If FCC were to prevail in its decision to classify cable modem se...

at NATOA’s Litigation & Regulation seminar in Washington. That’s because FCC’s decision will create unregulated monopoly for high-speed access to Internet, attorney Nicholas Miller said. With freedom from regulations such as must-carry, program access and ownership limits, there’s nothing to stop cable from migrating video offerings to unregulated cable modem space, he said. Cable operators could opt for video streaming as opposed to current one-way line, he said, and in that event all franchise fees could disappear. Attorney Brenton Bleier said consolidation no longer would be concern for local franchising authorities, but “our hands will be full” in trying to prevent migration to Internet content from cable. There’s no final FCC ruling and no court ruling on classification, Miller said, and LFAs should act on franchise transfers and renewals in that context. Attorney Tilman Lay said cable modem classification mattered to LFAs because of money involved. LFA’s would take immediate hit of 10% in franchise fees, but amount would grow to billions of dollars as penetration increased, he said. After first siding with LFAs on cable definition of cable modem service, cable operators settled for information service classification because there would be no open access, franchise fee or customer service requirements, Lay said. Attorney James Baller said broadband deployment wasn’t as rapid as claimed because what was being touted as broadband wasn’t good enough for providing advanced telecom services. Small businesses haven’t benefited from cable broadband offering, he said, although residential customers have. For localities, it isn’t just issue of residential service but larger issue of economic development, he said. That’s why states (Va., Wis.) have begun to relax restrictions on municipal entry into telecom business, realizing localities have important role to play in deployment, Baller said. LFAs wanted broadband deployed in cities and are willing to work with private sector, including with Bells and other incumbents, he said. Sixty local govts. are offering broadband services now and 6 are providing fiber to homes and businesses, he said. Baller said that although bankruptcies and abandonment of systems by CLECs were threatening to cut into cities’ franchise fee revenue, situation also presented opportunity for localities. LFAs could bring “white knight” to table or pick up assets themselves and provide service, he said. Attorney John Pestle said federal law didn’t limit or give FCC authority to restrict city’s right to grant or deny approval of merger transfer applications, and key provision was that city could ensure that residents were no worse off than before transfer. Issues that could be addressed in transfer process, he said, are public, educational and govt. (PEG) access commitments of franchisee, protections against discounts on bundled service and EEO, he said.