Cable groups protest school network plan

July 13, 1994|By Michael Dresser | Michael Dresser,Sun Staff Writer

An article in yesterday's Sun incorrectly identified the Maryland department that rejected the cable television industry's contention that an analog technology would be sufficient for the state's planned educational network. In fact, it was the Department of Budget and Fiscal Planning that wrote a letter to that effect on June 13.

The Sun regrets the errors.

Claiming the Schaefer administration has stacked the deck in favor of Bell Atlantic Corp., Maryland's cable television companies have let the bidding deadline for building a statewide educational network pass without submitting a proposal.

Instead, the state's cable television association and Comcast Cablevision of Maryland filed a protest accusing the state of violating its own procurement laws in its haste to build a so-called "distance learning" network, industry officials said yesterday.

FOR THE RECORD - CORRECTION

The cable industry's decision left Bell Atlantic as the apparently unchallenged bidder on the local part of the network.

The state did not name all the bidders, but Budget Secretary Charles L. Benton Jr. said there were a total of three -- including Bell Atlantic. Spokesmen for AT&T Corp. and MCI Communications Corp. confirmed they were the other two, but explained they were contending for the long-distance segment of the contract. That would leave Bell Atlantic with a clear field locally.

In their protest, the cable association and Comcast had asked Maryland officials to postpone Monday's deadline seeking bids for the so-called "distance learning" network. J. Edward Davis, general counsel for the state cable association, said he took that plea as far as Attorney General J. Joseph Curran Jr. but was turned down.

A. L. Denny, the state procurement officer in charge of the contract, said yesterday that the window for bidding was now closed.

In its protest, the cable industry contends that the Schaefer administration improperly conducted the procurement process TC through the Department of Budget and Fiscal Planning rather than the Department of General Services.

"You have the wrong agency establishing the wrong criteria to procure the wrong network that will lead to long-term problems," said Scott A. Livingston, an attorney representing Comcast and the cable association. Mr. Benton said the cable protest was being evaluated.

Ironically, the bidding process the cable industry shunned was begun at its own insistence after the Schaefer administration and Bell Atlantic announced ambitious plans last summer to build a fiber-optic network linking every college and high school in the state.

Gov. William Donald Schaefer and officials of Bell Atlantic-Maryland (the Chesapeake & Potomac Telephone Co. of Maryland) announced plans for the network amid great fanfare just over a year ago.

At the time, the governor said he saw no need for competitive bidding because the state and the phone company were forming a "partnership" under which Bell Atlantic would foot the bill for the $30 million fiber-optic network and give away more than $10 million in TV monitors, microphones and cameras to participating schools.

The announcement set off howls from the cable industry, which contended that the network would not be free because of the monthly tariffs participating schools would have to pay to Bell Atlantic.

Two months later, acting on Mr. Curran's advice, the administration reversed course and said it would open the process to competing bids.

Yesterday, cable industry representatives charged that the bidding was never truly open. They said the state's Request for Proposal (RFP) was tailored to favor their chief rival. "If you're a phone company, it fits well," said Wayne O'Dell, president of the Cable Television Association of Maryland, Delaware and the District of Columbia.

The cable industry's dispute with the state centers on a question of technology. The RFP specifically asks for an all-fiber digital network known as DS-3, which cable executives said Bell Atlantic would be in a better position to provide.

Mr. Livingston derided the proposed digital fiber-optic network as "gold plating." He said the state could receive all the services it needs through an analog system using a hybrid network of fiber-optic and coaxial cable.

Coaxial cable is the connection cable companies use to bring television signals to people's homes.

Mr. Livingston compared the state's RFP to a bidding for police cars where the specifications were drawn so that only Cadillac, Mercedes and BMW dealers could bid.

Stephen Burch, Comcast's senior regional vice president, said his company would have been in the bidding if the rules had been open to any technology that could do the job.

"I wasn't offering a tin can on a string," said Mr. Burch. "I was offering a technology that in my mind would offer the same quality of distance learning that the telephone companies could offer."

But in a response to cable companies' questions about the RFP on June 13, the state Department of General Services rejected that contention. The department said a digital network is necessary to provide the statewide connectivity and audio and video quality it requires.

Dave Pacholczyk, a spokesman for Bell Atlantic, said he was surprised that the cable industry had not submitted a bid. "With all that they have said over the past 12 months, I thought they'd at least take a stab at it," he said.

Mr. Livingston said that if the protest were denied, the cable industry would consider appealing to the Maryland State Board of Contract Appeals. He said he was reluctant to file a lawsuit because the courts have generally granted the executive branch wide latitude in procurement matters.

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