Aug 13, 2009 (National Broadband Plan Workshops; Stimulus Applications Due)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for THURSDAY AUGUST 13, 2009

Two more FCC National Broadband Workshops today: 1) Technology/Fixed Broadband (http://benton.org/node/26283) and Technology/Wireless (http://benton.org/node/26284)


INTERNET/BROADBAND
   FCC Criticized as Broadband Deployment Discussion Focuses on Commercial Providers
   Broadband Stimulus Applications Due
   Telecom Experts Offer Last-Minute Advice to Broadband Stimulus Applicants
   States weigh in as feds prepare to spend billions on broadband for remote areas
   Missouri Seeks Broadband Stimulus Funding
   The Digital Philadelphia Project
   Qwest passes on broadband stimulus funds
   Progress & Freedom Foundation Questions FCC's Network Neutrality Authority

WIRELESS/TELECOM
   As carriers gird for FCC fight, an omen down under
   Cellphone Users in US, Canada, Spain Pay Most
   Apple, Dell Answering China's Call?
   Smart Phones Gain as Midrange Handsets Suffer
   Fairpoint ordered to respond to Vermont complaint

MORE ONLINE...
   Independent Filmmakers Distribute on Their Own
   Google Faces Suit Over On2 Purchase
   Redbox sues 20th Century Fox over DVD releases
   European publishers target Google
   Silicon Valley still a center of the tech world
   News About Economy Seen as Less Dire, More Hopeful

HEALTH & MEDIA
   Health 2.0 could shock the system
   Blumenthal helps rebut health reform critics
   It's War. Media War

MEDIA OWNERSHIP
   WTO dispute panel raps China on audiovisual goods
   Big Radio Reports Big Declines

POLICYMAKERS
   VC Joins FCC, Will Focus on the Smart Grid
   FCC's Diversity Committee to Meet Sept 22

