CENTER WILL SEEK GOVT. OVERSIGHT OF AT&T COMCAST ISP ACCESS
Center for Digital Democracy (CDD) doesn’t believe Comcast Pres. Brian Roberts when he says he’s committed to allowing multiple ISPs aboard his company’s cable plant. CDD Dir. Jeff Chester intends to ask Justice Dept. and FTC to make sure AT&T Comcast, if their deal is allowed to be completed, will let independent ISPs compete with any similar services AT&T Comcast offers over its plant. Chester said he would ask for oversight similar to that imposed upon AOL-Time Warner deal, which stipulated that at least 3 independents be offered wherever its incumbents, AOL and Road Runner, were offered to customers. Chester said he saw number 3 independents as floor, not ceiling, and would prefer more ISPs be offered as choices to consumers. AOL-TW, meanwhile, has said multiple ISP model has helped, not hurt, its AOL and Road Runner services by drawing more customers overall to Internet product.
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Comcast said recent demise of Excite@Home was example of why working with multiple ISPs was simply good business. Industry source also said there were key differences between AT&T Comcast and AOL-TW deals -- namely, that AOL-TW owned nation’s and world’s largest ISP and hadn’t negotiated agreements with any independent ISPs at time of its merger. However, AT&T CEO Michael Armstrong and Comcast’s Roberts don’t own dominant service providers of their own, and both said recently that they expected to sign negotiated agreements with independents in 2002. Comcast is conducting trials in Philadelphia area with both Juno and Earthlink. AT&T Broadband and Comcast together would have 387,100 miles of plant passing 38.5 million homes, according to Warren Communications News Television & Cable Factbook.
Both AT&T Broadband and Comcast until recently relied solely on @Home to provide backbone for their cable modem services, but @Home’s bankruptcy forced both to build their own networks. While Comcast was able to work out deal with @Home to maintain service until @Home’s network goes dark in late Feb., AT&T’s 850,000 customers were left stranded without Internet service for up to week (CD Dec 3 p4). AT&T since has switched those customers to another network. In wake of @Home’s bankruptcy, some consumer advocates pointed to AOL-TW’s more open architecture as model in ensuring uninterrupted Internet service to customers.
Chester contended that without consent decree and FTC’s watchful eye, AOL-TW wouldn’t have engaged in “any kind of meaningful commercial contract” with Earthlink and other ISPs that now operated on its network. And despite Comcast’s public statements that it supports multiple ISP model, company has been “one of the leaders in the cable industry opposing open access safeguards,” Chester said: “We don’t intend to allow them to get away with trying to fool the public into believing that they are committed to open access. That’s going to be a principle battleground in this merger.” Roberts essentially has said there will be no battle, that Comcast wants competing ISPs and is willing to negotiate with them, but doesn’t believe in govt.-imposed solutions.
NCTA opposes what it calls “forced access” that would infringe on cable companies’ First Amendment rights, and assn. notes that cable modems allow users to access any site on Internet. Cable companies have invested $45 billion since Telecom Act to upgrade their plant for such broadband services and shouldn’t be forced to allow others to reap benefits of their hard-won investment, assn says. Also, NCTA said cable didn’t have “bottleneck” control over Internet access, that telephone companies, electric utilities, wireless and satellite providers offered alternatives. AT&T and Comcast both are conducting technical trials to determine how to provide, bill, link, service and troubleshoot multiple ISPs on cable modem platform, NCTA said.
FCC currently is weighing how to define cable modem service -- whether it’s telecom service, cable service or other type. Question is important in determining what, if any, regulations may apply. Cable companies believe it should be considered cable service, in part because industry enjoys regulated rates for pole attachments. Supreme Court also is weighing issue in FCC v. Gulf Power. Meanwhile, FTC has been overseeing AOL-TW’s consent decree and various contracts it has formed with ISPs. Chester said “you need to have an antitrust agency such as Justice or the FTC oversee these deals.” Allowing AT&T Comcast to create deals on its own would make ISPs “supplicants” rather than competitors because of new company’s huge market share, Chester said. Getting on network or being cut off from it has potential to make or break ISP, he said: “We will be able to show that Comcast will have significant control over 40% of America’s digital destiny.”
However, Chester acknowledged that getting conditions imposed on deal would be tough fight with Republican Administration in control. “This is going to be a bloody battle.” Industry source said Chester and others who wanted to pick fight should wait to see what carriage deals AT&T Comcast negotiated without govt. intervention.