bully" for attacking the underfunded
local PEG group.