Cable Gets A Pass On Broadband

00512 cable and the web AP

Federal regulators on Thursday exempted cable Internet companies from laws that force telecommunications providers to open their lines to competition.

The Federal Communications Commission, in a 3-1 vote, said the decision was necessary to spark more investment in high-speed Internet services.

The decision would "promote our goal of fostering a minimal regulatory environment that promotes investment and innovation in this competitive market," Commissioner Kathleen Abernathy said.

But, critics said the move puts cable companies into a "regulatory black hole."

"Instead of ensuring that the qualities that have made the Internet valuable in the first place, the nondiscriminatory environment, [FCC Chairman Michael Powell] is turning the internet on its head by in essence turning it over to these major monopolists," said Jeffrey Chester of the Center for Digital Democracy.

Unlike telephone companies, cable companies are required only to share their lines when specifically told to by the government. As a condition of the AOL Time Warner merger, that company was forced to offer its consumers a choice of Internet service providers on its high-speed lines.

Broadband Internet service that is carried over telephone wires, known as Digital Subscriber Line service, is governed by telephone regulations. The Bell companies, including Denver-based Qwest, have to share their lines if they want to be able to sell their Internet services nationwide.

Thursday's vote, classifying cable Internet as an "information service" rather than a telecommunications service that is subject to the open-access provision, makes sure that cable companies won't have to share anytime soon.

While the FCC indicated it would explore the possibility further, the commission used a special authority to overrule a federal court decision that would have opened a cable company in Portland, Ore., to the sharing requirement.

The move dismayed critics concerned about the increasing phenomenon of media consolidation in which fewer companies own television stations, Web sites, as well as the pipes that bring them to American homes.

"Unlike the telephone network, [cable firms] own a major number of content services," Chester said. "They will serve as the gatekeeper and give their own products preferential treatment."

The National Cable and Telecommunications Association, the cable trade group, said consumers will benefit from competition between different types of broadband services.

"Given the vigorous competition between cable modem, digital subscriber line, and satellite-delivered broadband Internet services, a policy of regulatory restraint is particularly appropriate," group president Robert Sachs said.

Powell, the commission's chairman, said the commission is following the lead of Congress.

"We cannot be driven to pick the definition we prefer based on what you think the consequences are going to be," Powell said. "The ruling is an interpretation of statute."

Michael Copps, the commission's lone Democrat, cast the only dissenting vote.
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