RCN Reaction Mixed to News of Proposed House Cable Law Provisions

HERNDON, Va.--March 9, 2006--RCN Corporation , a leading provider of triple play cable, high-speed internet and phone services, expressed a mixed reaction to news that key lawmakers in the House of Representatives had reached agreement on cable franchising.

"We are pleased to see the House recognize the predatory tactics that incumbent cable operators have long practiced against new entrants like us," said RCN's Senior Vice President, Strategic and External Affairs Richard Ramlall. "RCN has long advocated the need for protection against deep discounts targeted only toward consumers who live in an area served by a competitor. We look forward to seeing the text of the proposed bill and how they intend to address this competitive problem."

Ramlall explained that this practice is anti-competitive because it is not designed to lower prices of all of a company's cable customers, but rather only those in certain areas where competitors are entering the market. These discounts are in effect subsidized by the consumers in other parts of the franchise area, and solely designed to stop a competitor from entering the market.

"On the other hand, we are very disappointed in the proposed legislation because it gives the incumbent telephone companies a free pass on local franchising," said Ramlall. "Nor does it address the real barriers to entry in the cable market -- the critical need for 'must have' programming such as regional sports, children's and film libraries that are controlled directly or indirectly by incumbent cable operators."

According to Ramlall, access to critical programming at fair and reasonable prices is an issue that will be faced by the telephone companies when they start to compete and is far more of an impediment to effective competition than the local franchise process.

"RCN's experience in successfully negotiating more than 100 franchises demonstrates that the incumbent telephone companies do not need the 'free pass' that the Committee proposes to give them," Ramlall said. "The incumbent telephone companies who have existing networks and vastly greater financial resources than RCN clearly do not need the franchise concessions that they are seeking from Congress -- especially when that free pass assures the telephone companies an advantage by keeping existing cable companies subject to franchise obligations until they reach a 15% penetration level!"

Ramlall points to recent comments made at a Bear Stearns conference by Verizon's CFO Doreen Tobin, who said the company has recently been very successful in its franchising and that Verizon "is comfortable that (we will be) able to meet our targets and we will have enough franchising for where we're building to be able to sell."

About RCN Corporation

RCN Corporation, http://www.rcn.com, is one of the largest facilities-based competitive providers of bundled cable, high-speed internet and phone services delivered over its own fiber-optic local network to residential customers in the most densely populated markets in the U.S. RCN Business Solutions is a growing business that also provides bulk video, high-capacity and voice services to business customers. RCN provides service in the Boston, New York, Eastern Pennsylvania, Washington, D.C., Chicago, San Francisco and Los Angeles metropolitan markets. (RCNI-G)