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3 <br />SUMMARY <br />The franchise documents, cable standards ordinance and franchise agreement, prohibit the <br />transfer of either control or assets, however accomplished, without the prior consent of the <br />franchise authority. The proposed transaction will not result in the assignment of the franchise to <br />anew entity., The transfer will alter the ownership (stock) and control (management) of Time <br />Warner Inc.(Time Warner). The new company will be AOL-Tune Warner. ' <br />This transaction raises several important public policy questions which must be considered. <br />These issues center around Open Access, a form of common carrier status placed on the cable <br />company's broadband high-speed Internet platform. The arguments aze presented more fully in <br />the report. <br />Regardless, it is imperative that the franchise authority secure certain assurances from the new <br />entity that this hypothecation will not adversely impact current and future subscribers, the cable <br />distribution system, Time Warner Cable-Advance Newhouse's (TWEAK) business and customer <br />service policies and practices. <br />The franchise and FCC-394 documents direct Time Warner to furnish the franchise authority a <br />full set of descriptive identifying particulars about the proposed transaction. Also, by supplying <br />copies of all documents pertaining to the transfer, the Company has complied with the transfer of <br />ownership provisions of the current Franchise Agreement. The material change in the ownership <br />and management structures of Time Warner require the franchise authority to review, weigh and <br />approve the transfer of ownership and control among and between the entities. <br />To evaluate the proposed sale of MediaOne to AT&T and the merger of AOL and Time Warner <br />Inc., the following issues, concerns and documents were cazefully analyzed and considered: <br />1. Information gathered during telephone conversations with the parties' <br />representatives and responses to questions about the deal'; <br />2. Assurances from the parties that they agree to be bound by the terms and <br />conditions in the franchise agreement; <br />3. The completed FCC-394 Applications For Franchise Authority Consent To <br />Assignment or Transfer of Control of Cable Television Franchise; <br />4. Any outstanding issues the franchise authority may seek to resolve as a condition <br />of the transfer; and <br />1Q & A's are attached as Exhibit I <br />-i- <br />