June 1999

Communications-related Headlines for 6/30/99

MERGERS
FCC SBC-Ameritech Conditions Draw Broad Positive Reactions (WSJ)
Cisco to Buy Stratum One for $435 Million (WSJ)
CMGI Buys Alta Vista from Ailing Compaq (WP)

TELEPHONY
Access Charges Cut: Lower Long Distance Rates Should Follow (FCC)
Bell Atlantic to Raise Access Fee 51 Cents (WP)

EDTECH
For Religious Schools, a Victory on Money for Net Access (CyberTimes)

INTERNET
Hackers Attack Army's Main Internet Site (CNN)
Telefonica Casts Net for Latin Market (USA)

RADIO
Ever a Voice of Protest, Radio KPFA Is at It Again, but With a Twist
(NYT)

ANTITRUST
U.S. Said to Probe Ocean Cables (CNN)

MINORITIES
U.S. to Assist Small Tech Firms (WP)

MERGERS

FCC SBC-AMERITECH CONDITIONS DRAW BROAD POSITIVE REACTIONS
Issue: Merger
The Federal Communications Commission has proposed 28 conditions for approval
of the SBC - Ameritech merger. These conditions include: 1) timetables for the
Bells to enter new markets; 2) discounted rates for competitors leasing network
space; 3) promises to offer high-speed data service to low-income areas and 4)
fines totaling more than $2 billion for failure to comply with the conditions
set forth. The settlement package will be open for public comment a month
before being put to vote by the commissioners. So far no Bell company has won
approval by the FCC to enter the long-distance game because they have not met
the conditions set forth in the Telecommunications Act of 1996. This may give
SBC - Ameritech a leg up in being the first Bell company to do just that if the
FCC conditions of the merger are met. Gene Kimmelman of the Consumers Union
said, "It will take an army of regulatory policemen to oversee these
conditions" and that he doubts this will benefit residential customers.
[SOURCE: Wall Street Journal (B10), [AUTHOR: Kathy Chen]
(http://wsj.com/)
The 28 conditions can be found at the FCC Web site:
(http://www.fcc.gov/ccb/Mergers/SBC_Ameritech/conditions062999.html)

CMGI BUYS ALTA VISTA FROM AILING COMPAQ
Issue: Internet
Alta Vista, one of the best-known search engines on the Internet, was sold
yesterday to CMGI, an Internet company. The deal vas valued at $2.3 billion.
Though Alta Vista ranks 15th among the most popular online sites, its previous
owner, Compac Computer was struggling with its own financial problems and saw
that Alta Vista was drifting away from core activities. For the deal, Compac
will receive 19 million shares of stock in CMGI. In return, CMGI will own 83%
of Alta Vista. Compac will also get a share of the 40 Internet companies that
CMGI operates and hopes to generate sales of its hardware as part of its
"preferred relationships" with CMGI companies.
[SOURCE: Washington Post (E3) AUTHOR: John Schwartz]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/30/126l-063099-idx.html)

CISCO TO BUY STRATUM ONE FOR $435 MILLION
Issue: Merger
Cisco Systems, continuing with their aggressive policy of buying technologies
they do not want to develop internally, agreed to acquire StratumOne
Communications, which designs chips for high-speed computer networking. This is
Cisco's 36th acquisition and seventh this year. Analysts say the deal
demonstrates how chips are becoming more important as companies such as Cisco
build devices to route computer traffic faster over longer distances.
StratumOne's chips can process 10 billion bits of data a second.
[SOURCE: Wall Street Journal (B10), [AUTHOR: Scott Thurm]
(http://wsj.com/)

TELEPHONY

ACCESS CHARGES CUT: LOWER LONG DISTANCE RATES SHOULD FOLLOW
Issue: Telephony
Beginning July 1, 1999, long distance companies will see overall reductions in
access charge payments and contributions to universal service programs of over
half a billion dollars annually. These changes are designed to improve the
price structure for long distance calling in the U.S. and are likely to lower
prices, further stimulate long distance calling and boost the economy in
general. Federal Communications Commission Chairman William E. Kennard said,
"If consumers see higher flat fees without reduced per-minute rates, they may
want to shop around for another long distance company or even consider not
having a pre-subscribed long distance company at all." The FCC is releasing a
Consumer Fact Sheet - "Tips for Lowering Your Long Distance Telephone Bill."
(Check out the FCC site below for more information and the fact sheet.)
[SOURCE: Federal Communication Commission]
(http://www.fcc.gov/Daily_Releases/Daily_Business/1999/db990629/nrcc9038.txt)

BELL ATLANTIC TO RAISE ACCESS FEE 51 CENTS
Issue: Telephony
On July 1, Bell Atlantic will begin charging local area residents 51 cents more
on their monthly phone bills. This is the company's response to an action by
the Federal Communications Commission to reduce the "access charges" that
long-distance carriers pay local phone companies for the use of their telephone
networks. The company says it will lose $230 million in revenue over the coming
year and that the 51cent increase will make up for some of that loss. The new
charge will appear on bills as an increase from 53 cents to $1.04 in a line
item called "federal access charge." Bell Atlantic is referring all complaints
to the federal government and long-distance carriers AT&T, MCI World Com and
Sprint.
[SOURCE: Washington Post (E1), AUTHOR: Shu Shin Luh]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/30/132l-063099-idx.html)

EDTECH

FOR RELIGIOUS SCHOOLS, A VICTORY ON MONEY FOR NET ACCESS
Issue: EdTech/First Amendment
Last week, a Federal District Court ruled that a Wisconsin program which
subsidizes Internet access for schools, including religious schools, does not
violate the First Amendment separation of church and state. The judge,
however, did find that a related state grant program that gives subsidies to
parochial schools that have already established Internet access does violate
the constitution. This is the first major ruling on the government's ability to
help religious schools gain access to the Internet. Judge John Shabaz decided
that subsidy program -- a state version of the Erate program -- was acceptable
in part because the money goes directly to high-speed telecommunications
providers and not to the schools themselves. "Sectarian schools cannot convert
subsidized telecommunications links into an economic benefit to them to be used
for the advancement of the institution as a whole and its religious mission,"
he wrote. The grants program was deemed unconstitutional because it involved
direct cash payment to religious schools with few restrictions on how the money
was to be spent. Sharon Schmeling, executive director of the Wisconsin
Association of Nonpublic Schools, was pleased with the ruling. She said that
many of the 900 religious schools receiving state help might not be able to
afford Internet access without the program.
[SOURCE: CyberTimes, AUTHOR: Pamela Mendels]
(http://www.nytimes.com/library/tech/99/06/cyber/education/30education.html)

INTERNET

HACKERS ATTACK ARMY'S MAIN INTERNET SITE
Issue: Internet/Security
Yesterday, computers hackers succeeded in infiltrating the U.S. Army's main Web
site, as well as the Internet site for the National Oceanic and
Administration's Storm Prediction Center. The hacker took advantage of a
well-publicized flaw in the off-the-self software used to create the sites. The
attack on the NOAS's Storm Prediction Center prevented emergency management
officials from being able to track thunderstorms or tornadoes on the Web site.
Although one of the Army's Web pages was vandalized, there were no reported
security breaches. Yesterday's incident is the latest in a string of attacks on
government Web sites, including thoes of the White House, the Senate, and the
FBI.
[SOURCE: CNNInteractive, AUTHOR: Associated Press]
(http://www.cnn.com/TECH/computing/9906/29/army.hacked.02.ap/index.html)

TELEFONICA CASTS NET FOR LATIN MARKET
Issue: Internet
Telefonica, the Spanish telecommunications giant, said yesterday that it hired
Lucent Technologies to create an Internet based network for booming Latin
markets. Other new offerings for this market include: 1) Quepasa.com of Phoenix
as a Spanish portal; 2) Jazztel and Telefonica offering free Internet access;
and 3) since many U.S. companies will not ship outside of the US or Canada,
Skybox will offer a U.S. address and mail forwarding service. Nazca Saachi &
Saachi said that the number of Internet users in Latin America will reach 34
million by 2000. Visa International and International Data Corp. said
electronic commerce revenue in Latin America will hit $8 billion in 2003, up
from their $300 million last year. Deployment in Brazil and Chile will begin
this year.
[SOURCE: USA Today (5B), [AUTHOR: Steve Rosenbush]
(http://usatoday.com/)

RADIO

EVER A VOICE OF PROTEST, RADIO KPFA IS AT IT AGAIN, BUT WITH A TWIST
Issue: Radio
At KPFA, a San Francisco public radio station steeped in the tradition of
protest and free expression, recent protests have been aimed at the station's
owner, the Pacifica Foundation. Over the past few years there has been
increasing tension between staff members and the station's management, which
has been pushing for more national program and centralized decision making. The
conflict escalated into full-scale protests when Nicole Sawaya, KPFA's general
manager was fired two weeks before the station's 50th anniversary. "KPFA is the
closest thing that the Bay Area secular left has to a church," explained
Matthew Lasar, a former news reporter at the station "and Pacifica threw out
the preacher two weeks before Christmas." When national news reporter Larry
Bensky spoke out against the firing of the general manager, he was dismissed
too. The most recent protest on Monday evening included more than 100 people
chanting "Free KPFA." According to Pacific's executive director, Lynn Chadwick,
the station's problems are a result of a small group of people who are
resistant to change.
[SOURCE: New York Times (A12), AUTHOR: Everyn Nieves]
(http://www.nytimes.com/yr/mo/day/news/national/pacifica-radio.html)

ANTITRUST

U.S. SAID TO PROBE OCEAN CABLES
Issue: Antitrust
The U.S. Justice Department is investigating whether or not a consortium of the
world's leading telecommunications companies -- including AT&T, Sprint, MCI
Worldcom and three of Japan's biggest telecom firms -- unfairly dominate the
undersea cable business. The concern is that the more than 30-member consortium
has been violating antitrust laws by mopping up all available customers.
Upstart companies such as Global Crossing have complained of difficulties in
attracting customers for a trans-Pacific cable. Demand for undersea cable
traffic has soared in recent years with the rapid growth of the Internet and
the existing cables have traditionally been laid and maintained by a tightly
knit group of telecom giants. The Justice Department sent letter to several of
the consortium's members demanding details of a $1.2 billion undersea cable the
consortium is laying between the United States and Japan.
[SOURCE: CNN, AUTHOR: London (CNNfn)]
(http://cnnfn.com/1999/06/30/worldbiz/under_sea/)

