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Excite@Home exec takes on open access ruling

The Net-over-cable service cheers statements by the nation's top telecom regulator slamming a decision that could end exclusive relationships with cable operators.

CHICAGO--Excite@Home today cheered statements by the nation's top telecom regulator that slammed a decision which could effectively end the Net-over-cable service's exclusive relationships with cable operators.

Internet service providers have long pushed for access to the cable industry's high-speed networks. A recent federal court ruling in Portland, Oregon, upheld that city's right to impose a so-called open access requirement on AT&T, which controls a majority of Excite@Home.

Following a speech by Federal Communications Commission chairman William Kennard today at Cable '99, Dean Gilbert, senior vice president and general manager of the @Home consumer Internet service, said he "couldn't agree more" with the chairman's stance that handing regulatory powers to local authorities would cause "chaos" in the industry. (See related story)

Gilbert and Excite@Home are in an enviable position. The leading broadband Net access service, Excite@Home holds an exclusive relationship with its cable providers which excludes competing ISPs from offering their own services on cable pipes.

Yet the firm can't get too comfortable, as competitors like America Online and others are doing everything they can to get a piece of Excite@Home's broadband pie. Earlier this week, AOL and GTE held a demonstration in an effort to show that open access is technically possible--something that firms like AT&T have denied.

Looking to deflect attention from the Portland ruling, Excite@Home plans to hold a press conference tomorrow in an attempt to show that open access would severely hamper the deployment of cable Net access on a large scale.

Meanwhile, since the close of its deal with Web portal Excite, the high-speed firm has been working on cutting deals that will take its service into the next millennium. Today, Excite@Home inked a set-top box technology alliance with Scientific-Atlanta. As part of the deal, the Net-over-cable firm will license its local.tv, a Java-based content development tool, to Scientific-Atlanta.

The technology is expected to help cable operators create interactive local content on older set-top boxes, at least until advanced digital set-tops are ready for retail deployment.

Gilbert sat down with CNET News.com at the cable show to discuss the fallout from open access, the possibilities for interactive television, and the integration of its recent multibillion-dollar merger.

CNET News.com: What is your reaction to Kennard's comments that the country needs a nationwide broadband policy rather than let local municipalities take the reigns?
I couldn't agree more. He's dead-on right. Kennard's done his homework. He's not pro-cable, or pro-broadcasting, or anything. He's doing the job the FCC chairman should do. Do your homework and try and do what's in the best interest of the public. What happens in these cities is they get involved in the franchise transfer process and it becomes more emotional rather than analytical. Portland is on the fringe. They are way out there in terms of wanting to over-regulate.

You believe the case will be overturned. But assume for a moment that open access is imposed. What would need to be done and what does that mean for Excite@Home?
I don't accept the premise that it's going to happen, nor do I accept the premise that it's feasible to do it. It is not feasible in terms of scalability, and in managing a network. ? If anything like this ever came to pass it would destroy this business. I'm telling you there is no way this whole open access thing would do anything other than hurt the public.

Scientific-Atlanta struck a deal with you today under which they will license some of your technology for their set-top boxes. How important is interactive TV to Excite@Home?
Interactive TV is very important. But look, digital is also defensive for cable operators. You have to look at the reality. Their core video business is under attack by the direct broadcast satellite guys. It isn't a question of whether they like digital better than they like cable modems. They're behind, relative to what is out there from a satellite-delivered perspective.

The deal between you and Excite closed in late May, creating Excite@Home. What new features have been deployed since the deal's completion?
It's been the smoothest merger integration I've ever experienced. They've brought a lot of expertise to the table in a lot of areas that we didn't have. From my perspective, I get a huge promotional engine.

Content-wise we haven't rolled out a lot of the changes yet. But clearly we're going to integrate a lot of their personalization into the service. But for the most part, the content stuff is in development. The part where there's been the most tangible integration is we're starting to use Excite as a promotional vehicle for us. We've got like ten different ways we use the Excite portal to expose their user base to @Home. We're also building an online ordering system. The implementation of those programs is happening as we speak. In the next 90 days we'll have a full system up, although it may not have every cable partner on it on day one.

What technologies or service offerings do you believe Excite@Home is missing?
I think you're going to see us function on some communication functionality. We'll beef up that. Things like messaging services, where you can call voice mail and it will also leave you a message on your email system.

Do you think, as some have suggested, that Excite@Home needs a dial-up modem access option?
I don't think we need a dial-up service, per se. I think having a relationship, potentially with AT&T Worldnet, to do co-marketing and some things along those lines makes a lot of sense. I think you'll see us pursue a lot of things in that regard.

We've had talks with AT&T Worldnet about doing some stuff with them, because of the close relationship. They're logical to work with.

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