Formerly, the City of Los Angeles had 14 cable television franchise areas that were served by three incumbent cable operators; Time Warner had approximately 600,000 subscribers, Cox had approximately 10,000 subscribers and Charter had less than 60 subscribers. The City had provided cable television franchising regulatory authority of its cable television operators for over 30 years. The City's oversight of its incumbent cable television operators in the areas of consumer services and financial payments to the City, technical compliance with all local, state and federal laws, and Public, Educational and Governmental Access support had been ensured by City-issued franchises and ordinances through the City's vigilant enforcement of those ordinances.
In 2006, the California Public Utilities Code was amended under state law which preempted the City's cable television franchising rights to the California Public Utilities Commission. In 2007 and 2008, Verizon and AT&T began operating in the City.
State law provides for the City to continue to collect a 5% gross revenue franchise fee from the incumbent cable operators and from the telecommunications companies that offer video television services within the City's limits.