Cablevision 2014 Annual Report Download - page 25

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that in the future we may also engage in extraordinary transactions and such transactions could result in the incurrence of substantial
additional indebtedness.
Our business is subject to extensive government regulation and changes in current or future laws or regulations could restrict
our ability to operate our business as we currently do.
Our cable and other telecommunications businesses are heavily regulated and operate pursuant to detailed statutory and regulatory
requirements at the federal, state and local level. See "Item 1. Business - Regulation". In certain of our service areas, state or
local franchising authorities regulate the basic service tier rates we may charge our customers for certain of our video services in
accordance with FCC rules. The FCC and state and local governments also regulate us in other ways that affect the daily conduct
of our video delivery and video programming businesses, our voice business and our high-speed Internet access businesses. In
addition, our businesses are dependent upon governmental authorizations to carry on their operations. See discussion under "Item
1. Business -Regulation".
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. For example, new requirements giving third parties access to our network or other
assets, limits on how we offer broadband service or the rates we charge for it, or new regulations that confer asymmetrical benefits
on online video distributors 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, 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
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, 2014, our ten largest franchise
areas comprised approximately 57% of our total video customers and of those, two franchises, Newark, New Jersey, and the Town
of Hempstead, New York, comprising an aggregate of approximately 136,000 video customers, were expired. The Newark, New
Jersey franchise agreement was renewed in January 2015. We are currently lawfully operating in the Town of Hempstead, New
York franchise area under temporary authority recognized by the State of New York.
We rely on network and information systems for our operations, and a disruption or failure of those systems may disrupt our
operations.
Network and information systems are essential to our ability to deliver our services to our customers. We have in place multiple
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.
Operational or business delays may result from the disruption of network or information systems and the subsequent remediation
activities. Moreover, these events may create negative publicity resulting in reputation or brand damage with customers and our
results of operations could suffer.
We have expended, and expect to continue to spend in the future, significant amounts to protect our network and information
systems; however, there can be no assurance that these efforts will prevent any of the problems identified above.