Communications Technology: Archive

Will Open Access Burst Cable's Pipe?
Prepare Yourself for the Fight
By Arthur Cole

Following years of lobbying the federal government to stay out of the Internet business, major Internet service providers (ISPs) are now looking for government help in cracking open the broadband networks of private cable companies.

However, even though legislation to that effect has been introduced in Congress, it is unlikely to pass muster because of the enormous technical, legal and regulatory hurdles that would have to be overcome.

A little background: earlier this year, leading ISPs such as America Online and PSInet, operating under the OpenNet Coalition, began a lobbying effort to reclassify cable-based broadband networks as common carriers. This would force cable companies to abide by the same rules as the regional Bells in that they would have to provide a direct connection to any ISP that wanted it. The movement grew largely from efforts to open up TCIs broadband networks following that companys merger with AT&T. After the Federal Communications Commission approved the merger without common carrier requirements, the group took its fight to Congress.

In May, U.S. Reps. Rick Boucher (D) and Bob Goodlatte (R), both of Virginia, home ofbig surpriseAOL, introduced legislation that would rewrite some of the antitrust laws, but not the common carrier rules, to forbid cable companies from selecting exclusive broadband Internet providers. Specifically, one of the bills would block AT&Ts exclusive use of Corp. as its broadband provider.

With the deregulatory climate in Washington, D.C., these days, it seems unlikely the ISP lobby will be able to convince Congress that the broadband industry should be hit with potentially investment-killing regulation. But that doesnt mean leaders of the cable broadband industry should breathe easy.

"People are paying attention to it because its a well-funded lobbying effort, but it doesnt make technical, regulatory or legal sense," says Jim Chiddix, vice president and chief technical officer at Time Warner Cable, backer of the RoadRunner broadband service.

Even if the federal legislation goes nowhere, its wise to keep abreast of the arguments against regulation in case the issue crops up in your town. Local authorities have no power to override federal law, but a well-organized lobbying effort could wreak havoc with your business if local assemblies or attorneys general decide they can alter the broadband industry on some level. Time Warner recently had to brief the city of Los Angeles on the arguments against regulation after officials there began floating ideas of regulating that companys broadband services.

First the technical argument: The technology simply does not exist for a cable system to provide a direct connection to every ISP. As a shared network, in which users tap into a steady stream of information, cable does not devote a dedicated switch to each and every household. For ISPs to reach directly to broadband cable users, offering them a choice of providers other than RoadRunner, or some other preferred provider, they will have to utilize a portion of that finite amount of bandwidth. The issue then becomes one of bandwidth allocation.

"Say AOL, Microsoft and are sharing a network. What if gobbles up more of the network, and AOL and Microsoft are not getting enough?" said Milo Medin, chief technical officer at "ISPs have to be able to turn customers on and off, service them online when theres a problem, provide ISP information back to the customer & If you cant do that, you cant run a business. Its not just a question of where to send packets."

Could cable become a switched network? Sure, with billions of investment dollars and a reworking of the Data Over Cable Service Interface Specification (DOCSIS) standard for cable modems that was years in development. This would put cable at a tremendous disadvantage to telco digital subscriber line (DSL) rollout.

"Cable is what is driving DSL deployment," Medin said. "If you hold cable back, you eliminate a chief incentive for DSL deployment."

That brings us to the competition argument. The ISP coalition argues that without federal regulation, cable will hold a monopoly on broadband access. But that assumes there are no other players in the broadband market. What about DSL? What about wireless or satellite broadband?

Granted, each of these industries still is in its infancy, but so is broadband cable.

What industry definitely is not in its infancy? ISPs, which for years courted investment dollars, citing government assurances that it would not interfere until the Internet market matured and there was a clear need for regulation.

"It seems a little disingenuous," said Time Warners Chiddix. "We have the largest net content provider in the world, AOL, complaining about our industry, which is a fraction of its size."

And if its competition that regulation-prone legislators are worried about, the fact that DSL subscribers will be able to select from a variety of ISPs is likely to emerge as one of the chief advantages over cable.

As for ISP arguments that they will be shut out of the cable broadband market if they are not offered direct access to customers, users still will be able to subscribe to AOL or any other content provider through RoadRunner or if they so choose.

The issue of competition is interesting because it is cable that is feeling the squeeze from new competitors on the video side of the house. If it is to survive at all, it must branch out onto the Internet.

"If cable operators want to remain competitive, one way is to provide other services, such as cable modems, telephony and so on. The cable company is providing that service and enjoying the bulk of the profit from that service," said Ron Hranac, vice president of RF engineering at High Speed Access Corp., a provider of cable modem service. "If a competing service comes in, they get the bulk of the revenue, and the cable operator gets essentially rent."

That sort of return could cause operators, and the investment community, to seriously rethink the value of sinking more fiber into the ground.

Operators facing a fight on the local level also can cite existing federal law that clearly forbids classifying cable systems as common carriers as long as they are providing multichannel service. And because the U.S. Constitution forbids local regulation of interstate services, the case for local regulation has no leg to stand on.

That leaves Congress. Is there enough support in the legislature to interfere with cables broadband service provider arrangements? At this point it appears to be an uphill battle at best. But thats not to say the federal government cant step in at any time, especially if it feels cable dominance of the market is harming consumers interests.

"If cable starts filtering content or blocking sites, then were just asking for trouble," said Medin.

It behooves cable engineers to articulate clearly the technical infeasibility of open access so their companys top leaders will be prepared when overzealous regulators come to call. - CT

Bottom Line

The Argument Against Open Access

New legislation in Congress threatens to kill preferred provider arrangements for broadband services, and a movement also is afoot to have broadband services reclassified as common carriers. Clearly, this would upset the business incentive behind hybrid fiber/coax (HFC) deployment and could derail the cable broadband industry before it even gets off the ground.

But before you jump to the conclusion that this is a fight best left to the major players and the lobbyists in Washington, D.C., beware that the issue could find its way to the local community, where even small operators might have to spell out the objections to regulation.

Aside from the simple fact that it is not technologically possible to give a direct customer connection to every ISP that wants one, and the fact that any and all content on the Internet is still accessible by broadband customers, it still makes the most economic sense at the moment to allow cable to select exclusive providers of broadband service.

Not only is digital subscriber line (DSL) technology emerging as an active competitor to cable, but the entire broadband market also is still too new to come down with heavy-handed regulation that likely would kill investment in what promises to be a revolutionary development in how we all communicate.