City OKs Cable Takeover, With Internet Proviso

The Los Angeles City Council gave its blessing Tuesday to the takeover of a 94,000-subscriber cable television system in the east San Fernando Valley by AT&T.;

But the council’s benediction came with an asterisk.

Over the next 90 days, AT&T; and other cable operators must come up with a plan that will allow local Internet providers “nondiscriminatory access” to their cable lines, the council required.

Cable is viewed as a potentially lucrative way to deliver the Internet at rapid speeds, eliminating some of the delays incurred when data-rich materials such as graphics, sound bites and video clips are jammed down ordinary telephone wires.

AT&T; officials have said cable Internet delivery is one of the main reasons it is acquiring the East Valley cable system and thousands of others now owned by Tele-Comunications Inc. in a deal worth more than $40 billion.

But current Internet providers used the East Valley license changeover, which required city approval, to argue that cable operators should not have exclusive control of cable lines.

The city seems to have agreed, but plenty of battles are likely in the next three months as cable and Internet executives and attorneys argue about just what “nondiscriminatory access” means.

Meanwhile, the AT&T; acquisition of TCI is still awaiting approval by the Federal Communications Commission.