Bad Connection

Are city officials and Paragon Cable turning Minneapolis into a bandwidth backwater?

When Steven Clift isn't online, chances are he's traveling. The Minneapolis-based Internet strategist is in demand as a speaker in places ranging from New Zealand to Northern Ireland. He also works with the New York-based Markle Foundation to create a national 1998 online election project called "Web White and Blue," and on another initiative called "E-Mail for All."

Much of that work, Clift says, could actually be done from the comfort of his southwest Minneapolis home--if he had a broadband Internet hookup for things like online videoconferencing and lightning-fast access to complex Web sites and databases. "I'm hoping to make myself available to colleges, universities, and conferences, through the Internet, around the world," Clift says. "What I need is cheap and competitive access to high-capacity connections. Every second I spend waiting for something to download is a second I'm losing for activity."

That's why Clift is thinking of bugging out to St. Paul. There, cable TV provider Media One has just unleashed cable-based Internet service. For less than $50 a month, customers get to use their TV cable for data transmission at speeds ranging up to 4 million bytes per second. Compared to familiar dial-up modem data speeds of 28,800 and 56,600 bytes per second, Media One is offering nothing less than digital hyperdrive.

Clift can get broadband access in Minneapolis today, but only if he is willing to pay a phone company anywhere from $1,000 to $2,000 a month for a megabandwidth T1 phone connection, and then only if he can afford to pay the phone company's cost--roughly $2,500--of extending the connection into his apartment building. He can perform some high-bandwidth Internet functions using the scaled-down ISDN phone line to which he already subscribes, but that costs him more than $100 a month. "Basically, I'm a small business with increasing bandwidth needs," Clift muses. "So if in St. Paul there's going to be the level of access that Media One provides, that becomes a much more attractive place to live."

Clift says he's willing to wait about a year for the situation to change before he breaks out the apartment ads. But if 13th Ward City Council member Steve Minn's assessment is correct, Clift may want to begin shopping right now.

Minn, the ranking member of the Transportation and Public Works committee, is known as the council's chief gearhead, the one member who has absorbed information technology into his bloodstream. He says an ongoing negotiation stalemate between the city and Paragon means Minneapolis is unlikely to see the kind of cable-modem technology Clift wants anytime during the next two, perhaps three years. "It absolutely panics me when I think about putting the city on a competitive [digital] playing field," Minn says. "If our downtown core can't compete on high-speed Internet access, that's bad."

So why doesn't Minneapolis receive the same high-bandwidth service from its cable franchisee that Media One offers St. Paul and eastern suburban residents? To understand that, you have to understand why the city and its cable contractor, Paragon Cable, have been locked for the past four years in a paralyzing, high-stakes squabble over the value of something that, as yet, does not even exist.

When Minneapolis signed its first cable franchise agreement in 1982, the city got a sweet deal. It was one of the last major American metropolises to award a citywide franchise, and companies were scrambling to woo its business. The winning bidder, Rogers Cable TV, not only offered cable with a capacity of 120 channels (most cities at the time had 56), but agreed to hand over fully 25 percent of that overall capacity--30 TV channels--to the city for public-access use.

Much has changed since then. In 1989, Rogers Cable TV became Paragon Cable, and Paragon has subsequently undergone several ownership changes; in 1995 it became a Time Warner Inc. subsidiary. More importantly, in those 16 years digital communications technology has exploded, positioning cable companies for a massive expansion of their business. The fiber-optic lines replacing the old copper wires can be converted to carry almost any kind of data, and to do it both ways--from subscriber to network, as well as vice versa.

If Paragon replaces its Minneapolis copper cable with fiber, the system could suddenly carry 600 channels or more, with the city's 25 percent share ballooning accordingly. In addition to public-access TV, the city could begin offering Internet-only public-access radio stations, or multimedia Web sites. It could sponsor interactive videoconferencing panels between city officials and the city's wired residents. Not to mention the value of those channels as a leasable commodity. In short, fiber could give Minneapolis's cable share enormous value, says city cable officer Edie French.

But fiber may not happen unless Paragon gets a new franchise agreement. City and Paragon officials have been trying to renegotiate their deal--which expires in 2004--for at least four years. The negotiations stalled last August when Paragon showed little interest for a city offer to lease some of its unused channels to the cable company.

What Paragon wants, French says, is for the city to abandon the concept of "capacity," and limit its control over the franchise to a certain reduced number of TV channels. The cable company has argued that the negotiators who wrote the original agreement, at a time when the World Wide Web was barely a gleam in a programmer's eye, had no idea what the capacity language would one day mean. But French disagrees: Early-'80s city planners "had some anticipation that this was something of value. It's like one of our city parks. It may not be used for commercial value, but that doesn't mean that if somebody else can make more money off of it that we say, 'Okay, here, fine, you can have this.'"

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