AT&T Settles Plano Case

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AT&T Broadband & Internet Services last week agreed
to pay $967,000 to some 50,000 subscribers in Plano, Texas, ending four years of
squabbling over local cable rates.

The settlement with Plano city officials cleans up a series
of rate cases that have languished at the Federal Communications Commission since 1996.

In its most recent action, Plano ordered AT&T Broadband
to shave 35 cents off its 1999 basic rate. The MSO secured an emergency stay from the FCC,
which also put a hold on similar rate orders in the nearby Dallas suburbs of Arlington and
Richardson.

Under the settlement, Plano subscribers will get $4.98
credits during each of the next four months, city attorney Diane Wetherbee said.

AT&T Broadband will also stop collecting a
30-cent-per-month surcharge it was using to recoup costs that predecessor
Tele-Communications Inc. incurred for unpaid franchise fees.

Finally, the MSO will contribute $133,000 to the city
treasury.

"And the city did not give up its right to review
future rate increases," Wetherbee said.

Bob Miller, Plano's outside counsel, said the city and
AT&T Broadband have settled on the methodology the operator will use to calculate
service and equipment costs, thereby reducing the chances for future rate disagreements.

AT&T is negotiating a similar settlement in Arlington,
which also has four consecutive rate cases pending before the FCC.

Jennifer Lowry, assistant to the Arlington city manager,
said negotiators hope to have a final agreement ready for the City Council to vote on at
its Oct. 5 meeting.

At press time, Richardson officials had not responded to
calls for comment. But AT&T Broadband executives said Richardson officials have been
unwilling to enter into settlement talks. The Richardson City Council has ordered a
35-cent reduction in basic rates for 1999.

"We've been very impressed with the spirit of
cooperation we found in Plano and Arlington," AT&T Broadband spokeswoman Angel
Biasatti said, "and we're hopeful that we can work something out with
Richardson."

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