 |
City, county strike deals over TCI lines
Cable company agrees to customer rebates
Wednesday, February 17, 1999
By STEVE GOLDSMITH and NEIL MODIE
Seattle and King County yesterday reached separate deals on the future of cable television that leaders say will offer more channels and blazing-fast Internet links.
The deals also averted legal showdowns with AT&T, the soon-to-be-owner of cable giant TCI. Last week, the County Council courted a lawsuit when a committee unanimously approved a plan to deny the transfer of TCI's cable franchise to AT&T, but yesterday backed away from that approach.
What caused local leaders such anguish wasn't the desire for better cable TV service. Seattle council members yesterday approved rebates starting at $5 a month for 65,000 cable subscribers whose lines TCI hasn't upgraded. The County Council last year voted for $5 monthly rebates starting in March for 90,000 customers in unincorporated areas.
What city and county leaders struggled with was how to induce competition as the humble-looking cable poking into area living rooms becomes a prime link to lucrative telephone and Internet services.
A brigade of AT&T's telephone and Internet rivals tried to persuade city and county leaders that AT&T would control that port forever unless government forced change in its Internet plans.
AT&T's equally aggressive lobbyists contended that local governments lack the legal authority to intervene, and that such meddling would only stall the spread of new technology and actually impede competition.
Tugged by powerful private interests, the city and the county yesterday took largely wait-and-see approaches. The city reserved the right to intervene if technology, competition or federal rules change. The county ordered a panel of experts to determine whether AT&T's Internet access through @Home is anti-competitive.
The panel is to report back in October.
County Council Budget Chairwoman Jane Hague declared the county agreement "a win-win-win-win" for consumers, the county, AT&T and other Internet providers.
City officials voiced similar enthusiasm. "We were not looking to see what was best for AT&T or for Internet service providers," said Councilwoman Tina Podlodowski, "but what was best for the customer."
AT&T officials pronounced satisfaction that the city and county had approved the merger, while their rivals said at least some brakes had been installed.
"It's a field goal, but not a touchdown," Gary Gardner, executive director of the Washington Association of Internet Service Providers, said of Seattle's agreement.
Internet providers wanted governments to force AT&T to offer a basic data link through its cable, then allow customers to buy Internet services through any provider. Instead, Internet customers must pay a $40 monthly fee for AT&T's comprehensive @Home package, and, if they choose, pay for additional services from any provider without seeing the @Home screen.
Though many providers sell specialized services such as offering customers their own Internet domains, many home cable-modem users will have little incentive to go beyond what AT&T offers.
"The issue for us is price," said Bob Royer, a lobbyist representing a coalition of Internet providers.
Yet city officials said regulating cable prices is barred by the federal Telecommunications Act of 1996.
"We've pushed the envelope as far as we can," said City Councilman Nick Licata. "We do not have the authority to regulate price."
Licata joined the unanimous approval of the package, with Councilwoman Jan Drago disqualifying herself because her husband owns a small cable company.
The city did require AT&T to give other providers access to regional communications hookup centers known as "peering stations" or "Internet hotels," which should enable competitors to provide service that's just as fast as AT&T's.
AT&T promised the city and county in writing that for two years it will charge home consumers no more than $40-a-month for Internet service.
Councilman Peter Steinbrueck called Seattle's plan "a model nationwide" that attempts to anticipate rapidly changing technology.
Mayor Paul Schell said the deal will enhance citizens' choices, getting cable modems "deployed to as many Seattle residents as possible in the shortest possible time frame."
County Executive Ron Sims said he would have preferred his own proposal to what the County Council did. He proposed approving the corporate merger on the condition that AT&T provide open access to its high-speed Internet cable not only to customers of @Home but also to competing Internet services at no extra cost. That also would have prompted a lawsuit.
"I think if the council had more time, it would have moved toward my (proposed) ordinance," said Sims, clearly unhappy that the council and its staff negotiated the compromise with AT&T with little input from his own staff.
The County Council passed the county measure 11-1, with Council Chairwoman Louise Miller voting no.
Miller said she wanted to "to make a statement" about the erosion of programming options for basic-cable subscribers who must pay extra for service to get some channels formerly available with basic service.
City Councilwoman Margaret Pageler raised her own beef with TCI, saying she was angry the company had refused to pay nearly $1 million it owed the city after losing a court dispute over fees for using city power poles. As part of last week's negotiations, TCI agreed to pay the bill.
P-I reporter Steven Goldsmith can be reached at 206-448-8029 or stevengoldsmith@seattle-pi.com
SEATTLE POST-INTELLIGENCER REPORTERS
· Mall searched after fatal shooting, no gunman found
· Fire leaves two Arlington boys dead
· Shooting leaves three hurt, one dead in Skyway
more
101 Elliott Ave. W.
Seattle, WA 98119
(206) 448-8000
Home Delivery: (206) 464-2121 or (800) 542-0820
seattlepi.com serves about 1.7 million unique visitors
and 30 million page views each month.
Send comments to newmedia@seattlepi.com
Send investigative tips to iteam@seattlepi.com
©1996-2008 Seattle Post-Intelligencer
Terms of Use/Privacy Policy
