GTE Sues AT&T, Cable Affiliates

GTE Corp. Monday sued AT&T Cable Services, Comcast and their affiliated service providers, accusing the companies of denying consumers the right to choose their Internet providers.

Filed in a Pittsburgh, Pa., federal court, the suit claims the defendants illegally force their cable modem subscribers to buy @Home’s ISP service. The complaint alleges customers who prefer another ISP have no way to get that service unless they first pay @Home’s monthly fees.

The lawsuit seeks unspecified damages and asks the court to issue an injunction stopping the practices in question.

The complaint alleges the companies’ practice an unlawful tying arrangement by forcing customers to purchase their Internet connectivity from @Home. The lawsuit also said the relationships between affiliated cable companies and @Home constitute unlawful exclusive arrangements since @Home affiliates do not provide high-speed connectivity to Internet providers who are not members of the consortium.

“The Internet has exploded because of competition and has become the ubiquitous marketplace for the new milennium. Today, Americans can choose among thousands of ISPs when they sign up for Internet access with the telephone companies. But in the high-speed Internet access world of TCI and Comcast, consumers don’t have a choice.

“The cable companies have given us one excuse after another to deny their customers the right to choose an ISP. First, they said it was not technically possible. Then, it was too expensive. GTE has debunked these excuses through a demonstration of an inexpensive solution on our cable system in Florida. Now, through this suit, it is time to preserve American consumers’ right to choose their ISP.”

In a statement, [email protected] accuses GTE of being a monopolist that thwarted competition and is now crying foul.

“Since the passage of the 1996 Telecommunications Reform Act, GTE has spent millions on lawyers in an effort to prevent consumers from reaping the benefits of competition as the law intended. They have lost every significant case.

“It would be absurd for the court to find that the antitrust laws should be used to protect an entrenched monopolist, such as GTE, with a greater than 95 percent market share, from a new competitor like [email protected] which has less than 2 percent market share.”

The lawsuit comes on the same day [email protected] announced it is purchasing online greeting card provider Blue Mountain Arts for $780 million in cash and stock.

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