Designed in part to stem loss of potential revenue from franchise...
Designed in part to stem loss of potential revenue from franchise fee on cable modem service, Portland, Ore., released draft telecom ordinance that seeks, among other things, to plug franchise loopholes engendered by 9th U.S. Appeals Court, San Francisco,…
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decision classifying cable-delivered Internet service as telecom service. City’s incumbent cable provider AT&T has insisted that it doesn’t require telecom franchise for its cable modem service while asking cities in 9th Circuit jurisdiction to waive franchise fees on high-speed Internet service, citing court ruling. Portland has been relying on separate provisions in City Charter and City Code for procedural requirements governing its various telecom franchising, licensing and permitting policies, said Comr. Erik Sten. Proposed alternative would enable city to respond flexibly to “new demands or situations arising from, among other things, rapid growth in technology, digital convergence, cross-platform competition and new or other newly competitive lines of business” such as telephony over cable facilities, Sten told City Council. To be covered under ordinance’s classification of telecom providers would be franchised cable operators using cable facilities for provision of telecom or any other noncable service not otherwise authorized by underlying cable franchise agreement. Anyone who owned or controlled telecom system or facility located in rights-of-way would have to obtain from city current, valid franchise or license. Saying there had been very little industry input into draft ordinance, AT&T spokeswoman said: “The company is very clear that Excite @Home service is cable modem service and it doesn’t intend to get a telecom franchise.” In response to AT&T request for waiver of cable modem franchise fees, David Olson, dir. of Mt Hood (Ore.) Cable Regulatory Commission (MHCRC), which handles cable franchising and regulatory matters for 6 local govts.,including Portland, wrote company that while AT&T was relying on 9th Circuit ruling to maintain @Home service wasn’t cable service and therefore not subject to franchise fee, none of MHCRC franchises under which company operates authorizes it to provide any services other than cable services. As result, Olson said, AT&T is required to obtain additional local authority from each MHCRC jurisdiction to provide telecom or other noncable services. If AT&T believes otherwise, he said, it should provide legal rationale by March 1.