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INTERNET/BROADBAND


FCC CRITICIZED AS BROADBAND DEPLOYMENT DISCUSSION FOCUSES ON COMMERCIAL PROVIDERS
[SOURCE: Benton Foundation, AUTHOR: Kevin Taglang, Cecilia Garcia]
On August 12, the Federal Communications Commission hosted the second in a series of staff-led workshops on the creation of the National Broadband Plan mandated by the American Recovery and Reinvestment Act. Wednesday focused on broadband deployment and was split into three sessions -- wired, wireless, and unserved/underserved areas and groups. Outside the workshops, however, the FCC was facing criticism for over-relying on the perspective of traditional industry infrastructure providers in the day's discussion.
http://benton.org/node/27102
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PLANS FOR FAST LINKS IN RURAL AREAS DUE
[SOURCE: USAToday, AUTHOR: Leslie Cauley]
Proposals are due Friday for the first of three rounds of funding for federal broadband stimulus projects aimed at driving broadband into underserved parts of America. Already, there's a lot of griping about the $7.2 billion program. At the top of the list: red tape and application rules, which run several hundred pages in length. As envisioned by Congress, the $7.2 billion was to be used for broadband projects that could spur innovation and drive up broadband adoption rates. But because of the way the program is being implemented, that might not happen, says Craig Settles, president of Successful.com and a longtime telecom consultant. Under the rules, he notes, telephone and cable companies can attempt to veto projects — such as fiber-to-home installations — that might compete with their own DSL or cable modem services. Another potential trouble spot: speed. Under the rules, "broadband" is defined as 768 kilobits per second, which is about half as fast as a 1.5-megabit connection. That's "very low" by global broadband standards, says James Baller of the Baller Herbst Law Group in Washington. In Japan, 50-megabit connections aren't uncommon, he notes. The rules also put the onus on applicants to prove that an area is "underserved," he says. The government is favoring those areas for project funding. The problem: Phone and cable TV companies treat broadband-deployment data as confidential, so figuring out which markets qualify can be tough, says Dean Cubley, CEO of ERF Wireless, which plans to apply for funding.
http://benton.org/node/27112
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TELECOM EXPERTS OFFER LAST-MINUTE ADVICE TO BROADBAND STIMULUS APPLICANTS
[SOURCE: BroadbandCensus.com, AUTHOR: ]
Casey Lide, an attorney with the Baller Herbst Law Group; Jeff Arnold, the Deputy Director of Legislative Affairs for the National Association of Counties; and National Association of Regulatory Utility Commissioners General Counsel Brad Ramsay offered their advice on the future of American Recovery and reinvestment Act broadband funding at a webinar hosted by Governing.com. Arnold said counties want broadband even if it's not the fastest broadband available. "When you have nothing, even 768 Kbps [kilobits per second] is good," he said, referring to the minimum requirement for how speedy the new broadband projects must be able to deliver. Ramsay said California and other states have been recommending that applicants file early this week because of concern over the ability of the Web site taking applications to handle them all. Lide sees the first round of funding as an attempt to create a "thin skinned layer of broadband in rural areas of the country" and expects future rounds may not focus as intently on getting broadband to the unserved and underserved parts of the country.
http://benton.org/node/27096
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STATES WEIGH IN AS FEDS PREPARE TO SPEND BILLIONS ON BROADBAND FOR REMOTE AREAS
[SOURCE: Stateline.org, AUTHOR: Daniel Vock]
States across the country have pursued efforts toward creating statewide broadband policies and better access for their residents. But their scale pales in comparison to the $7.2 billion in stimulus money the federal government has committed over the next two years to improve high-speed Internet connections around the country. Every state is supposed to get a share, and every governor will get a chance to weigh in on how the funds are spent. In this wash of new money, state officials are scurrying to identify the states' greatest needs, coaching providers applying for stimulus money and developing overarching plans for how to roll out expanded service. State officials will have two major opportunities to determine how stimulus money is spent, although they won't have the final word. First, each state has to map which areas within their borders have broadband coverage, an ongoing effort that about half of the states have already started. State officials will then use that information to craft a plan to decide how best to expand access. Second, once the federal government receives all of the applications from potential providers, it will ask each state to rank its local proposals. The idea is to give governors and their designees a chance to figure out how each project fits in the state's overall plans for broadband expansion. In many cases, state officials are already busy helping applicants shape their proposals, including encouraging groups providing other services to work together on a single proposal. The federal government said it will favor ideas that partner with other stimulus-related projects, such as efforts to build a "smart" electric grid, improve highways, promote public safety and encourage technology upgrades for doctors.
http://benton.org/node/27100
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MISSOURI SEEKS BROADBAND STIMULUS FUNDING
[SOURCE: Associated Press, AUTHOR: ]
Missouri is applying for $142 million of federal stimulus money to expand high-speed Internet access to remote parts of the state. If Missouri's project is approved by the federal government, it would extend broadband access to more than 91 percent of the state's population. High-speed Internet currently is available to fewer than 80 percent of Missouri residents. Under the application, to be filed with the Department of Agriculture and Department of Commerce, the state and Sho-Me Technologies will request funds to help lay 2,500 miles of fiber-optic cable and construct 200 new broadband towers across the state. To make this project feasible, the state of Missouri would provide $25.2 million in matching funds if the application is approved and funded, and Sho-Me Technologies would contribute $8.375 million in fiber lines along the new network. The state's $25.2 million in matching funds would help purchase the equipment to connect the new fiber across the state. While the equipment would serve the needs of both the state and Sho-Me Technologies, the state would actually own the equipment. The state matching funds provided for this project would come from a $40 million allocation, from the federal budget stabilization fund, approved by the legislature this year for broadband enhancement projects. Known as a "middle-mile" project, MoBroadbandNow would bring a high-speed broadband connection into currently underserved or unserved communities. "Last-mile" service providers, such as local utility or cable companies, then would provide direct Internet access to homes, businesses and other customers either wirelessly or by laying additional fiber lines. Missouri is also partnering with a number of "last-mile," local Internet Service Providers to submit applications for recovery funds to extend broadband connections from the new MoBroadbandNow backbone to consumers in rural Missouri. Among these "last-mile" partners are Big River Telephone, Ralls County Electric Cooperative and Poplar Bluff Internet, which, in total, are seeking recovery act funding to extend high-speed Internet service, at fair prices, to more than 60,000 rural Missourians who currently lack such a connection.
http://benton.org/node/27099
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THE DIGITAL PHILADELPHIA PROJECT
[SOURCE: Technically Philly, AUTHOR: Brian James Kirk]
Wireless Philadelphia is dead. What was left of the title — once the 2004 promise of a wirelessly-connected Philadelphia — was lost this May when the nonprofit that shared the initiative's name rebranded itself as the Digital Impact Group to focus on bridging the city's digital divide. It was once charged with overseeing Atlanta-based Internet service provider EarthLink in managing the country's first municipal Wi-Fi program, a program that was never fully realized. Digital Philadelphia is a plan for a city-wide mesh network that connects city assets and ultimately bridges the Internet to unserved and under-served communities by proxy. The philosophy of building the network is predicated on a common sense notion of linking already built-out elements like the city's IT infrastructure, the public safety network and fiber backbone and wireless high sites completed for the former administration's Wireless Philadelphia initiative. With a wide, collaborated network, the city could then push net access to potential partners like schools and recreation centers, nonprofits and businesses, hospitals and universities, and could utilize the network's reach for its own municipal purposes. The city is even in discussions with Network Acquisition, the group of investors that bought out equipment from the failed Wireless Philadelphia initiative, to purchase some of its infrastructure.
http://benton.org/node/27098
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QWEST PASSES ON BROADBAND STIMULUS FUNDS
[SOURCE: Denver Business Journal, AUTHOR: Greg Avery]
Qwest, the nation's third-largest local phone company, says it will not apply for the first round of a $7.2 billion federal stimulus program expanding the reach of high-speed Internet because participating under its current rules doesn't make financial sense. The company wanted stimulus money to fund the neighborhood-level broadband networks that cost too much to realistically build in less populated areas. The rules have been criticized for skewing much of the stimulus money to projects connecting people living at least 50 miles outside cities and towns instead of larger populations of rural dwellers living closer to communities, and for putting applications covering slower-speed wireless broadband services on the same footing as wireline services with faster download speeds. US Telecom, a broadband industry association that Qwest joined last month, wrote to Agriculture Secretary Tom Vilsack and Commerce Secretary Gary Locke urging that the agencies not wait and change the rules immediately.
http://benton.org/node/27097
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PFF QUESTIONS FCC'S NET NEUTRALITY AUTHORITY
[SOURCE: eWeek.com, AUTHOR: Roy Mark]
In a filing supporting Comcast's appeal of the Federal Communications Commission ruling that Comcast violated the agency's network neutrality principles by throttling peer-to-peer traffic from BitTorrent, the Progress & Freedom Foundation contends the principles are not legally enforceable. The FCC cited seven separate provisions of the Communications Act as supporting its claims of ancillary jurisdiction. "Congress has not in fact delegated to the FCC any express authority to regulate Internet services. If it had, there would be no need for the Commission to strain the principle of ancillary jurisdiction to support its order," the PFF said in a friend-of-court filing. (PDF) "And its assertion of ancillary jurisdiction is untenable, exceeding any previously recognized scope and boundaries." The think tank further contended that the FCC's "expansive theory of its ancillary authority" would grant it "completely unlimited regulatory powers over information services." The PFF also claimed there is nothing in the Communications Act that delegates any express authority to the FCC to regulate Internet service. "If anything, its history indicates Congress's affirmative desire to keep such services unregulated," the filing said.
http://benton.org/node/27087
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WIRELESS/TELECOM


