The Supreme Court is now the last hope for cable operators that want to bar competing Internet-service providers providers from their high-speed networks.
Cable systems have fought for six years to block competing service providers from their Internet lines, which can be used to deliver video, telephone and other digital services that compete with one of cable's most lucrative new business segments.
Wednesday the federal appeals court in San Francisco refused the FCC's request to rehear its October decision throwing out a 2002 FCC declaration that the federal government is not obligated to open up cable high-speed networks, while telephone companies must do so for their high-speed digital subscriber lines.
The latest ruling technically affects only cable systems operating in the western states and under the San Francisco court's jurisdiction. Supreme Court is expected to weigh in eventually with a decision that governs the entire industry.
The FCC has a week to ask the San Francisco court not to put its open access ruling into effect. FCC chairman Michael Powell said he was disappointed by the ruling and is asking agency lawyers to "study our options and explore how to continue to advance broadband deployment for all Americans."
The cable industry is asking the FCC to appeal to the Supreme Court ASAP. "We will urge the FCC to seek U.S. Supreme Court review," says Dan Brenner, senior VP of law for the National Cable & Telecommunications Association. "We believe that if and when the Ninth Circuit's decision is given a full substantive review by the Supreme Court, it will be reversed."