ICTA NOTES

November 23, 1999

ICTA NEW ENTHUSIASM

Bryan Rader, CEO of Media Works in Atlanta, Georgia, was elected President of ICTA at the Board meeting on November 15. In addition, Anne Walker of Castle Cable was elected Vice President, Bob Pallé of Blonder Tongue will become the Treasurer and Rob Solomon of US OnLine Communications will be the incoming Secretary. The new 26 member Board will include FoxCom, I3S and WSNet. Most importantly, the ICTA Board has taken a definitive step in bringing together PCO/DBS providers and the customers they serve, namely MDU companies and REITs. Twelve MDUs and REITs are now members of the ICTA Board with those companies representing some 750,000 units nationwide.

Bryan Rader had this to say, "Everyone knows our industry is undergoing significant change due to consolidations and, unfortunately, some bankruptcies. This is no different than the telecommunications industry at large. ICTA is responding with a definitive program so that providers and customers work closely together to assure that our industry survives as a viable competitor to franchised cable so that our customers have negotiating alternatives and that there is a market force to continually improve products and services. This is a brand new day for our industry and ICTA will be leading the way. Our MDU partners are an essential ingredient to this rejuvenation."

PROGRAM OF EXCELLENCE (POE)

The ICTA Board adopted a resolution indicating that the development of a Program of Excellence is a primary objective for 2000. Scott Wiggins from United Dominion, Robert Oulton from NeXwave Entertainment and Bob Grosz are the initial members of a Board task force to develop a draft which will be considered by the Board and then all ICTA members.

It is expected that the POE will include three components. First, the establishment of standards that PCOs and DBS providers should adhere to in their dealings with MDUs/REITs. Second, the development of a computerized system of data collection about PCOs and DBS operators which will then be made available through a web site to all MDUs/REITs for their consideration in the selection of service providers. Third, the development of a comprehensive training program to address numerous areas, each with its own curriculum, for skill development by PCO/DBS providers. It also is anticipated that certificates would be granted when training has been completed and skill levels have been attained.

BOD REORGANIZATION

The ICTA Board of Directors has been organized to demonstrate a revitalized industry. Along with the 12 new MDUs/REITs on the BOD a key to our future in which providers and customers work together - we also elected 2 new members. Our first internet service provider has joined the BOD to help us pursue that market more vigorously. Michele Eilers of I3S, Inc. has promised important support. Also, Dave Stehlin from FoxCom, Inc. will be on the ICTA BOD as well as Vice Chairman of the SBCA MDU Segment. His insight into the future of telecommunications and MDU market will be most valuable.

The BOD also selected 11 new PCOs/DBS providers for its membership. This "new breed" of providers comes from all around the country, they are led by experienced and assertive people and they have great enthusiasm due to their view of the future as bright and full of opportunity. They include: Advanced Telemedia, Inc. - Trey Gaskins; Castle Cable Services - Anne Walker; Consolidated Smart Systems - Shane Plant; Media Works - Bryan Rader; MST - Frank Matarazzo; OnePoint Communications - Bill Wallace; Para Comm - Don Johnson; StarCom - Christopher Day; StellarVision - Henry Beaumont.

PROW Without Franchise

Dave Roberts, CEO of Entertainment Connections, Inc., in true PCO entrepreneurial spirit, took the risk and challenged the FCC to adopt rules allowing his Michigan based PCO to contract with a utility utilizing their dark fiber to transmit signal across public rights-of-way without first acquiring a franchise. The FCC ruled in Dave's favor and that is now being challenged in the 7th Circuit Federal Court of Appeals. In a similar action, Southwestern Bell Video Services sought to provide services through teleco wires owned by SWBell. In a 5th Circuit US Court of Appeals ruling in New Orleans, SBVS won the litigation brought by the City of Austin. Attached please find a brief synopsis of the ruling as written by the National Cable and Telecommunications Association. A copy of the 5th Circuit ruling, handed down on October 14, can be obtained from http://www.ca5.uscourts.gov/opinions/pub/98/98-50874-CV0.HTM or contact Brenda.

FCC LOBBYING

The new ICTA Board divided into teams and met with 4 FCC Commissioners offices, the Cable Services Bureau senior staff and the Chief of the International Bureau. In each of these meetings we stressed the importance of maintaining exclusive contracts for a reasonable duration, applying "fresh look" to perpetual contracts and limiting the impact of mandatory access statutes. Each of the meetings was useful with our spokespeople being well informed, articulate and practical in their presentations.

