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deny the fundamental principle of “open access” that has animated telephone deregulation

merely because lawyers can disagree about how it should be implemented.

83.

This is especially true for the FCC, because the FCC mandates that DSL offer

broadband under what is described as an “open access” model. How it is possible that there is no

concept of “open access” in the context of cable, but a concept of open access in the context of

DSL, frankly baffles us.1 8Certainly if the providers of DSL refused customers the choice of

ISPs, and then cited the Bureau’s findings as a defense to its actions, no court would recognize

the lack of a definition as any excuse.

84.

In our view, “open access” is simply a short hand for a set of competitive

objectives. The objectives sought in the DSL context are perfectly adequate to apply in this

context, at least as a starting point. For the relevant question that the agency should address is

how to assure that customers have an easy choice among relevant competitors, so as to preserve

competition in the broadband market. The DSL requirements assure that.

85.

The Commission can impose open access conditions on the AT&T/MediaOne

merger without replicating the complex regulatory scheme necessary to implement sections 251

and 252 of the 1996 Telecommunications Act. Interconnection to a cable modem network, even

by multiple ISPs, involves nothing more than a standard Internet connection between an ISP and

a router. It does not require collocation of equipment, nor would open access conditions require

AT&T/MediaOne to honor requests for interconnection at special locations within its network.

18 Indeed, AT&T has argued vigorously in favor of imposing open access requirements on local telephone providers.
See Reply Comments of AT&T Corp. (CC Docket No. 98-147), filed October 16, 1998, at 37: “the most important
action the Commission can take to speed deployment of advanced telecommunications services is to vigorously
implement and enforce the market-opening obligations that Section 251 imposes on incumbent LECs.” Why
deployment is encouraged by open access in one context, but closed access in another, is unclear to us.

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So long as unaffiliated ISPs are allowed to interconnect at the same place—and at the same

price — as unaffiliated ISPs, the End-to-End principle will not be compromised.

86.

The Bureau report seems to suggest that it is enough if access is open in one

broadband context, and not in all. But in our view, a principle is respected if respected generally,

not occasionally. And the benefits of a principle come from the expectation that it will be

respected. Further, it makes no sense economically to argue that competition in a small subset of

the broadband market is an adequate substitute for competition in the entire broadband market.

This is particularly true if (as the Bureau report itself suggests) the characteristics of the media

differ.

87.

Finding (3), (4) and (5): The core of the Bureau’s arguments, however, rest on

findings 3 through 5. These findings, we submit, are internally inconsistent. On the one hand, the

Bureau seems to assume that broadband cable will voluntarily adopt some form of open access.

Finding (4) states that “market forces will compel cable companies to negotiate access

agreements with unaffiliated ISPs.” Thus the future, in the Bureau’s view, will be much like DSL

is (because of regulatory requirements) today. The naïve assumption that AT&T will voluntarily

open the market to competition flies in the face of AT&T’s established policy, compounded by

the consolidation that is occurring in the broadband market. The Bureau does not explain exactly

what “market forces” will compel AT&T to open this market. How exactly will customers of a

certified natural monopoly exercise the power to “vote with their wallets?” The only plausible

disciplining effect the market might have on AT&T’s closed access policy is to slow the rate of

subscription to cable modem service, because the bundled service AT&T provides is less

attractive than an open alternative. But there is no reason to believe that AT&T, lacking effective

competitors in the broadband business in any given city, will recognize or respond to this market

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threat. Further, if the Bureau’s hope is that AT&T will be forced into open access because

consumers will delay their switch to broadband in boycott of its closed access policy, it is a

supreme piece of irony to suggest that it is the threat of regulationthat will delay the deployment

of broadband technology.

88.

If, however, the future is not a future of open access, and if cable becomes

dominant, then finding (5) suggests that “regulation might then be necessary.”19Thus the Bureau

threatens regulation if access is not open, after stating, in finding (3) that “the threat of regulation

ultimately slows deployment of broadband.” These three findings cannot go together. The

Bureau cannot consistently maintain it is not threatening regulation and then threaten regulation.

The Bureau creates more uncertainty than it removes, by conditioning this threat of regulation of

extremely vague notions of how extensive cable broadband must be, and how much open access

cable must provide.

89.

Indeed, if the Bureau does in fact decide to regulate this industry because access

does not magically become open, we will end up with morerather than less regulation, because

the bureau will have to regulate not just access to the wires, but a whole host of industries that

could have been competitive but that ended up being bundled to the network itself. We will find

ourselves, in short, in a new era of regulation reminiscent of the old days of the Bell System.

90.

The way to reduce uncertainty, and promote broadband adoption, would be for the

FCC to simply state a clear policy — that cable must be architected to facilitate open access to

cable customers. How quickly, and how precisely, are questions the agency can defer for now.

Just as the FTC has required online merchants to deal with privacy, or face regulation, so too