Local Self Reliance: Community Cable TV Alternative

Davis, California is experimenting with a co-op model for community cable access, a TV alternative so far tried only in scattered parts of the upper Midwest.

| May/June 1983

  • community cable tv alternative
    It remains to be seen whether Davis, CA's cable co-op will be a workable community cable TV alternative.
    Illustration by Fotolia/patrimonio designs

  • community cable tv alternative

Cable TV is a fast-growing, multibillion-dollar industry, and firms are scrambling to gain municipal franchises that will allow them exclusive rights to wire those territories for decades to come. In fact, one out of every four American homes is already reached by cable, and almost all of the systems that serve such residences are owned by major national corporations.

There are, however, a few exceptions. Several dozen smaller cities (including Conway, Arkansas and Jackson, Minnesota) have decided to finance and build their own cable services. Davis, California, though, will become the first major market to choose a third community cable TV alternative: customer ownership. As a member of the Davis Cable Cooperative (DCC), each household will be able to vote on the types of programs and services that the system will offer.

"Cable cooperatives do exist, but not in major markets," explains Robert Kahn, a DCC board member. "They've sprung up in the upper Midwest primarily because no one wanted to invest in those areas. But the industry wanted our market. In fact, several large companies that were bidding on a cable system for nearby Sacramento offered to tie Davis into it. But our community preferred a co-op."

How It Happened

Davis's cooperative cable system pretty much owes its existence to three factors: The National Consumer Cooperative Bank (NCCB) agreed to consider financing the project. In 1981, it gave DCC $130,000 to conduct a feasibility study, but did so only after the Davis city council awarded a conditional franchise to DCC with full franchise rights contingent on the outcome of that study. Everyone agrees that the city council's action was crucial. "It gave us the time to arrange financing and to contact experts to manage the system," says Kahn. In addition, Malarkey-Taylor Associates, a Washington-based organization with extensive commercial cable experience, was hired to manage the co-op.

Half of the required funds will come in the form of a short-term loan from NCCB, and more will be chipped in by outside investors who'll gain tax benefits. And of course, additional cash will be obtained from co-op members, each of whom will pay a $4-a-month equity fee as well as the $10 basic service charge. (A member who leaves the system can have his or her accumulated equity refunded.) However, despite such groundwork, the Davis system has a number of hurdles to overcome before it can be declared successful.

"For one thing," Kahn points out, "a survey found that the typical Davis resident watches television only half as much as does the average American, so we're not sure how many people in the area will subscribe to the service. This is, you see, an intellectual community, and we have a mild climate, so people are outdoors a lot of the time."

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