- The Washington Times - Thursday, January 17, 2002

Telephone and electric companies must provide competitors low-cost access to power and phone-line networks for broadband Internet access and wireless communication, the Supreme Court ruled yesterday.
The dispute grew out of the 1996 Telecommunications Act after cable television companies began providing high-speed Internet access in competition with the companies whose wires and buried conduits carried their cable TV signals.
By a 6-2 vote, the court ruled that cable companies can't be excluded under the law requiring subsidized low-cost use of poles and wires simply because they "commingle" high-speed Internet service.
That reversed an appeals court ruling that sent connection rates soaring from about $5 a pole per year to an extreme of $38 a pole in one case.
A second 8-0 vote decided that equipment facilitating wireless communications must be included because it meets the Federal Communication Commission definition of a "telecommunications service."
"[Such companies] have found it convenient, and often essential, to lease space for their cables. … Utilities, in turn, have found it convenient to charge monopoly rents," said the court's opinion written by Justice Anthony M. Kennedy.
He was joined on that part of the case by Chief Justice William H. Rehnquist and Justices John Paul Stevens, Antonin Scalia, Ruth Bader Ginsburg, and Stephen G. Breyer. Justices Clarence Thomas and David H. Souter joined in a dissent on that issue, but made the wireless vote unanimous.
Justice Sandra Day O'Connor took no part in either decision to avoid conflict with her investments in utility companies.
The Thomas-Souter dissent represents a rare alliance. They said the FCC should justify its rationale for regulating rates and decide "at long last" whether broadband Internet access is cable or telecommunications service, or neither.
The rulings cleared the way for the Federal Communications Commission to govern rates for "pole attachments," including wires and devices. Yesterday's decision is expected to ensure the availability of cheap computer links to the Internet, although the court did not address related cases in which utilities claim federally set prices are too low.
"Today's decision overcomes a potential impediment to broadband deployment, especially in rural areas," said Dan Brenner, an official of National Cable & Telecommunications Association which appealed a lower court decision to score yesterday's win for the cable industry.
"It's a big win for cable in that it removes a serious cloud that had been over them," agreed utilities stock analyst Blair Levin, a former FCC official.
Thomas P. Steindler, the Washington attorney for American Electric Power Service Corp., said the industry is disappointed but welcomed what he called "clarity on the issue," which he said ensures the status quo will continue.
"Cable companies were already insisting on and paying the cable rate while the case was in the courts," he said.
"The vast majority of cable hookups are made by behemoth cable companies. The power companies are dwarfed in size by those cable companies," Mr. Steindler said.
Other power companies in the case include Exelon Corp., Duke Energy Corp., FPL Group, Southern Co. and Teco Energy.
Mr. Brenner disagreed and predicted change, if only because the decision removes a barrier to expanding broadband service, "especially in rural areas."
The decision overturned an 11th U.S. Circuit Court of Appeals ruling that the 1978 Pole Attachments Act ensured access solely for cable television and clarified a 1996 law overhauling telecommunications regulation.
The 11th Circuit ruled for Gulf Power Co. which argued that the FCC could not regulate other pole attachments, which also includes access to buried conduits and utility rights of way.

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