Cable Broadband Monopoly Over?

[gornyhuy]

Price wars may be a-comin'!!

http://www.washingtonpost.com/wp-dyn...-2003Oct6.html


Cable companies would be required to open their networks to rival high-speed Internet service providers under a federal appeals court ruling yesterday that could lead to more choices for consumers and subject the industry to the same competitive pressures roiling the telephone market.

The ruling by the San Francisco-based U.S. Court of Appeals for the 9th Circuit bars the Federal Communications Commission from following through with plans to allow cable companies to exclude rivals from selling competing brands of Internet service over their lines.

The FCC adopted its deregulatory approach last year, betting that it would give the cable industry an incentive to continue investing in sophisticated fiber-optic networks. But the court said the agency must continue to classify cable's Internet offerings as a telecommunications service, subjecting it to the same regulations governing high-speed Internet service provided by telephone companies.

Currently, the vast majority of the nation's approximately 14 million homes that subscribe to cable high-speed Internet service have no choice when it comes to their service provider. If the ruling survives a likely appeal, the decision could provide broadband Internet users with new options for the content they see online, their e-mail addresses and potentially the monthly rates they pay.

The decision could also benefit companies such as EarthLink and America Online, which are trying to move their customer base from slower dial-up connections to higher-speed data services. Armed with the most recent decision, those companies could demand access to cable's broadband networks.

"Cable-modem users deserve choice in high-speed Internet providers," said Dave Baker, vice president for public policy at EarthLink Inc., the nation's third-largest Internet provider. "Today's ruling is a big step towards finally affording them that choice."

The three-member appeals panel said it was obligated to block the FCC action because it had previously ruled that the two-way nature of cable Internet service made it more like a telecommunications service than a pay television service that could be regulated by local governments.

At least one member of the appeals court, Judge Diarmuid F. O'Scannlain, expressed discomfort at getting in the middle of a policy debate even as he concurred with the panel's ruling. "Strange as this result may seem, I concur in the court's opinion only because I believe our court's precedent compels it," he wrote.

FCC Chairman Michael K. Powell vowed to appeal the decision. In a brief statement, Powell quoted from the judge's comments: "Unfortunately, as noted by Judge O'Scannlain, the ruling 'effectively stops a vitally important policy debate in its tracks,' producing 'a strange result' which will throw a monkey wrench into the FCC's efforts to develop a vitally important national broadband policy."

Cable industry sources noted that Powell is not obligated to enforce regulations even if cable is classified as a telecommunications service. Under current law, Powell has the right to "forbear" the enforcement of regulations in cases in which rules could cause more harm than good.