The federal government defended before the U.S. Supreme Court on March 29 its decision to refuse to regulate cable companies that provide broadband Internet access. The conclusion has riled Internet s

WASHINGTON, D.C. (The Hollywood Reporter) -- The federal government defended before the U.S. Supreme Court on March 29 its decision to refuse to regulate cable companies that provide broadband Internet access. The conclusion has riled Internet service providers that want to obtain more lines and therefore more customers.

Attorney Thomas Hungar, pressing the Federal Communication Commission's appeal to the justices, argued that cable and the Internet service it accesses are regarded as a single bundle under the law. Because the bundle's product, the Internet, is an information source, the FCC treats the cable line as an unregulated information service, said Hungar, a deputy U.S. solicitor general.

The litigation pits large, established cable companies that support the FCC's position against ISPs, who oppose it. The cable giants say deregulation allows for innovation, which spurs competition. The ISP companies counter that telephone-like regulation is needed to increase Internet access by allowing them to link up with more cable lines.

The seemingly high-tech case boils down largely to semantics. If the court deems cable a "telecommunications service," the government is bound by statute to regulate it. But if the justices conclude that cable is an "information service," the FCC can maintain its deregulatory posture under the 1996 Telecommunications Act.

The ISPs, including Brand X Internet Services and EarthLink Inc., have won so far. The San Francisco-based Ninth Circuit Court of Appeals has ruled that cable providers offering Internet access are providing a "telecommunications service," which the FCC regulates under the 1996 law.

Justice Antonin Scalia said he failed to see how the agency can then distinguish between unregulated cable and telephone lines that also provide Internet access but are regulated.

Hungar responded that telephone lines historically have been used as a communication service while the newer cable lines have not.

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