In two years, Verizon has caught Comcast in Fort Wayne’s cable television race.
Verizon paid more cable franchise fees to the city than Comcast during the second quarter of 2009, the first time Verizon topped its competitor in the city.
Cable television providers must pay 5 percent of either their gross annual subscriber receipts or the franchisee’s gross annual receipts, whichever is higher, to the city. The numbers don’t necessarily indicate which provider has more customers, but they do serve as a measure of each company’s success in the market. The companies historically have declined to disclose how many subscribers they have.
The most recent quarterly receipts show Verizon paying $333,212.45 and Comcast paying $322,599.37.
"While we don’t comment on specific figures, it’s plain that competition continues to benefit consumers and the city of Fort Wayne," Verizon spokeswoman Christy Reap said in a statement. "Verizon’s advanced all fiber-optic network offers a game-changing broadband and entertainment choice to city residents."
The numbers don’t overly concern Comcast, according to spokesman Jim Hughes, who said the company is growing its phone and Internet business.
Comcast still leads in unincorporated Allen County franchise fees. The county received $83,023.70 from Comcast last quarter and Verizon paid $64,760.75. Mediacom paid $4,188.35.
Verizon, however, will soon leave the Fort Wayne market. Frontier Communications Corp., a telecommunications company that specializes in serving rural markets and small cities, is acquiring about 4.8 million Verizon phone lines for $5.3 billion in stock. The deal, which includes Fort Wayne’s FiOS television service, is expected to close in less than a year. A Frontier spokesman did not return a call seeking comment.
Hughes said since that May announcement, some customers have begun to leave Verizon for Comcast because of the unknown of a new provider and his company’s features.
"They also know they can depend on us to take care of them for the long term," he said.
While Comcast’s receipts have declined since Verizon entered the market, Fort Wayne’s total cable television market has grown. With both companies aggressively pursuing customers, the total amount of money people pay for cable television has grown, despite the recent economic slowdown.
For example, Comcast paid $497,794.28 in fees for the first quarter of 2007, the last quarter Comcast was the only local cable television provider. The city’s most recent receipts show a 31.7 percent jump in total fees since then.
A variety of factors could have led to this increase. People paying more for cable television – whether through rate increases or higher-end subscriptions – mean more franchise fees. People could also have left satellite companies for Comcast or Verizon; satellite companies do not pay franchise fees.
Also, residents without cable could have decided to subscribe after the recent digital conversion for over-the-air broadcasts.
Jim Haley, city information technology director, said 60 percent of the franchise fee revenue goes to the city’s general fund. The remainder finances public access channels, grants to non-profits to enhance local access and administrative costs. Because of the increase in fees, Haley said the city will award more grants next year.
