►
Description
San Bruno City Council Meeting 07-28-09 10d. Cable TV Fund Modifications
A
B
Honorable
vice
mayor
and
members,
the
city
council
good
evening,
the
item
before
you
is
the
approval
of
an
amendment
to
the
capital
improvements
program,
budget,
forming
a
new
commercial
data
and
voice
services
project
and
authorizing
the
city
manager
to
execute
purchase
orders
for
telecommunications
equipment
in
the
amount
of
1
million
six
hundred
nine
thousand
dollars,
as
articulated
during
the
budget
study
session
presentation
and
subsequently
in
the
cable
rate
review.
Presentation.
Staff
is
before
you
this
evening
to
present
its
recommendation
to
expand
the
services
offered
by
san
bruno
cable
to
include
commercial
data
and
voice
services.
B
These
strategic
and
timely
investments
into
the
cable
enterprise
has
advanced
the
city's
mission
to
remain
a
value,
oriented
service
provider
and
has
strengthened
San
bernal
cables
position
to
camp
combat
market
competition.
A
decade
ago,
cable
companies
enjoyed
a
majority
share
of
the
video
market.
However,
since
that
time
a
significant
amount
of
market
share
has
been
lost
to
competing
satellite
service
companies,
while
cable
companies
were
dealing
with
land-based
analogue
infrastructure.
The
satellite
companies
were
utilizing
direct-to-home
satellite
delivered
digital
technologies
to
offer
consumers
more
choice
and
channels.
B
As
a
result,
cable
companies
across
the
country
without
exception
experience
significant
subscriber
losses
losses
in
san
bruno
space.
Twenty
percent
of
customers
switched
to
satellite
service
to
address
this
loss
and
subscribers
the
cable
companies
leveraged
their
cable
infrastructure
to
offer
services
that
satellite
companies
could
not
and
then
launched
a
marketing
campaign
that
bundled
service
offerings,
bundled
services
offering
customers
the
convenience
of
one
bill
and
coupled
with
significant
cost
savings.
B
The
benefits
of
these
investments
are
that
San,
Bruno
cable
is
still
a
thriving
municipal
cable
operation
where
citizens
are
enjoying
a
comprehensive
suite
of
broadband
services
at
a
great
price.
San
bernal
cable
is
highly
successful
today,
but
the
competitive
landscape
continues
to
change.
Technology
continues
to
advance
and
there
is
an
opportunity
for
that
san
bruno
cable
to
serve
a
broader
segment
of
our
community
by
initiating
high-quality
internet
and
telephone
service
to
business
customers.
B
Since
the
City
Council's
interest
is
to
preserve
sanburne,
ok
boss
mission,
to
continue
being
the
primary
choice
for
cable
service
with
low
rates,
then
further
action
is
necessary
now,
before
the
impact
of
any
new
competition
is
felt
when
there's
choice
in
the
market,
consumers
switch
it's
just
the
nature
of
the
business,
but
how
a
business
responds
to
these
changes
will
determine
its
success
or
failure.
They
may
be
a
window
of
one
to
two
years
of
time
before
AT&T,
ATT,
uverse
and
possibly
other
services
become
widely
available
in
San
Bruno.
B
The
time
is
best
utilized
by
further
diversifying
services
to
include
commercial
data
and
voice
services
to
serve
the
needs
of
San
Bruno's
business
community.
In
these
tough
economic
times,
every
business
is
looking
to
increase
productivity
and
reduce
costs.
The
same
high
quality
low
cost
service
enjoyed
by
residents
can
be
extended
to
meet
the
needs
of
the
business
community.
However,
in
order
to
tap
into
this
new
opportunity,
a
capital
investment
in
telecommunications
equipment
is
required.
B
Staff
after
having
worked
on
this
project
for
10
months
with
a
variety
of
vendors
and
experts,
select
the
Cisco
Systems,
the
only
local
state
of
California
qualified
vendor
who
is
able
to
fully
satisfy
the
design
and
technology
requirements
to
provide
a
comprehensive
solution
for
the
development
for
the
deployment
of
commercial
services.
A
variety
of
routers
and
switches
and
IP
telephony
equipment
have
been
identified
for
purchase
as
outlined
in
your
staff
report.
B
This
selected,
these
selected
items,
are
commercial
grade
and
have
useful
lives
of
10
plus
years
and
can
support
many
data
customers
and
up
to
4
1700
telephone
sets.
These
pieces
of
equipment
are,
for
the
most
part,
replacing
aging
or
lower
grade
existing
equipment
so
that
a
higher-quality,
highly
reliable
commercial
grade
service
can
be
delivered
even
if
the
City
Council
does
not
other
does
not
adopt
this
project.
This
evening,
these
equipment
replacements
will
be
required
separately
either
this
year
over
the
next
two
to
three
years.
B
As
an
example,
the
city's
legacy
mitel
telephone
system
is
slated
for
replacement
starting
this
year
and
requires
a
general
fund
investment
of
187
thousand
dollars.
If
san
bruno
cable
is
directed
to
launch
commercial
services,
this
general
fund
investment
will
not
be
required.
The
city
would
subscribe,
27
of
cable
telephone
service
and
enjoy
the
benefits
of
not
only
a
new
IP
based
phone
system,
but
the
benefits
of
paying
itself
in
the
process.
One
piece
of
equipment
that
is
not
replacing
existing
existing
gear
is
a
new
transport
switch.
B
This
switch
will
be
utilized
to
import
the
HD
signals
of
comm
pass
comcast,
sportsnet
and
direct
studio
feeds
of
local
broadcast
stations.
Replacing
the
over-the-air
signals,
reception
setup
we
have
today
and
to
access
a
variety
of
bandwidth,
wholesalers
to
reduce
operating
costs.
