1. 1 Broadband in California and the Digital Infrastructure Video Competition Act of 2006 Michael Morris Program Supervisor Video Franchising and Broadband Deployment February 16, 2010

2. 2 State Issued Video Franchises The CPUC has issued a total of 102 Video Franchises to 23 companies. The transition from locally issued video franchises to state issued franchises is well under way.  Nearly 2/3 of all video customers in the state are now served by state video franchise holders

3. 3 Video Subscribers At year-end 2008, 7.1 million Households subscribed to video from state-issued video franchise holders and their locally-franchised affiliates  This is an increase of 13% over the previous year

4. 4 Video Competition Under DIVCA, video competition has increased quickly AT&T and Verizon more than tripled the number of HHs to which they offer video between 2007 and 2008

5. DIVCA’s Requirements for Companies with over 1,000,000 Telephone Customers Verizon satisfied its second-year requirement to offer video to 25% of the households in its telephone service area AT&T’s third-year test requires it to offer video to 35% of its telephone households by April 1, 2010 AT&T and Verizon provide service at no cost to one community center for every 10,000 customers Fifth-year build out requirement  Verizon – 40%  AT&T – 50% 5

6. More Upcoming Deadlines for AT&T and Verizon Within three years of commencing service, 25% of homes offered video service must be low income households Within five years of commencing service and thereafter, at least 30% of homes offered video service must be low income households 6

7. 7 Broadband Availability and Subscribership Under DIVCA, the CPUC gathers data on broadband availability and subscribership The approaches to data sources has evolved  Voluntary data from broadband industry to the Governor’s Broadband Task Force (availability) CPUC has updated that data with information from CASF and CETF  DIVCA data by Census Tract (availability and subscription)  FCC data by Census Tract (subscription)

8. 8 Broadband Data NTIA State Data & Development Program The Recovery Act (ARRA) allocated $350 million for broadband mapping CPUC designated by the governor as the entity eligible for a Mapping Grant in California CPUC received $2.3 million dollar grant

9. 9 Broadband Data NTIA State Data & Development Program Collecting broadband availability data from all broadband providers in the state  Data at census block level for small blocks and “street segment” level for large blocks  Much more granular than census tracts 10,000 blocks in each tract Creating a web-based broadband availability map, searchable by address

10. 10 All Broadband Connections in CA (68% of CA HH)

11. 11 Broadband Penetration Growth (DIVCA Franchisees) Residential Wireline Broadband Penetration Increased by 12.7% during 2008 in California (DIVCA Data) 2007 Penetration 2008 Penetration [1] [1] 2007 - 2008 Growth Rate Residential Wireline Broadband 55%62% (7,910,166 subs) 12.7% Mobile Broadband Wireless Service Plans [2] [2] 6%14%133% [1] [1] Penetration = Number of Subscribers / 12,733,414 households [2] [2] In some cases, wireless broadband is purchased by many of the same households that also purchase wireline broadband. However, the DIVCA data do not allow this to be quantified.

12. 12 Technologies Used to Deliver Broadband by DIVCA Video Franchise Holders

13. 13 Technologies Used to Deliver Broadband by State Video Franchise Holders DSL 49% Cable Modems47% Fiber to the Home 4%

14. 14 Residential Broadband Download Speed

15. 15 Residential Broadband Download Speed 58% of residential broadband connections (provided by DIVCA franchise holders) are more than 3 Mbps 30% of residential broadband connections (provided by DIVCA franchise holders) are more than 6 Mbps

16. 16 Video Franchise Employment Data Percent Change by Category 2007 Total 2008 Total Total # Change 2007- 2008 Total Percent ChangeCategory 3932(7)-17.9%Exec / Senior 5,6563,943(1,713)-30.3%Officials / Managers 1,8032,43763435.2%Professionals 7,4986,412(1,086)-14.5%Subtotal Managers & Professionals 6,2905,655(635)-10.1%Technicians 9,6478,634(1,013)-10.5%Sales / Associates 16,96716,077(890)-5.2%Office / Clerical / Associates 14,27613,899(377)-2.6%Skilled Crafts 1,015990(25)-2.5%Operations /Laborers / Service 63,19158,079(5,112)-8.1%Total

17. 17 Video Franchise Employment Data Percent Change by Company 20072008Change AT&T29,50925,881-12% Charter1,3981,341-4% Comcast7,1677,2902% Cox3,2433,3212% Time Warner7,3217,9008% Verizon8,1107,070-13%