News

AT&T Blasts Mass. Holdouts

11/28/1999 7:00 PM Eastern

AT&T Corp. and MediaOne Group Inc. fired back last week
at two Massachusetts communities demanding open access in exchange for transferring cable
licenses.

In an appeal to the Massachusetts Department of
Telecommunications and Energy, the MSOs challenged the town of North Andover and the city
of Quincy for trying to require AT&T to unbundle its broadband platform.

Both communities agreed to transfer their MediaOne
licenses, but only if AT&T provided access to competing Internet-service providers on
terms equal to its affiliates.

MediaOne spokesman Rick Jenkinson said a separate appeal
will be filed against Cambridge and Somerville, two Boston-area suburbs that denied
transfers when AT&T refused to accept their access demands. Cambridge and Somerville
also challenged AT&T's managerial ability to operate a cable system.

In a statement, AT&T vice president of law and
government affairs Michael J. Morrissey called the Quincy and North Andover access
conditions "unlawful," pointing out that state officials and the Federal
Communications Commission maintain a hands-off policy regarding Internet access.

"We cannot accept an unlawful condition, and we are
asking the DTE to void the conditions imposed by the two communities, allowing the license
control to transfer and the companies to merge," Morrissey said.

Morrissey also swiped at doubts raised in Cambridge and
Somerville about AT&T's qualifications, insisting that the company can "step
into the shoes of MediaOne" effectively.

He concluded by indicating that AT&T and MediaOne will
"vigorously" defend their positions -- a possible indication that a lawsuit has
not been ruled out.

So far, Massachusetts has been the most active state on the
access front, with four local franchising authorities electing to require AT&T to
unbundle its high-speed infrastructure.

That may change when the North Andover board of selectmen
meets this week. That board may join Weymouth, Mass., by reversing its earlier decision.
It is reportedly weighing company-proposed transfer language that would allow the town to
revisit access if courts or state or federal regulators ultimately agree that local
governments can impose open access.

But the state DTE has already determined that communities
considering cable transfers can only evaluate AT&T's legal, financial, technical
and managerial qualifications. And a state-appointed special magistrate who held regional
hearings attended by 165 of 175 MediaOne license holders ruled that AT&T satisfied the
DTE's criteria and that open access is not "relevant" to transfers.

Elicia Mathews, director of the DTE's cable-television
division, said the agency can order North Andover and Quincy to come up with
"decisions more consistent with our findings."

"Let me put it this way: Under state law, cities and
towns are the license-issuing authority," Mathews said. "But that authority to
issue licenses was granted to them by the state in the first place."

Officials in both North Andover and Quincy were unavailable
for comment.