DOING BATTLE IN THE L.A. CABLE WARS

The head of the city’s Telecommunications Department has a reputation of pragmatism and negotiating skill--but as she tackles the troubled TV system, she’s struggling to master the personalities and the protocol--and the real

test is yet to come.

On a crisp spring day just before she left for Los Angeles, Susan Herman climbed to the roof of New York City’s 71-year-old Municipal Building, turned to face a photographer and grinned.

Over her shoulder, the stately Brooklyn Bridge swept across the East River and the skyscrapers of Brooklyn and Manhattan spread toward the horizon. The gilt-draped statue of “Civic Fame� that tops the 40-story building glinted above her. To Morris Tarshis, recalling that day, it proved a telling portrait.

“Sitting on top of the world. That’s Susan,� chuckled the powerful New York bureaucrat who was Herman’s mentor before she moved west.

Difficult First Test

Only a few months later, her perch was much less lofty. The newly named head of Los Angeles’ Telecommunications Department, she sat at the center speaker’s table in the City Council chamber. Council members lashed her recommendation that the city bid on a $400,000 cable television production studio. It was her first real “at-bat,� Councilwoman Joan Milke Flores said later, and the pitches were hard and fast.

Councilwoman Joy Picus called Herman’s proposal “extraordinarily rash.� Councilman David Cunningham, mocking and condescending, reminded Herman that the council, not she, would make any decision. Councilman Marvin Braude peppered Herman with questions and rebuked her when she tried to answer them.

But not all the tough talk came from the council. When Braude scolded Herman for failing to check a pertinent fact, she interrupted coolly, “I have.� When he refused to let her speak, she turned and requested time from Council President Pat Russell. When Braude objected, Herman addressed him pointedly: “I was just answering some of your questions.�

City’s Political Realities

It was Herman’s introduction to the stiff realities and difficult political demeanor of the Los Angeles City Council. And it was the council’s first hard look at Herman, a stylish, tough and driven regulator brought to Los Angeles to harness what some private cable consultants and other experts say is perhaps the worst-regulated patchwork of cable systems in the nation.

Only 31--believed to be the youngest department manager in city history--she brings to Los Angeles a reputation for persistent pragmatism, negotiating tact and technical skill. As director of telecommunications in New York City, she helped negotiate franchises for new operators and spurred improvements in existing systems, regulating cable firms with an aggressive but even hand.

This arsenal of experience is essential. Cable systems in Los Angeles face troubles of striking depth. The operator of one major system, CommuniCom, is being reorganized under federal bankruptcy laws. Franchisees for the Eastside and South-Central Los Angeles have never provided any service. Service for South-Central is the subject of a Supreme Court lawsuit that could strip the city of its right to assign franchises.

Three Franchises for Sale

Three other franchises owned by Group W are up for sale. And another system, United Cable in the east San Fernando Valley, has had financial problems.

Six months after taking charge of the newly formed Telecommunications Department, Herman is struggling to master the personalities and protocol of Los Angeles while starting the second phase of the city’s cable wars--the refranchising of 14 service areas.

The first round, a lengthy process ending in 1983 in which original franchises were granted, proved divisive and nettling, raising politics-by-lobbying to an art form.

Herman’s first reviews are good: While organizing her department and working up preliminary refranchising plans, she has won praise as a quick-minded workaholic. But the real test lies ahead in the months leading to the awarding of new franchises in early 1987.

It is a point of pride to Herman that she does not act, sound, or look bureaucratic--except when, in her high-pitched, staccato delivery, she slips into cable jargon and refers to a firm’s “infrastructure.�

She has two secretaries but frequently answers her own phone. She works late so often that, she jokes, she has met more janitors than fellow general managers. After work, she sometimes drives around neighborhoods, hoping to glimpse what cable needs might be. Last month she took her first vacation in more than two years, traveling to England for pleasure--and to check out British cable systems.

Petite and attractive, she looks younger than 31. She wears her long brown hair piled atop her head or lets it fall casually over her shoulders. When she strides purposefully down City Hall corridors, visitors sometimes mistake her for a clerk.