The
total
cost
of
the
commercial
data
and
voice
services
project
is
1
million.
B
Six
hundred
nine
thousand
dollars
staff
arrived
at
this
negotiated
price
after
negotiating
vigorously
with
Cisco
over
a
five-month
period
to
achieve
a
fifty-four
percent
discount
overstreet
pricing,
with
additional
assurance
from
Cisco
that
it
is
the
best
price
in
the
company
can
extend
a
cisco
has
offered
to
finance
his
purchase
through
cisco
capital
at
favorable
terms,
including
a
stepped-up
payment
plan
over
five
years.
Giving
the
business
enough
time
to
ramp
up
sales
staff
will
be
returning
with
a
recommendation
of
the
financing
of
this
purchase
at
the
next
city
council
meeting.
B
The
service
itself
will
entail
providing
dedicated
high
capacity
in
an
internet
and
point-to-point
connections
in
IP
based
phone
service
for
business
consumption.
The
service
will
be
competitively
priced
in
comparison
to
existing
service
providers.
Staff
anticipates
that
the
pricing,
the
higher
level
of
service
and
expanded
features
and
functionality
of
IP
based
services
will
attract
many
small
to
medium
sized
businesses.
B
The
commercial
services
are
expected
to
generate
six
million
dollars
over
the
next
six
years
and
net
income
of
1.4
million
after
settling
lease
obligations
and
contributions
to
end
contributions
to
the
general
fund
of
approximately
1
million
dollars.
In
closing,
the
commercial
services
project
will
achieve
a
few
key
objectives:
one
it
will
enable
the
city
to
offset
any
revenue
loss
from
customers
switching
to
alternative
services
to
it
will
enable
a
city
to
maintain
its
value
pricing
for
its
core
video
customers.
B
D,
it
enhances
the
value
of
the
cable
system
if
the
business,
if
a
situation
ever
arises,
that
requires
a
sale
of
the
cable
system.
This
investment
will
not
be
in
vain,
because
cable
systems
are
valued
based
on
technical
technological
advancements,
the
services
that
are
offered
and
the
amount
of
operating
cash
flow
the
business
generates
from
an
economic
development
perspective.
The
availability
of
high
quality
value
priced
commercial
services
will
make
San
Bruno
more
attractive
to
technology
companies
or
any
company
for
that
matter.
B
To
looking
to
relocate,
it
enables
the
city
to
preserve
general
fund
money,
pay
itself
for
the
phone
service
and
order
and
earn
additional
revenue
in
the
form
of
equity
transfers
from
the
cable
operation.
With
that
staff
recommends,
approve
of
the
project
and
I'll
be
happy
to
answer
any
questions
you
may
have
any.
C
Although
it's
a
lot
of
it's
still
over
my
head,
I
think
just
the
concept
of
it
and
going
into
that
that
whole
nother
realm
that
we're
not
you
haven't,
touched
it
and
I
think
the
you
know,
Cisco,
looking
at
the
numbers
and
looking
at
how
they're
going
to
finance
this
just
I
just
leaned
over,
and
you
said
well
you're,
going
to
save
almost
two
hundred
thousand
dollars
by
by
fitting
the
city
with
a
phone
system.
That's
about
how
much
I'm!
Looking
that's
about
how
much
the
loan
is.
C
C
D
When
I
SAT
through
the
presentation
as
well,
I
had
some
concerns
as
far
as
the
unexpected
problems
that
we
could
or
could
not
have
happen,
which
we
did
as
we
experience
through
the
boxes.
I
was
also
concerned
in
regards
to
the
current
staffing
level
that
we
have
at
the
cable
and
whether
this
is
going
to
impede
the
customer
service
level.
That
I
think
we
need
to
keep
in
order
to
keep
our
customers
satisfied.
D
The
general
fund
saving
its
money
for
a
new
phone
system
which
I
know
the
last
time
it
was
done,
was
probably
night
late.
Nineteen,
ninety
something
not
late
90s
and
just
be
able
to
save
that,
as
well
as
the
monies
that
we
currently
pay
to
another
provider
was
beneficial.
Also,
we
have
five
years
within
this
agreement,
but
of
course,
if
there
is
an
early
pay
back,
there
is
no
penalty.
You've
negotiated
that
within
the
contract
as
well.
D
You
know
so
I
think
what
was
said
at
the
last
part
of
your
presentation,
which
al
said
in
the
meeting
which
helped
to
convince
me
was
that
the
fact
this
asset,
that
the
city
has
to
maintain
its
current
value
and
to
ensure,
if
you
do
put
it
on
the
market,
that
it
has
the
potential
for
retaining
and
gaining
back
for
the
citizens
of
this
community,
to
make
this
investment
in
the
future
technology
to
keep
up
with
the
competition.
So
we
can
assure
satisfaction
for
everyone.
E
There
there's
an
old
saying:
you
know
you
move
or
you
lose
and
we
have
to
move
because
otherwise
we're
going
to
lose
the
customer
base
that
we
do
have
so
I
I'm
all
for
it
I
think
it's
exciting,
I
think
you've
covered
all
the
bases,
all
the
negative
things
that
can
happen.
There's
always
something
I
think
you,
you
and
your
staff
have
looked
into
minimizing
anything
like
that.
E
A
We
might
get
our
wires
crossed
no.
This
is
this
is
great.
You
actually
have
to
spend
some
money
to
make
some
money,
and
this
is
expanding
out
into
where
we
might
have
should
have
been
a
war.
We
should
have
been
a
little
while
ago,
so
I
I
look
forward
to
it,
and
would
someone
like
to
introduce
a
resolution
I
would.