Urban Politics #57: City Council On The Merger Of TCI-AT&T


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By City Councilmember Nick Licata.

Urban Politics (UP) blends my insights and information on current public policy developments and personal experiences with the intent of helping citizens shape Seattle’s future.

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City Council On The Merger Of TCI-AT&T

On Tuesday, 2/16/99, the City Council unanimously passed legislation that adopts as much open access for ISPs (Internet Service Providers) as a city legally can. However, the city can not legally set prices for Internet services, so this is the most we can achieve for now, until federal regulations change. More information on this is included in my position statement below. The amount of open access for ISPs, however, is more than other cities have, so it is an important accomplishment.

The City Council also resolution (Res. #29902) to carry out a study of (quoting from the resolution): “alternative ways of providing the citizens of Seattle with these telecommunication services, including franchising private providers, establishing public-private partnerships to provide the services, and the creation of a public utility to provide the services.”

The panel will be composed of the “City’s Chief Technology Officer, representatives of Seattle City Light, the Executive Services Department, the Law Department, the Citizen’s Technology & Telecommunications Advisory Board, the Mayor’s Office, the City Council, and appropriate community and industry representatives.” It will provide a report by September 30,1999.

Nick Licata’s Position on the TCI merger with AT&T

Should we condition the TCI merger with AT&T with a requirement for “open access” to the Internet?

The answer is an obvious yes. But I have come to realize that the City must also recognize that the term “open access” has many different definitions.

For me “open access” to the Internet through cable comes down to two important conditions: Equality in price and in quality of service among all the ISP’s using AT&T’s cable hookup.

The City has been negotiating on these two issues and they have reached the following arrangements.

When consumers sign up for AT&T’s cable service will they be able to choose from any ISP carrier without visually going through @Home. In other words, when a subscriber gets the AT&T cable service they will see on their computer screen all of their usual icons plus the @Home Icon. They will not have to go through an @Home “homepage” or be subject to @Home advertising banners.

In addition, the speed with which any ISP’s content is provided to a subscriber will be the same for all ISP’s. In technical terms, all of the ISP’s will have equal access to using the same piering point that @Home uses. In other words, @Home will not be able to provide faster access to their content and slower access to the content provided by other ISPs.

Because @Home will not visually funnel other ISPs through them, and because @Home will not discriminate on content or speed of access to it, there will be open access to the same bandwidth on the Internet for all subscribers whether they use @Home or another ISP.

Even with these concessions, that the City gained from AT&T, there still is not equal pricing among all of the ISPs through cable. This is an important issue. It would be best if a subscriber would pay one price for AT&T’s cable hookup and then another for the @Home Internet service. I would like the City to require that price structure on AT&T. But the city cannot require this unbundling because the Telecommunications Act of 1996 does not make cable service a utility.

Consequently it is not subject to either municipal or state regulatory authority. The City Council will be sending a letter to the Washington state Congressional delegation requesting this authority at the local level I encourage you to contact them as well. The City Council legislation also formally adopts full open access as a goal, not currently legal.

Practically what this means for a cable subscriber is that AT&T will include @Home under their cable access price. You will still be able to choose another ISP and totally ignore @Home, but you will have to pay for the ISP’s service. To me this is clearly an unfair pricing and marketing advantage for @Home.

Some have suggested that we challenge AT&T’s pricing arrangement through the courts. Generally I don’t shy away from court battles, but legal experts believe that we would most likely lose. In addition, Seattle’s rewiring would not go forward until the court case was settled, which could be years off. Meanwhile other cities not challenging AT&T would be rewired before Seattle.

I’ve also looked at what King County is doing. They are gearing up to go to court with AT&T over the open access issue. I asked the chair of our citizens advisory group on Cable why shouldn’t we do the same. He responded that the County’s situation is vastly different and they have far less to loose than we do.

