Adelphia Breaches Contract with Island

Towns Charge Cable Television Giant with Failing to Deliver Payments
for Community Access Channels

By JOSHUA SABATINI

Adelphia Communications, the nation's sixth largest cable
operator, has breached the 10-year contract it signed with the six
Island towns last year, says the Island's cable advisory
committee.

Letters highlighting Adelphia's violations of its contractual
obligations were drafted by Peter Epstein, a cable attorney in Boston,
and sent this week to each town's board of selectmen for their
signatures.

Mr. Epstein is the attorney who worked with the Vineyard cable
advisory committee, a board made up of a representative from each Island
town and put in charge of the contract negotiations with Adelphia. The
negotiation process took a year.

The letters, destined for Randall D. Fisher, vice president and
general counsel for Adelphia Cable Communications, state that Adelphia
has not met three conditions of the contract, which took effect July 1,
2001.

Under the contract, Island towns are to receive five per cent of the
gross annual revenues earned by Adelphia each year from the more than
9,000 cable subscribers on Martha's Vineyard.

The Island towns have designated Martha's Vineyard Television
(MVTV) as the recipient of Adelphia's payment. The group aims to
operate three public access channels provided by Adelphia, as well as
provide the Island community with access to its film equipment and
staff.

MVTV president Denys Wortman said the group received a first payment
of $150,000 from Adelphia in February. The first $100,000 of that is a
payment Adelphia must make annually at the beginning of the calendar
year, and represents an advance on the annual five per cent payment due
every year by August 1, he said.

Of the remaining $50,000, half represented start-up money and half a
no-interest loan, to be paid back in annual $5,000 payments starting in
the contract's sixth year.

Mr. Wortman said he has not received the rest of the five per cent
payment for fiscal year 2002. All told, MVTV expects to receive about
$200,000 each year.

John Alley, chairman of the cable advisory committee, said, "A
lot of this played out over the last several months, with Adelphia going
into bankruptcy."

The company filed for federal bankruptcy protection in June.

"They haven't completed a number of things that were in
the contract," Mr. Alley continued. "We spent a year
negotiating the contract. All has gone well except for these few
areas."

The second condition that remains unmet requires the cable provider
to present documentation certifying the exact amount of the five per
cent payment within 30 days after the fiscal year's end, which
would have been August 1.

No such documentation has been provided by Adelphia.

The letter noted that late payments accrue interest from the date
due at the annual rate of three per cent above the prime rate. It gives
Mr. Fisher 30 days to respond.

Mr. Wortman said MVTV plans to move into a building at the regional
high school located between the football field and the main building.

He plans to sign a lease with the school next week for use of the
building.

Work to prepare the building for MVTV has been ongoing, Mr. Wortman
said, using money from Adelphia's initial payment. The facility
should be completed in the next four weeks.

Mr. Wortman said if Adelphia does not pay the money MVTV is owed, he
will not be able to hire the staff necessary to run the facility.
Payments from the cable provider are needed to cover MVTV's
operating expenses in coming years.

"Hopefully [the letters] will remind Adelphia that there are
certain parts of the contract that it must honor," said Mr. Alley.
"I imagine they will respond to the communities."

Mr. Alley added that Adelphia has also not installed all of the 29
live feeds in various municipal buildings around the Island, as required
under the contract.

"It is out of our hands, in terms of the cable advisory
committee writing a letter to Adelphia, to say pay up," said Mr.
Alley. "The contract is signed, and Adelphia must honor their part
of the deal. Once they signed, they are obligated to take care of
it."

The money is there, said Mr. Alley, because it comes from the
Island's Adelphia subscribers.

Lisa Carparelli, a spokeswoman for Adelphia Communications, said the
company is "looking into the matter."