To: Jay Lowe who wrote (5508 ) 2/19/1999 1:08:00 PM From: Jay Lowe Read Replies (1) | Respond to of 29970
Former FCC Commissioner Comments on AT&T-TCI Merger xdsl.comxdsl.com February 18, 1999 -- Former FCC Commissioner and Coudert Brothers law partner Rachelle Chong may be quoted as follows regarding the Federal Communications Commission (FCC) approval of the AT&T-TCI merger. AT&T had said it will spend an estimated $5.7 billion to upgrade TCI's cable system so it could offer consumers a bundle of high speed Internet access, plus cable service, and local and long distance telephone service. "It is of critical importance that the FCC decided to refrain from imposing common carrier-like conditions on AT&T that would have required AT&T to give open access to TCI's upgraded broadband cable modems systems. At the heart of the FCC's reasoning is its belief that the high speed, broadband market is in a 'nascent stage' and must be allowed to evolve free of undue government intervention." "This is bad news for Internet service providers and consumer groups who had argued that the FCC should force AT&T to make these lines available to competitors who offer Internet or phone services. It is also bad news for telecommunications resellers, because it will encourage more investment in facilities-based systems as opposed to encouraging a resale market." "The biggest winner is AtHome, who would have the value of its cable modem broadband system plunge if the FCC had mandated access to its system as if it was a traditional telephone common carrier. Other big winners include the manufacturers of components of broadband systems, such as suppliers of DSL, data equipment and fiber, who would have seen a drying up of customers should the FCC have ordered AT&T to share its broadband network with others. The final winner is the American consumer, who ought to see an uptick in the speed of construction of new broadband networks." "In this order, the FCC clearly signaled a 'hands off' policy for the regulation of high speed data services similar to its decision many years ago to not force enhanced service providers to pay access charges to local telcos for access to their systems on grounds that the FCC believed the enhanced service market was in its infancy. It appears that the FCC is treating all who enter the broadband network market as 'new competitors,' no matter who they used to be in their prior lives. This policy is the right one and should jump-start growth in the high speed data broadband sector."