IP: Cable Lobby's Pregnant Silence

[David Farber <dave () farber net>]

> Date: Tue, 15 May 2001 12:55:39 -0500
> From: Stephen Heins <steveh () northnet net>
> Organization: NorthNet
> Subject: Cable Lobby's Pregnant Silence
>
> Open-Mndeds,
>
> Here is a story about the cable lobby worth sharing with you. The newly
> renamed
> National Cable and "Telecommunications" Association has one response to
> media
> questioning about the inappropriately named "Internet Freedom and
> Broadband Deployment Act": "No comment."
>
> The moral of the following story goes as follows: Gatekeepers are very
> territorial and often very clever!
>
> In particular, it is very interesting to watch the cable industry use
> the "telecommunication services" status to avoid a community franchise
> fee and to add sex appeal to their names, but still deny the
> applicability of the Telecommunication
> Act of 1996 for access their networks.
>
>
> Anyway, here it is the article:
>
> Cable Lobby Quiet on Key
>
> Telecom Bill by Erik Wemple Online
> Exclusive, May 14 2001
>
>
> Cable lobbyists are conspicuously silent on proposed federal
> legislation that could make the market much tougher for operators.
>
> Last Wednesday, the House Energy and Commerce Committee
> approved the Internet Freedom and Broadband Deployment Act,
> which would unleash the Baby Bell phone companies on the
> high-speed Internet sector.
>
> Sponsored by Reps. Billy Tauzin, R-La., and John Dingell, D-Mich., the
> bill would excuse the phone companies from a key provision of the
> 1996 Telecommunications Act. That provision required the
> companies to open up their networks to local competition before
> joining cable-service providers in offering advanced services.
>
> But there is a competing option more favorable to cable companies.
> On May 5 Reps. John Conyers Jr., D-Mich., and Chris Cannon,
> R-Utah, sponsored a proposal that would keep the phone
> companies restricted to conventional telephone service and
> constrained by the market-opening mandates of the 1996 act. It
> would also muster $3 billion in loans to assist companies in
> extending broadband to underserved areas.
>
> But the cable industry has had little to say, at least publicly, about
> the rival bills.
>
> The National Cable & Telecommunications Association, which usually
> blitzes reporters and industry insiders with positional press
> releases when such critical legislation hits Capitol Hill, is staying in
>
> the background for now.
>
> When asked about the pending bills, NCTA spokesman David
> Beckwith replied, "No comment."
>
> Major cable providers are taking a similar approach. AOL Time
> Warner declined to comment on the legislation. A Comcast
> spokesperson referred inquiries on the legislation to NCTA.
>
> In fact, cable companies are facing a double bind. Operators would,
> of course, very much like to keep the phone companies out of the
> high-speed arena. But making such a case before lawmakers could
> paint them as proponents of government regulation ­ a concept
> that is anathema to industry executives.
>
> To cable operators, government regulation means an open-access
> requirement which could hurt profits and reduce their leverage with
> Internet service providers and other companies who want a ride on
> their broadband pipes.
>
> The closest that the government has come to an open-access
> requirement is the Federal Trade Commission’s consent agreement
> in the merger of AOL and Time Warner, a document filled with
> stipulations regarding how the combined company should handle
> broadband access agreements. Still, there are some activist
> lawmakers who favor a wide-ranging open-access requirement, and
> heading them off is the cable industry’s first priority.
>
> Doing so may require a consistent track record. The cable lobby is
> trying to avoid the regulatory trap that Microsoft fell into. For years
> the software behemoth skewered the government for pursuing its
> headline-making antitrust case against the company. Yet last year,
> it complained to federal regulators about the monopolistic dangers
> of the AOL-Time Warner deal.
>
> But some observers say that cable providers may not have much to
> worry about. MSOs, after all, have been providing Internet services
> for years, which insulates them somewhat from an immediate
> competitive threat from the local phone companies.
>
> "They think they have a jump on the Bell companies," says a cable
> industry observer.
>
> For now, the NCTA is simply watching the deliberations, ready to
> pounce in case the legislation drifts too far.
>
> "If you were to see legislative amendments dealing with open
> access, the cable industry would perk up," says the source.
>
> The sidelines strategy may work out perfectly for the industry.
> Although Tauzin may want to move his bill through the legislature
> quickly, the 30-24 committee vote doesn’t give the measure much
> momentum. Furthermore, House Judiciary Committee Chairman
> James Sensenbrenner, R-Wis., has appealed for referral of the
> legislation, a tack that would allow the committee to mix in the
> Conyers-Cannon prescription for broadband deployment.
>
> House Speaker Dennis Hastert, R-Ill., is expected to rule on the
> jurisdictional battle within two weeks.
>
>              END
>
> Steve
>
> --
> Steve Heins
> thewordmerchant.com
> Director of Marketing
> NorthNet
> email: steveh () northnet net
> 920-233-5641



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