AS CARRIERS GRID FOR FCC FIGHT, AN OMEN DOWN UNDER
[SOURCE: TelephonyOnline, AUTHOR: Ed Gubbins]
As Federal Communications Commission Chairman Julius Genachowski focuses "relentlessly" on competition, he cannot have failed to notice the recent admission of Australian carrier Telstra that it has engaged in anti-competitive practices, denying rivals the legal right to interconnect by falsely claiming there was no room for new equipment in seven exchange facilities ­ an admission that came only after the departure of its former chief executive officer, Sol Trujillo. Known for his adversarial relationship with unions and the government (which owned the company just four years ago and still owns a large part), Trujillo will be remembered by Australians as "the one who took on the government and lost," one analyst said. As the former CEO of US West, Trujillo must have been shocked to learn that a Fortune 500 company can take on the government and lose. Now Australia is barreling ahead with an ambitious plan to build a $34-billion open nationwide network, dramatically changing Telstra's tone and inspiring others around the globe. The FCC does appear serious about competition, judging from its inquiries into exclusive deals between carriers and smartphone makers and the rejection of Google Voice from the iPhone. And carriers obviously think they can win once again by beating the government; the Wall Street Journal reports that major wireless operators are quickly beefing up lobbying operations and hiring former Democratic Congressional staffers.
http://benton.org/node/27095
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CELLPHONE USERS IN US, CANADA, SPAIN PAY MOST
[SOURCE: Wall Street Journal, AUTHOR: Susana Ferreira]
Consumers in the US, Canada and Spain have among the highest mobile phone bills in the world, according to an Organization for Economic Cooperation and Development report, which also reveals that people are increasingly ditching land lines in favor of using only cellphones. The new report by the OECD, which surveyed its 30 member countries, says that revenue in the mobile-phone sector is on the rise, despite the global recession. "People don't give up their cellphones. Many of us are on two-year contracts, and we can't just walk away from them," Taylor Reynolds, an economist with the OECD's Telecommunications and Internet Policy division, said in an interview. Mobile phone "connections are seen as a necessity, not as a luxury." Mobile phones are steadily becoming cheaper to use, and service is more readily available, according to the report. Still, there are glaring differences in prices and usage around the world. In Europe, mobile phone service is generally cheaper than in the U.S. Users in northern Europe, especially Denmark, Finland, Sweden and the Netherlands, pay the least for their mobile phones, and are therefore increasingly substituting their land lines with cellphones.
http://benton.org/node/27094
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APPLE, DELL ANSWERING CHINA'S CALL?
[SOURCE: MediaPost, AUTHOR: Mark Walsh]
China has long loomed as a huge potential opportunity for outside mobile technology companies. Cracking that market has been another matter. But recent reports suggest that Apple will launch the iPhone soon in China, while Dell may debut its own mobile device there. What's not in question is that China has a lot of mobile users -- more than 700 million, according to second-quarter figures from mobile research and consulting firm Chetan Sharma. As of last year, Nokia was the top mobile phone seller in China, with a 46% share of shipments into China. Due to the sheer size of the mobile market in China, eMarketer predicts the Asia-Pacific region will overtake the U.S. in mobile ad spending by 2012 when it hits $6.8 billion.
http://benton.org/node/27092
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SMART PHONES GAIN AS MIDRANGE HANDSETS SUFFER
[SOURCE: Wall Street Journal, AUTHOR: Gustav Sandstrom]
Global sales of smart phones continued to rise in the second quarter as customers sought more features for their money, research firm Gartner said Wednesday. However, the overall mobile-phone market declined from a year earlier for the third consecutive quarter, though the decline was at a slower pace than in the previous quarter, Gartner said in its quarterly report on the industry. The rapid downturn in consumer spending has hammered the wider market as customers delay upgrades and hold off buying new phones. Prices of phones have been falling as phone companies and vendors try to stimulate demand. However, sales of smart phones are on the rise as vendors and wireless companies focus on marketing these devices in the hope of making more revenue per device. Consumers who would usually buy midrange phones are either now purchasing smart phones, which offer features such as email, or are trading down to less-expensive handsets, said Gartner's research director, Carolina Milanesi.
http://benton.org/node/27108
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FAIRPOINT ORDERED TO RESPOND TO VERMONT COMPLAINT
[SOURCE: Associated Press, AUTHOR: ]
Fed-up regulators opened a probe Monday into whether to revoke FairPoint Communications' right to do business in Vermont, grilling its president about customer service problems and ordering the troubled telecommunications provider to respond to a state "show cause" petition within 30 days. The state Public Service Board gave the company until Sept. 10 to formally reply to a petition filed last month in which state officials asked for an investigation into whether FairPoint has the financial viability and operations know-how to recover from its inauspicious start handling telecommunications business in Vermont, New Hampshire and Maine.
http://benton.org/node/27091
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HEALTH & MEDIA


