STATE OF HAWAl'I APPLICATION FOR RENEWAL OF CABLE .

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STATE OF HAWAl'IAPPLICATION FOR RENEWALOF CABLE TELEVISION FRANCHISEI.IntroductionIn accordance with the State of Hawai' i's Hawai' i Administrative Rules ("HAR")(esp. § 16-133-9 and §16-133-28 and 29), an applicant for a renewed cabletelevision franchise is required to submit an application, in a form designated bythe Director of the Department of Commerce and Consumer Affairs ("DCCA").This Application represents that form, with respect to the April 24, 2014 notice ofintent for franchise renewal by Oceanic Time Warner Cable LLC ("Oceanic") forthe Kauai County franchise. Submission of the completed Application, and itsacceptance by DCCA, are necessary State conditions for the requested renewal.However, the application process outlined in HAR does not relieve Oceanic of itsobligations, or prejudice any of Oceanic's rights, under the renewal provisions of§626 of the federal Cable Communications Policy Act of 1984 as revised, norother applicable law and regulation. In particular, the completed Application doesnot constitute a "renewal proposal" for the purposes of the formal renewalprocedures described in the Cable Act. Acceptance of the Application by DCCAdoes not confer any franchise right, nor constitute agreement in whole or in partregarding any franchise provision. DCCA's acceptance is intended only as anacknowledgement of the substantial completeness of the Application and theinformation it contains, along with acknowledgement that Oceanic has fulfilled anecessary State condition for obtaining a renewal franchise as requested. Uponacceptance of the Application, it is DCCA's intention to draft a proposedfranchise, incorporating provisions reflecting community needs and interests, andcomments from the public hearing on the renewal application, to serve as thebasis of negotiations aimed at establishing a mutually agreeable franchisedocument.[REMAINDER OF PAGE LEFT INTENTIONALLY BLANK]

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016II.General InformationA.Provide a summary of the application for renewal.Response: For nearly fifteen years, Oceanic has provided high-qualityand innovative cable television and other services 1 to the residents ofKauai while making significant investments in its Kauai system.On December 17, 2015, DCCA approved Charter Communications, lnc.'s("Charter") and Oceanic's former corporate parent, Time Warner Cablelnc.'s ("TWC"), joint application for the transfer of control of all ofOceanic's franchises in the State of Hawai' i, including the Kauai franchise.See Decision and Order No. 366, issued on December 17, 2015 ("D&O366"). Today, as a wholly-owned, indirect subsidiary of Charter, Oceanicoffers over 500 analog and digital video and music channels, andcontinues to provide local residents with innovative cable television, video,data, voice and other services through one of the most technologicallyadvanced systems in the industry. From delivering reliable and innovativeservices, to employing the latest in high definition ("HD") technology tobring local sports and other locally-produced programs directly tosubscribers' homes, Oceanic - through its over 1,300 employeesstatewide - has developed a solid record of stability, performance andcommitment to the residents of Kauai and the entire state.Oceanic, by leveraging the synergies of the Charter merger with TWC andBright House Networks ("BHN"), looks forward to continuing and buildingupon its tradition of providing dependable, high-quality and innovativecable television services to the residents of Kauai though a franchise thatbalances the interests of stakeholders with the flexibility to deploy andmanage technology and resources in the best, long-term interest of allsubscribers on Kauai. Among other features, Oceanic's applicationproposes to provide public, educational and governmental ("PEG") access1Certain of the subjects and benefits discussed in this Application pertain to non-jurisdictional productsand services. While Oceanic lawfully provides services other than cable over its system, DCCA does notregulate the various other services offered by Oceanic and referenced in this Application, such asOceanic's high speed data, phone, and Wi-Fi services. Oceanic discusses them in this Application asexamples of the types of innovative services that Oceanic has and will continue to provide to theresidents of Kauai. Oceanic respectfully reserves all rights relating to the inclusion of or reference to suchinformation, including without limitation Oceanic's legal and equitable rights relating to jurisdiction, filing,disclosure, relevancy, due process, review, and appeal. The inclusion of or reference to non-jurisdictionalinformation may not be construed as a waiver of any rights or objections otherwise available to Oceanic inthis or any other proceeding, and may not be deemed an admission of relevancy, materiality, oradmissibility generally or with specific regard to the DCCA's actual public interest standard underapplicable law.2

