2. Background

Application (A.) 02-05-010 of CBC seeks approval of the change in control of CBC that will occur indirectly as a result of the placement of AT&T Broadband Phone and CBC under a new parent, AT&T Comcast. CBC serves approximately 75 customers in California.

Similarly, A.02-05-011 of AT&T Broadband Phone seeks approval of the change of control of AT&T Broadband Phone that will occur indirectly as a result of the placement of AT&T Broadband Phone and CBC under a new parent, AT&T Comcast. AT&T Broadband Phone serves approximately 145,000 customers in California.

Resolution ALJ 176-3088 of May 16, 2002 preliminarily determined that these are ratemaking proceedings for which no hearings would prove necessary.

On June 7, 2002, The Utility Reform Network (TURN) and the Consumer Federation of America (CFA) filed a joint protest to these applications, stating that the proposed financial transaction "constitutes a major change in the status of the company and raises significant public policy issues."² The TURN-CFA joint protest states that although "the Commission is not required to conduct the public interest analysis contained in Sections 854(b) and 854(c) [of the Public Utilities Code], the Commission can (and should) still closely scrutinize the transaction using the elements from that public interest test."³

In addition, Qwest Communications Corporation (Qwest) filed a protest asking the Commission to order the applicants to serve testimony, permit discovery, and hold evidentiary hearings to resolve any disputed issues of fact. Qwest asked that the Commission "either deny the application, or grant the application subject to conditions to protect the public interest, including, but not limited to, requiring applicants to provide equal access to competitors to provide cable telephone and cable modem services over applicants' cable network facilities."⁴

On June 17, 2002, AT&T Broadband Phone and CBC (Applicants), filing separately, responded to the protests of Qwest and TURN-CFA. The responses asked that the Commission summarily dismiss the protests. The responses argued that the protests raise issues not pertinent to the applications and that "the public interest requires rejection of the protests."⁵

On July 19, 2002, the Commission held a joint PHC to determine the next steps in these two proceedings. Discussions focused on the points made by parties in their protests and responses. Discussions also focused on the information needed to develop a scoping memo and a plan for managing a consolidated proceeding.

On August 8, 2002 Assigned Commissioner Peevey and ALJ Sullivan issued a "Scoping Memo and Ruling of Assigned Commissioner and Administrative Law Judge" (Scoping Memo) affirming that this was a ratesetting case, refining the scope of the proceeding, consolidating the two applications, and establishing a timetable for resolving outstanding issues. In addition, the ruling ordered AT&T Broadband Phone and CBC to make a supplemental filing that demonstrated how the proposed application met the public interest criteria enumerated in Section 854. The ruling also established a schedule for parties to comment on this supplemental filing.

AT&T Broadband Phone and CBC filed and served a "Joint Supplement to Applications of Comcast Business Communications, Inc. and AT&T Broadband Phone of California, LLC." (Joint Supplement) on August 16, 2002. On August 23, 2002, the CFA and Qwest each filed a response to the Joint Supplement. (TURN did not file a response.) In addition, on August 23, consistent with Rule 8(d) of the Commission's Rules of Practice and Procedure, Qwest requested final oral argument in the above-captioned proceedings.

On August 29, 2002 Qwest filed a "Motion for Leave to File a Supplemental Response to the Joint Supplemental Filing of Comcast Business Communications, Inc. and AT&T Broadband Phone of California, LLC" (Motion for Leave). Attached to the motion as exhibit C was the "Supplemental Response of Qwest Communications Corporation to the Joint Supplemental Filing of Comcast Business Communications, Inc. and AT&T Broadband Phone of California, LLC" (Supplemental Response). On September 5, AT&T Broadband Phone and CBC jointly filed a "Joint Opposition of Comcast Business Communications, Inc. and AT&T Broadband Phone of California, LLC to the Motion of Qwest Communications Corporation to File a Supplemental Response" (Joint Opposition).