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Hawaii Road Runner Customers:
The State Cable Franchise Fee does not apply:

March 14, 2002

The FCC ruled today that Cable Modem Service (Road Runner) is an interstate information service, and is not a Cable Service.

In a Declaratory Ruling adopted today, the FCC concluded that cable modem service is properly classified as an interstate information service and is therefore subject to FCC jurisdiction. The FCC determined that cable modem service is not a "cable service" as defined by the Communications Act. The FCC also said that cable modem service does not contain a separate "telecommunications service" offering and therefore is not subject to common carrier regulation.

The FCC's notice indicates:

Regarding franchise fees, the FCC notes that the law limits franchise fees to 5 percent of the gross revenues the cable operator receives from cable service. The FCC said that revenues from cable modem service should not be used in computing this franchise fee ceiling.

See the FCC Press Release. 

In light of this FCC action, I believe it is appropriate to deduct from the billing of Road Runner Service the charge for the State Cable Franchise Fee (5% of the service charge), as well as Hawaii GET charged on the Cable Franchise Fee (4.167% of the Franchise Fee).

In my case, the Road Runner Service charge is $39.95. The State Cable Franchise Fee is $2.00, and the GET on the Franchise Fee is $0.08. I am deducting $2.08 from the amount of my cable bill and remitting the balance.

Currently in Hawaii, over 60,000 customers are billed $39.95 or more for Road Runner, AOL or Earthlink broadband service by Oceanic Cable and its affiliates. The amount billed and overcharged for April, 2002 alone is at least $120,000.

I intend to deduct this fee from my cable bill dated March 7, 2002, due April 5, 2002, and have e-mailed notice of my intent to deduct this fee to Oceanic. I suggest all other customers e-mail Kiman Wong, Oceanic Internet General Manager, of your intent to deduct the fee:

Dear Mr. Wong:

The FCC issued a ruling on March 14, 2002  that State Cable Franchise Fees do not apply to Cable Modem Service.

It is my intent to deduct this fee from my cable bill. Please let me know what this fee,  including taxes, amounts to on my bill dated (your cable bill date).

Thank you,
Your Name

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