He and others on this citizens advisory group have told me that they can live with the City’s agreement provided we have sufficient “triggers” for automatically reopening our franchise with them. Those triggers include any change in technology which will allow for fast cable multi-switching capability that would enable ISP’s to totally avoid going through AT&T’s network administrator. This is not something that exists for cable right now in any part of the country.

Also should there be any change in legislative authority on any level, the City can reopen the agreement to allow us to actually do some price restructuring. I am interested in having the City take an aggressive stance in working with cities around the country to change the Telecommunications Act of 1996 to allow us that authority. In addition, the city can reopen the agreement if AT&T gains too much of the cable Internet market share.

Lastly, the City needs to continually be evaluating strategies on how we can encourage competition to the advantage of our consumers. Currently there are three main “platforms” a consumer can use if they wish to connect to the internet at speeds faster than conventional modems allow: cable, DSL and wireless satellite dishes.

We should be looking at how the City can use our authority to increase competition among all three. To this end, the City’s agreement with AT&T may pressure UW West to increase the delivery of their DSL service, which have been slow in promoting. This platform is about as fast as the cable service but cost significantly more.

Above all, the City needs to work with citizen groups and other government bodies to assure that corporations, whether they be AT&T or US West, not control both the information pipe and the content. The City’s approval of AT&T merging with TCI does take us dangerously close to that state. I do not believe, however, that it crosses the line.

In relying upon the advice that I’ve received from citizen activists, who are more knowledgeable than I am in technical matters, I believe that we have the proper triggers to stop corporations from crossing that line in the future.

Convention Center Expansion

There will be a public hearing on tomorrow, Wednesday, February 17, in the City Council Chambers, 11th floor of City Hall 600 Fourth Ave., at 6:00 P.M. (Sign-up: 5:30 P.M.) on the expansion of the Washington State Convention Center.

This issue is currently being considered in the Transportation Committee, chaired by Richard McIver. (Richard.McIver@seattle.gov)

As a citizen, I prepared a report criticizing the City of Seattle’s transfer of the City owned and publicly financed Freeway Park Garage to the Washington State Trade & Convention Center. The revenue from it will soon be averaging $500,000 a year to the Convention Center over the next decade.

The early editions of my Urban Politics email newsletter (available at the Internet website: http://www.seattle.gov/leg/licata/up00dex.htm dealt with this issue.

In addition, I voted against the Master Use Permit for the Convention Center expansion in August, 1998.

However, at this juncture, the Council will most likely approve the street and aerial skybridge vacations that the Convention Center needs from the City to proceed with their expansion. The Council has a four-year history of passing legislation in support of the expansion, and last summer’s 8 to 1 vote granting their Master Use Permit suggests that it will continue.

The Expansion will bring two and a half years of construction ending with a building roughly equal in size to the Kingdome, next to one of the densest neighborhoods in Seattle.

For that reason, I am focusing my efforts on ensuring that adequate neighborhood mitigation is included. The Pike-Pine and First Hill neighborhoods have requested about $1.7 million for mitigation. I have met with community leaders to assess how to achieve it.

I am currently exploring a change in the Convention Center’s design that could provide these funds and even save the Convention Center some money. The change would eliminate the huge gallery structure that spans Pine St. for an entire block. It was a feature originally suggested by the Seattle Design Commission as a public amenity. Its cost has been estimated to be $3 million. Although it provides a glass canopy, much of its bulk consists of steel beams. Most importantly eliminating it would not hinder the functional elements of the Convention Center.

Some of the money saved could be used for extending light fixtures and art features up Pine Street past the freeway, thereby creating an inviting pedestrian corridor from the Pike/Pine neighborhood past the Convention Center and all the way down to the Pike Place Market. Funds would also then be available for providing open green space such as expanding the Boren Street Park by raising the retaining wall next to the freeway.

Community leaders have responded very positively to this suggested design change. I’m hoping that it would also be acceptable to the Convention Center since it could also lower their construction costs.

Keep in touch…

 

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