MINORITIES

U.S. TO ASSIST SMALL TECH FIRMS
Issue: Technology
The Commerce Department launched a campaign to steer $1.5 billion in federal
technology contracts over the next five years to a select group of small
businesses, most of them headed by women and minorities. Why the new focus? The
Commerce Department says it is a response to its previous strategy that began
in the mid-1990s to award contracts to the nation's largest firms as it
streamlined its own purchases of computer systems and software. The Washington
area, where there is a large concentration of minority contractors, has been
largely affected. Although the total 1993 federal contracts in the region
increased by 51%, those awarded to minority-owned firms grew only by 6%. Why
such a difference? Analysts say it is partly due to the elimination of
affirmative action plans (such as the Small Business Administration's Section
8(a) program) to aid small and minority-owned companies as well as the
aforementioned government procurement plan.
[SOURCE: Washington Post (E3), AUTHOR: Peter Behr]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/30/147l-063099-idx.html)

--------------------------------------------------------------

Communications-related Headlines for 6/29/99

TELEPHONY
FCC Weighs Unusual Limit on SBC Deal (WSJ)
Joint Phone Venture Wins an Approval (NYT)

BROADBAND
AT&T Access Woes Multiply (B&C)

INTERNET
Coalition Sets Plan to Block Internet Music Piracy (NYT)
Capital Dispatch: Wanted: More Online Government (CyberTimes)
Webcast Audiences Aren't Just Sitting There, Survey Finds (CyberTimes)
Man Given 2 Year Term In E-Mail Case (NYT)
U.S. Aims to Help E-Buyers Beware (WP)

MEDIA & SOCIETY
Parents Not Tuned to V-Chip (WP)
Dole Proposal Tackles Internet Pornography (WP)
Court Gives Ear To Bunny (B&C)

TELEPHONY

FCC WEIGHS UNUSUAL LIMIT ON SBC DEAL
Issue: Mergers
The Federal Communication Commission is holding talks with SBC and Ameritech
about the one-year-old proposed merger. They are not discussing specifics with
the public but sources say there may be some conditions on the merger, which
would address monopolistic concerns. The proposed terms seem to be less
stringent than some that were considered earlier. One may be requiring the
deployment of high speed Internet service and opening their markets to
competition or face stiff fines. The FCC is expected to seek public comment on
the proposed items.
[SOURCE: Wall Street Journal (B1), AUTHOR: Miriam Jordan]
(http://wsj.com/)

JOINT PHONE VENTURE WINS AN APPROVAL
Issue: Alliance
The Justice Department has approved plans for a $3 billion joint venture
between AT&T and British Telecom. The alliance is intended to allow the two
companies to combine their voice data and Internet services for multinational
corporations. In March, after AT&T agreed to sell its British assets, European
regulators gave their OK to the plan. The Federal Communications Commission
still must approve the deal.
[SOURCE: New York Times (C27), AUTHOR: Bloomberg News]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/29att.html)

BROADBAND

AT&T ACCESS WOES MULTIPLY
Issue: Broadband
AT&T is heading into more trouble in the cable business. In Los Angeles, three
out of five members of the city's technology advisory committee resigned
because of the open-access issue. The third recently resigned after a report
opposing open-access to cable lines was brought into negotiations. AT&T faces
many upset local committees in San Francisco, Atlanta, suburban Boston and
south Florida as Internet companies and local telephone companies lobby their
city councils for open-access to cable lines. These companies feel AT&T will
monopolizing cable lines, only offering consumers their own high speed Internet
services. A federal court decision in Portland, Oregon this May brought the
issue of open-access to all of AT&T's markets. The court decision gave Portland
the power to force AT&T to allow competitors access to the cable lines in that
market. AT&T claims if the markets are open, it signals the government choking
off development of new business because AT&T has invested money into the
technological development and the government is giving their investment away.
Internet providers and telephone companies believe that cable services should
be regulated similar to long-distance where consumers can choose among dozens
of carriers for high speed Internet services.
[SOURCE: Broadcasting &Cable (p11.), AUTHOR: John M. Higgins]
(http://www.broadcastingcable.com/)

INTERNET

COALITION SETS PLAN TO BLOCK INTERNET MUSIC PIRACY
Issue: Intellectual Property
Music and technology companies have agreed to work together to develop a
technology that would block the playing of pirated songs on digital music
players. They have formed a coalition called the Secure Digital Music
Initiative to prevent future unauthorized copying of music over the Internet.
Last year's launch of the portable Rio player, which lets users listen to songs
downloaded from a computer using MP3 technology, cause great fear in the record
industry. The coalition has developed a two phase plan that will initially
allow portable devises to play all music, but subsequent versions of the
players will be required to block all unauthorized music.
[SOURCE: New York Times (C1), AUTHOR: Neil Strauss and Matt Richtel]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/29music.html)

CAPITAL DISPATCH: WANTED: MORE ONLINE GOVERNMENT
Issue: Access to Information
Two technology advocacy groups, the Center for Democracy and Technology (CDT)
and OMB Watch, have begun a campaign to identify "the 10 most wanted
government documents, reports or data sets that should be on the Web -- but are
missing in action due to the failure of the government to use the Internet
fully." The groups are asking citizens to participate by filling out the form
at the CDT's Web site, (http://www.cdt.org/righttoknow/10mostwanted/) or
at the
OMB Watch Web site, (http://www.ombwatch.org). "We're deputizing the Net
community, journalists and researchers," said Ari Schwartz, CDT policy analyst.
"If your document is chosen as one of the top 10, you will be rewarded with a
full force effort to get the documents they are seeking up on the Web."
[SOURCE: CyberTimes, AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/06/cyber/capital/29capital.html)

WEBCAST AUDIENCE AREN'T JUST SITTING THERE
Issue: Internet
Good news for companies that are focusing on Web sites that offer audio and
video. A survey to be released today by Arbitron NewMedia indicates that 49
percent of the respondents said they buy products they see advertised during
Webcasts or on related sites. Northstar Interactive, a research firm owned by
Arbitron NewMedia, conducted the survey online this month. Northstar
interviewed 1,527 Internet users who were picked randomly on the sites of two
major online broadcasters, Broadcast.com and Vtuner.com. Sixty-three percent of
those surveyed access Webcasts at home, while 47 percent access them at work. A
third of the respondents said they tune in daily, while three-quarters said
they tune in once a week. Gregory Verdino, vice president and general manager
for Internet information services at Arbitron NewMedia, said the study found
that the Internet audience would like to see a portable device that would allow
them to listen to and watch Webcasts anywhere.
[SOURCE: New York Times (CyberTimes), AUTHOR: Lisa Napoli]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/29radio.html)

MAN GIVEN 2 YEAR TERM IN E-MAIL CASE
Issue: Internet
A 23-year-old man was sentenced to two years in prison for sending threatening
e-mail to nearly 100 Hispanic people around the country. Kingman Quon was
convicted on seven counts of civil right violations after admitting to the
crime. He also apologized to his victims, who included many faculty members at
California State University at Los Angeles, students at MIT, and employees of
Xerox and NASA. "When I read, 'I hate your race. I want you all to die,' how
could I protect myself?" said of the recipients, Assemblywoman Gloria Romero of
California. "This, your honor, was about me. It was about having a name like
Romero. . . . The morning I read that e-mail, I felt defenseless." Some
observers, however, question whether jail time is an appropriate punishment for
sending email. "What this is really about is the feeling on the part of Federal
authorities that they need to prove they're on the job in cyberspace," said
Mike Godwin, a lawyer and author of _Cyber Rights: Defending Free Speech in the
Digital Age_.
[SOURCE: CyberTimes, AUTHOR: Rebeca Fairley Raney]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/29hate.html)

U.S. AIMS TO HELP E-BUYERS BEWARE
Issue: Internet/Health
The Federal Trade Commission (FTC) is cracking down on fraudulent advertising
for health products on the Internet. According to a market research survey,
health concerns are the sixth most common reason for using the Internet (and
growing by 70% a year). But amid the helpful information that can be found on
reliable Web sites, the number of unreliable and potentially dangerous Web
sites are growing. Since 1994 the agency has brought charges for fraudulent
advertising against the operators of 91 Internet sites, including eight that
sold health-related products. Most recently, it put up 12 "teaser sites" on the
World Wide Web to educate people about questionable marketing tactics. As part
of its campaign called Project Cure.All, the FTC created homepages for
nonexistent products called ArthritiCure (for arthritis relief), NordiCaLite
(for weight loss) and Virility Plus (for impotence treatment) to help raise
consumer awareness of deceitful adds and to educate them on how to better read
ads. Another safe way to obtain health information is by going to the following
government web sites which provide links to reliable sources and advice on how
to evaluate health-related products: www.healthfinder.gov and www.ftc.gov.
[SOURCE: Washington Post (Z7), AUTHOR: Susan Okie]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/29/007l-062999-idx.html)

MEDIA & SOCIETY

PARENTS NOT TUNED TO V-CHIP
Issue: Television/Technology
The long-awaited V-chip, which allows parents to screen out violence (hence the
V), offensive language and sexual situations, has been installed in new TV sets
and is now out on the market. There is doubt, however, that parents will ever
be chip-hip. People today have difficulty programming their VCRs, much less a
new chip inside their TV sets. And, most importantly, few people are aware of
the TV ratings that appear before television shows (D=suggestive dialogue,
V=violence, FV=fantasy or cartoon violence) that are necessary to "block" these
shows using the V-chip. Also, there is concern that the V-chip could increase
the amount of questionable material on TV because networks might ague that
families now have a means to block any material they chose. On the other hand,
violent TV shows could lose advertisers if the V-chip blocks them out.
According to federal law, every new set bigger than 13 inches has to have the
V-chip installed by January 1. It is estimated that roughly half the households
in the country could have a V-chip TV in five years, but lack of education on
its use and on the rating system could limit widespread use.
[SOURCE: Washington Post (A1), AUTHOR: Paul Farhi]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/29/059l-062999-idx.html)

DOLE PROPOSAL TACKLES INTERNET PORNOGRAPHY
Issue: Internet
Republican presidential candidate Elizabeth Dole tackled the issue of Internet
content by stating, "Libraries shouldn't use federal tax money to put
pornography on their shelves and they shouldn't put it on their desktops or
laptops." She said she wants to end federal funding for libraries that allow
access to pornography. Republican pollster Michael Baselice said Dole, like
other republican candidates, is searching for ways to siphon attention and
money from Texas Governor George W. Bush.
[SOURCE: Washington Post (A3), AUTHOR: Ceci Connolly]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/29/074l-062999-idx.html)