It presently appears as if the Cable Services Bureau will move a proposal to the Commissioners by the end of the year addressing the 3 major issues cited above. Although nothing is certain, there are numerous indications that we have made progress in communicating our message. On 18 GHz microwave transmission, the International Bureau indicated that they understand our point-of-view, understand how the existing NPRM negatively affects our industry and understand options which could protect us from negative impact of the NPRM.

"We need to have many more sessions where the providers and users of the PCO/DBS products communicate with several levels at the FCC," stated Laurie Baker, Vice President of Ancillary Services at Camden Properties Trust. Numerous other Board members agreed. Therefore, these FCC visits will occur more frequently and will team together all segments of our industry to communicate a unified message that PCOs and DBS providers are essential for the enhancement of competition in the MDU market.

NMHC Data

The National MultiHousing Council has published data which indicate that in 1999, the biggest apartment builders and management companies continue to increase their share of the market. They increased their holdings by a collective 11%, the biggest increase since 1990. Of the top 50 multifamily unit companies in the nation, 17 are REITs owning 42% of all the units in the top 50. Eight of the 17 REITs are ICTA members: AMLI Residential Properties Trust (49); Archstone Communities (7); AvalonBay Communities (17); Camden Property Trust (13); Equity Residential Properties Trust (2); Gables Residential Trust (31); United Dominion Realty Trust (5); and Walden Residential Properties (16).

FCC REORGANIZATION

The FCC has recently created 2 new bureaus, the Enforcement Bureau and the Consumer Information Bureau. The new bureaus were activated November 8, 1999.

David H. Solomon has been named Chief of the Enforcement Bureau which consolidates enforcement functions and personnel form the Common Carrier, Mass Media, Wireless Telecommunications and Compliance and Information Bureaus.

Lorraine Miller, is expected to be named Bureau Chief of the Consumer Information Bureau.

Visit the following site for a copy of the FCC press release, or contact Brenda. http://www.fcc.gov/Bureaus/Miscellaneous/News_Releases/1999/nrmc9072.html

VIRGINIA ACTIVITY

Past issuesof ICTA Notes described a battle in Fairfax County, VA, a suburb of Washington.

The Board of County Supervisors had to address the franchise transfer from Media General to Cox. A coalition of several apartment owners, Virginia BOMA and ICTA fought to include a provision in the transfer that would have required perpetual contract "Fresh Look." This effort held up the transfer for 3 months, during which the coalition met with Supervisors, the County attorneys and the 2 franchise companies. Needless to say, the MSOs had the lobbying money and muscle, had the County attorney buffaloed and won in the end. Regardless, it was a battle worth waging.

On the Virginia state level, the CLECs of WinStar and Teligent pushed hard for a Mandatory Access bill. A coalition of ICTA - NMHC - BOMA - CAI - United Dominion - AvalonBay - Town & Country - and others stopped the bill; that's the second time in 2 years. We expect the issue to surface again next year.

MARK YOUR CALENDARS

The ICTA Board adopted a resolution which states, "Be it resolved that ICTA do all possible to unite the PCO/DBS industries to better serve the MDU market. This includes working to develop, endorse and sponsor one industry trade show or conference and one electronic and/or print publication."

Therefore, the MDU Conference held in conjunction with the SBCA Convention in Las Vegas on July 18 - 21, 2000, will be our major focus for the year. We intend that this conference serve as the single and unifying conference for the PCO/DBS industry including suppliers, manufacturers/vendors, programmers and MDU/REITs. "We will build on our initial year's success and make July 2000 bigger and better," said Bryan Rader. He also said, "We must pull together. Our industry is not big enough or well enough financed to have more than one robust and successful conference or show. ICTA working with its Board and members see the July Conference as our opportunity to build on last year and further rejuvenate our industry."

The ICTA BOD also will strongly support Larry Kessler's Technology Conference scheduled for Charleston, SC on March 27 - 29, 2000. Larry has been most cooperative with our industry and shares the goals of MDU/REITs that have joined our Board.

SHVA Bill

The Satellite Home View Act reform bill has passed both bodies of Congress and has been sent to the White House. This is legislation central to the DBS platforms and to the Satellite Broadcasting and Communications Association.