| Supreme Court Holds FCC May
Set Rates for Pole Attachments for Broadband Internet and
Wireless |
1/16. The Supreme
Court issued its opinion
[PDF] in NCTA v. Gulf Power,
the pole attachments case. It reversed the decision of the U.S. Court of Appeals
(11thCir). The Supreme Court held that the Federal Communications Commission
(FCC) can set rates that cable companies pay for access to the
utility poles of phone companies for lines that provide both
cable TV and high speed Internet access. The opinion also
covers rates paid by wireless telecommunications companies.
Introduction. Justice Anthony Kennedy wrote the opinion
of the Court. He began with the observation that "Since
the inception of cable television, cable companies have sought
the means to run a wire into the home of each subscriber. They
have found it convenient, and often essential, to lease space
for their cables on telephone and electric utility poles.
Utilities, in turn, have found it convenient to charge
monopoly rents." The Pole Attachments Act prevented the
charging of monopoly rents by instructing the FCC to set rates
for pole attachments by cable TV companies and
telecommunications providers. This case addresses the question
of whether the FCC continues to have authority to set rates
when the lines used by the cable companies provide both new
broadband Internet access services and old fashioned one way
programming.
Section 224. Congress has addressed the question of
pole attachments in several bills, which are now codified at 47 U.S.C.
§ 224. § 224(b)(1) provides, in part, that the FCC
"shall regulate the rates, terms, and conditions for pole
attachments to provide that such rates, terms, and conditions
are just and reasonable, and shall adopt procedures necessary
and appropriate to hear and resolve complaints concerning such
rates, terms, and conditions." Sec. 224(a)(4), in turn,
defines the term ''pole attachment'' as "any attachment
by a cable television system or provider of telecommunications
service to a pole, duct, conduit, or right-of-way owned or
controlled by a utility."
Proceedings Below. The FCC asserted in an order that
Section 224 applies to traditional cable TV service, as well
as to commingled TV and Internet service. However, pole owning
utilities petitioned the U.S. Courts of Appeal for review of
this FCC order. The 11th Circuit sided with the phone
companies. Cable companies then petitioned the U.S. Supreme
Court for writ of certiorari. The Supreme Court agreed to hear
this case.
Broadband Internet Service. Justice Kennedy wrote (in
Part II of the opinion) that "No one disputes that a
cable attached by a cable television company, which provides
only cable television service, is an attachment ``by a cable
television system.´´ If one day its cable provides
high-speed Internet access, in addition to cable television
service, the cable does not cease, at that instant, to be an
attachment ``by a cable television system.´´ The addition of
a service does not change the character of the attaching
entity -- the entity the attachment is ``by.´´ And this is
what matters under the statute. This is our own, best reading
of the statute, which we find unambiguous."
Justice Kennedy added that "Even if a cable company is a
common carrier because it provides telephone service, of
course, the attachment might still fall under the second half
of the ``pole attachments´´ definition: ``any attachment . .
. by a provider of telecommunications service.´´ "
Justice Kennedy also noted that the FCC's order did not
determine whether broadband Internet access services over
cable are a "cable service" within the meaning of
Title 47. However, Kennedy continued that it was not necessary
to resolve this question to reach a decision in the present
case.
Wireless Telecommunications Services. Justice Kennedy
wrote (in Part III of the opinion) that "A provider of
wireless telecommunications service is a ``provider of
telecommunications service,´´ so its attachment is a ``pole
attachment.´´ "
Dissent. Justice Clarence Thomas wrote a separate
opinion, in which Justice Souter joined. Thomas concurred with
the analysis in Part III of the opinion, regarding wireless
service. However, he wrote that "The Court's conclusion
in Part II of its opinion that the Act gives the FCC the
authority to regulate rates for attachments providing
commingled cable television service and high-speed Internet
access may be correct as well. Nevertheless, because the FCC
failed to engage in reasoned decisionmaking before asserting
jurisdiction over attachments transmitting these commingled
services, I cannot agree with the Court that the judgment
below should be reversed and the FCC's decision on this point
allowed to stand. Instead, I would vacate the Court of
Appeals' judgment and remand the cases to the FCC with
instructions that the Commission clearly explain the specific
statutory basis on which it is regulating rates for
attachments that provide commingled cable television service
and high-speed Internet access. Such a determination would
require the Commission to decide at long last whether
high-speed Internet access provided through cable wires
constitutes cable service or telecommunications service or
falls into neither category."
