- The Washington Times - Friday, June 23, 2000

A federal appeals court ruled yesterday that Portland, Ore., can't force AT&T; Corp. to open its cable network to competitors.

The decision could affect local governments across the nation, including Montgomery County, that are trying to force cable companies to open their cable lines to competitors that want to market high-speed Internet connections.

AT&T; sells high-speed Internet access over cable lines through ExciteAtHome, which it partially owns. ExciteAtHome has exclusive rights to AT&T;'s cable system until 2002.

AT&T; applauded the decision yesterday.

"We're pleased with today's ruling because it clarifies decisively the limits of local authority when it comes to the provision of high-speed Internet access over cable," AT&T; general counsel Jim Cicconi said.

The 9th Circuit Court of Appeals sided with AT&T; and overturned last year's lower court ruling that Portland has the authority to require cable companies to allow competing Internet service providers (ISPs) access to AT&T;'s cable network.

U.S. District Judge Owen Panner ruled in June 1999 that the city had authority to pass the ordinance mandating open access.

Yesterday's decision is the second judicial defeat for open access proponents in two months.

In May, the U.S. District Court for the Eastern District of Virginia overturned a cable franchise requirement in Henrico County, Va., mandating that AT&T; must open its cable network to competitors.

It's not clear how the decision will influence the debate over open access in Montgomery County.

Montgomery County officials are debating open access because Comcast, the nation's third-largest cable company with 8.2 million subscribers, plans to take over Cable TV Montgomery and provide cable service to the county's 315,000 subscribers.

The county could follow Portland's lead and make the transfer of the franchise agreement contingent on the company's opening its cable lines to ISPs.

Despite the 9th Circuit Court's decision yesterday, Greg Simon, co-director of the pro-open access group the OpenNet Coalition, said the ruling "is a huge victory for consumers."

In its ruling, the court said Internet access over cable is a telecommunications service, not a network. That makes it governable by federal law.

Mr. Simon said he interprets that to mean cable companies should have to provide rivals with access, similar to requirements imposed on phone companies.

"Today's ruling clarifies that cable Internet services are subject to the same requirements as telephone company-delivered Internet services and will open the door for other Internet service providers to gain access to upgraded cable systems," he said.

Mr. Simon also called on the Federal Communications Commission to use the court decision to shape a national open-access policy.

The FCC so far has decided not to regulate Internet access over cable lines and yesterday it seemed not to change its position.

The matter revolves around the speed at which cable lines deliver data to Internet users.

Cable operators that offer customers high-speed cable modem service link consumers to the Internet 50 to 100 times faster than a standard dial-up service.

An estimated 2 million consumers subscribe to high-speed Internet access over cable lines and 97 percent of those get service from ExciteAtHome or Roadrunner, owned by AT&T; and Time Warner Inc.

The dispute in Portland took shape in 1998 when AT&T; announced its planned to buy Tele-Communications Inc. That's when some ISPs urged regulators to approve transfer of the cable franchise agreement to AT&T; only on the condition that the telephone company make those high-speed cable lines available to all ISPs.

The FCC approved the merger without that measure, but local elected officials in Portland and Multnomah County, surrounding Portland, approved the transfer to AT&T; on the condition that ISPs be allowed to use the cable lines.

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