Glenn closed by thanking all for coming out to the meeting and once again promised to respond to each submitted.

Transcription

1 On 27 November 2012, members of the Dagsboro, Delaware Mediacom Team met with the residents of Ocean Pines to respond to questions and concerns from subscribers. This annual town hall meeting is a requirement of the franchise agreement between Ocean Pines and the cable provider. Starting at 5:30 PM, Bob Thompson, Ocean Pines General Manager, made introductory comments by saying the Mediacom had made a significant investment in the cable infrastructure in Ocean Pines and "Although it may not be perfect, it's a pretty good system". He also stated that the prepared questions address difficulties and deficiencies in service but that during the days preceding this meeting, many residents had expressed how pleased they are with the changes being made to the service. At that, Bob turned the floor over to Glenn Bisogno, Director of Area Operations. Glenn began by introducing Katie Brinsfield, his administrative assistant, and the remainder of his staff composed of the Technical Operation Manager, Service Supervisor, Installation Supervisor, and HFC/Maintenance Plant Supervisor. He then made a few personal background comments regarding his two years at Mediacom and then took the led to address questions from bullets embedded in a prepared Power Point presentation. Glenn began his presentation with Mediacom's accomplishments in His assumption was that many questions would be satisfied by these highlights. Questions that still remained unanswered would then be addressed. Glenn's first accomplishment was the launch of the NFL Network because there was so much interest expressed in it in past years and not because it was a big revenue maker. When Mediacom bought the existing system, it had to replace every major piece of equipment in the infrastructure because it could not handle Internet, voice, and additional channels of video. Additionally, all existing equipment was analog and over the past year the company has been incorporating digital equipment to cope with wider bandwidths and additional video channels. So far this year, more than $150,000 of improvements have been invested just in Ocean Pines. The investment is a good indicator that the cable company has been improving the network to give better services. Another upgrade was the incorporation of a Cable Modem Provisioning System (CMPS) which provides fast, reliable, and inexpensive monitoring service to cable modems. Because more things are hooking to the Internet, the CMPS improvement resulted in taking over-utilized ports from up to 45% during peak times in the evening down to 0%. Currently, Mediacom has no over-utilized ports. In about two year, the firm will be looking for more equipment to handle the growth in Internet demand. In Ocean Pines, there are some areas that have older cable, cable laid behind houses, and cable physically difficult to access. Over time, this older equipment will be replaced. Most residents should have seen improvements with the implementation of equipment upgrades. However, recently the area was hit by two significant storms that caused outages. In some areas effected by the storms, the outages were so severe that they were not even reported for days. All outages were rectified as soon as the maintenance staff was able to replace damaged equipment and bring the system back on line. Mediacom has invested in system improvements and looks forward to additional channels being added in Some customers don't desire more channels while others want more HD channels. Some want channels that friends and neighbors get but are not yet offered by Mediacom. In March of 2013, Mediacom will be rolling out digital simulcast. It's the first step

2 in going all digital. What this means is that the current analog channels will be replicated as a digital channels. For example, analog channel 2 will remain on channel 2 but will also appear as a digital channel on channel 102. Eventually, all the equipment supporting analog channels will be replaced with digital equipment allowing more channels to be carried on the existing bandwidth. For every 1 analog channel, the cable can add 6-8 digital channels. Channel capacity is at a premium and going digital is the way to gain more capacity with existing bandwidth. Some of this bandwidth will be occupied by channels customers have been asking for but for which the system has no existing space. After March, Mediacom will be able to launch new channels, such as the NFL channel, on to the system. The few channels not being currently used will be the channels we will use to accomplish the digital transition. Eventually, with this new digital capacity, customers will be able to control the lights, thermostat, or video surveillance system in your home from your cable system. While this transition is going on, Mediacom will continue to replace defective cable segments and will integrate a battery back up system to kick in when ever there is a power outage. Improvements all cost money. The revenue is generated from customers. So, Mediacom has to balance the cost of improvements against overtime expenses and seasonal population availability. Without a balance, no one would be able to afford the cable service now available. Over the past year, the company has hired two more technicians to cope with demand. Next year it will be hiring two addition line technicians to supplement the engineering staff. The additional staff plus the additional capital improvements will allow the company to become an outstanding cable provider. The questions that came through the were fairly consistent. The following questions are keyed to comments in the next section. 1. Many asked why we can't have a 13 or 23 channel basic service. We cannot do this because we have existing contract obligations for channel feeds from the big networks. Most of these agreements are obligations we assumed when Mediacom took over the former cable system. Its a problem with the overall industry to force bundles as part of a new contract but as contracts are renewed, we try to separate these bundling obligations that effect our lowest tier cable costs. We are not often successful. The industry forces us to take the high-cost, highdemand channels with the low-demand channels. To continue offering the high-demand channels you want, we have to incur the contract cost. As in any business, we have to pass these costs on to the consumer. For example, when ESPN signs on to carry MOB, the contract assumes the cost of a new $20M player. Then, when ESPN comes to us or Comcast to negotiate the rights to distribute MLB, the consumer fees are built into the monthly cable bill. All this drives up costs and sports in our area represent 38% of the cable bill. If you don't watch sports, you pay for it anyway because it's part of the bundle. 2. Another question that was provided was the question about senior discounts. The problem with senior discounts is identifying who is the real senior in the household. When I was in New York, a town served by Time Warner had a population of 12% seniors. However, 28% of the town were benefiting from the senior discount offer. So when that 15 year contract terminated, Time Warner no longer offered the discount. With Mediacom, it's very hard to verify that the senior in a household is actually benefiting from the discount. Add on top of that is the question about offering discounts to low income households. Again, it's very hard to verify age and