FCC Chairman Michael Powell
stated in a release that "I am pleased by the Supreme
Court's decision upholding the FCC's authority to set rates
for attachments to telephone and electric poles. It is
important that the Court rejected an interpretation of the
Communications Act that could have raised the rates that
consumers pay for high-speed Internet access services and
derailed the broadband revolution." |
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| FCC Releases Annual Report
on Video Programming |
1/14. The Federal
Communications Commission (FCC) released its 8th
Annual Report [122 pages in PDF] on the status competition
in the market for the delivery of video programming. The
report finds that "competitive alternatives continue to
develop. Cable television still is the dominant technology for
the delivery of video programming to consumers in the MVPD
marketplace, although its market share continues to decline.
As of June 2001, 78 percent of MVPD subscribers received their
video programming from a franchised cable operator, compared
to 80 percent a year earlier."
It further found that "The total number of subscribers to
both cable and non-cable MVPDs continues to increase. A total
of 88.3 million households subscribe to multichannel video
programming services as of June 2001, up 4.6 percent over the
84.4 million households subscribing to MVPDs in June
2000."
The report also states that "The most significant
convergence of service offerings continues to be the pairing
of Internet service with other service offerings. There is
evidence that a wide variety of companies throughout the
communications sector are providing multiple services,
including data access. Cable operators continue to expand the
broadband infrastructure that permits them to offer high-speed
Internet access. The most popular way to access the Internet
over cable is still through the use of a cable modem and
personal computer ..." |
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| Verizon CEO Advocates RBOC
Deregulation |
1/16. Verizon
President and Co-CEO Ivan
Seidenberg gave a speech
to the U.S. Chamber of
Commerce in Washington DC in which he argued for less
regulation of services provided by Verizon.
He stated that "Unlike those of Microsoft or AOL Time
Warner or AT&T Comcast, our regulated assets are subject
to a long list of price regulations, sharing obligations, and
separate subsidiary requirements that put us on an unequal
footing in the marketplace and remove the incentives for
investing in new technologies."
He continued that "Traditional policies have shifted
value, growth and innovation away from the incumbent telephone
companies to less-constrained segments of the industry. And,
since they are based largely on resale and the forced sharing
of telephone company assets, they do little to promote the
robust competition among multiple technologies and service
providers that would benefit American consumers and
businesses."
He concluded that "It's time to take down the ``do not
enter´´ signs at the entrance to the broadband future. ...
Now it's time for the FCC, along with the Congress, to take
action to open the gates to broadband investment and let us
put our resources to work where they can do the most good for
America."
Seidenberg also advocated passage of legislation giving the
President trade promotion authority. He also advocated
legislation that would provide incentives and tax breaks for
businesses that reinvest in lower Manhattan. |
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| People and Appointments |
1/16. Paul
Otellini was named President and Chief Operating
Officer of Intel. See, Intel
release.
1/16. Lawrence Ricciardi, IBM's
general counsel, will retire in July, 2002. |
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| More News |
1/16. The Department of
Justice published in its web site a redacted copy of its brief
filed with the U.S.
Court of Appeals (10thCir) in USA
v. American Airlines, an antitrust case
involving Section 2 of the Sherman Act, (15 U.S.C.
§ 2). At issue is whether American violated Section 2 of
the Sherman Act by adding money losing capacity to drive lower
cost competitors out of four of American's Dallas Fort Worth
Airport.
1/15. The U.S.
Court of Appeals (FedCir) issued its opinion in EZ
Dock v. Schaffer Systems, an patent
infringement case involving interpretation of the on
sale bar. The U.S. District Court (DMinn) held that EZ
Dock's U.S.
Patent No. 5,281,055 invalid under the on sale bar,
codified at 35 U.S.C.
§ 102(b). The Court of Appeals reversed and remanded.
1/16. The Federal Communications
Commission (FCC) extended the deadline, from February 1 to
March 8, for submitting comments in response to its Further
Notice of Proposed Rulemaking regarding the current state of
the market for local and advanced telecommunications services
in multi tenant environments. See, FCC
notice of extension of deadline [PDF]. This is WT Docket
No. 99-217.
