Cablevision Systems Corp. has filed a petition with the
Massachusetts Department of Telecommunications and Energy, asking the agency to force an
auction of a fiber optic network built by an affiliate of Boston Edison.
Cablevision claimed that the electric utility has
improperly subsidized the fiber network, which is owned by Princeton, N.J.-based RCN Corp.
Cablevision is asking the agency to force Boston Edison to refund $60 million to its
customers -- the difference between the network's value and the money that the
utility receives from RCN for using it. Boston Edison is a major RCN stockholder.
In its Sept. 22 filing, Cablevision said Boston Edison
built the fiber optic network, using funds from its electricity customers, from 1988
through 1997. The company also claimed that RCN uses the network under a 68-year lease
agreement that pays Boston Edison about $500,000 annually.
RCN currently offers cable, telephone and Internet service
in Somerville and Arlington, Mass. Cablevision has 320,000 subscribers in the Boston area.
"This is a restatement of allegations made in the past
and currently being investigated by the DTE," said John Conroy, a government-affairs
spokesman for Boston Edison. "We believe that we have adequately explained the basis
of the business transactions that we have gone through."
Cablevision argued that its efforts are an attempt to
promote competition, and not to prevent it.
"If in the telecom side, RCN were allowed into the
market at a far lower cost [than other companies], it has a chilling effect," said
Dominic Slowey, a Cablevision spokesman. "It could limit the number of players in the
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