High Court Rules Cable Firms Need Not Share Lines; Decision Likely to Limit Broadband Service Choices
Posted on: Wednesday, 29 June 2005, 15:00 CDT
WASHINGTON -- The Supreme Court ruled on Monday that cable companies may keep rival Internet providers from using their lines, a decision that will limit competition and consumers' choices.
The 6-3 decision is a victory for the Bush administration, which sought exclusive control to promote broadband investment from cable companies.
Judges should defer to the expertise of the Federal Communications Commission, which concluded that limited access is best for the industry, the high court said in an opinion by Justice Clarence Thomas.
More than 19 million homes have cable broadband service. At issue is whether cable Internet access is a "telecommunications service" under federal law that makes it subject to strict FCC rules requiring companies to provide access to independent providers.
The FCC said no, voting in March 2002 to exempt cable companies from the rules to stir investment. The agency reasoned that high- speed Internet over cable was just an "information service," making it different from phone companies.
Billions at stake
The stakes were high. Cable companies have invested billions to set up broadband networks and are now reaping the benefits. Last year, the industry earned about $10 billion in revenue from cable- modem subscriptions, which now represent its fastest growing segment.
The cable industry also had the backing of phone companies, which will now push the FCC to deregulate their Internet services on digital subscriber lines. Currently, DSL is regulated as a "telecommunications" service that requires companies to share their lines with independent providers.
Consumer groups argued that subscribers should be able to choose their own Internet service provider. Left unregulated, cable companies will monopolize the market, they said.
Source: Columbian
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