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To: ALTERN8 who wrote (17563)	12/6/1999 3:15:00 PM
From: ALTERN8	Read Replies (1) \| Respond to of 29970

Monday December 6, 2:43 pm Eastern Time Internet, cable firms split on AT&T access deal By Aaron Pressman WASHINGTON, Dec 6 (Reuters) - Cable television companies on Monday welcomed AT&T Corp.'s (NYSE:T - news) agreement to share its high-speed Internet lines in a few years, arguing the deal proved that additional government regulation was not needed. Operating from the same set of facts, Internet service providers (ISPs) and consumer groups said the deal showed a desperate need for new federal rules imposing the shared access principles sooner, more broadly and on all cable companies. Earlier on Monday, No. 2 cable operator AT&T formally announced an agreement in principle negotiated with No. 2 ISP MindSpring Enterprises Inc. (NasdaqNM:MSPG - news) to give cable high-speed Internet customers more choices. AT&T's current cable Internet service requires that customers buy Internet service from Excite AtHome Corp. (NasdaqNM:ATHM - news), which is owned largely by AT&T and cable partners Comcast Corp. (NasdaqNM:CMCSA - news) and Cox Communications Inc.(NYSE:COX - news) The exclusive Excite AtHome deal has drawn sharp criticism from other ISPs, who have said it thwarted competition, and public interest and consumer groups, who have feared potential harm to the Internet's open and democratic nature. AT&T's agreement in principle with MindSpring deferred sharing of the cable wires until AT&T's contract with Excite AtHome expires in mid-2002. AT&T and MindSpring, or any other ISP interested in using AT&T's cable wires, also must still negotiate a contract with exact terms and conditions, including pricing, for shared access. Jupiter Communications analyst Dylan Brooks said AT&T and other cable firms were the big winners, since the agreement was likely to keep the Federal Communications Commission and Congress from intervening in the debate. ``The biggest impact is helping stave off any federal regulation,' Brooks said. ``The FCC has been leaning against getting involved and this provides a good excuse.' America Online Inc.(NYSE:AOL - news), by far the largest ISP, was a loser, since the terms agreed to by MindSpring were unlikely to satisfy AOL, Brooks said. Excite AtHome was also a loser, since it was losing its exclusive franchise, he said. At midday, shares of AT&T rose 1-1/16 to 58-1/16 on the New York Stock Exchange. AOL shares rose 2-3/4 to 81-1/16. Cox shares fell 9/16 to 47-7/16. On the Nasdaq, shares of MindSpring rose 4-9/16 to 36-7/8. Shares of Excite AtHome fell 1-15/16 to 50-1/8. Shares of Comcast rose 1/4 to 43-5/8. Major cable players, including National Cable Television Association president Robert Sachs, quickly took up the anti-regulatory message. ``The AT&T/MindSpring agreement strongly reinforces our view that private sector negotiations are much more likely to produce benefits to consumers than any set of government-imposed regulations,' Sachs said in a statement. A Cox spokeswoman called the deal ``conceptually sound,' adding that her company has ``always taken the position that cable companies and ISPs should be able to work this out in the marketplace.' Among Internet companies, AOL said it would still lobby for federal regulation imposing open access sooner and more broadly. ``This sounds like a move in the right direction, but the proof is in the pudding,' said George Vradenburg, AOL senior vice president. Even MindSpring officials said that they had some problems with the principles to which they had agreed in the letter with AT&T. ``It's at least a good start toward defining how an open access relationship should work, but it's certainly not complete,' MindSpring Chairman Charles Brewer said in an interview. ``The thing that's wrong is the timing -- waiting for the exclusive contracts to expire.' MindSpring vice president Dave Baker, who helped negotiate the deal, said AT&T had made important concessions by agreeing that sharing its cable lines was technically feasible and would promote investment. ``It's worlds better than their public pronouncements of just a few months ago,' he said. Excite AtHome chief technology officer Milo Medin, who participated in the negotiations, said the agreement included a definition of shared access that was acceptable to his company. But Medin warned that implementing shared access would require technical changes that could take two years to develop and deploy. ``The technology to do what we're talking about in that letter doesn't exist today,' he said.