BendBroadband’s cable television service is in the midst of an evolution to an all-digital platform. The transition will be completed by the end of 2008. At the end of 2008, BendBroadband will turn off its analog cable TV signal. With digital service, subscribers receive their television programming through a set-top box at each TV.

The move to all-digital is driven by several important goals:

• Quality Improvements: Digital and high-definition television provides a superior picture and sound quality over analog cable TV.
• Increased Programming Options: Instead of only one analog cable package we now offer four digital programming package choices with the option of additional programming tiers and premium channel suites.
• Bandwidth Reclamation: The efficiencies gained from an all-digital platform will allow BendBroadband to dramatically expand the number of high-definition and standard-definition channels and to greatly increase Internet speeds during 2008 to 2009. Additional bandwidth will remain available for future advanced services.

Questions about the Federal Government’s Coupon Program

There are two major reasons for BendBroadband to migrate to an all-digital platform.

1. To continue to provide the DCT700 low cost set-top box, to our video subscribers: Due to the FCC separable security ban, all cable companies were required to convert to new CableCARD set tops starting in July 2007. The replacement for the DCT700 costs three times as much, potentially increasing the cost of set top rental from $1.95 per month to $5-$6 per month. By committing to transition to all-digital by the end of 2008, BendBroadband was able to obtain a waiver from the FCC to continue use of the DCT700. The savings in capital cost to BendBroadband and in monthly set-top box rental cost for our customers is substantial.

2. To reclaim bandwidth: Each analog video channel consumes the same bandwidth as 10 digital channels or 2 high-definition channels. Today bandwidth is becoming limited for BendBroadband and other cable companies due to the introduction of high-definition TV and new services such as VOD and high-speed Internet while continuing to transmit a full analog basic cable lineup. The bandwidth reclaimed from eliminating over 50 analog channels will be redeployed to launch more high definition channels, more standard definition digital channels, increased VOD and to greatly increase the speed of Internet service over the coming years.

It’s estimated that the average household has three TVs. Because BendBroadband will discontinue analog service at the end of 2008, customers will need a set-top box for every TV in order to receive their entire BendBroadband digital programming package. Since there is a potential for long lines if customers wait until the end of the year, we’re currently offering up to two standard DCT700 set-top boxes free through 12-31-08 and up to two more standard set-top boxes for only $1 per month through 12-31-08. Standard set-top boxes are normally priced at $1.95 per month. Why wait and risk being at the end of a very long line when you can upgrade your other TVs now for little to no added cost through the end of 2008?

We urge you to act now! Additional set-top boxes are easy to obtain and install. You can simply visit our lobby for the free self-installation option or if you prefer to pay for a professional installation, we will be happy to schedule a service visit – just call 382-5551, select “sales” and talk to one of our customer care representatives.

BendBroadband is eliminating analog cable TV service at the end of 2008. Local broadcasters, such as KTVZ must eliminate their over-the-air analog broadcast signals by February 17, 2009. These two efforts are not related in any way.

After December, 31 2008 there will be no BendBroadband analog signal distribution and a set top will be required to receive your full digital package. However, if your TV is a late model, digital set, you will still be able to receive local NBC, ABC, Fox and OPB stations because these signals are not encrypted by BendBroadband. Older, analog TVs will require either a BendBroadband set top (to receive your digital cable service) or a customer-supplied digital converter box to receive free over-the-air local digital broadcast signals. For more information about the transition to digital over-the-air broadcast signals, please see the Government Coupon FAQs below.

BendBroadband ceased to offer analog basic cable to new subscribers as of May, 2007. Existing analog cable TV customers that transfer service to a new residence are required to convert to digital service at the time of their move. All other current analog customers will be transitioned to digital service by the end of 2008. BendBroadband has made significant progress with this effort; in fact as of early March, more than eight out of ten homes are now receiving digital service. Due to the large number of customers involved, BendBroadband encourages customers not to wait to the last minute to make the switch and we currently have an aggressive upgrade offer so that analog basic cable customers can convert to digital cable for the same price they currently pay for analog cable.

After the special offers have expired at the end of the year, customers converting from analog basic cable to the digital Essentials, Preferred or higher packages, will experience increased cost related to digital service fees and set-top rental, but will enjoy the added benefits of more channels, better audio and video quality, the on-screen programming guide, access to Video on Demand, music and parental controls. In order to provide more choice and pricing flexibility, BendBroadband also offers a Limited Package ($17.95 per month) and a Family Package ($29.50 per month). These services provide the benefits of digital cable TV while still costing less than analog basic service even when the DCT700 set-top rental costs are included.

BendBroadband has established a nation-leading position in HD programming, with more than 50 HD channels as of February 2008. We’re aggressively adding more HD channels as they become available with dozens of new HD channels coming in 2008. And unlike satellite providers, there’s no extra HD access fee! Here’s a quick overview of the HD programming we offer:

• HD Broadcast – Unlike satellite providers, BendBroadband offers the local HD broadcast signals from ABC, NBC, CBS (from Eugene) PBS and Fox.
• HD Simulcast – Simply put, an HD simulcast channel is the High-Def version of a cable network. We currently offer more than 40 HD simulcasts with many more on the way.
• HD Plus – Our HD Plus package consists of unique HD-only channels including Universal HD, MGM HD, HDNet, HDNet Movies and HD Theater. Newer additions include Smithsonian HD and MHD.
• HD on Demand – High-Definition programming On Demand is an emerging and exciting new source of HD content that uniquely differentiates BendBroadband from the dish companies. As Hollywood studios continue to embrace the value of the VOD platform, we expect the number of HD on Demand titles to expand exponentially.