Density: 125 homes/mile for middle-market systems, 100 homes/mile for edge-market systems

Imported Signals: 1 independent, 1 educational

Microwave Hops: 12

Underground Cable: 5%

Investment Period for Distribution System: 2 years

Finally, we might pose the question of ability to pay in a

slightly different manner: What percentage of revenues could each system pay every year without allowing its rate of return to fall below 15 percent? The answers to this question appear in Tables E-8 through E-10.

Combining the NCTA's own predictions about subscriber penetration with a modest 2 percent growth rate leads to estimates of 13.45 to 25. 13 percent of revenues realized as excess returns. An increase in revenue growth to 4 percent leads to estimates of 30.56 to 39.80 percent of revenues as excess returns. Even the more modest 55.3 percent penetration assumption for the top 100 markets yields estimates of 12.52 to 22. 28 percent of revenues in excess of those required to cover the cost of capital with our modest 2 percent growth rate. This rises to 29.82 to 37.57 percent when 4 percent growth is assumed. Even if penetration is a meager 40 percent of homes passed at maturity, 4 percent revenue growth would yield estimates of excess returns of 17 to 30 percent of revenues for a 10,000 subscriber system.