This came out after the close.
It may be immaterial long-term, but perhaps those who follow the courts decision had extra incentive to take those profits.
BV
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RCN: No Delay From Court's OVS Decision; CEO
McCourt Says Ruling Will Not Materially Affect RCN's Plans for
Expansion
PRINCETON, N.J., Jan. 20 /PRNewswire/ -- The Fifth Circuit Court of Appeals in New Orleans has released its decision in
the case of City of Dallas v. Federal Communications Commission, involving rules regarding Open Video Systems (OVS)
which the FCC adopted following passage of the Telecommunications Act of 1996.
Apparently, the Court has invalidated the FCC's rule which exempted OVS operators from the requirement to obtain a
franchise from local governmental authorities. The Court also invalidated the rule allowing OVS operators to decide on their
own to offer carriage to competing in-region cable operators and appears to have left intact the more general restriction on
in-region cable operators requesting carriage on an OVS system in the same region.
The Court upheld many of the OVS rules which were at issue in the case, including the rules allowing non-local exchange
carriers, such as RCN (Nasdaq: RCNC - news), to provide OVS, the rules prohibiting current or former cable companies from
operating open video systems in their cable service areas where they do not face effective competition, the rules limiting
franchise fees and other fees imposed on OVS operators, and the rules excepting OVS operators from local requirements for
the construction of institutional networks.
David C. McCourt, RCN's Chairman and CEO, noted that RCN's current business plan encompasses both traditional cable
television and OVS operations, as well as telephone and Internet operations. ''The Company will study the Court's opinion
carefully, but we fully expect that the decision will not materially affect the Company's aggressive expansion of its video,
telephone or Internet offerings.''
Andrew D. Lipman, counsel for RCN, stated, ''Upon our preliminary review, the Fifth Circuit's decision reaches some
conclusions with which we and the FCC respectfully disagree, but it does not appear to materially impair the Company's plans
to expand its offerings in the video distribution marketplace. Indeed, with respect to the franchise requirement, we have never
implemented an OVS system in any jurisdiction without first working closely with the municipal authorities and entering into a
franchise-like agreement, and we fully expect to continue this policy in the future.'' Lipman added that, after he and the
Company have had an opportunity to review the decision more carefully, they will determine, in conjunction with the FCC, what
if any future steps to take in the case.
RCN Corporation (Nasdaq: RCNC - news) is the nation's first and largest single- source facilities-based provider of
communications services to the residential market, the largest regional Internet service provider (ISP) in the Northeast and the
nation's seventh largest ISP. The company is currently providing local and long distance phone, OVS and cable television, and
Internet services in several markets from Boston to Washington, DC. RCN has expanded its target market to include
California's San Francisco to San Diego corridor. Additional information about RCN's services may be found on the company's
web site at www.rcn.com. |
