Maine, Mass. Ops Duck Pole-Fee Hikes

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Operators in Maine and Massachusetts are celebrating
victories over local utilities on pole-attachment disputes that could have inflated
cable-operating budgets by thousands of dollars.

In Maine, operators fought off proposals that would have
raised pole-rental rates by $18 to $20 per year, bringing the total per pole to $30. Those
rates would have been quadruple the national average, and they would have represented up
to 20 percent of system operating budgets. Officials from the New England Cable Television
Association had tried for three years to negotiate reasonable rates charged by utility
companies including Bangor Hydro, Bell Atlantic Corp., Central Maine Power and Maine
Public Service Co.

When talks failed to bring a resolution, operators proposed
state legislation. But executives did not relish a skirmish with utility companies:
Workers in that industry are viewed as civic heroes for their work to restore power after
this winter's devastating ice storms. To make more of an impact on legislators,
operators turned to their own medium. Instead of presenting paperwork that legislators may
not read, Time Warner Cable of Portland, Maine, illustrated a national pole-rate survey
conducted by Washington, D.C.-based attorney Paul Glist. It demonstrated the suppression
of telecommunications advances in the state if operators had to pay gigantic hikes in pole
fees.

It seemed to do the job. Legislators, including Maine House
Majority Leader Carol Kontos, indicated that they would entertain the industry's
rate-freeze proposal. That threat tweaked the negotiation process. The electric and
telephone utilities will freeze rates for one year, and then fees will rise according to
the consumer-price index.

"We were able to drive the point with legislators that
rising rates would virtually ensure an end to line extensions and rebuilds," said
Laurine Langille, director of government affairs for northern New England at the NECTA.

In Massachusetts, the industry dodged a 30 percent
pole-rate increase that was sought by Boston Edison Co. but rejected by the Massachusetts
Department of Telecommunications and Energy. It was the first time that pole rates had
been challenged in the commonwealth.

Ironically, Boston Edison revealed its rate-increase
proposal on the same day that it announced its $300 million joint venture with RCN Corp.
to offer video services in the state in competition with incumbent cable operators.

The state agency, using Federal Communications Commission
formulas, ruled that the increase was inappropriate. Further, it rolled back current
rates. Fees for solely owned poles dropped from $8 per year to $7.38, and jointly owned
pole rates decreased to $3.70 from $4.56.

The operators also expressed concerns about the potential
for anti-competitive action by Boston Edison and RCN against incumbent operators, but the
DTE deferred action on that matter to future dockets.

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