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AT&T Cable Wins Round Two U.S. Court of Appeals rules localities cannot mandate open access to cable networks, but open access advocates foresee further legal hurdles for the telco. by Patricia
Fusco Champagne bottles might be popping throughout AT&T Corp. headquarters as the much awaited ruling on the "Portland Decision" was handed down late Thursday. The 9th U.S. Circuit Court of Appeals reversed the decision of a lower
court, stating that the city of Portland had overstepped its authority
and could not require AT&T The three-judge panel unanimously decided that the 1996 Telecommunications
Act prohibits a local franchising authority from regulating cable Internet access
since the regulation of telecommunications services is under the jurisdiction
of the federal government, not local municipalities.
Corporate smiles "Now that the court has made clear Congress' intent to bar ordinances
like the one enacted by Portland, AT&T and other cable companies will
be able to get on with investments that will bring advanced services to
millions of Americans," Cicconi said. "In particular, AT&T looks forward
to bringing our high-speed service to the people of Portland as soon as
possible."
Cable Broadband service provider and AT&T partner Excite@Home The firm released a statement on the decision that noted similar decisions
in state courts and legislatures have rejected calls for regulation of cable
access, "hopefully this will end the forced access debate."
Dissenting opinions The Court order read in part, "We hold that subsection 541(b)(3) prohibits
a franchising authority from regulating broadband Internet access because
the transmission of Internet service to subscribers over cable broadband
facilities is a telecommunications service under the Communications Act."
Because the court labeled cable broadband access akin to digital subscriber
line (DSL) service, "Open Access" proponents are calling on the Federal Communications Commission to enforce the
same laws that apply to DSL line sharing in the context of broadband cable
networks.
Portland City Commission Erik Sten said the municipality would carefully
review the ruling before it would file for an appeal the court's decision.
"We may have lost the battle but may have won the war," Sten said. "The City
must fully consider the implications of the court's ruling before we appeal
the decision."
Ramifications Greg Simon, OpenNet Coalition
cofounder said in order for AT&T to benefit from the decision, it must
prove to the FCC that there is competition in the cable access market.
"The court ruled that cable broadband is similar to DSL access," Simon
said. "If the FCC has to forbear for one broadband service, then they
have to forbear for both, and enforce open access as the law of the land
for high-speed communication in the U.S."
Rich Bond of the OpenNet Coalition added that the FCC has the authority,
but not the disposition, to create a consistent open access system for
all high-speed services in the nation.
"The FCC made sure people can choose their ISP and their telecom service
provider, bur cable is under different rules," Bond said. "Clearly the
FCC now has the authority and as a matter of policy must treat Internet
access over cable in the same manner."
The group is calling on the FCC to take action and enforce the same
statutory laws of the telecom industry on cable firms, making interconnection
rules that apply to DSL apply equally to cable modem service.
Endgame The FCC has not responded to the 9th Circuit Court ruling at this time.
But the federal regulatory agency has taken bold steps to ensure that
consumers have a competition choice for telecom services. It remains to
be seen whether the same will apply to high-speed cable services.
Pending play AT&T will wait until the end of a trial set for September to determine
if it can continue with its scheme to gain greater control of Excite@Home.
The deal set in March between AT&T, Excite@Home, Cox Communications, Inc. In a statement released Wednesday, Cablevision Free-for-all The Cablevision lawsuit comes as AT&T is attempting to use Cablevision's
last-mile delivery systems in New York.
Scott Cleland, Legg Mason Precursor Group
managing director, said Cablevision's lawsuit is odd.
"It's a strange lawsuit because AT&T and Cablevision have cooperated in the
past. With AT&T owning one-third of Cablevision, it's odd to see them file suit,"
Cleland said. "It's hard to say weather communication broke down due to
the March agreement with other cable firms, or a competitive factor over New
York cable services."
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