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To: ahhaha who wrote (3016)	10/30/1998 3:00:00 AM
From: neverenough	Read Replies (1) \| Respond to of 29970

-------------------------------------------------------------------------------- Consumer groups oppose closed cable Internet services Reuters Story - October 30, 1998 01:49 By Aaron Pressman WASHINGTON, Oct 29 (Reuters) - Limitations imposed by cable television operators on their new high-speed Internet services threaten to cripple diversity and competition in cyberspace, a coalition of consumer groups said on Thursday. While most people connect to the Internet over ordinary phone lines, by the end of the year almost half a million will be using cable connections that operate at speed 30 to 50 times faster, analysts said. And more than 10 million will be using cable access within three years. In the telephone-based world of online access, competition blossomed among thousands of Internet service providers, the groups, including Consumers Union and the Consumer Federation of America, said. But cable Internet offerings will limit competition by requiring customers to pay for services even when the customers would prefer to purchase similar offerings from competing firms, they said. And cable companies may choose to limit the services or resources Internet users are able to access in order to generate added revenues or protect their current television offerings. "Offering Internet service under the closed cable TV system will, quite literally, change the character of the Internet as an engine of creative technological and marketplace innovation, open entry, economic growth and free expression," the groups said in comments written by the Media Access project, a nonprofit law firm in Washington. The warnings were included in comments urging the Federal Communications Commission to reject the proposed $48 billion merger of AT&T Corp. and Tele-Communications Inc. unless the companies were required to provide equal access to their high speed Internet service, At Home Corp. Telephone companies are considered "common carriers" and must allow customers to subscribe directly to any Internet or online service. Typically, a customer pays the phone company a flat rate for the phone line and another $12 to $22 per month to an online service provider like America Online Inc. or EarthLink Network Inc. Cable operators, by contrast, have nearly complete control over what travels down the cable line and plan to act as both access provider and online service, charging about $40 a month in addition to television charges. A customer wanting another service provider, for e-mail or to serve as host for their personal Web site, would still have to pay the full cable company fee. At Home general counsel David Pine defended the practice and said his company's customers could reach any online or Internet service they wanted in addition to At Home. "What the cable companies are doing is making a substantial investment and to do that successfully they need to be able to charge for these services," Pine said. The At Home service was designed to integrate fully its high-speed access and Internet services, he added. "It's not just the At Home service," he said. "Access to the broadband network and the service are very, very integrated together." The consumer groups said At Home was already limiting choice by preventing its customers from watching more than 10 minutes of live video pictures broadcast, or "streamed," over the Internet. Pine conceded that the cable owners of At Home wanted to prevent such video services from eventually eating away at their cable television business. "Cable doesn't want to invest into a service that's going to threaten its core cable television business as a practical matter," he said, adding the issue had been "blown out of proportion" because little high-quality video was currently available online Copyright 1998 Reuters Limited. All rights reserved. Republication or redistribution of Reuters content is expressly prohibited without the prior written consent of Reuters. Reuters shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon. --------------------------------------------------------------------------------