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016channel capacity, contribute to Kauai's PEG capital expenditures in anamount that accounts for the dramatic changes in the way individualscreate and distribute their own video programming, and discuss withDCCA commercially reasonable terms regarding the continuedmaintenance of, use of, and signal transport on, Oceanic's institutionalnetwork ("I-Net").8.AuthorizationState the names, addresses, and occupations of all persons who areauthorized to represent or act on behalf of Applicant in those matterspertaining to the Application. For each person so authorized, Applicantshall state the limits, if any, of the Authority of the individual to makerepresentatives or act on behalf of Applicant with respect to matterspertaining to the application. The requirement to make such disclosureshall continue until the State shall have accepted or rejected Applicant'sapplication or until Applicant withdraws its application.Response: Oceanic has authorized legal counsel and the followingemployees to represent or act on its behalf in those matters pertaining tothis Application:Yamamoto Caliboso LLLC 1099 Alakea Street, Suite 2100Honolulu, HI 96813The following Oceanic officer is fully authorized to act on behalf ofOceanic:Regional Vice President200 Akamainui StreetMililani, HI 96789Gregg FujimotoC.History and experienceProvide a narrative account of Applicant's history and experience in theoperation of the Kauai County Franchises.Response:Oceanic's roots in Hawai' i can be traced back to thedevelopment of housing in central Oahu in the late 1960s. Castle &Cooke's Oceanic Properties constructed a 12-channel cable system forresidents of Mililani. This cable system, Oceanic Cablevision, eventuallybecame a separate business entity operating the Mililani cable system andthe Rainbow TV cable system, which served portions of Manoa and3

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016Nuuanu onCompany.alease-back arrangementwithHawaiianTelephoneIn light of the FCC requirement that telephone companies divest theirinterests from the cable business, the State of Hawar i enacted a lawenabling cable operators to use public-rights-of-ways to install their cableplants. The State Department of Regulatory Affairs (now known as theDepartment of Commerce and Consumer Affairs) then divided the islandsof Hawai' i into franchise areas. These areas were awarded to individualcable operators based on the merits of the services they proposed to offerin the areas their respective cable systems would ultimately serve.Oceanic Cablevision was awarded a franchise granting it authority toprovide cable service throughout most of metropolitan Honolulu, the entireCentral Oahu area, and the North Shore between Kaena Point andKahuku.Oceanic Cablevision was one of the nation's first "urban build" systems toprovide cable-exclusive programming in addition to broadcast stations inorder to produce a marketable product. Even though customers in areassuch as the North Shore and the deeper reaches of Manoa and Nuuanuvalleys on Oahu would often subscribe to cable television for improvedreception, most residents in the populated areas of Oceanic Cablevision'sservice area were looking for more than just better broadcast receptionand welcomed Oceanic Cablevision's expanded services.Oceanic Cablevision's planning, innovation and engineering during the1970s established the vision and foundation for Oceanic's system thatexists today. Currently, Oceanic serves not only the original franchisearea awarded to Oceanic Cablevision in the late 1960s, but has grown toinclude the entire state of Hawar i.Oceanic's presence on Kauai dates back to 2002, when the DCCAapproved Oceanic's predecessor-in-interest, Time Warner EntertainmentCompany, L.P.'s ("TWE") application for the transfer and amendment ofthe cable franchises held by G Force. 2 G Force provided cable televisionservice to the residents of Kauai through Garden Isle Cablevision andKauai Cablevision, which were two separate cable systems with separateheadends. The G Force systems provided approximately 65 analogchannels to Kauai residents.2Decision and Order No. 291 (July 12, 2002).4