She started work less than 24 hours after walking off a plane from New York. Big cable decisions were percolating back East, so--in her typical, hard-driving manner--she shrugged off her lame-duck status and worked there until 2:30 a.m. Sunday. Then she slept a few hours, caught a plane to Los Angeles, unpacked and went to work Monday.

Time between the jobs was so tight that she rented her West Los Angeles apartment, sight unseen, by telephone from New York. To her chagrin, she still hasn’t gotten around to signing up for cable TV service, partly because it can be a nuisance.

“To tell you the truth, I have a little bit of a workaholic addiction to the television set,� she said. “When I used to go home in New York to view my cable, it was not to watch it. It was to flip through to ensure that what they were obligated to carry they were carrying . . . That was really boring.�

But her interests go beyond cable television. In conversation, she chats humorously about subjects ranging from the culinary significance of movie theater bonbons to the dilemma of a single career woman, like herself, whose proud mother pointedly desires grandchildren.

She professes an attraction for books, the theater, opera, an occasional baseball game. But she reserves her most glowing admiration for one particular hobby: pinball.

“This is a real betrayal to my industry,� she confides with a nervous laugh, “but I don’t like video games. I like pinball . . . the aesthetics of it . . . the pine boards and the steel ball and the flippers . . .�

She used to hang out in New York’s tawdry Times Square--�all the pinball parlors,� she said, almost reverently. “Thousands of them. It’s very odd to go in there--you have a business suit and your high heels and your briefcase, sitting there punching in quarters.�

She recoiled at the suggestion that luck plays a part in pinball. “Luck?� she said in mock horror. “It is definitely skill. . . . I’m pretty good at it, too.�

That same self-confidence led her to top city jobs in New York. She went to work in the New York City mayor’s office on a fellowship after her 1974 graduation from Raymond College, a small liberal arts school in Stockton, Calif. Soon she was hired as special assistant to Herbert Sturz, chairman of the New York City Planning Commission.

“She had the maturity that relatively few people do . . . she was resourceful, fun, very good on details; she works hard, she’s unpretentious,� Sturz recalled recently. “She didn’t trade on charm. I respected her.�

Sturz asked her to concoct a plan for franchising cable television in the four outer New York boroughs that, unlike Manhattan, did not have service. Two years later, her voluminous report complete, the city created a telecommunications department and named Herman, at age 28, to direct it.

The department was created under the city’s Board of Franchise, run by 30-year City Hall veteran Morris Tarshis, a brawny cigar smoker who negotiates contracts for the commercial use of New York streets, tunnels, pipelines, bridges and sidewalks. Tarshis, whose reputation as a tough regulator is well known even in Los Angeles, was alternately worshiped or reviled by cable operators-- depending on the state of negotiations. He caught much of the criticism himself but won glowing praise that shone on Herman as well. Their professional relationship still is close and respectful.

In New York, Herman quickly won a reputation for keeping on top of consumer complaints, “tickling� cable operators with a flurry of letters and telephone calls. Although Tarshis was the main negotiator, Herman helped hammer out franchises for the four outer boroughs. Those cable systems are now under construction.

In an arena where cable operators generally try to provide nothing and cities try to demand everything, she stuck with negotiations between the two until they bore pragmatic fruit, willing to switch approaches as long as her goal was reached.

One novel move championed by Herman and others solved the thorny problem of how to run public access channels--those dedicated to educational or citizens’ group programs. Rather than allow cable firms or the city to handle the channels, New York set up independent corporations funded by the cable companies to run each borough’s public programming. Stuart Domber, president of the Queens nonprofit corporation, said Herman acted as an instrumental referee between the parties.

“The board of (corporation) directors wanted pie-in-the-sky and the cable companies wanted to give up nothing,� Domber said. “She presented a view of reality.�

Herman also handled the city’s relations with the two cable firms that serve Manhattan. Donald H. Mitzner, senior regional vice president for Group W, which serves north Manhattan, said Herman proved a stubborn but genial foe with whom he shared a few yelling matches and a healthy respect.

