Cyber Ramblings - Jul 4, 2000

4 July 2000
Bank on the Internet as a Preferred Vehicle for Financial Services
To emphasize the convenience of Internet banking, Bank of the Internet USA of San Diego picked today--a national holiday in which bricks-and-mortar banks throughout the U.S. are closed--to launch its brand new Internet-only bank. The new bank provides financial services completely via the Internet; thus customers can access their accounts, pay bills and even apply for a home loan, in real time, any time of the day, any day of the year--including national holidays. Such institutions are fitting additions to today's rapid global commerce, which has no place for services that close their doors at anytime.

FCC Begrudgingly Enters the Open Access Battle
The Associated Press reports that the U.S. Federal Communications Commission is planning to look into whether old rules designed to break open the local Bell monopolies extend to new Web services still in their infancy. FCC Chairman William Kennard, however, indicated that the Commission is leery of applying heavy-handed regulations. "We don't want to get into a situation where people are rushing to judgment or rushing to enforce legal obligations that really haven't been fleshed out yet," Kennard said. "It's become clear to me that the FCC will have to address the issues raised by the court."

The FCC, under the leadership of Kennard, prefers to take a hands-off approach toward such matters, but a court ruling last week in which a Portland 9th Circuit Court of Appeals determined that local authorities in Portland can't force AT&T Cop. to open its network to rivals might force the commission to act in the near future. Since the ruling, at least one ISP has already challenged AT&T. The company, Internet Partners of Hillsboro, Ore., has asked AT&T to open its lines and indicated that it will file a complaint with the FCC if AT&T doesn't comply.

A Double Dose of Denial for WorldCom and Sprint
The European Commission announced last Wednesday that it has chosen to prohibit a $129 billion merger between U.S. telecoms groups WorldCom Inc. and Sprint Corp. on the grounds that the new company would have an unfair dominance in the Internet market. The decision was somewhat moot, however, because the two companies announced Tuesday that they would withdraw the proposed merger from review by the commission after the U.S. Department of Justice filed a lawsuit to block their merger. The commission went through with the decision as a formality because the two companies hadn't yet officially cancelled the merger agreement.

Another Important Victory for ISPs
In the past year, U.S. courts and lawmakers have consistently agreed that Internet service providers, under U.S. law, should not be held responsible for material that is published unbeknownst to the provider. In terms of case law, the Prodigy case in May got the ball rolling in the ISPs' favor. An Illinois judge followed the trend in June when he ruled that two ISPs, PSINet and GTE Corp., could not be held responsible for the unauthorized online publishing of nude pictures of Illinois State University student athletes. The athletes took the ISPs to court under the Communications Decency Act because the ISPs hosted Internet services that sold video tapes from hidden video cameras in toilets, changing rooms and showers at university sports facilities. The companies that sold the tapes, also being sued by the students, might find it a little more difficult to get off the hook.

US E-Signature Bill Becomes Official
Last week's big story on the Internet and technology fronts was the passing of the e-signature bill in the United States. President Clinton made it official Friday when he fulfilled the bill's final step into the law books by putting his signature on it. "Online contracts will now have the same legal force as equivalent paper contracts," Clinton commented. "With the swipe of a smart card and the click of a mouse, (customers) will be able to finalize mortgages, sign insurance contracts or open brokerage accounts."