A federal judge overruled a state regulators”™ decision to allow AT&T Inc. to offer television in Connecticut without being subject to rules governing cable TV companies like Cablevision.
The decision means AT&T, which began marketing TV service in Stamford, New Haven and Hartford last December, would have to obtain a cable franchise to offer service, though it can appeal the decision.
Multiple states have required AT&T to obtain franchise agreements for its “U-verse” television service to assure regulator oversight of services, including Florida where AT&T is preparing to roll out service later this year.
AT&T spokesman Seth Bloom said the judge made a summary judgment on one aspect of the Department of Public Utility Control (DPUC) decision, which allowed AT&T to proceed without a cable TV franchise.
“The federal court decision is far from finalized,” Bloom said, noting the Connecticut General Assembly passed a new law this spring intended to promote competition. “The state law was made to be technology neutral to provide consumers (with a choice of providers).”
While applauding the federal ruling, Connecticut Attorney General Richard Blumenthal initially agreed that the new state law may “gut” the federal decision and embolden AT&T to plow ahead without a franchise.
Blumenthal subsequently indicated the federal court decision nullifies the new state law, and filed a petition with the state DPUC demanding DPUC force AT&T to obtain a statewide franchise.
“We are seeking to enforce a new era of cable competition,” Blumenthal said in a written statement. “The first steps are an emergency order that would stop AT&T from constructing new facilities and signing up new customers until it has a franchise.”
Blumenthal”™s petition also asks DPUC to prohibit AT&T from ceasing service to existing customers during the application process.
The federal court case had pitted the state Office of Consumer Counsel and the New England Cable and Telecommunications Association Inc. against AT&T and DPUC.
Connecticut affiliates of Cablevision Systems Corp. were originally plaintiffs, as well.
In June 2006, AT&T convinced DPUC that because its U-verse service”™s delivery technology uses the Internet protocol that also delivers Web and some telephone services, it should not be classified as a cable company.
Cable companies countered that the distinction was invisible to most consumers, and that AT&T would reap an unfair regulatory advantage with a nearly identical service.
Judge Janet Bond Arteron, who sits in U.S. District Court in New Haven, granted summary judgment in late July in favor of the plaintiffs.
At the end of the second quarter, AT&T had 51,000 subscribers to its U-verse television and Internet service.
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