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from: MultiChannel News

AT&T: Conn. AG Is 'Anti-Consumer'

(Multichannel News) _ An action taken by Connecticut's attorney general to stop AT&T from deploying its U-verse TV video product in the state is "anti-consumer through and through," according to the telephone company.

Attorney General Richard Blumenthal filed an emergency petition last week, asking state utility regulators to make AT&T get a cable franchise for its Internet-protocol delivered video service, U-verse.

His filing also seeks an order to immediately stop construction of new facilities and prevent the addition of new customers until AT&T has a franchise. If his petition is granted, AT&T would be prohibited from dropping service to its initial video customers; those consumers should not be penalized for AT&T's failure to have obtained a state cable franchise, according to the filing.

The petition is in reaction to a July 26 ruling by U.S. District Court judge Janet Bond Arterton that AT&T was in fact a cable operator, despite a 2006 decision by the Connecticut Department of Public Utility Control that determined that U-verse does not meet the definition of a traditional cable service.

The Arterton ruling came in a suit brought by the state's Office of Consumer Counsel, the New England Cable & Telecommunications Association and Cablevision Systems.

The Connecticut utility control panel proactively took the action to define the new video-delivery method last year. Because video is delivered via Internet protocol at the consumer's demand, and in bits and bytes rather than in a continuing stream, the commissioners agreed with AT&T that the product is not a cable service. Therefore, the phone provider did not need a franchise, according to the DPUC commission, which approved its subcomittee's findings on a close, 3-2 vote.

To date, the Connecticut regulators have been the only utility board to try to legally define U-verse as anything but a cable service.

AT&T has staunchly opposed the "cable service" definition, even taking localities to court when they have tried to regulate U-verse in the same manner as cable providers.

Blumenthal's emergency petition is supported by Connecticut's state consumer counsel, Mary J. Healey. The Office of the Consumer Counsel has been a consistent critic of the DPUC U-verse action. Both Blumenthal and Healey said they support competition but added that even-handed regulation will ensure a truly competitive market.

The July 26 ruling "decisively cut short the miscalculation embarked upon" by the DPUC, Healey said in a filing on the U-verse docket, adding an unequal playing field for video competitors is unacceptable and illegal.

Healey's filing notes that the state's other major telephone company, Verizon Communications, is competing while "AT&T continues to litigate for freedom from consumer-protection rules."

But AT&T argues that it is providing competition, noting U-verse is now available in 35 Connecticut communities, including Norwalk, Stamford, East Haven, Meriden, Waterbury and Bloomfield.

"Our service is getting a hero's welcome from consumers who welcome choice and competition and for the first time are able to say no to the cable monopoly's constant price increases and lackluster customer service," said AT&T media director Jenny Parker.

Connecticut recently passed a statewide franchising law that is about to take effect. That allows for the entrance of new competitors, Parker added, and contains numerous consumer protections.

But Blumenthal's filing asserts that the new law does not remove the need for the utility control department to carry out its statutory obligations, including the issuance of a video franchise before a provider begins operations in the state; nor does it remove the need to ensure the provider is in compliance with all state-specific operating regulations.