AT&T Corp. v. City of Portland: Classifjring "Internet Over Cable" in the "Open Access" Fight

AT&T Corp. v. City of Portland: Classifying "Internet Over Cable"1 in the "Open Access" Fight* 1. INTRODUCTION The Internet is one of the fastest growing communications technologies in history.2 In the past five years, the proportion of Internet users in the United States has increased from less than one percent of the population to nearly one-third of the population today, or fifty million people.3 Most people who have accessed the Internet during this time period have done so by using a local telephone line. Consequently, regulations governing the use of local telephone lines have had a substantial impact on how the Internet has developed. Title II of the Communications Act of 1934 requires local phone companies to provide telephone lines to all who request them on a nondiscriminatory basis.4 This open regulatory approach means that anyone can become an Internet service provider (ISP) by purchasing telephone lines from the local telephone company. As a result, multiple ISPs now compete to provide Internet access to consumers over a single telephone company's networks.5 Demand for Internet access, however, is changing. The slower, narrow-bandwidth telephone connections of the past are beginning to give way to high-speed, broadband connections6 that have the ability to provide "[r]eal time high-fidelity music, telephone, videoconferencing, television and radio programs."7 Several different technologies are being used to meet this new demand including cable television networks, telephone lines called digital subscriber lines (DSL), fixed wireless systems, and direct satellite connections. As of late 1999, cable television networks have taken a strong lead in the broadband access market, providing broadband service to approximately one million homes.8 DSL is a distant second, providing service to approximately one hundred thousand homes.9 Fixed wireless lags far behind cable and DSL, and broadband via direct satellite will not be operational for at least a few more years.10 In the past, these different transmission technologies-cable television, telephone, wireless, and satellite-have been regulated as distinct industries offering unique services. The application of these divergent regulatory structures to Internet access has created conflicting regulatory results. For example, local telephone companies are currently required to allow competing DSL providers to use their networks to offer broadband Internet access to consumers while cable companies, at least on a national basis, are not. As demand for these services grows, courts and regulators will face increasing pressure to reconcile divergent regulatory schemes for transmission technologies that offer the same or very similar highspeed data services. The United States District Court for the District of Oregon, in AT&T Corp. n. City of Portland,11 was the first court to address how broadband Internet provided over cable television networks (Internet Over Cable) should be regulated. In this case, the court held that Internet Over Cable should be classified as a cable service and, consequently, that provisions of Title VI of the Communications Act govern its regulation. The court ultimately concluded that local franchising authorities (LFAs), who have the legal right to regulate certain aspects of cable service, can require a cable company to provide access to its facilities to other ISPs as a condition of granting a transfer of a cable television franchise from one company to another. This Note argues that the district court in AT&T Corp. v. City of Portland erred when it classified Internet Over Cable as a cable service. It suggests that LFAs do not have the authority to force a cable operator to open its Internet facilities to other ISPs and recommends that Internet Over Cable be regulated as a non-cable communications service or as an advanced telecommunications capability and not as a cable service. Part II of this Note provides a brief overview of the laws governing services provided over telephone lines and cable television networks. …