HEALTH 2.0 COULD SHOCK THE SYSTEM
[SOURCE: Financial Times, AUTHOR: Esther Dyson]
[Commentary] Can the grassroots Internet do for health what it is doing for politics? America's political culture has been revitalized in recent years as citizens have become newly vocal and engaged, in large part through the web. The Internet gives all of us the ability to get involved, whether by signing up to a presidential candidate's mailing list, participating in local politics through blogs or even just sharing photos and interests on social networking sites. Whatever happens with President Barack Obama's plans for healthcare reform, the same thing is starting to happen in the field of health itself - that is, that happy state in which you do not need much from the medical system. Indeed, healthcare is ripe for the kind of revolution we are having in politics, due both to a backlash against the dysfunctionality of the old system and to the power that the Internet gives people to collect information and organize themselves. Real improvement in the healthcare system depends only partly on who pays. It also has to do with who makes the choices - and whether they have enough information and incentives to do so wisely. In the end, all politics is local. And health begins at home.
http://benton.org/node/27110
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BLUMENTHAL HELPS REBUT HEALTH REFORM CRITICS
[SOURCE: GovernemntHealthIT, AUTHOR: Mary Mosquera]
The adoption of health information technology will be a catalyst for the healthcare improvement goals of health reform legislation, said Dr. David Blumenthal, the national health IT coordinator. Blumenthal answered critics of the administration's health reform efforts and health IT's role in accomplishing it in an Aug. 7 online presentation sponsored by the Department of Health and Human Services. "Health IT can empower all kinds of improvement in preventive care, in acute care and chronic care," he said. Health IT will also help provide physicians equipped with best practices and research data for treating many conditions to improve patient outcomes, he said. The economic stimulus provides $1.1 billion for comparative effectiveness research through programs at HHS' Agency for Healthcare Research and Quality, the National Institutes of Health and the Office of the HHS Secretary. "I think they are afraid that physicians somehow will be controlled by the information that's in the record or by guidelines that are in the electronic record," Blumenthal said. An electronic record, however, assembles for the physician all of the information that is relevant to be able to make an effective decision.
http://benton.org/node/27090
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IT'S WAR. MEDIA WAR
[SOURCE: The Huffington Post, AUTHOR: Sue Wilson]
[Commentary] The vocal, viral army of people opposed to health care reform is a campaign aided by a giant radio and TV cheerleading squad. As with the "Tea Parties," Fox News and AM Radio are promoting both the town halls and the lies to tens of millions of unwitting people. No wonder people are upset; trusted voices are scaring them to death. Voices like Rush Limbaugh, on 600 radio outlets, telling them, "as Obama said, they'll give 'em some pain killers, and let 'em loop out until they die." Laura Ingraham, on 300 stations, "Some will call them death camps." Glenn Beck, on 400 more, "Why is there no more discussion than there is on Sarah Palin, and what she said over the weekend that there would be a death panel for her son, Trig? That's quite a statement. I believe it to be true..." So, average people, shut out of the facts and terrified of the Obama plan, storm into town halls to shout down their elected representatives. Here's where it gets good: this irate army creates just the kind of spectacle news loves to cover, so the "real" news amplifies the falsehoods way beyond the walls of the hall. The mainstream news no longer takes the time to clarify the facts, but instead becomes an effective PR machine for the right wing war of words.
http://benton.org/node/27086
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MEDIA OWNERSHIP


