Agenda - 06-29-2000-5b - Laserfiche WebLink

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21 9. The D.C. Circuit Court decided to consider sepazately the challenge to the statute and the challenge to the FCC rules. l0.On May 19, 2000, the D.C. Circuit Court upheld the constitutionality ofthe statute requiring ownership limits. The FCC's voluntary stay on enforcing its rules was automatically lifted. 11. D.C. Circuit Court will hear oral arguments on the FCC rules on October 17, 2000. Local Phone Competition • Local competitors added 65 percent of new business lines in the third quarter of 1999. • In 1996, competitors to the incumbent phone companies had one percent of the local market. - In the second quarter of 1999, competitors reached siac percent of the mazket. • AT&T provides residential local telephone service to SS5,000 customers nationwide. - MediaOne provides residential local telephone service to 100,000 customers nationwide. Public interest Benefits from the AT&T-MediaOne Mer er In analyzing the potential public interest benefits from the merger, the FCC found that consumers are likely to benefit from increased local telephone competition. The FCC determined that the combination of AT&T's brand name, expertise and telephony assets with MediaOne's expertise in providing cable telephony, and the economies of scale offered by the merger, is likely to increase these companies' ability to compete successfully against the incumbent LECs. AT&T's success in providing cable telephony over the merged firm's systems also is likely to facilitate its efforts to provide local telephony over other cable operators' networks through contractual arrangements. The FCC concluded that the merger will enable AT&T and MediaOne to provide local telephony competition more effectively than either company could independently or through joint ventures. Broadband In its analysis, the FCC also considered the impact the merged firm will have on broadband services, but declined to impose conditions in this regazd. The FCC discussed the merged entity's ability to provide high-speed Internet access over a vast cable infrastructure. The merged firm also would have major ownership interests in the nation's two largest cable broadband Internet services providers (ISPs), Excite@Home and Road Runner. Excite@Home and Road Runner are the exclusive ISPs serving broadband subscribers over the cable systems of AT&T, MediaOne, TWE, Cox Corporation and Comcast Corporation, among others. The FCC analyzed the merger as modified by the U.S. Department of Justice's proposed consent decree with the applicants, which requires them to divest their interests in Road Runner no later than December 31, 2001, Franchise Fee U-Tax Auditing & Cable Television Administration 101 Pocono Lane, Cary, North Carolina 27513-5316 Voice # 919.467.5392 Fax # 919.460.6868