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Technology Stocks : America On-Line (AOL) -- Ignore unavailable to you. Want to Upgrade?

To: George Martin who wrote (17680)	5/19/1999 5:46:00 PM
From: Bruce Cullen	Read Replies (3) \| Respond to of 41369

Steve Case cries again! ========================== AOL's Case for cable help unheeded Top regulator won't intervene in high-speed Net fight By Jeffry Bartash, CBS MarketWatch Last Update: 5:36 PM ET May 19, 1999 Net Headlines Telecom Report WASHINGTON (CBS.MW) -- America Online boss Steve Case once again trouped up to Capitol Hill to plead for help in gaining access to high-speed cable networks, but the nation's top telecommunications watchdog all but ruled out regulatory intervention any time soon. AOL, the largest U.S. provider of online access with 18 million users, is worried it will eventually lose customers unless lawmakers step in. The company wants Congress to force cable operators to lease AOL access to their networks at the same price they charge affiliated cable Internet service providers such as At Home (ATHM: news, msgs) and RoadRunner. At Home is controlled by AT&T (T: news, msgs), soon to become the largest cable owner in the United States, while Roadrunner is controlled by Time Warner (TWX: news, msgs), now the largest domestic cable provider. AOL (AOL: news, msgs) fears that customers, if faced with a requirement to buy At Home or RoadRunner's high-speed service before gaining access to AOL, will simply opt to pay for the cable ISP. If that happens, the cable ISPs could metamorphose into monopolies, Case warned. "We're simply saying there needs to be some sort of approach to prevent cable companies from blocking (independent) ISPs access to their networks," Case said. AOL also met with analysts In Washington Wednesday where it announced an intensifying e-commerce directive. See full story. Speed first Federal Communications Commissioner William Kennard expressed sympathy for AOL's situation but said there's no stomach at his agency or in Congress to heap more regulations on the cable industry. In unusually frank remarks, Kennard acknowledged that regulators could face a stark trade-off: Boost regulations in the cable industry at the risk of slowing the advance of high-speed access to the Internet. Or stand pat to ensure speedy nationwide rollout of such services at the risk of creating new telecommunications monopolies. "That's really the dilemma we're facing today," Kennard said. A 'light touch' Case, making his case at a Congressionally sponsored forum on the future of high-speed Internet access, argued that he's not asking lawmakers for much. He said he simply wants them to exercise a "light touch" under which cable operators couldn't give favorable pricing to any one Internet provider. A similar provision exists in the local phone business. Major local phone carriers such Bell Atlantic or BellSouth are legally required to sell wholesale access to their networks to smaller competitors, who in turn resell local service to business and other customers. Kennard, however, said the FCC's long-run aim is to reduce regulation, not to increase it. "We're not trying to be the gatekeeper deciding who gets in and who doesn't," he said. He also disagreed with Case that it would be easy for regulators to craft such a pricing mechanism for the cable industry. He noted that it's difficult to determine what a "fair" price is for access to a telephone network, the result of which has been years of lawsuits between the Baby Bells, competitors and regulators. That's hampered the development of competition in the local phone sector, he said. Kennard even went so far as to suggest that one likely resolution to AOL's problem is for the online service to fork over a stake in the company to the cable operators in return for favorable access to their high-speed networks. For more Net news, see Internet Daily. Case and Kennard spoke at a congressional forum sponsored by Sens. Jay Rockefeller (D-W. Va.) and Bill Frist (R-Tenn.). Other speakers included Milo Medin, founder and chief technology officer of At Home Network; and Duane Ackerman, CEO of BellSouth.