COURT GIVES EAR TO BUNNY
Issue: Cable/ First Amendment
Last week, the Supreme Court agreed to review a law that requires cable
operators to block the sound and video of all adult channels from
non-subscribers and confine adult programming to the hours of 10 p.m. to 6a.m.
The Playboy Entertainment Group is fighting the law on constitutional grounds.
They also claim that the law would result in $25 million in lost revenues over
the next ten years. The government, however, has asked the Supreme Court to
uphold the law, arguing that it "imposes a very limited restriction on speech
and is a very effective approach to the substantial evil it addresses."
[SOURCE: Broadcasting&Cable (p.13), AUTHOR: Paige Albiniak]

--------------------------------------------------------------

Communications-related Headlines for 6/28/99

INTERNET
3-Week Delay in Opening Up Internet Name Registration (NYT)
For a Personal Touch, Some Sites Add Real People (NYT)
Brazilians Take to the Web With Uncommon Speed (NYT)
Web Snags Ads from Newspapers, Phone Books (USA)
Schools turn to Internet (SJM)

BROADCASTING
TV Station's Libel Trial Revisits Old Murder Case (NYT)
Hearings on Public Broadcasting and Consumer/Investor Access (House)

MERGERS
US West Inc. And Frontier To Weigh Bid (WSJ)
Lucent, Cisco Settle (CNN)

ANTITRUST
Microsoft, Running Scared (NYT)

INTERNET

3-WEEK DELAY IN OPENING UP INTERNET NAME REGISTRATION
Issue: Internet
The Commerce Department has announced that there will be a three-week delay in
the introduction of competition in the Internet name registration business. As
part of the process of transferring control of the Internet to the private
sector, the government developed a plan to end Network Solutions official
monopoly on the registration of domain names. The nonprofit Internet
Corporation for Assigned Names and Numbers (ICANN) was created to oversee the
transfer of the network into private hands. Almost from the beginning, the
process has been marked by controversy, with many questioning ICANN's decision
to levy a $1-a-year free on every registered domain name. Most importantly,
Network Solutions and ICANN have not been able to come to an agreement about
who has rights to the information about who the over 5 million registered
domain names belong to. If Network Solutions refuses to share the information,
the Commerce department has threatened to allow another company to take over
the administration of .com, .net and .org. Such a move could cause a split in
the Internet's root server, which could result in Internet chaos.
[SOURCE: New York Times (C1), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/28name.html)
See also:
COMMERCE DEPARTMENT, NETWORK SOLUTIONS AGREE TO EXTEND SHARED REGISTRATION TEST
BED UNTIL JULY 16
[SOURCE: NTIA]
(http://www.ntia.doc.gov/ntiahome/press/testbed062599.htm)

FOR A PERSONAL TOUCH, SOME SITES ADD REAL PEOPLE
Issue: E-Commerce
Several e-commerce sites are taking a unique approach to "humanizing" their
operations: they are replacing software with real people to provide customer
service. "Especially as the Internet moves into the mainstream, consumers are
looking for that comfort zone that ties into the world they're used to," said
Chris McCann, senior vice president of 1-800-Flowers, which is implementing an
Internet telephony service to answer consumer questions. Other companies such
as Eddie Bauer and Hewlett-Packard have plans to implement a combination of
text-based chat and Internet telephony customer support packages. The desire to
enhance online customer relations stems from the flood of complaints that
accompanied last year's holiday shopping season. Resent studies have also
indicated that between 33% and 66% of online transactions are never completed.
Online retailers are beginning to realize that e-commerce might require more
overhead costs than many originally anticipated.
[SOURCE: New York Times (C4), AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/06/cyber/commerce/28commerce.html)

BRAZILIANS TAKE TO THE WEB WITH UNCOMMON SPEED
Issue: International/Internet
At this moment, South America's largest country, Brazil, might just be the most
competitive portal market in the world. Yahoo, America Online, Microsoft's MSN
and Telefonica of Spain all have plans to compete with local companies in this
rapidly growing Internet market. In Latin America's most wired country, the
number of Brazilians on the Internet jumped 130% last year alone. Despite
Brazil's economic instability and sever inequities, experts predict Internet
penetration will grow 60% to 100% in the next three years. What is not known,
however, is who will emerge as winners in Brazil's intensifying portal war.
[SOURCE: New York Times (C2), AUTHOR: Simon Romero]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/28braz.html)

WEB SNAGS ADS FROM NEWSPAPERS, PHONE BOOKS
Issue: Internet
Newspapers and the Yellow Pages are facing a huge threat: losing $50 million
dollars in local advertisements to the Web. Forrester Research has predicted
that by 2002 Web advertising will jump to 27% from 15% of the advertising pie,
as others continue to shrink. John Sturm, CEO of the Newspaper Association of
America, said he believes newspapers will not be hurt because they are online
as well as in print, so they have a double advantage in the game.
[SOURCE: Wall Street Journal (B1), [AUTHOR: Miriam Jordan]
(http://wsj.com/)

SCHOOLS TURN TO INTERNET
Issue: Internet
Some schools are finding an alternative to selling pizzas or candy for needed
fundraising. Several Web sites are offering a new form of e-commerce that gives
money to schools for Internet purchases made by family and friends. Each
service works a little differently. The Schoolpop.com site offers rebates to
schools for purchases made at several prominent e-stores, including Amazon and
eToys. "We always need to do fundraising -- and our community is very wired,"
said Larry Curb, principal at Miller Junior High School in San Jose. "It seemed
to make sense."
[SOURCE: San Jose Mercury News, AUTHOR: S.L.Wykes]
(http://www.mercurycenter.com/svtech/news/indepth/docs/school062899.htm)

BROADCASTING

TV STATION'S LIBEL TRIAL REVISITS OLD MURDER CASE
Issue: Media Law
Who can journalists trust to gather information if they cannot trust a public
official? That is the legal question in a Minnesota case. Terri Stokes is suing
a local detective, Anoka County and WCCO-TV, a station owned by CBS, for libel
because the detective gave his theory of the murder of Terri's husband to
WCCO-TV. The detective told reporters of the station that Terri had killed her
husband with a shotgun blast while he slept in their bed. Six years later,
Terri Stokes' libel suit claims she has spent the better part of six years
fending off media and police inquiries regarding the incident. Media law
experts say that holding a news organization liable for the words of a public
official speaking on the record could pose an unsettling precedent. The defense
has already lost several key battles, most notably a ruling last fall denying a
defense motion to dismiss the case. Federal District Judge David Doty rejected
the defense's contention that repeating statements in the public record or made
by government officials is protected speech. The judge called the broadcast
"highly slanted" and said the reporter failed to adequately question the
detective's exaggerated statements.
[SOURCE: New York Times (C10), AUTHOR: Andrew Bluth]
(http://www.nytimes.com/yr/mo/day/news/financial/minn-libel-trial.html)

HEARINGS ON PUBLIC BROADCASTING AND CONSUMER/INVESTOR ACCESS
Wednesday, June 30, 1999 at 10:00 a.m. in 2123 Rayburn House Office Building
the
Subcommittee on Telecommunications, Trade, and Consumer Protection will hold a
hearing on the Corporation for Public Broadcasting Authorization Act of 1999.
Also at 10:00 a.m. in 2322 Rayburn House Office Building the Subcommittee on
Finance and Hazardous Materials will hold a hearing on H.R. 1858, the Consumer
and Investor Access to Information Act of 1999.
[SOURCE: House of Representatives]
(http://www.house.gov/commerce/schedule.htm)

MERGERS

US WEST INC. AND FRONTIER TO WEIGH BID
Issue: Merger
Frontier's board will convene today to consider the new bid from Qwest
Communications International, which is now about 10% higher than Global
Crossing $43 million bid. Frontier along with US West must decide if the
sweetened deal of $47 million is worth leaving their verbal commitment with
Global Crossing. Global Crossing argues that their bid can be completed sooner
because the merger review is already underway. They also believe they face
fewer regulatory and antitrust problems with the government as Bellsouth,
another Baby Bell, is providing part of Qwest's bid through their partial
ownership of the company. Global Crossing sees the concessions that would have
to be made to satisfy the Justice Department as a problem which could severely
cost US West and Frontier in the end. Qwest produced a letter from a member of
the FCC stating that Qwest dropping their long distance service in the US West
territory was sufficient for the deal's completion. Global Crossing says it
does not plan to immediately raise their bid for the two companies. (OK, I am
still waiting for Heather Locklear to come in and clear this up.)
[SOURCE: Wall Street Journal (B1), [AUTHOR: Miriam Jordan]
(http://wsj.com/)

LUCENT, CISCO SETTLE
Issue: Technology
Lucent Technologies Inc., the telephone-equipment maker, and Cisco Systems
Inc., the top Internet-equipment builder, have agreed to settle a year-old
patent-infringement lawsuit. Lucent sued Cisco last June, alleging the company
had infringed on eight key Lucent data-network patents. Cisco responded with
its own countersuit. The settlement announced Friday states that Cisco and
Lucent agree to cross-license each other's technology. The two companies did
not disclose further settlement terms. Both sides expressed their satisfaction
with the outcome. Lucent was especially content because as of Thursday they had
completed their $25.2 billion acquisition of Ascend Communications Inc. -- a
Cisco rival -- gaining access to networking equipment that will enable Lucent
to compete more effectively in the data world.
[SOURCE: CNN, AUTHOR: Reuters]
(http://cnnfn.com/1999/06/26/technology/wires/lucent_cisco_wg/)

