A three-judge panel of the Third Circuit Court of Appeals listened to a lively debate over a 2005 FCC order that eliminated the obligation of wireline phone carriers to provide competitive Internet service providers (ISPs) with access to the broadband transmission component of their networks, as attorneys for the appellants and the FCC sparred on the regulatory classification of wireline broadband services and on whether the FCC properly applied the tenets of the Supreme Court’s Brand X decision to its ruling. Litigants against the FCC include Earthlink, Comptel, Time Warner Telecom, and a host of small ISPs that fear the FCC’s order will effectively shut them out of the Internet services market. Citing Brand X, in which the Supreme Court affirmed an earlier FCC decision that classified cable modem services as an information service that is exempt from common carrier regulation, the FCC decided to afford the same regulatory treatment to broadband digital subscriber line (DSL) services offered by wireline phone carriers. The rationale behind the decision, according to FCC counsel James Carr, was that “once the FCC had determined with the Supreme Court’s approval that it was not going to apply . . . regulations to the market leader [cable modem providers], it made no sense to apply them to the second-place competitor.” Noting, however, that Brand X was premised on the fact that the transmission component of cable modem services (unlike DSL) was never made available on a stand-alone basis, Comptel asserted that the FCC’s reliance on Brand X is flawed, as previous judicial decisions have determined that the bundling of information services with telecom transmission does not terminate common carrier obligations associated with the telecom transmission service. Declaring, with respect to DSL, that “all parties agree there were existing transmission services offered to retail [DSL] customers,” Earthlink backed up Comptel, arguing before the court that the FCC should have used an alternative remedy, such as forbearance, to lift the requirement that wireline broadband transmission services be offered to competitors on a stand-alone basis. As BellSouth, an intervener on the FCC’s behalf, quipped that the FCC’s order “has been in place for some time, and the sky has not fallen,” Judge Julio Fuentes observed that, in Brand X, the Supreme Court’s analysis hinged on the standpoint of the end-user, to whom cable modem and DSL services would appear to be indistinguishable.