Supreme Court asks why cable broadband lacks regulation

U.S. Supreme Court justices on Tuesday questioned why the U.S. Federal Communications Commission (FCC) would classify cable modem broadband as unregulated, while it regulates DSL (digital subscriber line) and other services offered by large telecommunications carriers.

In the Brand X vs. FCC case, a group of Internet service providers has opposed the FCC's attempts to classify cable modem service as an unregulated information service, effectively shutting out independent ISPs from riding on cable broadband networks and selling their services to cable modem users.

During oral arguments, Supreme Court justices questioned how cable modem service providers can argue that broadband access and Internet functionality are an inseparable service when the FCC has required large incumbent telecom carriers to sell access to their broadband networks to competing Internet service providers (ISPs).

Thomas Hungar, deputy solicitor general at the U.S. Department of Justice, told justices that the FCC had the authority to separate cable modem service from traditional telecommunication service.

In recent years, the FCC has moved away from classifying DSL as a telecommunication service, he noted. Incumbent local telecom carriers have traditionally faced regulation, including requirements they share access to their networks with competing carriers, because the four large incumbents inherited large parts of their networks after the breakup of the government-sanctioned AT&T Corp. monopoly in 1984.

In February 2003, the FCC voted to phase out rules requiring the large incumbent telecoms, often called regional Bells, to share residential DSL lines at discounted rates with competing ISPs.

On one side of the Brand X case is a group of ISPs, including Earthlink Inc. and Brand X Internet LLC, arguing that U.S. broadband customers would have more choices of providers, and that competition could drive down prices, if the Supreme Court rejects the FCC's attempt to classify cable modem broadband as an unregulated information service.

Supporters of the FCC action, including the cable industry, say broadband adoption in the U.S., hailed by President George Bush and other politicians as an engine of economic growth, would slow if cable providers were forced to share their networks with competing ISPs.

Both sides' arguments depend heavily on arcane definitions of telecommunication and information services buried in FCC regulations and U.S. telecom laws.

During arguments Tuesday, Justice Antonin Scalia compared the cable industry's argument in the case to an automobile parts vendor who requires customers to purchase car windshields when they want to buy windshield wipers. Justice Stephen Breyer compared cable modem service to voice mail, which offers similar functionality to e-mail but is associated with a highly regulated telecommunication service.

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