Cable Unbundling: Bad news for Telecos


The U.S. Ninth Circuit Court of Appeals threw out the FCC ruling designating cable services as information services, not to be regulated as telecommunications. The FCC has said it will appeal the decision to the full Appeals Court.

bq. “There is considerable doubt that the court will agree with the FCC on cable modems,” comments Allan Tumolillo, Probe Financial Associates (PFA). “The FCC acted in the best interest of its cable company constituents and under the belief that the policy would encourage broadband competition.”

PFA says there is a strong chance that the FCC policy protecting cable companies will not survive later appeals. Under current conditions, cable companies can expand their customer base through voice service and by allowing customers to connect to any ISP transparently.

bq. “Cable knows that its core audience is getting older, as young consumers turn to broadband, cable will fight to maintain control of broadband access,” Tumolillo concludes. The uncertainty of how voice over cable may be treated by the FCC plays a large factor in the future of the cable industry.

Source: Probe Financial Associates press release

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