3 income. Mediacom is not closed to the idea of discounts. We're looking at it but in any business there is a bottom line to cover all expenses such as salaries, gas, and network agreements, telephone poles, and easement rights. Our rates are balanced to provide the best service at the lowest cost. 3. Glenn then address a question from the floor regarding signal levels. A customer stated that the signal level at the pedestal at the street was 3. A Mediacom tech stated that it should be 12. The customer cannot get to his because his browser times out. The problem has existed for some time but multiple trouble calls have been unable to resolve it. Glenn stated that his Service Supervisor will be there the next day. 4. Next, a resident from the floor asked a question on Glenn's delivery process. He wanted to know if Glenn was going to finish his presentation and then address the questions submitted in advance. Glenn explained that he was attempting to capsulize the questions in his presentation. Given his presentation now being completed, he is now opening a Q&A session from the floor. The customer wanted to now why he was getting a SOAOO code on his HD channels. Service techs state that is has be a broken or damaged cable upstream from his house. As a temporary solution, the techs laid an orange cable across his drive from a neighbors box. The cable has been on top of his drive for close to a month. He wanted to know when the damaged cable was going to be replaced and when his temporary cable was going to be buried. The supervisor said that all the paper work on the problem has been verified and work would begin in a day or two. 5. A question was then asked about discounts already discussed. The resident wanted to know why Mediacom gave incentivizes to recruit new customers but didn't give discounts to retain existing customers. He also want to know what would happen if the cable companies refused to agree to increased franchise fees from the cable channels. Glen explained the in the case of Food Network, Mediacom could drop them from distribution. There may be many irate customers but it would not effect the overall cable selection. However, in the case of ABC, the network charges the cable company to carry the local affiliate when, in fact, you could receive the channel free with an over the air antenna. ABC owns ESPN and the Disney channel and they bundled the channels as a package. Take one and get all three. Delete one and loose all three. Customers go irate when there favorite channels go dark so the cable companies are blackmailed into taking the whole package. 6. Regarding retention programs, Glenn explained that the incentive pricing was a price with no margin for profit. We have to make profit or the shareholders will force corporate changes. Mediacom has a no contract program or programs to best meet the customer need and budget. They will grant an incentive program to a customer if he has been out of contract for over 6 months. They also have a seasonal plan. It starts in September and lasts for 6 months. You must be a in regular retail billing program and have another billing address. We will work with you to step down to a 1 or 2 bundle package or lower Internet speed if you don't work at home. 7. A customer asked why his Internet dropped out frequently. He was told by the tech that his modem need to be swapped out. Glen stated that if your modem is 7-8 years old, it runs on Data Over Cable Service Interface Specification (DOCSIS 1) software that is no longer supportable and needs to be swapped out. But if you modem is newer than that, it's a DOCSIS 2

4 or DOCSIS 3 modem and a swap probably won't fix the issue. However, if it turns out that your problem is the modem, it is cheaper to replace the modem rather than generate a trouble call and come out to your house. With regards to Set Top Boxes (STB) causing problems, a swap probably won't fix the issue. With STBs, troubles are usually caused by connections or lack of ventilation. STBs with a DVR can also cause a problem. The DVR is a spinning hard disk and like your computer will fail after a number of hours. In this case, we would be happy to replace the box. 8. A customer asked if he could purchase a cable box. Glenn stated that STBs are not made for consumer purchase. This is an industry directive and not a Mediacom policy. 9. A question was asked if there could be a local call center established. If a call center was established, it would have to be open from early morning until 11 PM. That service is so expensive, utility companies, phone companies, and cable companies cannot afford the personnel overhead and still be competitive. 10. The next question asked was one of blue screen. A resident stated that 6-8 times a month, his HD channels would develop a blue screen or pixilation with sound drop e outs. Glenn explained that there could be many reasons to cause a blue screen. About 15% of trouble calls are from customers who have hooked up a new device incorrectly. About 30% of the trouble calls are from a device on the outside of the house that has aged or had been struck by lighting. It could also be caused by one of the main trunk amplifiers going bad. Amps are on 24/7 and over time will fail. In that case, we identify the failed device and replace it. But if the blue screen has been experienced for 30 or 60 days, then we have failed to do our job. We'll have to send a manager out to the problem and fix it and then figure our why the tech didn't identify the problem earlier. 11. The next individual from the floor stated a number of problems faced over a long time. It was hard to understand the specifics of his complaints and understand the details of his question because of audio drop outs on the video of the meeting. I could not deduce the customer issues from Glenn's response. 12. The next resident, although hampered with audio drop outs, asked how often Mediacom was required to file performance verification records with the FCC. Glenn stated that he is required to file records twice every year. The filings are public files and are on file at the Dagsboro office. They are available on request. 13. Then there was some discussion over channel 805 or 806. The issue was unclear because multiple people started talking over one another. It got to the point the GM interrupted the discussion and brought some sanity to the meeting. 14. A Parke resident then got up to speak to the Mediacom FAQs sheet posted on the Ocean Pines web. He read from the FAQs that the franchise agreement was to be reviewed and renewed in 2013 but more likely in He wanted to know if the BOD was in negotiations with Mediacom about the contract renewal or will Ocean Pines be stuck with Mediacom for another 5 years? The GM took the floor to address the question. He stated that the Board President had

