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Seattle, TCI Settle Internet Access Battle

Seattle officials and cable company Tele-Communications Inc. have settled their differences and reached an agreement that both sides say should bring high-speed Internet access to the area soon.

Recently, AT&T, which last year sealed a $48 billion buyout of TCI, has been negotiating with Seattle officials to transfer the local TCI franchise to AT&T. Officials threatened to derail the deal unless TCI opened its cable network to other ISPs, allowing them to offer high-speed access to homes served by the cable company.

According to The Seattle Post-Intelligencer, rivals of AT&T tried to persuade local leaders that AT&T would not make good on its promises to allow open access unless it was forced to by the government.

AT&T countered that local governments lack the legal authority to intervene in the dispute. The company said government involvement would slow innovation.

On Tuesday, Seattle and King County officials ordered a panel of experts to determine if AT&T's Internet access through @Home is anti-competitive. Seattle officials said they would intervene if technology, competition or federal rules change. That group is scheduled to report back in October.

Internet providers wanted officials to force AT&T to offer them a basic data line that would allow customers to buy Internet access through any ISP they wanted. They said since @Home customers are forced to pay $40 for a package of offerings, they have little incentive to go with another ISP.

City officials said legislation overhauling the cable industry doesn't allow them to regulate the prices. They are going to force AT&T to give other providers access to peering stations, or regional hookup enters, to allow competitors to offer high-speed access over TCI's lines. AT&T also promised it will not charge more than $40 a month for its cable Internet service for the next two years.

Seattle isn't the only place where open access issues are raging. A similar fight over the AT&T/TCI merger is occurring in Dallas where a group of ISPs and other interested parties have formed the North Texas Open Access Initiative.

Although the Dallas City Council in mid-January refused to address the open-access issue, the group hopes it will attract enough attention to force action at the federal level.

Earlier Wednesday, 99 percent of AT&T shareholders approved the TCI deal. TCI shareholders are currently meeting to consider the offer as well.



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