As Time Warner begins the process of renegotiating its franchise
agreement with the city of Portland, much of the coverage in the Press
Herald has focused on cable television. And for good reason.
City residents have no cable choice but Time Warner, and since 1996 the
cost of its service has risen three times faster than inflation.
But a far more serious long-term issue for Portland residents and
Maine's economy is Time Warner's stranglehold on broadband cable
The Internet as we know it developed within a framework of "open
access." That is, people could choose their own Internet service
provider (ISP), view any Web site and transmit any information they desired.
Open access did not happen by chance but rather by regulation. Many
years ago, the Federal Communications Commission required that, for a
reasonable fee, local phone companies allow their wires to be used by
rival ISPs to provide Internet service.
The result was robust competition. More than 7,000 ISPs sprang up
nationwide. Competitive, low-cost service ushered in rapid growth. Open
access ensured that the Internet developed as a diverse, free-flowing
and democratic medium.
Today, most people still access the Internet through a dial-up modem.
But dial-up is rapidly being supplanted by broadband. Broadband is many
times faster and allows users to view high-resolution streaming video,
download graphics-rich Web sites and utilize new real-time interactive
applications and services.
Broadband service can be provided through a cable network, or through a
digital subscriber line (DSL) that runs on the local phone network, or
Rather than extend open access rules to broadband, the Bush
administration issued regulations last March that allow cable companies
to lock out rival ISPs. A few months later, the administration proposed
lifting the open access rules for DSL lines as well.
This means that just two companies - Time Warner and Verizon, which
offers DSL - could control Portland's broadband service for the
The administration says its policies are necessary to ensure that big
cable and telephone companies have an incentive to roll out broadband
service nationwide. But about 80 percent of all households are already
linked to one or more types of broadband infrastructure. There's no
indication that heightened competition will slow deployment.
The administration also argues that people will be able to choose among
different kinds of broadband (DSL, cable or satellite) and this will
provide sufficient competition. But satellite service has technological
limitations that render it less than ideal. That leaves at best a duopoly.
Lack of competition means higher prices. Even worse, the lack of
nondiscriminatory open access rules will allow broadband providers like
Time Warner to inhibit or block access to certain Web sites.
This is no far-fetched conspiracy theory. Cisco Systems, a leading
network equipment manufacturer, issued a memo to providers recently
explaining that Cisco tools can "restrict the incoming . . . broadcasts
(from competitors) as well as subscriber's outgoing access to the . . .
site to discourage its use. At the same time, you could promote and
offer your own or partner's services with full-speed features to
encourage adoption of your service."
Time Warner could thus transmit its own content and the content of
affiliated companies at high speeds while slowing or blocking access to
The economic implications are severe. Imagine if a private corporation
controlled the highways and allowed affiliated companies to truck their
goods in the fast lane while rivals were restricted to a snail's pace.
We would never stand for it - nor should we allow the Internet, another
key piece of economic infrastructure, to be similarly hijacked.
The First Amendment implications are even more chilling. While phone
companies are prohibited from interfering with a citizen's right to call
(or access through a dial-up modem) anybody he or she wishes, these same
protections have not been extended to broadband.
With Time Warner in control, how long will we be able to view sites
criticizing big media companies or advocating open access or lower cable
rates? Unfortunately, federal laws bar Portland from requiring open
access as part of Time Warner's franchise renewal.
The City Council, however, chould pass a strong resolution calling on
the federal government to revise its policies and adopt open access. A
resolution could bring attention to the issue and perhaps spur our
congressional delegation to action.
Stacy Mitchell of Portland is a researcher with the
New Rules Project of the Institute for Local Self-Reliance