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016Following the transfer of the franchises, Oceanic embarked on acomprehensive program to consolidate, expand and upgrade the former GForce systems, including consolidating the two systems and installing oneprincipal headend, upgrading the system to a minimum bandwidth of 750MHz (without passing on those costs to subscribers), and providingextensive and quality programming to residents, including digitalprogramming. On April 20, 2005, DCCA acknowledged that Oceaniccompleted the 750 MHz upgrade for its Kauai system, enabling access todigital and other services. 3 Since then, Oceanic has continually upgradedits Kauai system such that residents on Kauai now enjoy a system thatprovides a wide array of modern services available to other subscribersstatewide.Today, the current activated capacity of the Kauai system is 870 MHz,with much of the system upgraded to support 1 GHz, and Oceanicprovides over 500 digital and analog channels of programming from avariety of sources (local broadcast stations, studio origination, satellite andother video sources). Oceanic's system includes a network of coaxialhard lines and optical fiber.Oceanic has also provided digitalprogramming services to Kauai residents since 2002. Oceanic currentlypasses over 38,000 homes on Kauai.Through these investments and upgrades, Oceanic's subscribers currentlyhave access to an expansive array of cable services and other advancedservices that were not previously available to Kauai residents, includingdigital phone service. By standardizing system capacity throughout itsfranchise areas in Hawai' i, including on Kauai, Oceanic has strived tobring service parity to all of its subscribers in the state.Oceanic has also taken its obligation to be a good corporate citizen veryseriously.Over the course of its history in Hawai' i, Oceanic hassupported many non-profit entities in the state with substantial donationsand has participated in numerous community and charitable events.Oceanic is an integral part of the Kauai community and the largerstatewide community.Oceanic's history of both service and commitment to the residents ofKauai amply demonstrates that Oceanic has not only been a goodcorporate citizen, but has also been an industry-leading, innovativeprovider of cable communications services to its subscribers on Kauai andthroughout the state.3See Decision and Order No. 319, at 3 (April 20, 2005).5

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016D.Describe the present Kauai County cable systems.Response: Oceanic's current cable system employs a hybrid fibercoaxial ("HFC") network. Oceanic transmits signals on the system vialaser-fed fiber optic cable from origination points known as "headends"and "hubs" to a group of distribution "nodes," and uses coaxial cable todeliver these signals from the individual nodes to the homes they serve.The primary headend for Kauai is in Kalaheo, with hubs located inKukuiula and Kapaa.Oceanic's former corporate parent, TWC, pioneered this architecture andreceived an Emmy Award in 1994 for its HFC development efforts. HFCarchitecture allows the delivery of two-way video, which is essential toproviding advanced video services like video on demand ("VOD"). All ofthe homes passed by Oceanic's cable system are served by plant that hasbeen upgraded to provide at least 870 MHz of capacity, with newerportions of the system upgraded to 1 GHz of capacity.E.Technology Change and Kauai County Cable System InfrastructureDescribe with particularity how: (1) the technical provision of cable serviceis likely to change over the period of the franchise; (2) the demand forservices in the franchise area is likely to change over that same, period(for example, the capability of accommodating High Definition Television,two-way services to the home, high speed broadband, Internet service,data transmission, etc.); and (3) it can assist in affirmative development ofthe cable system infrastructure in Kauai County during the remaining termof the franchise.Response: The history of cable technology is one of rapid change andOceanic expects that the future will likely see a similar progression of newdevelopments, services and associated technology. Oceanic, with theexperience and expertise of Charter, is prepared to meet the cable-relatedneeds of Kauai residents in the next franchise period, in a manner thatgives Oceanic flexibility to manage its technology and resources, competefor new video customers, and offer affordable services to price-sensitivecustomers. In the near term, Oceanic's cable customers will continue toreceive the same, similar, or higher quality products and services that theycurrently enjoy. Moving forward, Charter is committed to making theinvestments necessary to ensure that its network is not only robust fortoday's cable-related needs, but capable of evolving to meet tomorrow'scable-related consumer and business demands, to the extent financiallyand technically reasonable.Charter, for example, anticipates deploying innovative equipment and6

