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Wave Broadband Gets Calif. Franchise

Wave Broadband, the Seattle-based cable operator run by industry veteran Steve Weed, has obtained a statewide franchise in California, the second cable company besides Cox Communications to do so.

Weed said the company applied for the statewide franchise for one reason — it recently swapped its systems in Ventura and Cerritos, Calif., for Charter Communications systems in West Sacramento.

Weed said that since the Charter franchise agreements were up for renewal, Wave decided to apply for a statewide franchise, which was awarded on Sept. 7.

Although he said the company has no current plans to expand in California, Weed added that the new franchise agreement would make any future acquisitions in the state easier.

Wave isn't sitting on the sidelines, however. Weed said that the company is expecting to close on an acquisition in the Portland, Ore., area in November.

Wave agreed to buy about 16,000 customers from Willamette Broadband in Woodburn, Canby and Oregon City earlier this year. It also agreed to buy about 4,000 customers from Charter in systems around Portland, at undisclosed terms.

When the deals close, Wave will have about 145,000 subscribers in three clusters — Seattle, San Francisco and West Sacramento.

Wave Broadband agreed to the Ventura and Cerritos swap earlier this year. At the time, Charter said the Cerritos system had about 26,000 revenue-generating units and the West Sacramento systems had about 34,000 units.

Wave acquired the Cerritos system in 2005 from Knology Broadband, which had bought it from Verizon Communications.

“We're trying to consolidate markets to where we get a pretty good presence and improve our efficiencies,” Weed explained. “In L.A., there was nothing left to buy that we could interconnect. And in Sacramento, the only thing left to buy was the Charter system. Conversely, L.A. is one of Charter's key markets and they can interconnect our stuff to them. It [the swap] allows us to double our size in Sacramento, and we weren't going to get any bigger in L.A. anyway.”

In January, Wave completed the purchase of Starstream Communications, which had about 20,000 customers in the Sacramento area.

Wave will have 40,000 subscribers in that market, served from one headend.

AT&T and Verizon also have statewide video franchises in California.