Cerritos Keeps Plugging for a Cable TV System

The anticipated cable television boom in this city so far has been something of a bust.

Without a solid offer to set up a system, the City Council this week was forced to extend a bidding deadline for its cable franchise. The 60-day extension marks the second time that the city has relaxed a bidding deadline after failing to attract a formal bid for its franchise, which some industry experts predicted would attract widespread interest.

Cerritos is one of the last cities in this corner of Los Angeles County without cable service.

The council last summer passed an ordinance authorizing cable television in the city, clearing the way to accept bids. City officials had hoped to end the bidding in mid-November and announce the winner this month, said Michele Ogle, the city’s communications coordinator, who oversees the effort to bring cable to Cerritos.

But none of the 75 or so companies notified about the available franchise submitted proposals by the November deadline, so the bidding period was extended in December until this week. The results were the same: no bidders.

Three Companies Interested

However, three companies are now reportedly interested, Ogle said. Because none has delivered a formal proposal, all three firms asked for the 60-day bidding extension adopted by the council Monday night.

The three cable companies that have submitted letters of interest are American Cable Systems, a Massachusetts-based firm; General Telephone Co. of Thousand Oaks, and Mainland Communications, a newly formed cable operator in Redondo Beach.

While surprised at the lack of interest, Ogle said it is not totally unexpected. City officials want an underground system that would be used to carry the signals.

Because it costs less, cable companies prefer putting lines on telephone poles. An underground system can cost up to $60,000 a mile, contrasted with $20,000 a mile for an above-ground system, according to city reports. The whole system would cost about $10.3 million to build.

About 80% of all utility lines in Cerritos, including telephone and electrical lines, are underground, Ogle said.

Industry in Tumult

“Like most other cities in the past, we expected a lot of interest in Cerritos from cable companies,” Ogle said. “But we also knew the undergrounding requirement might discourage some companies.”

At the same time, the tumultuous state of the cable industry may have cost Cerritos potential bidders, Ogle said. Following a period of phenomenal growth in the 1970s and early 1980s, the industry has slowed, prompting mergers, buy-outs and, in some cases, bankruptcies.

Two of the companies interested in Cerritos, American Cable Systems and Mainland, are in the midst of purchasing other cable firms. And the third entry in the Cerritos cable derby, General Telephone, is just entering the home cable market.

If General Telephone lands the Cerritos franchise, it would be its first city franchise ever, according to Tom Leweck, the company’s public-affairs director.

“We have been active in the business marketplace,” Leweck said, “but we are entering a new area--home cable.”

‘Interactive System’

Cerritos wants an “interactive system” that would allow features like pay-per-view watching, home banking, home access to libraries and residential or business alarms.

As a middle-class community with a relatively young and affluent population of almost 70,000 and a preponderance of single-family homes, Cerritos is considered by its industry consultant as a good city for a cable franchise. Until last year, however, Cerritos did nothing directly to obtain cable.

John Saunders, director of internal affairs, has said the city decided to wait to offer cable “because lots of communities” were having problems with their cable providers and Cerritos wanted to learn from those mistakes. At the same time, he said, demand from Cerritos residents in recent years prompted the city to move on the issue.

In a report to city officials, George L. Page, an Oregon telecommunications consultant, said as many as 60% of the city’s residents might subscribe to a cable system.