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                                                        DA 96-863


                            Before the
                FEDERAL COMMUNICATIONS COMMISSION
                     Washington, D.C.  20554



In the Matter of                             )
                                        )
Application of NU/Mode 1 Communications, Inc.     )
for Determination of Exempt                  )
Telecommunications Company Status            )    File No. ETC-96-4
under Section 34 of the Public Utility            )
Holding Company Act of 1935, as added by          )
Section 103 of the Telecommunications Act of 1996 )    


                              ORDER


     Adopted:  May 29, 1996                  Released:  May 30, 1996 


By the General Counsel:


     1.   On April 4, 1996, NU/Mode 1 Communications, Inc. ("NU/Mode 1") filed an
application with the Commission for a determination of "exempt telecommunication company"
("ETC") status pursuant to section 34(a)(1) of the Public Utility Holding Company Act of 1935
("PUHCA"), as added by section 103 of the Telecommunications Act of 1996.   NU/Mode 1's
application was placed on public notice for comment on its adequacy and accuracy on April 8,
1996.  No parties filed any comments.  As explained below,
NU/Mode 1 satisfies the criteria for a determination of ETC status and, therefore, its application
is granted.



     2.   According to its application, NU/Mode 1 intends to become a subsidiary of
Northeast Utilities, a registered public utility holding company under PUHCA.   NU/Mode 1
states that it will be engaged, directly or indirectly, through one or more "affiliates" (as defined in
PUHCA section 2(a)(11)(B)), and exclusively in the business of providing telecommunications
services, information services, other services or products subject to the jurisdiction of the
Commission, and/or products or services that are related or incidental to the provision of such
products or services within the meaning of PUHCA section 34(a)(1).   NU/Mode 1 states that it
will, as an initial venture, provide long-haul fiber capacity on a wholesale basis to non-associate
companies through an affiliate.  In a supplemental filing providing further details on its
telecommunications activities, NU/Mode 1 indicates that it intends to provide long-haul fiber
capacity on a "carriers' carrier" basis.  These services will be provided using newly-constructed
fiber optic facilities along the transmission corridors of public utility affiliates of Northeast
Utilities.  The project, known as the New England Optical Network ("NEON"), will initially
consist of approximately 410 miles of backbone fiber installed along electric utility rights-of-way
in Connecticut, Massachusetts, and New Hampshire.  This portion of the network will be initially
constructed within the current service territory of the operating companies of Northeast Utilities,
but will subsequently be extended to encompass the entire New England region of the United
States and potentially eastern Canada as well.

     3.   NU/Mode 1 also states that it intends to offer long-term leases of fiber optic
facilities to major carriers which it believes will be less costly than new construction by the
carriers themselves.  According to NU/Mode 1, this customer base will include existing long-
distance carriers, cellular carriers, competitive access providers (CAPs), video service providers,
and various new entrants into the telecommunications market such as personal communications
services (PCS) providers.

     4.    NU/Mode 1 submits that because of the breadth of the NEON network, it can
offer a fast and economical option for carriers wishing to add extremely reliable capacity to their
networks.  In some cases, according to NU/Mode 1, the NEON network will provide redundancy
or alternative routing for existing carriers; in other cases, new wireless entrants will employ these
facilities for backhaul of their customer traffic to interconnection or switching centers. 
According to NU/Mode 1, using the NEON network, carriers will be able to offer improved
service at competitive rates and, because it is "carrier-independent," multiple carriers will be able
to reach rural and secondary markets that would have been too costly to enter independently. 
NU/Mode 1 states that because of the growing importance of communications capacity to
economic development, it believes that this new fiber infrastructure will be advantageous to
regional development and will enhance the growth of communications services overall in the
New England region.

     5.   Based upon the representations contained in NU/Mode 1's application and its
supplemental filing, we determine that NU/Mode 1 is an exempt telecommunications company
as that term is defined in PUHCA section 34(a)(1), as amended.

     6.   Accordingly, IT IS ORDERED that the application of NU/Mode 1 IS GRANTED. 
IT IS FURTHER ORDERED that staff notify the Securities and Exchange Commission of this
determination.


                         FEDERAL COMMUNICATIONS COMMISSION




                         William E. Kennard
                         General Counsel