Open Access Still Hot Topic at NATOA

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Even as open access is high on the minds of regulators reviewing the merger of America Online Inc. and Time Warner Inc., so will it be hotly debated when the annual meeting of the National Association of Telecommunications Officers and Advisors rolls into Los Angeles this week.

Some NATOA members believe the access question remains alive despite a recent Ninth Circuit Court of Appeals ruling that seemingly slammed the door on the bid by Portland, Ore., to force AT & T Broadband to unbundle its high-speed network.

However, the architect of the Portland ordinance that triggered a two-year court fight with AT & T Broadband believes the Ninth Circuit has simply refocused the argument.

In ruling that Portland's authority did not include the right to require AT & T Broadband to allow independent Internet-service providers onto its network, the appellate court opened another can of worms when it declared Internet-over-cable to be a telecommunications service.

"The judicial 'last word,' as spoken by the Ninth Circuit, is that carriage of [Excite@Home Corp. high-speed-data service] @Home is a telecommunications service," Portland franchising director David Olson said.

"Assuming that to be the case, then most cable operators that provide @Home or Road Runner are providing a 'telecom' service without proper authorization under their 'cable' franchises," he added.

Coincidentally, the annual NATOA meeting comes one week before Portland must decide whether to appeal the Ninth Circuit decision.

Olson-who will appear on an open-access panel on the first day of the NATOA conference-said cities must determine what type of authorization is necessary and what fees, if any, must be paid in order to offer a telecommunications service.

The Ninth Circuit ruling also raises questions about what rights are conveyed by a telecommunications franchise and who ultimately enforces the agreement.

"These are all big, complex questions, and the answers may differ from state to state and city to city," he added.

In the interim, some jurisdictions have reached "a temporary truce" with their cable operators by treating @Home and Road Runner as cable services for the purposes of franchise fees and other authorizations, while waiting to see what the Federal Communications Commission does.

"This suits the convenience of many cable operators and cities, but I'm not sure it's the best answer for the public and for the robust growth of the Internet," Olson said.

Nevertheless, one of those cities is Portland, where Olson and AT & T Broadband are negotiating a license agreement that would have all of the characteristics of a telecommunications franchise, which could theoretically act as blueprint for other communities.

Cathy Cunningham, the assistant city attorney in Irving, Texas, also expects talk of open access to surface at the NATOA meeting, the Ninth Circuit notwithstanding.

Cunningham recently represented NATOA during hearings at the FCC involving the proposed mega-merger between AOL and Time Warner.

In her testimony, she warned against "presupposing" that there's a market for alternative high-speed Internet-access providers. She argued that some communities have no independent ISPs or digital-subscriber-line service available, which gives cable de facto control of the market.

"I think some people don't understand that there are a lot of places that have no choices for broadband services," she added, citing her own middle-class suburban neighborhood outside of Irving.

"The FCC needs to rule on open access," she said. "It can't just assume that choice is already out there."

Some local regulators, though, aren't so sure that open access will dominate the debate at the NATOA conference as it did a year ago.

"Sure, people will be talking about it," said Susan Littlefield, telecommunications officer in St. Louis, which has passed its own open-access ordinance. "But I think it's going to be more like, 'What do you think the FCC is going to do?'"

Instead, Littlefield expects the conversation to shift to franchise renewals, as each community tries to find out what terms other jurisdictions extracted from their local operators.

Another topic will be the overbuild craze that has some communities juggling two or three potential new market entrants. "What to do about overbuilds is going to be huge because everybody is seeing them," she said.

Jonathan Kramer, principal with Kramer.Firm Inc., a local government-consulting outfit, said the focus of the open-access question has shifted from Portland to Henrico County, Va., which is appealing a court decision striking down its own ordinance requiring AT & T Broadband to unbundle the network it acquired from MediaOne Group Inc. NATOA has filed a friend of the court brief in that case.

If Henrico County wins on appeal, Kramer said, the next stop is the Supreme Court. "If the appeal supports Henrico County, then you have a split between the circuit courts. And that's usually when the Supreme Court will open its doors for review," he added. "This is an issue that is not going away. It needs to be finalized."

Kramer conceded that there will be other issues to debate at the NATOA conference.

The cable industry's nonstop consolidation frenzy, for one, has regulators concerned about its impact on customer service, as they are less willing to believe new operators' promises.

"There's going to be less of a honeymoon for the new operator," Kramer said. "Regulators are more concerned about making sure things don't go downhill. And consolidation has raised a concern about making sure the promises made by the previous operator are followed up on."

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