When an apartment building superintendent refused to allow Mitzner’s workers to wire the structure--which the firms were required to do--mediation fell to Herman. She had one response, Mitzner said, recalling their typical conversation.

“ ‘Go wire it,’ � Herman would say.

“ ‘But the super is standing there with a hammer.’ �

“ ‘Sue them,’ � she responded. The buildings were wired.

Last fall, drawn by the challenge posed in Los Angeles and hoping to live closer to her Northern California parents, Herman applied for the $60,000-a-year post as general manager. She scored first in written and oral examinations, met Mayor Tom Bradley and took the job.

Her major goals for Los Angeles’ refranchising mimicked those won in New York--to provide the same quality of services for all neighborhoods, rich and poor, and to connect the city’s systems to allow citywide public and educational programming. On both efforts, she faces a fight.

Equal services, Herman believes, are “a basic democratic right. It sounds corny but I believe it. . . . The goal is to avoid electronic red-lining, information-rich and information-poor.�

But industry consultants say the city--in meting out the original franchises in 14 irregular pieces--has made it extremely difficult to equalize services. Small companies operating on a shoestring subscriber base will not be able to afford improvements that bring their systems up to par, said Carl Pilnick, a veteran Los Angeles-based consultant.

Even Councilwoman Joan Milke Flores, who generally supports Herman, questions whether equality is possible.

Small and Large Firms

“Realistically, we haven’t done that and can’t do that,� Flores said. “It’s difficult to take Jack Barry (the small firm serving Westchester) and require the same thing of him and Group W.�

Company officials offer more virulent opposition.

“Every community in the city of Los Angeles has different needs. What is of interest in Marina del Rey, I promise you, is not of interest in East Los Angeles,� said Moctesuma Esparsa of Buenavision, which holds the Boyle Heights franchise.

Herman says that interconnecting the systems will allow broadcasting across franchise boundaries of programming ranging from City Council sessions and fire safety programs to community celebrations. Other city officials likewise hail interconnection as a boon to emergency planning, theoretically allowing the city to communicate with its residents in the event of an earthquake or other disaster.

“I think that it is a way of uniting a very decentralized city,� said Herman.

But cable operators argue that connecting the systems would be horrendously costly.

“It is a question of expense and benefit,� said William Cullen, president of United Cable and the Southern California Cable Assn., a group of local operators. “I think it’s a worthwhile public service, but it doesn’t get us any subscribers, believe me.�

Herman chooses her words carefully--even solicitously-- when discussing specific franchises or industry positions. But she openly ridicules complaints about the cost of improvements.

“Nobody put a gun to these companies’ heads and said, ‘Do business in the City of Los Angeles,’ � she said.

“If different companies achieve it in different ways, I don’t care. I don’t care if they use red wires, blue wires, green wires, as long as the service gets there. I don’t care if they use one cable, two cables, 14 cables, or a big fat purple one, as long as it provides diversity of service.�

But it will take more than tough talk to win concessions. Herman must also develop the political expertise to counter stiff lobbying by cable firms. The persuasive influence of Los Angeles’ 12 companies--equal to the combined total in Chicago, San Francisco and Philadelphia--was described by one person who took part in the initial franchising wars as “chilling.�

So important is the balance of power between the cable firms, the council and Herman that every move is scrutinized for its political meaning.

When the council’s Industry and Economic Development Committee this summer considered the department’s refranchising policies, for example, they replaced Herman’s “minimum requirements� with “objectives and guidelines.�

Goals Considered Elastic

Several cable operators pounced on the change as evidence that the city’s stated goals are highly elastic. In a more blunt diagnosis, independent cable consultant Pilnick said the change showed the council’s inherent “sympathy� to cable operators.

The council hearing on Herman’s proposal that the city bid on a $400,000 production studio--a suggestion shunted to a committee after it sparked a cross-fire of criticism--showed that she has not yet mastered the idiosyncrasies of local politicians.

In New York, the City Council has fewer day-to-day responsibilities and Herman thus had more independence, usually dealing only with the mayor and a few other major city officials. Here, she must establish working relationships with 15 powerful council members and a host of assorted departmental personalities.

