Comcast Corp. filed a lawsuit against the city of San Jose, Calif., Thursday,
the Mercury News reported.
The MSO alleged that city officials are illegally trying to force the company
to pay for a costly telecommunications network connecting city buildings and
schools in exchange for the right to operate in the city.
The dispute dates back to when the system was owned by AT&T Broadband,
which was acquired by Comcast in November.
The city wants the operator to add as many as six public-access channels and
to wire public buildings and schools with connections to facilitate two-way
video, voice and high-speed data.
Comcast countered that subscribers would end up paying for a service
available to the entire city, so the city's plan amounts to a special tax on a
subset of San Jose residents, which would have to be approved by a two-thirds
vote.
The operator added that it should be allowed to deduct the cost of the
telecommunications network from its franchise fee -- an idea San Jose has
opposed.
