For Immediate Release: June 22, 2000

San Francisco, CA – Today, the U.S. Ninth Circuit Court of Appeals struck a victory for consumers and the free market by ruling that local authorities in Portland, OR could not force AT&T to open its cable-based Internet access networks to its competitors. The Court’s jurisdiction includes California – where the Los Angeles City Council is set to vote on a similar proposal tomorrow.

"The Ninth Circuit came to the only logical conclusion in this case – that it would be outrageous to have every local city council member from Portland to Florida making telecommunications law," said Sonia Arrison, director of the Center for Freedom and Technology at the Pacific Research Institute. "The telecommunications industry is over-regulated as it is. Opening the door to more local regulations would only create greater confusion, higher prices, and slower Internet service."

"This is a matter of good old-fashioned American competition and it should be left to the market to work out," explained Arrison. "Other Internet service providers are already coming up with ways of providing Internet service that don’t use cable lines at all. The issue here is not about consumers –they’re getting good service at low prices. It’s about politicians doing the bidding for companies that want a bigger part of the market share without doing their own work to get it."

The federal court ruled that Internet access should be defined as a "telecommunications service" under the 1996 Telecommunications Act and should be regulated by the Federal Communications Commission (FCC), not local government.

"Even the FCC Chairman, William Kennard, has issued a warning about what he called the ‘[t]he dark cloud of regulation’," added Arrison. "I think he hit the nail on the head when, in a May 9 speech to the National Cable Television Association, Kennard told the industry flat out, ‘if digital bits don’t flow through your systems, they’ll flow over your competitors’ platforms.’"

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Sonia Arrison is the co-author of A Primer on Forced Access. To receive a copy, contact Dawn Dingwell at (415) 989-0833, ext. 136 or visit our website at www.pacificresearch.org.

The Pacific Research Institute for Public Policy is a non-profit organization dedicated to the promotion of the principles of individual freedom and personal responsibility. The Institute believes these principles are best encouraged through policies that emphasize a free economy, private initiative, and limited government. By focusing on public policy issues such as health care, welfare, education, and the environment, the Institute strives to foster a better understanding of the principles of a free society among leaders in government, academia, the media, and the business community.