Councilwoman Flores, a fan of Herman’s, said that while Herman is strong on technical knowledge, “she’s a little naive on some of the political situations.

“In some areas, she’s still learning,� she said. “We take her for granted. . . . She’s done so well, we forget she’s new and having to learn.�

Herman has impressed politicians with her willingness to take city plans--even those changed by politicians--and run with them as if they were her own. Her public utterances about the council show increasing political savvy.

“Over time, some department managers who have been here for 30 years begin to tire of going in and confronting the council with something controversial,� said Craig Lawson, Mayor Bradley’s liaison to Herman’s department. “They do it. They don’t relish it. Because she’s new and young and aggressive, she’s willing to do that.�

Herman won some points for her refusal to back down when the council attacked her proposal to purchase the cable studio.

“It was a little bit of a trial--see how the petite little lady responds . . . a little bit of a macho thing there,� said Flores. “How much do you know and how quickly can you get on your feet? How do you react to that? Cry or stand your ground?�

Herman herself grinned ruefully when asked about the council hearing. “I just learned a little bit more civics,� she said.

Cable Companies in the Los Angeles Area A. Valley Cable TV Inc. B. Sammons Communications Inc. C. United Cable TV of LA Inc. D. King Videocable Co. E. Telesystems Co. F. Group W Cable Inc. G. Group W Cable Inc. H. Group W Cable Inc. I. CommuniCom Inc. J. Jack Barry Cable TV K. ACCESS L. Buenavision M. Colony/Harbor Cablevision Inc. N. Dimension Cable Television Source: Los Angeles Department of Telecommunications CABLE TV PROBLEMS IN LOS ANGELES Susan Herman calls Los Angeles’ cable situation “a challenge.� The city’s 14 franchises equal the combined total in Chicago, Philadelphia and San Francisco. Twelve companies serve areas with anywhere from 93 to 315,000 homes, offering between 26 and 116 channels. Their financial stability ranges from shaky to rock-solid. GRANTING THE FRANCHISES: The first seven franchises were granted between 1952 and 1967 in areas where over-the-air reception was poor. The city took little regulatory role, according to a city-sponsored report by consultant Howard Gan. The remaining seven were granted between 1978 and 1983, at the height of cable TV wars. Franchise bidders tried wooing council members with gifts and made dizzying offers of enrichment to sought-after areas. The result was what the Gan report called “a brain teasing jigsaw puzzle� of franchises. THE BIGGEST PROBLEMS: CommuniCom, holder of the city’s largest franchise, (I) has filed bankruptcy proceedings, remaining afloat because of multimillion-dollar emergency loans. The firm has upgraded transmitting facilities but remains plagued by more customer complaints than any other franchise, Herman said. City officials say they are trying to prod CommuniCom into improved service while not forcing it into a deeper financial hole. The South-Central Los Angeles franchise (K) remains unserved because of a lawsuit. ACCESS-Sun Cable won the contract, but rival Preferred Communications sued. In a decision being appealed to the U.S. Supreme Court, a federal court said the practice of awarding a franchise to one firm violates the First Amendment. If the decision is upheld, cities could lose the authority to franchise cable companies--in effect, losing their most potent weapon. Boyle Heights (L) remains without cable three years after Buenavision won the franchise. The company’s chief executive officer, Moctesuma Esparsa, blames the delay on financial setbacks. Banks have refused to back construction because not enough time remains on the franchise to guarantee a profit, Esparsa said. Buenavision wants the city to extend the franchise; Councilwoman Joan Milke Flores wants the the council to consider stripping Buenavision of the franchise. Buenavision declined a recent suggestion that it engineer a “demonstration project� to service a small segment of Boyle Heights. United Cable, which serves the east San Fernando Valley (C), faces a Jan. 31 deadline to install 270 miles of cable, roughly one-fifth of its area. FACING POSSIBLE SALE: Westinghouse Electric in August unveiled plans to sell off Group W, its cable television division, which holds three Los Angeles franchises stretching from Pacific Palisades through the Santa Monica Mountains west to Highland Park (F,G,H). The sale is expected to occur next year, in the heat of the refranchising effort.