Court Rules F.C.C. Erred in Decision on Net Access
October 7, 2003
By MATT RICHTEL
SAN FRANCISCO, Oct. 6 - In a setback for the Federal
Communications Commission, a federal court issued a ruling
on Monday that may force cable companies to share their
high-speed Internet, or broadband, networks with competing
Internet service providers.
The decision, issued by a three-judge panel of the Court of
Appeals for the Ninth Circuit, found that the F.C.C. erred
in an earlier ruling that effectively absolved cable
companies of any obligation to make their lines accessible
to competitors.
The decision was hailed by Internet access providers who
sued to get the right to lease those lines and offer
competing services over them. They said the court decision
would give consumers more choice when shopping for a
provider of high-speed Internet service. "This will help
drive prices down and quality of service up; it will drive
broadband deployment," said Dave Baker, vice president for
law and policy at Earthlink, an Internet service provider
and a plaintiff in the lawsuit.
The F.C.C. said it would appeal the case. Michael K.
Powell, the chairman of the F.C.C., said in a statement
that the decision would hurt efforts to develop a national
policy on high-speed Internet services.
The court decision is another blow to the F.C.C., which has
been under attack from Congress for its decisions
permitting greater media consolidation.
Despite claims of victory by the cable industry's
competitors, telecommunications lawyers said the
implications of the 39-page ruling might not be clear for
some time. They said the decision did not specifically
require cable companies to lease their lines to
competitors. Rather, the court ruled that the F.C.C. was
wrong in the way it categorized cable broadband services
for regulatory purposes.
In March 2002, the commission ruled that it would regulate
cable broadband providers as "information services," a
definition that applies to companies that process data.
Companies that fall under that definition are subject to
much less stringent regulation.
The F.C.C.'s approach toward broadband regulation - for
both cable companies and telephone companies - is to permit
the major players to build their high-speed Internet
infrastructure without requiring them to open their
networks to competitors. The F.C.C. has said the best way
to expand deployment is to give the big companies incentive
to invest in new networks.
The appellate court, however, found that cable broadband
service providers were in part providing
"telecommunications services," a definition that could
subject them to the greater obligations of "common
carriers" under federal law.
The court indicated in a footnote in the ruling that "the
practical result of such a classification is that cable
broadband providers would be required to open their lines
to competing" Internet service providers. Mr. Baker of
Earthlink asserted that the court's language meant that his
company "should be able to buy transport from all cable
companies."
That result is by no means certain. In a preliminary
decision in February, the F.C.C. said it would not force
the telephone companies to lease their high-speed Internet
access, or digital subscriber lines, to rivals. The
commission could apply that ruling to cable companies as
well.
Even before the ruling, some cable companies reached
agreements with Internet service providers to lease their
high-speed cable lines. For instance, Comcast Cable, one of
the largest cable companies, has agreements to share its
network with several national Internet service providers,
including America Online and Earthlink, as well as regional
providers.
Mr. Baker said Earthlink's cable agreements give it access
to about 25 percent of the homes in the United States that
are served by cable.
The National Cable and Telecommunications Association, a
trade group, said the court decision was one step in a long
process and that it did not yet have an opinion on the
case.
David H. Fiske, a spokesman with the F.C.C., said the
agency did not know whether the decision could force a
change in direction or policy. He said the agency was
reviewing the access issues raised by cable modem and
D.S.L., but said it is unclear whether the same legal
analysis would apply to both technologies.
F.C.C. lawyers also said that even if cable broadband
providers were regulated as telecommunications services,
the agency could choose not to impose a regulation that
required them to lease their lines to competitors.
http://www.nytimes.com/2003/10/07/technology/07CABL.html?ex=1066513861&ei=1&en=0696695271778a0b