IVI Doubts FCC Win On Leased Access

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Los Angeles -- Internet Ventures Inc. president Don Janke
said last week that he is pessimistic about gaining approval to lease video channels from
cable operators to provide Internet access.

Janke said he spent two days in Washington, D.C., meeting
with Federal Communications Commission officials about his request, and he came away
virtually certain that he would not prevail.

Janke said IVI -- a small Internet-service provider based
in Redondo Beach, Calif. -- was incapable of lobbying the issue at the same level as the
cable industry. "One side had half a lobbyist, and the other side had 50
lobbyists," he added.

IVI filed a petition with the FCC in June asking the agency
to force cable operators to lease 6-megahertz channels to ISPs. Under the law, cable is
required to set aside between 10 percent and 15 percent of its channels for leased-access
programmers.

The cable industry attacked the petition, saying leased
access is reserved for video providers, and not data-access companies like IVI.

FCC officials, commenting on the IVI case at the Western
Show here last week, indicated that IVI's legal arguments for relying on cable
leased-access rules were weak because the law requires leased-access programmers to
produce programming that is comparable to the output of local TV stations.

Janke claimed that video streaming is clearly video
programming: IVI built a Web portal that provides access to 75 U.S and foreign TV
stations.

David Goodfriend, cable adviser to FCC commissioner Susan
Ness, said the agency had to be sure that IVI's petition was consistent with the intent of
Congress when it passed the leased-access laws in 1984.

"The burden of proof is really on [IVI] to show that
the statute contemplated what they have in mind," Goodfriend said. "That has to
be able to stand up in court, whether or not this fits the statutory definition [of video
programming]."

IVI fought the leased-access issue alone. America Online
Inc. and MindSpring Enterprises Inc., leaders of the OpenNet Coalition, refused to throw
their considerable weight behind the leased-access approach to prying open cable networks
to third-party ISPs.

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