5 reviewed the contract and found that one of the contract parties had to be "significant" issues in the delivery of the contracted service. Without significant issues being found, the contract is automatically renewed. However, the term "significant" was never defined. The BOD plans to explore options after 2013 for the continuation of the franchise agreement. Glenn spoke up that he is doing everything he can to satisfy customers' expectations. The reason there is no competitive environment in Ocean Pines is because it costs $40K/mile to lay cable and $2-3M for a cable head end. For approximately 7800 homes in the Pines, the incentive for competition is not the re. For the capital investment Mediacom has made in Ocean Pines, we're planning to continue our customers for the long term. 15. A woman the asked if CEO Rocco Commisso ever visited Mediacom in Dagsboro and the service area here. He was here recently but did not visit the Ocean Pines community. He did meet customers and talked with them in the Dagsboro lobby. Rocko will also get a summary of the discussions from this evenings' meeting. 16. The two questions from the next resident could not be made out because of drop outs on the audio again. However, Glenn did answer one question by saying the STBs with DVRs are computers and technology is making the STBs smaller. The combo STB/DRVs are the same for all cable providers. 17. Glenn then stated that he will respond to each and every that was submitted in advance of the meeting. He then spelled out his address so the audience had a record of it. 18. The next gentleman gave praise to the local office for finally fixing his Internet problems that had plagued he for a long time. He then went on to talk about the pixelization and sound drop outs that he experiences on HD channels. Glenn stated that this issue was a common issue expressed throughout the evening and he will investigate it and resolve it. 19. There was then some statements form a part time resident who said that she broke her contract with Dish Network because they were not providing her with the agreed upon local channels. Because she wanted local news, she switched to Mediacom. Nonetheless, both Dish and DirecTV do provide the local Salisbury channels and the NBC affiliate out of Philly. 20. The next woman stated that she reported an outage but the operator never took her name or set up a trouble call. She never got a time frame for the tech to call at her home. Glenn stated that a tech should respond to the trouble in hours and could not answer her question without looking into the data log from the call. 21. A question was asked regarding the TV Guide channel. Mediacom dropped the channel because it wanted to reclaim the 6 MHz of bandwidth for digital programming. Local channel programming guide can be obtained on the Internet at Mediacomtoday.com. Glenn closed by thanking all for coming out to the meeting and once again promised to respond to each submitted.

6 1. I have no record of a request for a 13 or 23 basic channel service. It's a good point but I don't recall it being asked. 2. Senior discounts and low income discounts were addressed. 3. A question on signal strength and Internet connectivity was not included in the questions. 4. The question regarding SOAOO code on HD channels was not part of the pre-screened questions However, the question regarding a temporary cable across the drive way or yard was submitted. 5. Corporate channel bundling was not addressed by a pre-screened question. 6. Incentive pricing and 6 month pricing plan was addressed in the question list. 7. The replacement of STBs was addressed as was an issue with a DVR. 8. A question on the purchase of a STB was not submitted. 9. A question on a call center question was not submitted. 10. There were many questions regarding long term service interruptions, either on Internet connectivity, TV picture and audio drop outs, or phone troubles. Glenn did address this issue stating that long term trouble calls would need a manager to investigate the problem and then retrain the tech to fix the problem in the future. 11. Audio break up of the video prevented an understanding of the questions and discussion from the floor. 12. FCC performance filings were not addressed in the pre-screened questions. 13. I couldn't understand the question about channel 805 or 806. However, this subject was not presubmitted. 14. There were questions on the topic of the franchise contract submitted but they were deleted from the questions forwarded to Mediacom because they are questions to be resolved by the BOD. 15. A question regarding the CEO visits was not asked. 16. Audio break up of the video prevented hearing the two questions asked but Glenn's response filled in the missing question. Questions on STBs and DVRs were submitted and Glenn addressed these questions. 17. I was pleased to hear Glenn state that he would respond to every question submitted. 18. There were many questions submitted regarding pixelization and sound drop outs or signal strength issues on HD channels. Glenn will investigate this problem further. 19. The next resident made a series of statements instead of asking questions about a problem. 20. The issue of logging a trouble call by the call center will be investigated further by Glenn. 21. Questions on channels such as TV Guide, Hallmark, Cooking Channel, and Turner Classic were submitted and generally addressed by Glenn.