FCC chairman backs free ‘Net

Kennard applauded at cable confab

CHICAGO — FCC chairman Bill Kennard received a standing ovation from cable operators gathered here Tuesday after he said that regulators should keep their hands off the Internet.

The subject is a hot topic at the National Cable Television Assn. confab, which is buzzing over a June 3 court decision by an Oregon judge who found that local officials could force AT&T to open its cable plant to rival Internet service providers.

The ruling caused cable stocks to dip out of fears that regulators could burden cable companies with regulations that would slow down the deployment of a high-octane Internet.

Much of the investment in the ‘Net now is based on the idea that access via cable systems will make it speed up, giving Web surfers almost instantaneous access to volumes of data and even full-motion video.

The Federal Communications Commission topper warned that if local officials are given a free hand in regulating the Internet, “There would be chaos.” Just one day earlier, at the opening session of the three-day confab, AT&T chairman and CEO Michael Armstrong also warned that “chaos” would ensue if local regulators were allowed to force cablers to give AOL and other Internet service providers equal access to their customers.

Kennard emphasized that point Tuesday: “(The) Information Superhighway will not work if there are 30,000 different technical standards or 30,000 different regulatory structures for broadband.”

Growing concerns

Still, there are increasing signs that cablers are open to giving America Online and other Internet service providers access to their systems. Time Warner chairman Gerald Levin told a panel discussion Tuesday that in five years time, “AOL will be paying us.”

Asked to elaborate later, he said, “No one has been able to enter into a good economic marketplace deal with AOL, but eventually I’m sure there will be one.”

In the same vein, Armstrong told Wall Street analysts Monday that he could envisage opening up AT&T’s cable systems to online providers like AOL after 2002, when the cable system’s exclusive access deal with @Home Corp. expires, according to analysts present at the meeting.

Kennard even said he is reviewing his options with his legal staff, but refused to reveal any details on what his options may be. He went on to point out that the cable industry has failed, so far, to make an official plea for help in the Oregon case.

“I’m surprised that I haven’t yet received a petition for declaratory relief,” said Kennard.