ANTITRUST

MICROSOFT, RUNNING SCARED
Issue: Anti-Trust
The government argues Microsoft has a monopoly because most personal computers
use Windows. But then why are software developers rushing to write applications
for Linux, an upstart operating system with about 15 million users? And why
hasn't Microsoft sought higher prices? The government says that Microsoft
charged less to computer makers that helped persuade their customers to use
Microsoft products and rewarded companies that helped with distribution. This
is true. It is also legal; ask the cereal company that pays supermarkets to
display its Frootios on shelves near the checkout counter. The government also
complains that Microsoft forced computer makers to install Windows without
major changes -- just as Ford would prevent car dealers from clipping off the
tail off the Mustang pony insignia. Since the trial began, the government has
no doubt shown that Microsoft has had very bad manners. But it certainly hasn't
proved that Microsoft violated the antitrust laws by harming consumers. It's
time for the antitrust division to give up yet another misguided effort to
micromanage the fast-moving information-technology business.
[SOURCE: New York Times (A21), AUTHOR: Ronald A. Cass (Dean of Boston
University School of Law and Microsoft Consultant)]
(http://www.nytimes.com/yr/mo/day/oped/28cass.html)

--------------------------------------------------------------

Communications-related Headlines for 6/25/99

INTERNET
Dr. Jesse's Internet Checkup: The Good and Bad News About
the Health of the Web (ZDNet)
A Swirl of Rumored Internet Deals (NYT)
Who Will Play Domain Names Cop On The Net? (SJM)

BROADBAND
AOL, Cable Execs, Sprint Square Off Over Broadband Access (CNN)
Cable, Internet Groups Square Off (Spokane)

PUBLIC BROADCASTING
Corporation for Public Broadcasting Authorization
Act of 1999 (House)

WIRELESS
It Takes a Cell Phone (WSJ)
Development of Mobile Satellite Services (NTIA)

MERGER
Gannett to Buy U.K. Publishing Company (WP)

ANTITRUST
Microsoft Trial Ends with Firm Chastened (WP)

INTERNET

DR. JESSE'S INTERNET CHECKUP:
THE GOOD AND BAD NEWS ABOUT THE HEALTH OF THE WEB
Issue: Internet
THE GOOD NEWS: The Internet will continue strong growth for the next couple
of years: Roughly 180 million people are online worldwide (Nua Internet
surveys), The number of Web sites grew from 1 million to more than 5 million
in the last two years (Netcraft), Two-thirds of U.S. homes will have
Internet access by 2003 (Yankee Group). Traffic: more people are spending
more time on the Web and more are logging in from home. Ecommerce: Global
ecommerce will reach $1 trillion by 2002 -- a 66-fold increase from 1997
(Deloitte Consulting); the number of PCs used for ecommerce activities grew
41% from 1997 to 1998 (Infobeads), 44% of U.S. companies are selling online
now, and 36% more expect to do so in the next 12 months (The Association of
National Advertisers). And demographics are changing so Web users are
starting to look like average citizens. THE BAD NEWS: Infrastructure -- the
Web may be subject to increasing blackouts and periods of unreliability.
Advertising -- less companies are budgeting less and paying less for Web
advertising. Abuse -- 1/3 of Net use in the office is recreational; Internet
scams now rank No. 1 on the list of Top 10 scams (North American Securities
Administrators Association); and 6 million people have reported credit card
frauds online (National Consumers League).
[SOURCE: ZDNet AnchorDesk, AUTHOR: Jesse Berst, Editorial Director]
(http://www.zdnet.com/anchordesk/story/story_3553.html)

WHO WILL PLAY DOMAIN NAMES COP ON THE NET?
Issue: Internet/Legal issues
While both Congress and the Internet Corporation for Assigned Names and Numbers
are considering rules to govern trademark violations on the Internet, the
courts may beat them to the punch in deciding how to apply existing trademark
laws to cyberspace. A San Francisco Court of Appeals has recently heard three
separate cases addressing the toughest issues that still need to be resolved in
relation to registration of domain names. One question is who should police
trademark violations. The other issue is how to handle two parties that both
have legitimate claims to an Internet address. The courts must determine if a
trademarked company has exclusive rights to an address, even if another party
has legitimate rights too. Companies have been quick to threaten to sue people
who have domains they want.
[SOURCE: San Jose Mercury News, AUTHOR: Howard Mintz]
(http://www.mercurycenter.com/svtech/news/indepth/docs/domain062599.htm)

A SWIRL OF RUMORED INTERNET DEALS
Issue: Mergers
Over the past week several rumors about deals between Internet and computer
companies have surfaced on the Net. Following a report on Jagnotes.com, Compaq
confirmed that it is in talks with CMGI, an Internet investment concern. There
is also speculation about Gateway acquiring the Internet service provider
Earthlink. These potential deals illustrate the desire of both computer and
Internet companies to get into each other's business. Gateway has been able to
attract 4000,000 users to its Gateway.net service by offering one free year of
service. Whether these all-in-one packages are the answer for computer and
Internet ventures remains to be seen.
[SOURCE: New York Times (C9), AUTHOR: Saul Hansell]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/25place.html)

BROADBAND

AOL, CABLE EXECS, SPRINT SQUARE OFF OVER BROADBAND ACCESS
Issue: Broadband
A top official at AOL told the House Commerce Committee's Telecommunications,
Trade and Consumer Protection Subcommittee yesterday that Congress must choose
between the "open model" of the Internet or the "closed model" to promote Net
access. AOL has a vested interest in the open access because they want to have
presence in cable television delivery, digital subscriber line (DSL) technology
and other forms of high-speed, or broadband services. AT&T is trying to put a
stop to AOL's cable access as AT&T doesn't want to open its cable systems to
competition, citing cost and complexity. To disarm those arguments, AOL
conducted a recent test with GTE, claiming that it can easily sell access via
local cable networks with the addition of a simple, low-cost router box. Sprint
Corp. Senior Vice President Al Kurtze called on the Subcommittee to open not
only cable companies' local networks, but local phone companies' local loops as
well. Kurtze said efforts by "monopoly" local phone and cable companies to
limit access to existing phone and cable links to the home will leave consumers
"technologically stranded."
[SOURCE: CNN, [AUTHOR: reposted from Newsbytes]
(http://cnnfn.com/news/technology/newsbytes/132499.html
See also:
DEPLOYMENT OF DATA SERVICES
Issue: Broadband
Links to testimony at the House Telecommunications Subcommittee hearing on
the deployment of data services. Witnesses included: Howard A. Lenox, SBC
Telecommunications; Tom Tauke, Bell Atlantic; Dave Scott, Birch Telecom;
Mary Beth Vitale, RMI.NET; Stephen C. Gray, McLeodUSA; Glenn Falcao,
NORTEL Networks; Russ Daggatt, Teledesic; Kirby G. Pickle, Teligent; Al
Kurtze, Sprint; George Vradenburg, AOL; Marc J. Apfelbaum, Time Warner
Cable; and Alex V. Netchvolodoff, Cox Enterprises.
[SOURCE: House of Representatives]
(http://com-notes.house.gov/cchear/hearings106.nsf/Witnesses?OpenView&StartK
ey=0B6688530825A0D78525679300553786)

CABLE, INTERNET GROUPS SQUARE OFF
Issue: Broadband
Opening cable systems to multiple ISPs was the issue du jour Wednesday in
the Spokane City Council chambers. Internet On Ramp of Spokane, owned by
California-based Internet Ventures, has lobbied the city and county, trying
to convince officials that TCI should have to open pieces of its network to
Internet service providers (ISPs). On Ramp is arguing that ISPs qualify for
"leased access" rights. cable companies are required by law to lease some of
their channels to outside programmers and On Ramp is arguing that
Internet-video shows are so fast when passed over cable -- 100 times faster
than standard dial-up connections -- that ISPs behave much like video
programmers because customers can choose to watch Internet TV shows. Don
Janke, president of Internet Ventures, said, "The Internet has grown up to
be video," citing agreements that film studios are making to show movies
online. Ken Watts, TCI's general manager in Spokane, maintained "Internet
access is not video programming," and has said TCI will challenge any
government move to open its cable lines to ISPs, as it already has done in
Portland.
[SOURCE: The Spokesman-Review, AUTHOR: Mike Roarke]
(http://www.spokane.net:80/news-story-body.asp?Date=062499&ID=s598577&cat=Co
ntent)

PUBLIC BROADCASTING

CORPORATION FOR PUBLIC BROADCASTING AUTHORIZATION ACT OF 1999
Issue: Public Broadcasting/Budget Issues
Wednesday, June 30, 1999 10:00 a.m. in 2123 Rayburn House Office Building
Subcommittee on Telecommunications, Trade, and Consumer Protection hearing
on the Corporation for Public Broadcasting Authorization Act of 1999.
[SOURCE: House of Representatives]
(http://www.house.gov/commerce/schedule.htm)

WIRELESS

IT TAKES A CELL PHONE
Issue: Wireless
What do you do when you live in country where there are only three phones for
every 1000 people? In Bangladesh, through a loan program at the Grameen Bank, a
private commercial enterprise in Dhaka, you could get a loan for a new cellular
phone. Grameen has been offering microloans to villagers to build fish ponds,
buy cattle or machinery. But since the bank can buy the airtime in bulk and
resell it at cost, they are beginning to see the advantages of the digital
world. The villagers buy phones to check on prices of wood, cattle and produce
so the middlemen in Bangladesh no longer scam them. Delora Begum has been
coined the "phone lady" in her village as she lets people use the phone and
makes a small profit which she reinvests in her husbands chicken coup. Mohammed
Yunus, the founder of the Grameen Bank, says he hopes within five years the
network will be nationwide, putting every villager within one mile of a phone.
[SOURCE: Wall Street Journal (B1), [AUTHOR: Miriam Jordan]
(http://wsj.com/)

DEVELOPMENT OF MOBILE SATELLITE SERVICES
Issue: Satellite
NTIA filed comments at the Federal Communications Commission in IB Docket
No. 99-81 and RM-9328 on efforts to provide additional spectrum allocations
for the development of mobile satellite services.
[SOURCE: NTIA]
(http://www.ntia.doc.gov/ntiahome/fccfilings/rm9328_comments62499.htm)

MERGERS

GANNETT TO BUY U.K. PUBLISHING COMPANY
Issue: Merger
Gannet Co., the Arlington, VA-based publisher of 74 daily newspapers in the
U.S., including USA Today, has placed a bid to acquire British media company,
Newsquest PLC. It says it will pay $1.7 billion in cash and assumed debt for
the company, which has been looking for buyers since early this year so that it
can hold its own against the industry consolidation occurring in the United
Kingdom. The deal is not final and Newsquest could receive other offers in the
next week. Gannett's strategy in the U.S. has been to acquire small to
mid-sized papers in one-newspaper towns, but it said the Newsquest union would
be a "good match-up." One media analyst said this was a good strategy because
there is no opportunity to buy U.S. newspapers right now and because
acquisition prices are very high in the U.S. and low in Europe.
[SOURCE: Washington Post (E3), AUTHOR: Shu Shin Luh]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/25/094l-062599-idx.html)
See Also:
GANNETT MAKES 1.5 BILLION BID FOR NEWQUEST
[SOURCE: Wall Street Journal (B2), [AUTHOR: Erin White]
(http://wsj.com/)

