Ruling Limits Phone Firms’ Video Service

A federal District Court judge Thursday severely limited the scope of an earlier ruling that would have cleared the way for the nation’s phone companies to begin offering video programming in their home territories.

As a result, most of the nation’s phone companies cannot immediately begin competing against cable companies operating in the same areas where they have a telephone monopoly, stalling any consumer benefits from the expected face-off between the media giants.

In a ruling late Thursday, U.S. District Judge T.S. Ellis said his decision in August striking down a federal ban on phone companies’ providing video services in their service territories applied only to Bell Atlantic, the regional telephone company in the mid-Atlantic states that challenged the law.

At the time of the ruling, the decision was seen as applying equally to the remaining regional Bell companies, which did not participate in the original suit.

Following Ellis’ decision Thursday, at least one regional phone company, Ameritech, said it will seek a similar ruling. “For the sake of our Midwest customers, Ameritech intends to pursue aggressively our right to compete in the cable TV industry,” said Richard Brown, vice chairman of the Chicago-based Baby Bell.

Other Baby Bells are expected to make similar moves, arguing that Ellis’ ruling in August set an important precedent.

The original ruling was widely viewed as a potentially huge victory for the nation’s phone companies in their fight against the cable operators for control of the new “superhighway” telecommunications networks that are being readied across the nation.