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July 28, 1999
Web posted at: 5:57 p.m. EDT (2157 GMT)

by Elizabeth Wasserman

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WASHINGTON, D.C. (IDG) -- William Kennard, the chairman of the Federal Communications Commission, says the agency plans to grab one end of the rope in a legal tug-of-war with cities and counties. Both sides claim the right to decide whether cable-modem customers should have a choice of ISPs.

The courts will determine who falls into the mud.

It's not easy to predict a winner. Legal experts say both the FCC and local authorities have valid claims to overseeing cable policy, particularly where access is concerned.

"In a way, they're both right," says Michael Botein, a telecommunications law professor at New York Law School. He notes that FCC rules dating back to the 1970s, as well as subsequent congressional telecommunications and cable acts, including the 1996 Telecommunications Act, "all affirm a city may have a franchise that requires different types of access, including leased or commercial access. It certainly seems to me that could include the use of data channels."

At the same time, he says, some rules have been changed to take away local control over such issues as pricing and content. "The FCC is now the sole arbiter of rate levels and related issues," Botein says. "So if you can control the rates, controlling access isn't terribly helpful."

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So far, only one city, Portland, Ore., and one county, Broward County, Fla., have voted in favor of requiring cable franchises in their communities to open access to cable pipes. But votes are expected in San Francisco this week and other communities over the next few weeks.

This epic battle pits some of the Internet's largest firms against the world's telecom giants. America Online has joined forces with GTE, U S West, MCI WorldCom and myriad smaller ISPs to urge local officials to require open access. Bell Atlantic and SBC have formed a separate lobby on the issue. Both factions are fighting the cable companies. That means fighting AT&T, which has gobbled up two of the nation's largest cable franchises, Tele-Communications Inc. and MediaOne Group; both cable companies require their Internet subscribers to use Road Runner or Excite AtHome.

While the FCC's Kennard has been dropping hints for months that he sides with cable operators on the issue and does not want to see regulations requiring access, last week he announced that the commission will likely intervene. He has asked his general counsel to draft a friend-of-the-court brief in the Portland case "so we can explain to the court why it's important we have a national policy."

The groups supporting open access blasted Kennard as an AT&T lackey. Greg Simon, a former aide to Vice President Al Gore who now serves as cochairman of the Open NET Coalition, said in a statement that his group is "astonished that a high public official would put the federal government at the service of a massive communications corporation as William Kennard has done."

[In a July 23 letter to Kennard, Simon apologized: "The remarks attributed to me were from a press release published without my review or approval. The remarks were disrespectful to you and to the Commission and I apologize that they were published." In addition, Simon added that it would be "an egregious mistake for anyone to have the impression that I question your personal conduct, integrity or motives in any way" and said he has the "highest regard" for Kennard. "I deeply regret that these remarks failed to reflect that regard, and I apologize to you and your staff that this occurred."]

Meanwhile, the National Association of Counties, which represents two-thirds of the nation's counties, passed a motion last week asserting the right of local governments to require cable companies to provide open access.

As you might expect, Excite AtHome doesn't see it that way. "The FCC has spent a lot of time on this issue," says Milo Medin, the company's CTO. "They're trying to understand everyone's perspective. They have a policy. The policy is they don't want to regulate the Internet."

Ultimately, the courts will decide. "They both can lay claim," says Jeanne Schaaf, senior analyst at Forrester Research. But some observers suggest that the FCC abdicated its responsibility by not tackling the issue months ago. "Washington had decided to stay out of it for now, but it's become a grassroots political problem," says Scott Cleland, a policy analyst for Legg Mason, a Baltimore-based investment firm. "Washington would prefer that the provinces behave -- but Washington doesn't control the provinces."