DOJ, FCC SEEK SUPREME COURT REVIEW OF CABLE MODEM SERVICES

Less than three months after the Bush Administration declined to support a U.S. Supreme Court appeal to maintain its UNE rules, the FCC and the Solicitor General's office filed separate petitions asking the high court to uphold the agency's position that cable-modem offerings are information services.

The distinction between information and telecom services is significant because providers of telecom services have regulatory and tax obligations. Telcos have long complained that it is unfair that their DSL products are more tightly regulated than cable modem services.

As expected, cable officials such as National Cable & Telecommunications Association President and CEO Robert Sachs supported the petitions.

“The reversal of the Brand X decision is important because, if affirmed, it would impose on cable modem service cumbersome regulation that would deter innovation and development of broadband services and technology in the United States,” Sachs said in a statement.

But the FCC determined that cable modem services were information services after the Ninth Circuit Court of Appeals indicated that cable modem offerings were information services with a telecom component. When the court was forced to decide the question last October in the so-called “Brand X” case, the judges indicated that they were required to adhere to the precedent.

Because the merits of the FCC classification were not considered in the Brand X case, the matter is especially appropriate for the Supreme Court, according to a U.S. Department of Justice brief filed through the office of Acting Solicitor General Paul Clement.

“This case is likely to determine the regulatory classification under the Communications Act that will apply to broadband (i.e., “high-speed”) Internet access services in the United States,” the DOJ petition stated. “Absent this Court's review … a vastly important aspect of national telecommunications policy will have been settled in the Ninth Circuit … without any evaluation whatever of the FCC's contrary interpretation of the statute it is charged with administering.”

Legal experts contend the Solicitor General's office recommendation that the Supreme Court take the case greatly increases the likelihood of the appeal being heard by the high court.

Legg Mason telecom analyst Blair Levin said the classification of information services and telecom services is not as significant as many believe. He noted that the recent FCC decision ordering providers of voice over IP — which most commissioners consider an information service — to adhere to surveillance mandates previously reserved for telecom service providers exemplifies that fact.

“That tells you that classifications are relevant only to a point,” Levin said. “If government wants to require an obligation, it will.”