Earthlink 2008 Annual Report Download - page 11

Table of Contents
Internet Access Regulation
Narrowband Internet Access
The regulatory environment for narrowband Internet access services is well established. Beginning in the 1970s, the Federal
Communication Commission's ("FCC's") policy has been to classify narrowband Internet access services as "information services", which are
not subject to traditional telecommunications services regulation, such as licensing or pricing regulation. Under this framework, ISPs are assured
access to the narrowband telecommunications transmission service of telephone carriers needed to provide narrowband Internet access
information services.
One potential risk to our dial-up business would be a change to the rules governing how charges for ISP-
bound traffic on
telecommunications networks are levied. While Internet traffic is not subject to the FCC's carrier access charge regime, dial-
up ISP bound traffic
is regulated by the FCC. The FCC has established a uniform, nationwide rate for ISP-
bound traffic, but these rules have been criticized by the
courts and further judicial scrutiny is expected in 2009. Changes to the rules governing dial-
up ISP bound traffic could impact our cost of
providing this service.
Broadband Internet Access
The FCC classifies broadband Internet access as a single, commingled information service, whether provided over DSL by telephone
companies or over cable modem by cable companies. As a result, cable companies and telephone companies that offer a broadband Internet
access information service are not required by the FCC to offer unaffiliated ISPs stand-
alone broadband transmission. We have entered into
several commercial agreements with cable and telephone companies to offer broadband access to our customers. However, if our contracts with
cable companies and telephone companies were to expire and not be replaced, our broadband Internet access customer base and revenues would
be adversely affected.
Broadband Internet Access Agreements
We have commercial agreements of varying terms with network providers that provide us with the transmission needed to offer broadband
Internet access. Our largest providers of broadband connectivity are AT&T and Time Warner Cable; we also have agreements with other
national providers and with regional and local providers. The following summarizes the expiration dates for our agreements:
Pursuant to its commitments made in connection with the FCC's approval of the merger of AT&T and BellSouth in 2006, AT&T will
continue to offer wholesale DSL to unaffiliated ISPs, such as us, until at least through June 2010. This merger condition obligation applies to
both the SBC Corporation and BellSouth Corporation subsidiaries of AT&T. During 2008, we entered into a new wholesale broadband
agreement with AT&T (SBC) and are currently negotiating a new contract with AT&T (BellSouth).
Our contract with Covad automatically renews on a month-to-
month basis. In the event that Covad elects to terminate the contract, we
would have a transition period to transfer our customers to other providers' networks. We are currently discussing a new contract with Covad.
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Broadband Network Provider
Contract Expiration
AT&T (formerly BellSouth Corporation)
June 2009
Qwest Corporation
November 2009
AT&T (formerly SBC Corporation)
December 2009
Comcast Corporation
December 2010
Verizon Communications Inc.
March 2011
Time Warner Cable/Bright House Networks
November 2011
Covad Communications Group Inc.
Month
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to
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Month