FCC told 9th U.S. Appeals Court, San Francisco, that it had ‘reas...

FCC told 9th U.S. Appeals Court, San Francisco, that it had “reasonably” concluded that cable modem service was interstate information service. “The Commission’s reading of the statute makes good sense,” agency wrote court last week. Court is reviewing FCC’s classification of cable modem service, which is being challenged by Earthlink, Verizon, WorldCom, consumer groups and several others. In March, FCC said that cable modem service was interstate information service and that Internet delivered over cable wasn’t subject to common carrier regulations (CD March 15 p1). Ruling went to heart of questions about rights of local franchising authorities, their ability to levy taxes on such services, whether cable modem ever would be subject to universal service requirements and whether cable operators would have to offer “open access” to Internet service providers (ISPs). In its filing, FCC said court’s ruling 2 years ago in AT&T v. Portland, Ore., didn’t require agency to classify cable modem as telecom service, just that law classified telecom component of cable modem service as such. Because Telecom Act doesn’t define clearly how it should be classified, “this court must defer to the FCC’s reasonable interpretation of ambiguous statutory terms,” Commission said. Agency said it believed cable operators were using telecom to provide end users with information service. Therefore, it said, it concluded that cable operators’ offering of telecom to ISPs constituted private carrier service, not common carrier telecom service. FCC said it asserted federal jurisdiction properly because Internet communications frequently crossed state and national boundaries. Court should reject any suggestion that agency’s order “somehow impairs the ability of local governments to manage their rights of way,” agency said: “The Commission has not yet decided how (if at all) its classification of cable modem service will affect local regulation of rights-of-way.” That question is subject of separate proceeding. FCC in March opened rulemaking to examine which govt. agencies, if any, had power to regulate cable modem service and invited comment on whether, “in light of marketplace developments, it is necessary or appropriate at this time” to require multiple ISP access. FCC asked court to dismiss challenge by Verizon, which said Commission should adopt same classification for wireline broadband services. Again, FCC said that question was part of separate proceeding and shouldn’t be considered by court.