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Voters likely to be silent on open-access issue this year

It's becoming increasingly unlikely that voters in various cities will be able to weigh in on whether AT&T should be forced to open its cable network to outside ISPs.

After only a brief time in the public eye, the chances of a serious election-day challenge to AT&T's cable Internet ambitions this year are receding.

A reversal in fortune for a ballot drive in Denver, Colorado, and failing momentum in San Francisco make it unlikely that AT&T will have to defend its high-speed Internet franchise from voters this year. If so, this removes what could have been a dangerous--and expensive--thorn in Ma Bell's side.

But even without voters' input, the issue is finding new life elsewhere, keeping the heat on AT&T's ongoing drive to create a phone, cable TV, and high-speed Internet empire.

Minnesota regulators are looking into whether they have the ability to force AT&T to its high-speed cable network with competing ISPs as part of its merger with MediaOne. Earlier this week, open-access proponents also filed an initial round of complaints about the MediaOne merger with the Federal Communications Commission.

These rumblings are the early signs of a new stage in the cable-access battle that will take the industry well into next year, the players say.

"There's no doubt they're going to keep trying to get in [to our networks]," said AT&T spokesman Jim McGann. "These guys have no intention of backing down, so we'll continue to make our case."

The fight over cable-network access began with AT&T's purchase last year of Tele-Communications Incorporated. Led by America Online, US West, and GTE, a group of ISPs asked federal regulators to block the merger unless AT&T allowed outside ISPs to offer their services over its cable lines. The ISP campaign was dubbed "open access." Currently, most cable customers must use an ISP affiliated with their cable company, such as the AT&T-aligned Excite@Home.

Federal regulators refused to back the ISPs' position, but AOL and the phone companies took the issue to local municipal governments that also had a say in approving the merger. Several cities and counties did support the ISPs' position, but most approved AT&T's merger with little comment.

For a few short weeks this summer, it appeared that some voters might get a chance to decide the issue this year, led by an AOL-backed group in Denver. A coalition of ISPs and telephone companies apparently managed to get enough voter signatures to put a referendum on the November ballot forcing AT&T to open its high-speed cable network to other ISPs.

That group's success helped prompt a statewide ballot drive in Massachusetts and played a role in San Francisco, where local politicians were also debating the issue.

But now it appears that the Denver group's initial success has waned. Following a dispute over election rules and the filing of an official protest, local elections officials have ruled that the open-access referendum will not make it to this year's ballot.

"The Denver elections commission has basically said we're too late for the November ballot," said Jim Carpenter, a spokesman for the ISPs' coalition. "We're looking to see whether there are additional options, possibly legal options or a future ballot."

While they will not be voting on whether AT&T must provide access to its network, Denver voters in November will decide whether the city should renew the cable charter with AT&T. The ISP coalition may shift its focus to opposing the renewal, Carpenter said.

But that fight, even if done in the name of "open access," would be a steep uphill climb. AT&T and the city have spent considerable time negotiating the new contract and the company already has launched an expensive campaign persuading voters to support it.

Elsewhere, the chances of seeing cable issues on a 1999 ballot also are dimming. A San Francisco coalition backed by AOL and GTE says it is still deciding whether to launch a ballot drive, but is running up against the deadline for this year's election. The Massachusetts drive, if successful, would not go to voters until next year.

But even as the heat under the ballot initiative drives simmers down, the open-access issue is gaining new life elsewhere.

Minnesota state regulars are examining AT&T's merger with MediaOne, and the state attorney general's office is investigating whether the state has the legal right to force AT&T to open its network, according to assistant attorney general Dan Lipschultz.

If Minnesota does decide to rule on the issue, it will be the first state to do so. Several state legislatures have toyed with bills affecting the cable networks, but state regulators' jurisdiction over the issue has been unclear.

At the federal level, the FCC has begun looking into the MediaOne merger.

FCC Chairman William Kennard has said repeatedly that he does not think the market is mature enough to impose open-access requirements on cable companies. But that has not stopped AT&T opponents from filing petitions with the FCC asking that the company open the networks it would gain with MediaOne merger.

Minnesotta regulators will meet in November, and could decide the issue then. The FCC review of the merger is likely to stretch into next year.