WTO DISPUTE PANEL RAPS CHINA ON AUDIOVISUAL GOODS
[SOURCE: Reuters, AUTHOR: Jonathan Lynn]
China's regime for importing and distributing audiovisual material such as books and films breaks international trade rules and should be revised, a World Trade Organization (WTO) dispute panel said on Wednesday. It was the third time a WTO panel had ruled against China, which is becoming increasingly assertive in pressing its own complaints against other countries at the world trade body. The panel, ruling in a case brought by the United States, said China's system for importing and distributing the material also breached the terms of China's entry to the WTO in 2001. The United States immediately welcomed the ruling.
http://benton.org/node/27089
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BIG RADIO REPORTS BIG DECLINES
[SOURCE: MediaPost, AUTHOR: Erik Sass]
A slew of radio broadcasters reported their second-quarter results this week, with little cause for celebration. Led by Clear Channel Communications, the radio groups all posted double-digit declines, although some pointed out that these were smaller than in previous quarters.
http://benton.org/node/27088
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POLICYMAKERS


VC JOINS FCC, WILL FOCUS ON THE SMART GRID
[SOURCE: earth2tech, AUTHOR: Katie Fehrenbacher]
Apparently, venture capitalist Nick Sinai will become the Energy and Environmental Director for the Federal Communications Commission, where he will lead "a team that will examine how broadband/communications infrastructure and policies can support our national energy and environmental goals, with an emphasis on the Smart Grid." The move is unusual, largely because so far, the FCC hasn't really played a big role when it comes to standards or the implementation of the smart grid. The National Institute for Standards and Technology (NIST), the Federal Energy Regulatory Commission, the North American Electric Reliability Corporation (NERC), even the Institute of Electrical and Electronics Engineers (IEEE) have done a lot more high-profile work. But the FCC will have an important part to play when it comes to dictating the rules for smart grid services using wireless spectrum and broadband technologies, and perhaps Sinai's addition signals greater future involvement by the commission.
http://benton.org/node/27111
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FCC'S DIVERSITY COMMITTEE TO MEET SEPT 22
[SOURCE: Federal Communications Commission]
The Federal Communications Commission's Advisory Committee on Diversity for Communications in the Digital Age will hold a meeting on September 22. At this
meeting the Media, Telecom and Broadband, and Constitutional Issues working groups will each present a status report as to the matters they are considering. A formal recommendation from one of the groups may be proposed.
http://benton.org/node/27085
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