Comcast Sues San Jose, Illustrates Dangers of Cable Monopoly in Broadband Era

June 24, 2003

Comcast-now the nation's largest and most powerful cable company-has embarked on a political strategy designed to fatally erode the power of communities to determine how cable service should serve the public interest in the broadband era. The cable giant has sued San Jose (CA) to prevent a possible termination of its cable franchise. The dispute arose because Comcast is opposed to the city's request, as part of the franchise transfer from AT&T to Comcast, that the community receive access to a set of modern telecommunications facilities. These public interest facilities include an institutional network connecting city buildings and schools, and up to six new public-access channels. Comcast asked the US District Court to declare the city's requests illegal, and also objected to the appeals process that San Jose has established for the formal franchise renewal proceedings (in which a third-party officer will hear arguments from both sides and then make recommendations to the city council). A hearing on Comcast's suit is scheduled for August 13. (See link below to the Comcast Legal Memo)

At the core of this case are key issues that involve the future of free expression online and the role that local governments can play to ensure that citizens receive the benefits of advanced digital communications networks. The suit is but the latest political maneuver by cable over the last several decades to have the courts (or Congress and the FCC) support the industry's "first amendment rights" as paramount over the public's rights. Or, as Comcast told the court, " San Jose has caused irreparable harm to the First Amendment, due process, and other rights of Comcast." San Jose, according to the cable giant, is trying to "force Comcast to provide an excessive and unlawful package of public benefits in exchange for the right to continue to speak in the City." In other words, Comcast is using a specious First Amendment argument as a weapon, hoping that the courts will foolishly confuse the entertainment conglomerate's bundle of programming channels as the equivalent of a serious news gathering operation worthy of greater Constitutional protection.

The case is of enormous importance in that it reveals the cable industry's political goals for broadband. They clearly want to limit the ability of local government to use the franchise renewal process to require that some portion of broadband networks serve the interests of the public. (Cities and sometimes other government entities negotiate every decade or so with cable companies on a franchise to provide cable services. In exchange for using the public streets and other facilities, cable companies usually agree to some form of service to a community.) San Jose engaged experts to help the city develop a plan that would ensure the public would benefit from recent advances in cable broadband systems. For example, the city wants 10 percent of the bandwidth of the cable system set aside for public use, including two-way video, voice, and high-speed data communications. Comcast is also opposed to maintaining the channel location of the city's public, educational, and governmental channels, claiming that this will have "an adverse impact on Comcast's editorial decisions about what programming to carry on its system, and in what order those channels will be presented."

Comcast's attack on local franchising (in what one city attorney described as "bullying tactics") is part of a larger industry effort to eviscerate any public interest requirements that reflect the changing nature of broadband cable. Now that local systems can provide both high-speed Internet access and hundreds of digital channels, communities correctly seek to secure franchise terms that go beyond antiquated agreements that merely involve a few public-access channels.

Comcast and the cable industry already secured a huge victory under FCC chairman Michael Powell, when in March 2002 a new policy was approved for "cable modem service" that strips away safeguards ensuring that local governments, Internet service providers, and the public have reasonable access to cable's broadband pipeline. Not surprisingly, Comcast has been adding heavyweight lobbyists to its political operation, as it moves against cities and others. For example, it recently hired Lorine D. Card, the sister-in-law of White House Chief of Staff Andrew Card, as yet another lobbyist.

Now it's time for the public to focus on cable's plans to expand their local monopolies to include broadband Internet access, and to oppose industry efforts to redefine how cable is regulated in the public interest.

CDD will be following this issue closely.