Cablevision 2011 Annual Report Download - page 32

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Legislative enactments, court actions and federal, state, and local regulatory proceedings frequently
modify the terms under which we offer our services and operate. The results of these legislative, judicial
and administrative actions may materially adversely affect our business or results of operations. New
requirements giving third parties access to our network or other assets, for example, could materially
affect our ability to compete. Changes to regulations from which we benefit and on which we depend to
run our businesses also could materially affect our operations. Any action with respect to these or other
matters by the courts, Congress, the FCC, the states of New York, New Jersey, Connecticut, Utah,
Colorado, Wyoming or Montana, or concerted action by local regulators, the likelihood or extent of which
we cannot predict, could have a material adverse effect on us.
Our current franchises are non-exclusive and our franchisors need not renew our franchises.
Our cable television systems are operated primarily under non-exclusive franchise agreements with state
or municipal government franchising authorities, with the latter in some states also subject to approval of
state regulatory authorities. Consequently, our business is dependent on our ability to obtain and renew
our franchises. Although we have never lost a franchise as a result of a failure to obtain a renewal, our
franchises are subject to non renewal or termination under some circumstances. In some cases in New
York and New Jersey, franchise agreements have not been renewed by the expiration date, and we operate
under temporary authority routinely granted from the state while negotiating renewal terms with the
franchise authorities. As of December 31, 2011, our ten largest franchise areas comprised approximately
44% of our total video customers and of those, two franchises, Newark and Yonkers, comprising
approximately 110,000 video customers, are expired. We are currently operating in these franchise areas
under temporary authority. On December 15, 2011, the City of Yonkers and the Company executed a 10-
year renewal agreement, which will become effective when approved by the New York State Public
Service Commission; such approval is expected in the first half of 2012. In Montana, Wyoming,
Colorado and Utah, franchises must be renewed prior to their expiration date, subject to the protections of
federal law. Neither the Company nor its predecessor in those states, Bresnan Communications, has ever
lost a franchise.
A portion of our workforce is represented by labor unions. Collective bargaining agreements can
increase our expenses. Labor disruptions could adversely affect our operations.
As of December 31, 2011, approximately 580 of our full-time employees were covered by collective
bargaining agreements. On January 26, 2012, a majority of the Company's technician workforce in
Brooklyn, New York voted to be represented by the Communication Workers of America. The total unit
of employees is comprised of 282 full time workers. These employees are not yet covered by a collective
bargaining agreement. Collective bargaining agreements with the Communication Workers of America
covering this group of employees or agreements with other unionized employees may increase our
expenses. In addition, any disruptions to our operations due to labor related problems could have an
adverse effect on our business. We cannot predict whether labor unions may be successful in organizing
other portions of our workforce or what additional costs we could incur as a result.
We rely on network and information systems for our operations, and a disruption or failure of those
systems may disrupt our operations.
We have in place layered and multi-threaded security systems designed to protect against intentional or
unintentional disruption, failure, misappropriation or corruption of our network and information systems.
A problem of this type might be caused by events such as computer hacking, computer viruses, worms
and other destructive or disruptive software, "cyber attacks" and other malicious activity, as well as
natural disasters, power outages, terrorist attacks and similar events. Such events could have an adverse
impact on us and our customers, including degradation of service, service disruption, excessive call
volume to call centers and damage to our plant, equipment and data. In addition, our future results could
be adversely affected due to the theft, destruction, loss, misappropriation or release of confidential