Federal court says cable and telcos can pay the same rate for pole access

Federal law does not require telephone companies to be treated differently from cable companies, when it comes to attaching cables to utility poles. That’s the ruling of a federal appeals court (h/t to Omar Masry at the City and County of San Francisco for the pointer). It rejected a challenge from electric utilities to a 2015 decision by the Federal Communications Commission that equalised the standard charge for utility pole access, and trimmed back an irrelevant distinction. The rate is now the same whether the full service telecommunications company doing the attaching is the descendant of a television service provider or an old school telco.

Before then, telcos paid higher rates, which meant more money for electric utilities that owned poles. But the FCC’s decision to classify broadband as a telecommunications service and put it in the same common carrier regulatory bucket as telephone service created a quandary. Since cable companies are also Internet service providers, could electric companies start charging them the higher rate, and maybe push up broadband access costs in the process?

There was another problem. Or maybe an opportunity, depending on your point of view. Some states, like California, have exercised an option allowed by federal law and set their own rates for utility pole attachments – they were already charging cable and telephone companies the same, lower rate. Which might have given them a competitive advantage over states that relied on the FCC rules.

The court said that the FCC had sufficient reason to make the change…

The FCC sought to eliminate the disparity between the Cable and Telecom Rates in order to avoid subjecting cable providers offering broadband service to the higher Telecom Rate, and to avoid rate disparity between states whose pole attachment rates are regulated by the FCC and those states that had elected to regulate pole attachment rates using the Cable Rate even for telecommunications providers…This approach represents a “reasonable policy” choice, and thus we defer to the FCC’s interpretation.

It’s a good solution, but it misses the central issue. Cable and telephone companies are in the same business: selling television, telephone and broadband service, and buying up content companies to fill the pipeline. There’s no rational reason anymore to treat them differently.