Q. Why is cable access a controversy?
In most other cities, local government awards franchises that give cable operators the right to serve the citizens of these cities. These franchises must be reissued whenever a cable system changes ownership.
Last year, AT&T purchased the cable systems of TCI, formerly the nation's largest cable operator, and MediaOne, another large cable provider. As a result, AT&T had to get the approval of all of the cities served by TCI and MediaOne before it could start providing high speed Internet service and competitive local phone service.
Q. So what's all the heat and noise about?
AT&T is offering local telephone service over its cable, bypassing the local telephone companies (or "telcos"). The telcos, like SBC/Pacific Bell, U.S. West, and GTE, know that AT&T's local telephone service will probably be cheaper than the service they offer today. So they're running scared.
AT&T is also starting to offer high-speed Internet service at a substantially lower price than the telcos were charging for their version of high speed Internet access, known as digital subscribe line (DSL) service.
The telcos are doing everything they can to keep competition at bay, including asking local authorities to make unreasonable demands on AT&T as a condition of franchise transfers and renewals. One of these demands is that AT&T be required to make its cable available to any Internet service provider that wants to use the cable to offer Internet services.
Q. Are these "open access" demands realistic?
Regulating access is a bad idea, especially at the local level where it would result in a conflicting array of rules that could make it uneconomical for cable companies to invest in upgrading their networks so that cable Internet service could be offered. When the cable companies signed exclusive contracts with the Internet service providers who pioneered the technology, few companies were even willing to make the necessary financial investment. Now that a market is developing, more companies are interested in offering their customers high-speed Internet service, and cable companies like AT&T and AOL/Time Warner have told policymakers that they will open their networks to competing Internet service providers once the exclusive contracts expire. This is a reasonable way to ensure that a competitive market develops. And it is in line with the goals of the Telecommunications Act of 1996, which was enacted to encourage local competition.
Q. What about the "Portland decision," in which a federal judge ruled that AT&T must open its cable network, and an Appeals Court reversed the ruling. Can you explain that?
After buying TCI's Portland cable system last year, AT&T petitioned the City of Portland to approve the transfer of TCI's franchises to AT&T. The City said that AT&T must open its cable to competing online content and service providers. AT&T sued Portland, the trial judge ruled in Portlands favor, and the 9th District Court of Appeal reversed the ruling, declaring that local government does not have authority to regulate Internet access over cable networks. After the Appeals Court ruled, the Federal Communications Commission (FCC) indicated it would open a proceeding to consider whether federal regulation is necessary at this time.
Q. So what can I do to make sure that competitive local telephone and high-speed data services arrive in my neighborhood on time?
Contact your local, state, and national representatives. Make sure they understand that the telephone companies version of "openness" is not what it seems and not good public policy. You can also write to the FCC, reminding them that our national policy is to promote competitive telecommunications service, and encouraging them to continue monitoring developments but take no action at this time.
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