LOCALITIES WANT FRANCHISING OVERSIGHT OVER CABLE MODEM SERVICE
FCC’s Local & State Govt. Advisory Committee (LSGAC) recommended Commission “unambiguously” classify cable modem service as cable service to avoid litigation, delay and further investment uncertainty in build-out of cable service. Localities and capital markets need predictability and certainty of established legal precedent, LSGAC said, and existing legal and policy framework for cable services is “clearly understood and working well and provides explicit rights and remedies to cable operators, subscribers and information service providers.”
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Applying cable’s legal framework to cable modem services would provide favorable investment climate that would spur deployment, it said: “This well-known set of rules will reduce the regulatory and business uncertainty faced by investors and by local governments.” It would also help capital markets “accurately evaluate” rules that would be applied to cable modem service providers, LSGAC said. If regulatory classification is made that doesn’t address rights and responsibilities of cable operators and rights of information service providers and consumers, there will be “litigation, delay and further uncertainty,” committee said: “This uncertainty is certain to discourage cable modem service expansion as capital markets insist on higher returns on invested capital to accommodate the increased legal and business risks.”
LSGAC said classifying cable-delivered high-speed Internet service as information service didn’t preclude it from also being cable service as 2 definitions weren’t mutually exclusive. Information services offered on cable systems are subject to Title 6 jurisdiction and regulation, committee said, and Congress’s 1996 definition of cable service is “intended to expand the concept to include interactive information service.” Citing federal law, committee said: “In fact, all cable services offered by a cable operator appear to be ‘information service’ because cable services offer ’the capability for… making available information via telecommunications, and includes electronic publishing.'”
While stressing importance of retaining local franchising authorities’ (LFAs) oversight over cable modem, LSGAC said LFAs also should have authority to require open access. “Title 6 provides the FCC and local franchise authorities with sufficient authority to ensure that cable operators do not restrain competition between affiliated and unaffiliated content providers.” While NCTA agrees in part with local govts. that cable modem service should be defined as either cable service or information service, it contends there’s no legal or policy basis for govt.-mandated access to cable model platform. Many municipalities are concerned about loss of millions of dollars in potential revenue if cable modem service isn’t subject to franchise requirements. In light of 9th U.S. Appeals Court, San Francisco, ruling that cable modem service is telecom service, Cox notified cities in its Cal. systems that it would stop paying franchise fees for cable-delivered high-speed Internet service. AT&T also had sought waiver of franchise fees on cable modem but later backed away from move.
Legal framework for cable also recognizes and encourages “meaningful” role for local govts. in overseeing deployment of advanced cable services, LSGAC said: “Franchise authorities are best positioned to ensure that providers of advanced services address local and specific community needs and interests.” It said division of regulatory responsibility over cable operator’s video services and cable modem services would “frustrate public oversight of the deployment of advanced services.” Dichotomy would inhibit efforts by state, local and tribal governments to reduce digital divide, it said.
Separately, LSGAC Chmn. Ken Kellman, in letter to FCC Chmn. Powell, sought to discount industry’s argument that local rights-of-way (ROW) regulations and fees were delaying rollout of advanced telecom services. He said if federal preemption of ROW regulatory authority were required to spur broadband deployment, then industry should be able to provide examples of communities with more broadband services, more competition and lower prices in states such as Colo. where preemption already had occurred. “Yet, those arguments are never made at the same time local government regulation is being used as an excuse for lack of deployment,” he said: “The existing preemption of local regulatory authority in multiple states, and its lack of any connection to a greater deployment of broadband in those states, should be at the front of the Commission’s mind as it considers… the role of local governments in managing public rights-of-way.”