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To: GraceZ who wrote (12473)	7/15/1999 3:31:00 PM
From: Stephen L	Read Replies (1) \| Respond to of 29970

OK I'll play devil's advocate. What are the revenue and income growth implications IF the US adopts open access? Will the deployment of cable service slow? Or will the rents ATHM be able to charge all ISPs be sufficient to generate the required return on capital? Will a competition force the Excite part of ATHM to put some excitement back into there service? My own guess (and it is just that) is that after the near term uncertainties of switching to open access and "educating" local regulator that there is a cost to building and accessing cable service that ALL will have to pay, open access could be a positive. Finally, although the FCC appear opposed to open access, there is an election coming up and most pols have little to run on. Don't you think the populist spin of open access will gather momentum?

To: GraceZ who wrote (12473)	7/15/1999 4:36:00 PM
From: Peter Y. Hsing	Read Replies (2) \| Respond to of 29970

FCC's version of the end game? Phase 1) Today: Do NOT open cable--this will force the roll-out of other broadband solutions like xDSL (perhaps some wireless or DTH solution). This will also allow cable to build a competitive local loop using VoIP. Customers win--more competition between service providers and customers gain broadband services, sooner. Phase 2) Later (1-2yrs): Once cable's VoIP deployment gathers momentum, a certain level of local competition will exist (in addition to competition from CLECs), thus, prompting FCC to allow RBOCs to enter LD business w/o no restrictions. Customers win--more competition between providers, better services, sooner. Phase 3) Some point down the road, if the FCCs so feels that it is in the best interests of the consumer, AT&T and major MSOs can be broken up just like Ma Bell was years ago. Customers win again. Phase 1 is already happening today--AOL's investment in DirecTV/Hughes and the alliances with the RBOCs to roll-out DSL, amongst other events. The CLECs have not been competitive enough--near-total deregulation of telecoms in the US is being held back...the FCC would probably like to see a "real" competitor for local telephony services like cable come in (residential only, however). IMHO, there is no compelling reason to open cable up at this point in time--the authorities can always pull the trigger at any time after the cable upgrade/deployment has been completed--why waste such an effective "stick" now when the mere threat may suffice? My apologies if this seems a bit unclear--it's 4:30am in my part of the world.