Supreme Court Seems Skeptical About Cable Claims In Brand X

from the tricky-situation dept

While most of the Supreme Court attention yesterday went to the Grokster case, the Justices also heard the Brand X case, which was an appeal on a ruling from a few years back, saying that the FCC was wrong in classifying cable broadband services as “information services” instead of “telecom services” — and, thus, opening up the cable companies to forced line sharing rules. While it might not mean anything, the initial reports suggest that the Justices were skeptical of the cable companies claims, and seemed to wonder why cable broadband and telco broadband were being treated differently. Unfortunately, the case isn’t quite as straightforward as it might appear. The reason the telcos have line sharing rules in the first place is because they came by their copper lines through the breakup of a government granted monopoly. These were systems built with government backing (though, as some have pointed out, the cost of those lines should be next to nothing by now). Most of the cable systems were built by private companies. That’s a big distinction, and really is at the heart of this case. While both sides claim that competition will be stifled if the other side wins, that seems unlikely (either way). With the FCC leaning against line sharing, even if cable offerings are classified as telecom services, they might not be required to share lines. However the court decides, though, it is likely to influence many other FCC rulings that impact a variety of different services, such as VoIP — since it will set up the regulatory framework by which the FCC can rule across both cable and DSL. If both are aligned, it should also play into how they regulate wireless broadband technologies as well. In other words, the specific decision may not have a direct impact right away, but the eventual consequences may be far reaching.

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Comments on “Supreme Court Seems Skeptical About Cable Claims In Brand X”

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Anonymous Coward says:

It's still a monopoly

I don’t agree with Mike’s casual dismissal of cable line sharing. The fact is that while private business laid the cable, cable companies are still granted a monopoly for their cable franchise in most parts of the US. Unless, and until, there are widely available alternatives to cable broadband (there are NOT where I live), cable companies should be treated as the monopoly they are and have some responsibility to share their bandwidth.

Mike (profile) says:

Re: It's still a monopoly

Actually, I agree with you. In cases where they have a government granted monopoly it’s an issue that should be looked at.

The real issue, though, is whether or not it really is a monopoly when there are other forms of competition out there. i.e., cable competes with DSL.

So far, this looks more like an oligopoly, so perhaps the government should step in. I’m not taking sides on this one yet… it’s a fairly complex issue.

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