The cable companies have been fighting attempts to open up their networks to rivals, as traditional telcos have been forced to do.
The case was brought by tiny ISP Brand X Internet Services and others after the FCC ruled in 2002 that a service offering broadband access over cable networks is an “information service” and not a telephone service, which is subject to regulation under the Communications Act.
Brand X had argued that the FCC had overstretched its authority when it interpreted the Act in that way. But yesterday, reversing an appeal court ruling, the Supreme Court upheld the FCC interpretation by a majority of six to three.
The FCC welcomed the ruling.
“I am pleased that the US Supreme Court has affirmed the FCC’s ruling,” said Chairman Kevin Martin. “This decision provides much-needed regulatory clarity and a framework for broadband that can be applied to all providers. We can now move forward quickly to finalise regulations that will spur the deployment of broadband services for all Americans.”
Another happy observer was Kyle McSlarrow, President and CEO of the National Cable and Telecommunications Association.
“Today's Supreme Court's decision is a victory for consumers and maintains the momentum to advance broadband in the US,” he said.Classifying cable modem service as an interstate information service, as the FCC did, keeps this innovative service on the right deregulatory path”.
But consumer groups were not so pleased. The American Civil Liberties Union warned that the ruling could allow monopolistic broadband providers to leverage their ownership of the wires that people use to get on-line to exert control over subscribers' web surfing, e-mail, and internet telephone services.
"The Supreme Court missed an opportunity to correct the FCC's decision on this issue," said Senior Staff Attorney Chris Hansen. "The Court's ruling was a fairly straightforward judgment that the judiciary's tradition of deference to the executive's power to interpret the law exceeded any misjudgement on the part of the FCC. That judgment was mistaken in our view and the FCC seems to be moving in the wrong direction on this issue."
Dave Baker, vice president, law and public policy with ISP EarthLink, called the ruling a “blow to consumers and competition.”
“For too long, cable companies and the FCC have denied consumers a choice of broadband providers over cable,” he said. “Besides keeping prices high, this lack of choice limits the future deployment of innovative voice, video and data services beyond just those offered by the local cable company.”