ANTITRUST

MICROSOFT TRIAL ENDS WITH FIRM CHASTENED
Issue: Antitrust
After eight months of testimony, the Microsoft trial has ended. Now, it is up
to a federal judge to determine the fate of the world's largest software
company. If the judge rules against Microsoft --which is expected-- the
government could impose aggressive sanctions on the company. But this might not
happen given the recent market changes, including the recent promotion of
Microsoft's rival Linux operating system. George S. Cary, an antitrust
specialist, says: "The trial has helped spur new competition in the market, but
it also shows how a tiny ember like Linux can begin to glow if Microsoft is in
a position where they cannot flagrantly go out and crush it." Microsoft
believes the trial has nothing to do with the new interest in Linux and says it
would have occurred despite the trial. In the meantime, AOL is adopting a more
cautious policy of responding to its competitors by merging its browsing
software and online content. And, Microsoft is finding new ways to do business
by promoting its products without exclusive distribution arrangements. The
ruling on the trial is not expected to occur until late this fall and any
sanctions the judge orders could be delayed for two or three years by appeals.
[SOURCE: Washington Post (E3), AUTHOR: Rajiv Chandrasekaran]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/25/076l-062599-idx.html)
See Also:
MICROSOFT AND JUSTICE DEPARTMENT MET THREE WEEKS AGO TO SEEK WAY TO SETTLE
[SOURCE: Wall Street Journal (A3), AUTHOR: John R. Wilke]

--------------------------------------------------------------
...and we are outta here. Have a great weekend.

Communications-related Headlines for 6/24/99

CHILDREN ONLINE
Michigan Faces Challenge on Online Porn Law (CyberTimes)
Children's Internet Protection Act (Senate)

INTERNET
FTC to Curb Medical Sales Pitches (WSJ)
Youthful Web Network Has a Modest Goal: Replacing TV (NYT)
No Clicking Allowed in Artist's Browser (CyberTimes)
To Protest Unwanted E-Mail, Spam Cop Goes to the Source (NYT)
Old Newsgroups Marketed in New Packages (NYT)

ECOMMERCE
Millennium Digital Commerce Act (Senate)

MERGERS
Qwest Raises its Bids for 2 Companies (WP)
VoiceStream to Buy Omnipoint In Accord Valued at $2.04 Billion (WSJ)
Airtouch/Vodafone Merger (FCC)

WIERLESS
SnapTrack Inc. Finds a Way to Locate Cell-Phone Callers (WSJ)
Safety for Wireless Customers (Senate)
Global Mobile Personal Communications by Satellite (NTIA)

ENCRYPTION
Commerce Approves Encryption Bill (House)
Encryption Bill (Senate)

CHILDREN ONLINE

MICHIGAN FACES CHALLENGE ON ONLINE PORN LAW
Issue: Internet/Society
The American Civil Liberties Union (ACLU) filed suit yesterday to block a newly
signed Michigan law from taking effect. The Internet Crime Bill, sponsored by
Sen. Beverly S. Hammerstroh (R-MI) and signed by Gov. John Engler on June 2,
would make it illegal for a person to use the Internet to knowingly disseminate
"sexually explicit matter" considered "harmful to minors" to those under 18
years old. The ACLU says the law is so broad that it violates the First
Amendment and the interstate commerce provisions of the U.S. Constitution.
Those backing the ACLU include Art on the Net, a Web site with artwork
including photographs and pictures of nudes, a sex therapist, Dr. Marty Klein,
who answers questions online and a Michigan AIDS information group. Though
there are exemptions in the law for educational material, the ACLU argues that
it is impossible for publishers to know with certainty who is receiving their
material and say the definition of educational material is murky. The law also
might be unconstitutional because it could apply to Internet communication
originating outside of Michigan and interstate activity is left up to the
federal government to regulate. The Michigan law is expected to be overturned
given that similar laws in New York and New Mexico have not fared well in
federal courts. The ACLU intends to ask the court for a preliminary injunction
against the law at least until further court proceedings. The law is scheduled
to take effect August 1st.
(http://www.nytimes.com/library/tech/99/06/cyber/articles/24michigan.html)
[SOURCE: New York Times (CyberTimes), AUTHOR: Pamela Mendels]

CHILDREN'S INTERNET PROTECTION ACT
Issue: Universal Service
From the News Release: The Committee on Commerce, Science, and
Transportation approved by voice vote a bill to require schools receiving
universal service discounts (E rate money) to use a technology-based system
on their computers to screen out child pornography and obscenity. Schools
and libraries may also use the technology to block material that they find
is inappropriate for minors. A substitute to S.97 was offered by Senators
John McCain (R-AZ), Chairman of the Commerce Committee, and Fritz Hollings
(D-SC), Ranking Democrat on the Commerce Committee. The original bill was
introduced by Sens McCain and Hollings on January 19. The main provisions of
the bill are: 1) In order to be eligible for universal service, a school or
library would have to certify with the FCC that they have selected a
technology and have implemented a policy to filter or block materials on
computers with Internet access; 2) Libraries with only one computer may put
a technology or non-technology based policy in place. For libraries with
more than one computer, material must be blocked while computer is in use by
a minor; and 3) School and library administrators are free to choose any
filtering or blocking system that would best fit their community standards
and local needs. In providing for universal service discounts for Internet
access, no federal governmental body can make any qualitative judgements
about the system nor the material to be filtered that the school or library
has chosen.
[SOURCE: US Senate]
(http://www.senate.gov/~commerce/press/106-86.htm)

INTERNET

FTC TO CURB MEDICAL SALES PITCHES
Issue: Internet
The Federal Trade Commission (FTC) is finally treading where few regulators
have been willing to go: deceptive medical sales in cyberspace. The FTC is
expected to announce today that its investigators have found over 800 Web sites
that are making deceptive health claims. They also will announce settlements of
four companies accused of deception. These sites have been advertising and
selling products for a variety of ailments, such as shark cartilage pills as a
cure for cancer. Along with the legal action, the FTC is planning an
educational program to help the public find legitimate medical help on the Web.

[SOURCE: Wall Street Journal (A2), AUTHOR: John Simons]
(http://wsj.com/)

YOUTHFUL WEB NETWORK HAS A MODEST GOAL: REPLACING TV
Issue: Internet/TV
In Hollywood, a fledgling network is developing shows for a diverse group of
niche audiences including gay youth, fraternity brothers, skateboarders, and
Christian teenagers. None of these programs will be seen on TV they are all
part of the Digital Entertainment Network's Internet-only schedule. DEN hopes
to make its mark -- and lots of money by narrowcasting television like content
on the Net. "This is a new stage of entertainment relevant to whoever you are,
wherever you are," said Adam Solomon, the head of marketing at DEN. Analysts
question weather the network's audiences will be able to attract sufficient
advertising revenue to support programming. But the twenty-something's who are
at the heart of this venture are sufficiently optimistic. According to DEN
program host and professional in-line skater, Arlo Eisenberg: "MTV
revolutionized television. But this will replace TV."
[SOURCE: New York Times (E9), AUTHOR: Matt Richtel]
(http://www.nytimes.com/library/tech/99/06/circuits/articles/24denn.html)

NO CLICKING ALLOWED IN ARTIST'S BROWSER
Issue: Internet/Art
Internet spectators will soon be allowed to take "a dip in the Internet's
stream of consciousness." On Thursday, Netomat, an artist-designed alternative
to the standard Web browser, will be available for free download from the
Netomat site (www.netomat.net). The Internet software, designed by Maciej
Wisniewski a New York-based artist who works as a software developer for IBM,
ironically, does not allow viewers to click on the floating images or words
that users call up to view. Why the paradox? Wisniewski wants users to realize
that there are many different ways of interfacing with the vast and
multi-dimensional network that is the Internet. He also aims to humanize the
medium. By not clicking on the images to view more in-depth information, but by
calling the sources up at random and observing their intermix, he hopes people
will think of what and who the sources of information are on Internet. "I think
sometimes of the network as the many people who contribute to it," he said.
"All the information that this browser retrieves and displays in front of you
is information that somebody has made the effort to create and put up on the
network. The way we are accustomed to viewing them is very one dimensional."
Netomat could be poetic, but it could also be a commercial success if the
browser is ever used to create customized portals and if the code is made
widely available to other artists, as Wisniewski is considering.
[SOURCE: New York Times (CyberTimes), AUTHOR: Matthew Mirapaul]
(http://www.nytimes.com/library/tech/99/06/cyber/artsatlarge/24artsatlarge.h
tml)

TO PROTEST UNWANTED E-MAIL, SPAM COP GOES TO THE SOURCE
Issue: Internet
A new Web site allows users to fight back against unsolicited junk email.
Spamcop.net helps users detect the origin of a spam message and then sends a
copy of the unwanted mail to the network administrator of the spammer's
Internet service provider. Julian Haight, the site's creator, reports that over
120,000 complaint messages were sent to ISPs from his site in last month alone.
Many service providers have a no-spam policy and will close accounts if they
discover their subscribers are responsible for unwanted bulk mailings.
[SOURCE: New York Times (E4), AUTHOR: J.D. Biersdorfer]
(http://www.nytimes.com/library/tech/99/06/circuits/articles/24spam.html)

OLD NEWSGROUPS MARKETED IN NEW PACKAGES
Issue: Internet
Usenet, which used to be the domain of hard-core cyber-geeks, is now being
repackaged for the masses. Because no one owns Usenet's 45,000 newsgroups, they
are very attractive to commercial ventures that are looking to offer instant
communities to the browsing public. Companies like Talkway, Remarq, and
Deja.com gather and sort messages sent over Usenet and offer users an easy
point-and-click method of reading messages. Talkway has even renamed newsgroups
to be less intimidating for users. For example, they've turned
misc.education.home-school.christian into Christian Education. "These companies
are looking to aggregate an audience around discussion and turn that into
revenue," said Anya Sacharow, an analyst at Jupiter Communications. "They're
tapping into an existing base of people already exchanging information."
[SOURCE: New York Times (E1), AUTHOR: Katie Hafner]
(http://www.nytimes.com/library/tech/99/06/circuits/articles/24usen.html)