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016services, such as a set-top box that will use a downloadable securitysolution and a cloud-based user interiace that will enhance the consumervideo service and can be accessed through both new and legacy two-wayset-top boxes.F.Franchise Compliance ReviewDCCA through its consultant conducted franchise compliance reviewsregarding the Applicant which reflect that the Applicant has complied withthe terms of the existing franchise orders. (Please see "ComplianceReview" in the consultant's report Community Ascertainment and RelatedActivities dated April 5, 2016 (the "Ascertainment Report"), pp. 8-15.)Provide any comment or proposals regarding this section of the report.Response: The principal finding of the Compliance Review was thatOceanic is in full or substantial compliance with its material franchiseobligations. As it has during the current franchise period, Oceanic intendsto continue to diligently comply with its franchise requirements.The Compliance Review noted a few nonmaterial issues that either arenot compliance issues, or have been addressed or are in the process ofbeing addressed. For example, the review stated that some requiredreports were submitted past the scheduled due date. Oceanic's parent,Charter, is committed to prompt and accurate reporting. With Charter'soversight, Oceanic will strive to submit reports on a timely basis.The Compliance Review also reported that Oceanic currently does notprovide discounts for bulk MDUs serving senior citizens.Oceanic,however, does provide bulk service at significant discounts from thestandard subscriber rate to all bulk MDU customers, including thoseserving senior citizens, when bulk agreements are negotiated. Oceanicbelieves that these discounts are reasonable and comply with Decisionand Order No. 291. 4 Additionally, the customers noted in the ComplianceReview that are receiving grandfathered discounts are not bulk customers,as contemplated by Decision and Order No. 291, but rather individualsubscribers.With respect to technical issues, the Compliance Review gave Oceanic'ssystem high marks on all periormance measures. As the TechnicalReview concluded:See Decision and Order No. 291, at 17 (July 12, 2002) ("TWE has agreed to implement reasonablediscounts for bulk customers serving senior citizens, such as retirement communities and long term carefacilities located on Kauai.").47

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016The Oceanic Kauai system has been found tobe generally sound. Operations, maintenance,and repair activities are well managed andperformed with attention to detail, with an eyetoward long-term reliability and quality ofservice. As with other Oceanic-owned systemsthroughout the State, pride in ownership isshown by the dedication and work ethicdemonstrated by local Oceanic staff. As awhole, the public on Kauai stands to benefitfrom continuing to receive service fromOceanic. (Ascertainment Report, p. 29.)The Compliance Review reported that FCC proof of performance testsindicated analog signal distortions at five of the test points. But, theevidence indicated that these distortions were due to testing issues ratherthan systemic problems with the network. In any event, Oceanic, with thesupport of Charter, intends to monitor, and if necessary, correct any FCCproof of performance issues that may arise.Additionally, the Compliance Review stated that the "part of Oceanic'scable system served by the Kilauea Optical Transport Network (OTN)needs to be reconfigured to address reliability issues caused by thecurrent OTN platform." Oceanic is in the process of reconfiguring its fiberdistribution to serve the north Kauai area directly from the existing Kapaahub without a powered OTN. Additional equipment and fiber has beeninstalled but splicing still needs to be completed. This is currently plannedfor the first quarter of 2017. Once completed, this work should addressany reliability issues caused by the current Kilauea OTN.Through its planning, innovation and development of its system on theisland of Kauai, and throughout the state, Oceanic has demonstrated thatit is committed to investing in Hawai' i over the long term. With Charter'ssupport and resources, Oceanic intends to continue to provide reliable andinnovative services to its subscribers and relevant stakeholders through itsongoing operations, maintenance and repair programs, which will beenhanced by Charter's customer-focused business model.G.InnovationsPlease describe any cable-related innovations during the last ten yearswhich Applicant has undertaken.These innovations may includetechnological or consumer service upgrades.8

Application for Renewal of Cable FranchiseApplicant's Name: Oceanic Time Warner Cable LLCDate of Application: December 16, 2016Response: Over the past ten years, Oceanic has continued its traditionof providing innovative and high-quality products and services to itssubscribers.Cable-related innovations currently offered by Oceanicinclude: HD Television. Oceanic currently offers over 100 channels of HDtelevision, or HDTV, and expects to continue to add additional HDprogramming in the future. HD si

Company, L.P.'s ("TWE") application for the transfer and amendment of the cable franchises held by G Force.2 G Force provided cable television service to the residents of Kauai through Garden Isle Cablevision and Kauai Cablevision, whic