FCC STUDYING POSSIBLE NEXT STEPS AFTER CABLE MODEM RULING
FCC Chmn. Powell said the agency was weighing its options in deciding how to proceed after the 9th U.S. Appeals Court, San Francisco, refused to rehear a case involving the agency’s regulatory classification of cable modem service. The FCC could take the case to the Supreme Court or decide to forbear (not enforce) the rules. The appeals court let stand a decision by a 3-judge panel, which struck down the FCC’s decision that cable modem should be classified as an interstate information service. That panel had said it was bound by an earlier decision, AT&T v. Portland, that cable modem has elements of both an information service and telecom service.
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The regulatory classification is important because it potentially opens cable operators to common carrier regulation and open-access requirements on high-speed Internet products. That would mean cable would have to open its facilities to competitors. The cable industry contends that its networks were built with private capital and therefore, shouldn’t be subject to the same common carrier regulations put upon phone networks built with ratepayer money. NCTA Senior Vp-Law & Regulatory Policy Dan Brenner said the association would urge the FCC to seek Supreme Court review: “We believe that if and when the Ninth Circuit’s decision is given a full substantive review by the Supreme Court, it will be reversed.” The question is whether the 9th Circuit should have given deference to the expert agency.
Powell quoted a dissenting member of the 3-judge panel as saying at the time that the decision “effectively stops a vitally important policy debate in its tracks.” Powell said the decision would also prolong uncertainty because it remains unclear whether cable broadband service will get additional regulatory constraints. Powell said he was disappointed because the Commission had “carefully developed” its policy over the past several years and the policy itself was designed to “advance broadband deployment for all Americans.” Comr. Copps, who had opposed the Commission’s classification, said the court’s decision was good for consumers and Internet entrepreneurs: “I look forward to the start of a fresh dialogue on broadband service at the FCC.”
Consumer groups and ISP Brand X had brought the case Brand X v. FCC. They said the decision would help consumers by letting them choose among Internet service providers (ISPs) over cable systems, as with dial-up. “Those alternatives mean consumers will get more choices and potentially a whole new array of customized Internet features and lower prices for Internet connectivity,” said Gene Kimmelman, advocacy dir.-Consumers Union. He said he feared the FCC “will attempt to drag out this legal dispute even longer, to the benefit of cable monopolies.”
Mark Cooper, dir.-research for the Consumer Federation of America said the FCC should accept the court’s finding, which promises nondiscriminatory access regardless of the facilities used. “It is time for the FCC to obey the law and restore the vibrant environment for innovation and freedom of consumer choice on broadband that made the narrowband Internet such a dynamic engine of creativity and expression,” Cooper said.
ISP Earthlink also supported the challenge to the FCC. “Cable modem users deserve choice in high-speed Internet providers,” said Dave Baker, EarthLink vp-law & public policy. He said the ruling is “another step towards finally affording them that choice.” Media Access Project Pres. Andrew Schwartzman said cable open access is “now the law of the land” and if Powell “really supports the President’s goal of broadband deployment by 2007, he should take the same position he has taken on the recent D.C. Circuit case on telephone competition. That means avoiding needless delay by attempting to appeal to the Supreme Court. The FCC has now lost on this issue 3 times in a row. It should accept this result and implement cable open access as fast as it can.”