ECOMMERCE

MILLENNIUM DIGITAL COMMERCE ACT
Issue: Ecommerce
From Press Release: The Committee on Commerce, Science, and Transportation
passed by voice vote a bill to facilitate electronic commerce by encouraging
the use of digital signatures. Senator Spencer Abraham (R-MI), Chairman of
the Manufacturing and Competitiveness Subcommittee, offered a substitute to
S.761, the Millennium Digital Commerce Act. Senator Abraham introduced the
original bill on March 25, and cosponsors include Senators John McCain
(R-AZ), Chairman of the Commerce Committee, Ron Wyden (D-OR), Conrad Burns
(R-MT), and Sam Brownback (R-KS). The bill would do the following: 1)
Preempt state law so that digital contracts aren't denied legal effect
solely because they are in electronic form. This Federal preemption of
state law is an interim measure until the states enact uniform standards
which are consistent with S.761 or the Uniform Electronic Transactions Act
(UETA); 2) Grant parties to a transaction the freedom to determine the
technologies and business methods to be used in the execution of an
electronic contract; 3) Establish principles for international use of
electronic signatures: paper-based obstacles to electronic transactions must
be eliminated; parties to an electronic transaction should choose the
electronic authentication technology; parties to a transaction should have
the opportunity to prove in court that their authentication approach and
transactions are valid; and allow the free market to determine the type of
authentication technologies used in international commerce; and 4) Direct
the Department of Commerce and Office of Management and Budget to report on
Federal laws and regulations that might pose barriers to electronic commerce
and report back to Congress on the impact and provide suggestions for reform.
[SOURCE: US Senate]
(http://www.senate.gov/~commerce/press/106-83.htm)

MERGERS

QWEST RAISES ITS BIDS FOR 2 COMPANIES
Issue: Merger
Qwest Communications is not giving up its fight to acquire Baby Bell U.S. West
and long-distance carrier Frontier Corp. In fact, it has increased its bid for
the companies to $54.3 billion (from $50.3 billion) and diversified it to be
paid in cash as well as stocks. It will now pay 8% more for Frontier and 11%
more for U.S. West than what its rival, international telecommunications
newcomer Global Crossing, is offering the two companies. Analysts say the
closing of either deal would create a telecommunications powerhouse, but
speculate that a Qwest merger would result in "a powerful creature" in the U.S.
market whereas "the Global Crossing merger would set up a more potent
international player." According to one analyst, Qwest's new "extremely
attractive offer" could make it a very difficult one for U.S. West shareholders
to turn down.
(http://washingtonpost.com/wp-srv/WPlate/1999-06/24/229l-062499-idx.html)
[SOURCE: Washington Post (E1), AUTHOR: John Schwartz]

VOICESTREAM TO BUY OMNIPOINT IN ACCORD VALUED AT $2.04 BILLION
Issue: Wireless
VoiceStream Wireless Corp., a regional cellular phone company operating in 13
states in Western U.S. markets, agreed to buy Omnipoint Corp., a cellular phone
company that serves New York, Philadelphia, Boston and Detroit. The $2.04
billion deal furthers the consolidation of the nation's wireless industry. This
deal brings together the two largest providers of global system for mobile
communications (GSM), which is the digital wireless standard in Europe. Beyond
this deal, Hutchison Whampoa Ltd., a Hong Kong-based telecommunications
provider, will be investing $957 million in the newly combined company. In
addition, Cook Inlet Region Inc., one of VoiceStream's partners, is making an
investment of an undisclosed amount to acquire Omnipoint's entrepreneurial
licenses. Analysts believe this will give AT&T and Sprint a run for their money
in the national market as people desire seamless coverage and no roaming
charges when traveling.
[SOURCE: Wall Street Journal (A4), AUTHOR: Nicole Harris]
(http://wsj.com/)
See Also:
BETHESDA'S OMNIPOINT IN BIG WIRELESS DEAL
(http://washingtonpost.com/wp-srv/WPlate/1999-06/24/195l-062499-idx.html)
[SOURCE: Washington Post (E8 ), AUTHOR: Reuters]

AIRTOUCH/VODAFONE MERGER
Issue: Mergers
From the FCC News Release: The Wireless Telecommunications Bureau (Bureau),
on delegated authority, has approved the merger of AirTouch Communications,
Inc. (AirTouch) and Vodafone Group, Plc. (Vodafone), subject to certain
conditions. The Bureau concluded that the merger does not present
competitive concerns, and that its approval serves the public interest. The
adopted Order grants the applications filed by AirTouch and Vodafone
pursuant to sections 214 and 310(d) of the Communications Act of 1934 (the
Act), as amended, for approval to transfer AirTouch's licenses and
authorizations to Vodafone. In accordance with the terms of sections 214(a)
and 310(d), the FCC cannot grant such applications unless applicants
demonstrate that the transfer of the licenses and authorization will serve
the public interest, convenience, and necessity. Wireless Telecommunications
Bureau contacts: Lauren Kravetz at (202) 418-7240 (Commercial Wireless
Division); TTY at (202) 418-7233
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Wireless/News_Releases/1999/nrwl9026.html)

WIERLESS

SNAPTRACK INC. FINDS A WAY TO LOCATE CELL-PHONE CALLERS
Issue: Wireless
SnapTrack Inc. has found an inexpensive alternative to upgrading towers to
track the location of cellular calls. The alternative being developed by
SnapTrack is a satellite technology that can be installed via chip into the
cellular phone. This means that cellular carriers would not have to rebuild
their network infrastructure saving them millions of dollars. With this system,
the phone would take a "snapshot" of the signal being beamed down from the
satellite. SnapTrack's software, which would be incorporated in the chip placed
in the phone, would process that signal. The signal is then sent over the
wireless network to the phone company's computer where the location process is
completed. Splitting the process between SnapTrack's loaded chip and the
wireless carrier will save power so the phone's battery is not affected. It is
expected to cost phone makers $5 or $10 more per unit. The technology was
tested in Florida, and found to be about 90% accurate. The Federal
Communication Commission is requiring wireless-phone companies to have the
ability to track calls for 911 purposes by October 2001. They are planning to
host a round table discussion involving tracking technology with wireless
carriers and developers of cellular locator systems.
[SOURCE: Wall Street Journal (B8), AUTHOR: Nicole Harris]
(http://wsj.com/)
See also:
SAFETY FOR WIRELESS CUSTOMERS
Issue: Wireless
From News Release: The Committee on Commerce, Science, and Transportation
approved by voice vote a bill to create a universal standard for 911
wireless technology and promote technology to reduce response time for car
accidents and other emergencies. S.800, the Wireless Communications and
Public Safety Act, was introduced by Senators Conrad Burns (R-MT), Chairman
of the Communications Subcommittee, and John McCain (R-AZ), Chairman of the
Commerce Committee. The bill is designed to tie people through their
wireless telephones to medical centers, police, and firefighters. It would
expand the areas covered by wireless telephone service; establish parity of
protection for the provision or use of wireless 9-1-1 service; and upgrade
9-1-1 systems so that they can deliver more information, like location and
automatic crash notification data. S.800 is supported by the Emergency
Nurses Association, American College of Emergency Physicians, Coalition for
American Trauma Care, Fraternal Order of Police, Cellular Telecommunications
Industry Association, American Automobile Association, National Emergency
Number Association, and many other national health and public safety groups.
The House E-911 bill, H.R. 438, was passed by the House 415 to 2 on February
24, 1999.
[SOURCE: US Senate]
(http://www.senate.gov/~commerce/press/106-85.htm)

GLOBAL MOBILE PERSONAL COMMUNICATIONS BY SATELLITE
Issue: Satellite/International
NTIA filed comments in the FCC's International Bureau's Docket No. 99-67 and
NPRM 9165 on efforts to implement the international Global Mobile Personal
Communications by Satellite Memorandum of Understanding. NTIA remains
concerned about a number of issues vital to the future needs and operations
of the Federal aeronautical radio navigation community and implementation of
the Global Navigation Satellite System (GNSS) and its constituent elements
the United States Global Positioning System (GPS) and the Russian Federation
Global Navigation Satellite System (GLONASS).
[SOURCE: NTIA]
(http://www.ntia.doc.gov/ntiahome/fccfilings/nprm9165_62399.htm)

ENCRYPTION

COMMERCE APPROVES ENCRYPTION BILL
Issue: Encryption
From the News Release: As part of Chairman Bliley's ongoing effort to
promote the growth of electronic commerce, the full [House] Commerce
Committee approved a bill today providing export relief for encryption
products. The bill - H.R. 850, The Security and Freedom through Encryption
("SAFE") Act - was approved as amended, by unanimous voice vote. In
approving the bill today, the Committee adopted --all by voice vote -- a
number of amendments improving the bill. The Committee approved several
amendments offered by Mr.Oxley (R-OH); one that allows the Secretary of
Commerce to deny the export of encryption products to specific groups and
organizations if it would be used to harm national security, used to
sexually exploit children or used for illegal activities by organized;
another amendment clarifies that despite a company's ability to export a
product through encryption capabilities, the Secretary of Commerce may
prohibit that product's export for other reasons; and a third amendment
requires the Secretary of Commerce to consult with the Secretaries of State
and Defense, Director of Central Intelligence and the Attorney General when
conducting a technical review of an encryption product for export. The
Committee also approved an amendment offered by Mr. Dingell (D-MI) that
requires a comparable encryption product be available in a foreign country
in order for a U.S. company to export similar encryption technology to that
country. The Committee also approved two amendments offered by Mr. Stearns
(R-FL); one that prohibits U.S. companies from exporting products to
portions of China, specifically to the People's Liberation Army or the
Communist China Military; the second amendment requires that if a person has
been served a subpoena for access to encrypted information and if the person
has the capability to decrypt the information but does not, then that person
will be subject to additional criminal penalties.
[SOURCE: House of Representatives]
(http://com-notes.house.gov/cchear/hearings106.nsf/eeae8466ba03a2158525677f0
04b4d11/4c342b8f2876474f852567990066352b?OpenDocument)