1/16. The FBI's National
Information Protection Center (NIPC) released a report
titled "Best Practices for Wireless Fidelity (802.11b)
Network Vulnerabilities". It warns that "Computer
security experts have successfully intercepted and broken the
security built into the IEEE 802.11b Wireless Local Area
Network (WLAN) standard. The software tools used to exploit
the vulnerability are simple to use and available on the
Internet as freeware." It refers 802.11b users to a set
of best practices recommended by the Wireless Ethernet
Compatibility Alliance (WECA).
1/16. The USPTO published
in its web site the January
issue of USPTO Today [PDF].
1/16. Sen. Ted Kennedy
(R-MA) gave a speech [PDF]
in Washington DC in which he advocated delaying tax cuts
enacted by the Congress last year. Sen. Charles Grassley
(R-IA), the ranking Republican on the Senate Finance
Committee, responded in a release that "If the Democrats
succeed in raising taxes, they'll cost even more Americans
their jobs. I believe the American people will oppose Senator
Kennedy's bad idea, and it won't gain traction in the
Senate." |
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| Thursday, Jan 17 |
9:30 AM. The Federal
Communications Commission (FCC) will hold a meeting that
will focus on a review of FCC policies and procedures by the
Commissioners and senior agency officials. There will be three
panel presentations. Panel One will include Chiefs of the Mass
Media Bureau, Cable Service Bureau and Common Carrier Bureau.
Panel Two will include the Chiefs of the Consumer Information
Bureau and the Enforcement Bureau. Panel Three will include
the Chiefs of the Office of Engineering and Technology, the
International Bureau, and the Wireless Telecommunications
Bureau. See, FCC
release. Location: FCC, Commission Meeting Room (Room
TW-C305), 445 12th Street, SW, Washington DC.
7:00 PM. Jim
Dempsey (Deputy Director of the CDT) and David Cole (Georgetown law school)
will discuss the newly revised and expanded edition of their
book titled "Terrorism and the Constitution: Sacrificing
Civil Liberties in the Name of National Security". See, Amazon
listing. Location: Politics and Prose
Bookstore, 5015 Connecticut Ave., NW, Washington DC. (This
is at the corner of Connecticut and Nebraska. It is one mile
north of the Van Ness Metro stop.) |
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| Friday, Jan 18 |
| 12:30 - 1:30 PM. The Progressive
Policy Institute (PPI) will host a lunch briefing to
release two papers that call on government to dramatically
increase the use of information technology to prevent
terrorist attacks and to facilitate coordination between
local, state, and national law enforcement authorities. The
speakers will be Robert Atkinson (VP of PPI), Shane Ham
(senior policy analyst, PPI's Technology & New Economy
Project), and John Cohen. RSVP to John Bray at 202 608-1247.
Location: 600 Pennsylvania Ave., SE, 4th Floor. |
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| Monday, Jan 21 |
| Martin Luther King Day. The FCC and other federal agencies
will be closed. |
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| Tuesday, Jan 22 |
10:00 AM - 12:30 PM. The FCC's Office of Engineering and
Technology and Corning Incorporated will host a tutorial
on optical communications. See, FCC
notice. Location: FCC, Commission Meeting Room (TWC-305),
445 12th Street, SW, Washington DC.
12:15 PM. The Federal
Communications Bar Association's Common Carrier Practice
Committee will host a brown bag lunch. The speaker will be Dorothy
Attwood, Bureau Chief of the FCC's Common Carrier Bureau. RSVP
to Rhe Brighthaupt rbrighth@wrf.com.
Location: Wiley Rein & Fielding, 1750 K St., NW, 10th
Floor Conference Room. |
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| Wednesday, Jan 23 |
The House reconvenes at 12:00 NOON.
Ken Feree, Chief of the FCC's Cable Services Bureau, will
participate on an afternoon panel titled "The Rules: Can
Government Policy Keep Pace?" at the Broadband Outlook
2002 Conference. Location: Four Seasons Hotel, Washington DC.
12:15 PM. The Federal
Communications Bar Association's Global Telecommunications
Development Committee will host a brown bag lunch. Doreen
McGirr (Department of State) and John Giusti (FCC
International Bureau) will speak about preparations for the ITU
World Telecommunications Development Conference. RSVP to Kent Bressie.
Location: Wilkinson Barker
Knauer, 2300 N Street, NW, 7th floor, Washington DC. |
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