Cable One Mulls Starting a CLEC

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Cable One Inc., the Phoenix-based MSO, is preparing to get
its feet wet in advanced services, with plans to launch digital television and a
business-telephony offering next year.

Cable One president Tom Might said his company is gearing
up to offer a 100-channel digital-video service beginning in January. Once the initial
launch is completed in four as-yet-unnamed markets, he added, Cable One will begin rolling
out one new digital market a week, beginning in July 2000.

Cable One has about 750,000 subscribers in eight states.
The MSO, owned by The Washington Post Co., caught attention last week by advertising for a
vice president and general manager for competitive local-exchange carrier (CLEC)
development and a director of digital video services, along with other jobs.

Might said Cable One has been working on a digital offering
for quite some time. While direct-broadcast satellite penetration isn't the only reason
for the digital launch, Might said it was a major factor.

"It certainly is a very big one," Might said.
"Their penetration has kicked up."

The digital offering will launch with about 100 channels,
primarily premium services, music channels and pay-per-view for the first year. After
that, the company plans to offer basic digital tiers.

Cable One has been upgrading its systems for the past four
years and currently has about three-quarters of its systems at either 550 megahertz or 750
MHz capacity. Might said the company has earmarked $45 million for digital-services
related capital expenditures over the next three years.

On the telephony front, Cable One will likely offer long
distance and private-line service to medium- to large-sized businesses within the MSO's
service territory beginning some time next year. Might added that the goal was to become a
full-blown CLEC, probably in the next 18 months.

There are no current plans for residential telephony.

Cable One, like many other MSOs, already offers business
telephony on a small scale to educational institutions and hospitals. The launch of the
business telephony service was a logical extension of that, he said.

Although it would take at least 18 months to gain CLEC
certification and forge all the necessary interconnection agreements with incumbent local
exchange carriers, Might said he believes business telephony can be a lucrative
opportunity for Cable One.

Might said that in Cable One's 52 markets, only five or six
have a CLEC alternative to the local-exchange carrier.

"The CLEC market itself has been growing a couple of
hundred percent a year in real revenue," Might said. "That's what is
attractive."

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