ENCRYPTION BILL
Issue: Encryption
From Press Release: The Committee on Commerce, Science, and Transportation
today passed by voice vote S.798, the PROTECT Act: a bill to promote
electronic commerce that is consistent with our national security goals and
interests. S.798 was introduced by Senator John McCain (R-AZ), Chairman of
the Committee on Commerce, Science, and Transportation, on April 14.
Cosponsors include Senators Conrad Burns (R-MT), Chairman of the
Communications Subcommittee, Ron Wyden (D-OR), Spencer Abraham (R-MI), John
Kerry (D-MA), and Patrick Leahy (D-VT). The bill would do the following: 1)
Direct the National Institute of Standards and Technology (NIST) to complete
the establishment of an advanced encryption standard by January 1, 2002; 2)
Allow for immediate exportation of encryption of key lengths of up to 64
bits; 3) Permit the exportation of non-defense encryption (above 64 bits) to
responsible entities and governments of North Atlantic Treaty Organization
(NATO), Association of Southeast Asian Nations (ASEAN), and Organization for
Economic Cooperation and Development (OECD); 4) Allow for liberalization of
export controls for encryption by creating an Encryption Export Advisory
Board to review applications for exemption of encryption of over 64 bits and
give recommendations to the Secretary of Commerce. The board would be made
up of 12 members: the Under Secretary of Commerce for Export Administration,
seven individuals appointed by the President (one from the National Security
Agency, one from the Central Intelligence Agency, one from the Office of the
President, and four representatives from the private sector who have
experience in information technology), four representatives appointed by
Congress (one by the Majority Leader of the Senate, one by the Minority
Leader of the Senate, one by the Speaker of the House, and one by the
Minority Leader of the House); 5) Give the Secretary of Commerce 15 days to
respond to recommendations. If he rejects a recommended exemption, his
decision is subject to judicial review; 6) Reaffirm presidential authority
to veto a recommended exemption for national security purposes, and to
establish terrorist and embargo controls; 7) Authorize increased funding to
law enforcement and national security agencies to upgrade facilities and
intelligence; and 8) Give the Secretary of Commerce the authority to
prohibit the exportation of particular encryption products to an individual
or organization in a foreign country identified by the Secretary.
[SOURCE: US Senate]
(http://www.senate.gov/~commerce/press/106-82.htm)

--------------------------------------------------------------

Communications-related Headlines for June 23, 1999

INTERNET
It's A Dirty Job (WP)
Kvamme to Head Advocacy Group (SJM)
Sellers are Liable for Tax on Gains, Accountants Say (SJM)
Lawmaker Blasts Clinton Internet Address Reform (SJM)

TECHNOLOGY
House Republicans to Launch 'E-Contract' (SJM)

EDUCATION
Controversy Over College Application Essay Sites (CyberTimes)
UNext.com, 4 More Schools Agree to Deals (WSJ)

BROADBAND
DSL 'Lite' Would Plug In More High-Speed Consumers (SJM)

WIRELESS
Vodafone's Acquisition of Airtouch Wins FCC Approval (CyberTimes)

INTERNATIONAL
Dell Starts "Free'' Internet in Germany (SJM)

SECURITY
Microsoft to Require Privacy Promises (ChiTrib)

INTERNET

IT'S A DIRTY JOB
Issue: Internet/Society
Filters, screening programs that "block" people from accessing raw, violent,
hateful or just plain yucky material, are becoming more popular with parents
and policy makers. According to an Annenberg Public Policy Center poll, 32% of
American parents with household online connections use screening programs like
Cyber Patrol, CyberSitter, SurfWatch, Web Chaperone and X-Stop. In Congress,
the House added an amendment ("Children's Internet Protection Act") last week
sponsored by Rep. Bob Franks (R-NJ) to its version of the new juvenile justice
bill that would require filters on computers in schools and libraries that
receive federal Internet subsidies. Today, the Senate Commerce Committee will
consider a similar measure proposed by Sen. John McCain (R-AZ). Civil
libertarians and free speech absolutists either mistrust or abhor the idea of
placing restrictions on Internet access. Mainstream civil liberties groups
don

Communications-related Headlines for June 22, 1999

==================================================
INTERNET
Bill Would Make Cybersquatting a Crime (CyberTimes)
Hate Groups Target Children and Women Online, Report Says (CyberTimes)
Internet Tax Panel Has Rocky Start (WP)
Plan for Internet Voting in Louisiana Falls Apart (CyberTimes)

TECHNOLOGY
E-World Fuels U.S. Economy, Report Says (USA)

BROADBAND
AOL Joins Forces With Satellite Firm (WP)

MEDIA & SOCIETY
Future of Public Service Media's Role in the Digital Technology Age
(Benton)

JOURNALISM
Reuters Invests in Digital-Rights Concern (CyberTimes)

CABLE
High Court to Review Cable Sex Law (USA)

MERGERS
US West Affirms Plan to Merge With Global, Puts Qwest on Hold (WSJ)
Privacy Groups See Danger in a Merger (NYT)

THIS WEEK ON THE HILL
Hearings and Mark-ups (House)
Mark-up on Bills and Nominations (Senate)

INTERNET

BILL WOULD MAKE CYBERSQUATTING A CRIME
Issue: Internet
Senator Spencer Abraham (R-MI) introduced a bill last Friday to attempt to end
cybersquatting. It would make it illegal to register someone else's trademark
and misuse it to deceive customers or to sell it for profit. The first
conviction would be a misdemeanor. The second conviction could turn into a
felony. It would also give companies the ability to recover up to $300,000 in
damages for each trademark violation.
[SOURCE: New York Times (Cybertimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/06/cyber/capital/22capital.html)

HATE GROUPS TARGET CHILDREN AND WOMEN ONLINE, REPORT SAYS
Issue: Internet
"Poisoning the Web: Hatred Online," a newly published report by the
Anti-Defamation League (www.adl.org), says hate groups are "slowly but
increasingly" using the World Wide Web to appeal to women and children. Sites
are especially aimed at teen-agers and feature white supremacist messages.
Others are aimed at "improving a woman's [white] race." "Up until the Internet,
hate groups had to limit themselves to post-office boxes, brown wrappers and
small rallies in godforsaken places," said Abraham H. Foxman, national director
of the League. But the advent of the Internet, he said, "has provided bigots
with a superhighway to cheaply and attractively reach millions of people they
couldn't reach before." The League estimates that there are between 500-600
"hate" sites currently on the Internet. "Hate" sites are difficult to monitor
because the definitions of "hate" and "site" vary. Foxman also said that the
increase in "hate" sites is keeping pace with the regular growth of Web sites
in general --but that doesn't limit concern. Other organizations attempting to
monitor such sites include the Southern Poverty Law Center (www.splcenter.org)
and the Simon Wiesenthal Center (www.wiesenthal.org). For more information on
the report see the League's Web site tomorrow.
[SOURCE: New York Times (Cybertimes), AUTHOR: Pamela Mendels]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/22hate.html)

INTERNET TAX PANEL HAS ROCKY START
Issue: Internet/Tax
The Advisory Commission on Electronic Commerce --a special panel appointed by
Congress to study tax policy for the digital age-- met yesterday but made
little headway due to internal friction. The meeting was summed up as
"difficult." The two main opposing views were held by the head of the
committee, Governor James S. Gilmore 3d (R-VA), who seemed to be allied with
the information technology industry, and Governor Michael O. Leavitt (R-UT),
who opposed special interest monetary contributions. Additionally, the
committee is made up of high-tech executives and state and local government
representatives --all with different agendas. As mandated by Congress under the
Internet Tax Freedom Act, it is the commission's goal to study and make
recommendations by next April on whether and how to begin taxing Internet
commerce. Businesses are expected to push to keep the Internet free while
government officials hope to obtain possible sales tax revenues.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/22tax.html)
See Also:
BILLIONS OF DOLLARS HANG OVER INTERNET TAX DEBATE
[SOURCE: USA Today, AUTHOR: Richard Wolf]
(www.usatoday.com)

PLAN FOR INTERNET VOTING IN LOUISIANA FALLS APART
Issue: Internet/Voting
Louisiana Republicans will have to vote the old-fashioned way the next time
they conduct their caucus votes for Presidential candidates early next year.
The Louisiana Republican Party originally planned to use the Internet to cast
votes, but bitter conflict within the party scrapped the plan. On June 12, the
party voted against the plan. Mostly conservative Republicans opposed the plan
saying the risk of voter fraud made the plan impracticable. Backers of the plan
wanted a good image for the state: "This is where Louisiana [had] a chance to
say, 'We're the first in history."
[SOURCE: New York Times (CyberTimes), AUTHOR: Rebecca Fairley Raney]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/22vote.html)

TECHNOLOGY

E-WORLD FUELS U.S. ECONOMY, REPORT SAYS
Issue: Technology
"Emerging Digital Economy II," an annual study by the Commerce Department, will
be released today. Among the findings: 1) Workers in information technology
(IT) earned an average of 78% more than workers generally -- $52,920 vs.
$29,787; 2) From 1993 to 1998 over half of business equipment spending was from
investments in computers and communications; 3) 1996 and 1997 saw overall
inflation cut by .07% because of rising quality and falling prices of IT goods
and services; and 4) It projects almost half of U.S. workers will be employed
by IT industries or intense users of IT by 2006.
[SOURCE: USA Today (1A), [AUTHOR: Susan Page]
(http://usatoday.com/)

BROADBAND

AOL JOINS FORCES WITH SATELLITE FIRM
Issue: Broadband
AOL announced yesterday it will invest $1.5 billion in Hughes Electric --the
digital television and satellite data giant-- to develop Internet access over
satellite television signals. The alliance will allow AOL to compete with AT&T
and others delivering high-speed Internet access by making the speed of its
Internet service 14 times faster. Steve Case, AOL's chairman said that they
continued to have an interest in cable as a means to provide high-speed
Internet access but that AOL wanted to create a "broadband tapestry" that could
deliver AOL's service through a range of technologies. The deal is expected to
speed up AOL's plans to develop AOL TV, which is part of a strategy called "AOL
Anywhere". The strategy is designed to provide Internet connections through
devices other than computers. AOL TV will allow people to watch television and
buy CDs, chat with friends, etc., at the same time. Marketing is expected to
begin early next year.
[SOURCE: Washington Post (E1 ), AUTHOR: Shannon Henry]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/22/102l-062299-idx.html)
See Also:
BOOSTING HIGH-SPEED NET
[SOURCE: San Jose Mercury, AUTHOR: Jon Healey]
(http://www.sjmercury.com/svtech/news/indepth/docs/access062299.htm)
See Also:
AMERICA ONLINE TO PUT $1.5 BILLION INTO A HUGHES ALLIANCE
[SOURCE: New York Times, AUTHOR: Andrew Pollack]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/22aol-hughes....)

MEDIA & SOCIETY

FUTURE OF PUBLIC SERVICE MEDIA'S ROLE IN THE DIGITAL TECHNOLOGY AGE
[Conference] The Corporation for Public Broadcasting (CPB), the Benton
Foundation and the Hartford Gunn Institute are sponsoring a national conference
titled "The Role of Public Service Media in the Digital Telecommunications Age:
Defining a Strategic Vision." It will address the future role of public service
media. The invitation-only conference draws participation from the leadership
of national foundations, public institutes such as museums, libraries,
universities and public broadcasting organizations, as well as private
corporations, particularly Internet providers. Four key issues relating to the
future of telecommunications technology and its impact on educational
institutions and society as a whole is the focus of discussion for the
three-day meeting.

Specifically addressed will be how public service telecommunications can
contribute to citizen participation in government affairs, civic discourse and
problem solving; contribute to educational excellence and opportunity at all
age levels in our society; improve and enrich the content, quality, reach and
impact of public broadcasting programs; and enhance and facilitate community
building through public access to libraries, art museums, cultural institutions
and performing arts organizations. For more information see
http://www.cde.psu.edu/ or contact Lori Pacchioli at lvp5( at )psu.edu

MERGERS

US WEST AFFIRMS PLAN TO MERGE WITH GLOBAL, PUTS QWEST ON HOLD
Issue: Merger
US West said yesterday it would take no action on the unsolicited bid by Qwest
Communications International. US West, the Denver-based Bell telephone company,
announced loyalty to Global Crossing --as did Frontier Corp., a Rochester,
NY-based local and long distance company, last week. Qwest executives have
filed the appropriate registration with the Securities and Exchange Commission
to pursue a hostile offer if necessary. Joseph P. Nacchio, Qwest's CEO, said
they have the financial backing to increase the offer. He also said this offer
is not an attempt to snatch the companies from Global Crossing, but to provide
Qwest with the local customers for their broadband services. US West and
Frontier have both stated they would monitor events related to Qwest's
proposal. [Hmm

Communications-related Headlines for 6/21/99

CABLE
Execution is the Mantra (B&C)
Diversity: Why Is It Still So Elusive? (B&C)
Cable TV Going Interactive (SJM)

INTERNET
On the Web, as Elsewhere, Popularity Is Self-Reinforcing (NYT)
Chemical Reports Sparking a Debate (SJM)

E-COMMERCE
Taxing Web Wallets (NYT)
As E-Commerce Surges, So Do Technical Problems (NYT)
Internet Mind Control (ZDNet)

BROADBAND
Sprint to Tackle the Broadband Market By Selling Its
ION Network to Consumers (WSJ)

MEDIA & SOCIETY
House Rejects Media Control Bills (B&C)

MINORITIES
New Tax Certificate for the Age of Convergence (FCC)

THIS WEEK ON THE HILL
Deployment of Data Services (House)
Mark-up on Bills and Nominations (Senate)

ADVERTISING
Net Companies Look Offline for Consumer Data (CyberTimes)

JOURNALISM
Follow the Leaker (WP)

INTERNATIONAL
Europe Pushes for a 'Free' Net (WP)

INFO TECH
Survey Finds PC Usage in Homes Has Dropped (WSJ)
For Your Eyes Only (WSJ)

CABLE

EXECUTION IS THE MANTRA
Issue: Cable
The National Cable Television Association convention is Chicago was a
coming-out party for AT&T's Michael Armstrong as well as a farewell fete for
TCI's John Malone and NCTA President Decker Anstrom. As cable is making
promises to be a full service provider -- video, Internet and telephony --
the emphasis of the convention seemed to be on execution: choosing the right
technology and making it work. With themes like "Enter the Broadband
Millennium," cable just ain't cable anymore. But the Portland, OR ruling on
open access contributed to a somber mood.
[SOURCE: Broadcasting&Cable (p.8), AUTHOR: Price Colman]
(http://www.broadcastingcable.com/top/top_article.asp?articleID=692236583)

DIVERSITY: WHY IS IT STILL SO ELUSIVE
Issue: Diversity
"People of color, as a market, are larger than AT&T, Time Warner or
Comcast," said Bresnan Communications' Joe Lawson. They have $650 billion in
spending power; they are 20% of all cable subscribers; and they generate
$6.7 billion in cable subscriber revenue. Minorities make up 29.1% of the
cable work force -- but most are at the bottom. Of the 39,000 people of
color in the cable industry, none own a system and just 1 is in corporate
marketing. There are only five minority-owned cable networks. Studies show
that companies that diversify their management teams have as much as 50%
greater sales so, Lawson estimates, the absence in diversity in cable is
costing the industry billions. "If it makes us uncomfortable, it *should*
make us uncomfortable. But what should make us *more* uncomfortable is not
doing anything about it."
[SOURCE: Broadcasting&Cable (p.40), AUTHOR: Deborah McAdams]
(http://www.broadcastingcable.com/)

CABLE TV GOING INTERACTIVE
Issue: Cable/Internet
As interactive TV services debut in a spattering of communities around the
country, it is apparent that real pioneers in this area are smaller cable
companies and not the industry giants. "We don't see them beating down our
door, asking for these services yet," said AT&T spokesman Andrew Johnson.
"I guess our research doesn't indicate that, as of today, the market's ripe for
those kinds of services." But one interactive TV provider, Worldgate of
Bensalem, PA, reports a tripling of subscribers since just March. The
high-speed Internet access through cable connections is one of the big
attractions of these interactive TV services. Cable operators that have
invested heavily in costly upgrades to expand capacity and covert lines into
two-way networks, are eager to see a financial payback and hope interactive TV
might be just the ticket.
[SOURCE: San Jose Mercury News, AUTHOR: Jon Healey]
(http://www.mercurycenter.com/svtech/news/indepth/docs/cable062199.htm)

INTERNET

ON THE WEB, AS ELSEWHERE, POPULARITY IS SELF-REINFORCING
Issue: Internet
Researchers have found that a smaller number of very popular sites on the Web
command a share of the total traffic on the Internet. In a study conducted for
Xerox, Lada Adamic and Bernardo Huberman measured traffic to universities and
adult entertainment sites. Contrary to the notion of the Web as an equalizing
force, they found that the top 5 percent of all sites in the sample received
74.81 percent of all traffic. As economist would say, the Internet appears to
be a "winner takes all market". "This doesn't say it will be hopeless for a
small mom-and-pop Web site," Sridhar Rajagopalan, a member of the IBM research
team that conducted a study similar to the Xerox's. "It's more like a lottery."
[SOURCE: New York Times (C4), AUTHOR: John Markoff]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/21parc.html)

CHEMICAL REPORTS SPARKING A DEBATE
Issue: Internet
What is a "public record" and should it be disseminated by the Internet? Those
are the issues in question with the Environmental Protection Agency (EPA)
gathering information from chemical companies across the country. These
materials are being collected as part of the 1990 Clean Air Act. The
controversial information in these reports to the EPA include worst case
scenarios for chemical plants -- such as what could happen if there was a
massive toxic spill in a specific geographical location. It would also list the
local schools, hospitals and emergency response plans for each location. People
are concerned because these public records used to be kept in limited places,
such as a county office, where people would have to physically come in and view
the documents. They are concerned about terrorists getting this information too
easily from the Internet. American Civil Liberties Union Senior Staff Attorney
Chris Hansen said the Internet should not be treated any differently than other
information channels. Bill Pease, a Senior Scientist at the Environmental
Defense Fund, said, "Communities have the right to know the possible off-site
consequences of chemical hazards. We have too many of these accidents occurring
in the Bay Area and surrounding communities." This may be among the first of
many controversies involving public government records on the Web. If Congress
does not exempt this material from the Freedom of Information Act, it will be
available to everyone over the Internet.
[SOURCE: San Jose Mercury News, AUTHOR: Deborah Kong]
(http://www.mercurycenter.com/svtech/news/indepth/docs/chem062199.htm)

ECOMMERCE

TAXING WEB WALLETS
Issue: E-commerce
Today, a Congressional Commission will be examining the issue of taxing
Internet purchases. While 45 states require buyers to pay sales taxes -- even
on out-of-state Internet purchases, only 1% of Americans who bought on the
Internet last month paid any taxes at all. Last fall, Congress passed the
Internet Tax Freedom Act, which imposed a three-year ban on any Internet-only
taxes. But long term solutions for how to deal with sales tax in Cyberspace
have yet to be developed. If the federal government fails to create new tax
rules that reflect the realities of the new economy, 30,000 different taxing
jurisdictions will be compelled to apply their current tax laws to Internet
merchants creating a taxing Web of confusion for consumers, sellers, and local
authorities.
[SOURCE: New York Times (A19), AUTHOR: Michael Moynihan, (former Treasury
Department official, Senior Fellow at the Center for Strategic and
International Studies]
(http://www.nytimes.com/yr/mo/day/oped/21moyn.html)

AS E-COMMERCE SURGES, SO DO TECHNICAL PROBLEMS
Issue: E-commerce
The much-publicized shutdown of auctioneer Ebay for 22 hours, is just one
instance of the kind of technical glitches that e-commerce sites must deal with
on a regular basis. It is extremely challenging to construct networks that can
deal with a doubling of traffic every six months (or sooner). Some say that it's
amazing that high-volume sites don't crash more often. Most technically
demanding sites today are probably online brokerage firms, which -- according
to a company that tracks e-commerce sites -- are accessible more than 90% of
the time.
[SOURCE: New York Times (C1), AUTHOR: Matt Richtel]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/21tuff.html)

INTERNET MIND CONTROL
Issue: Ecommerce
Berst examines the battle over control of the first screen consumers see
when they turn on their information appliance. The importance springs from
two human traits: laziness and habit. If a consumer begins an Internet
experience, chances are s/he will be too lazy to change and then will just
get in the habit of starting there. The owner of that site, then, wields
enormous influence over what consumers do next. The biggest battlefields
include set-top boxes for TVs, Internet access start-up screens, wireless
appliances, corporate portals, cable Internet providers, and PCs. Phoenix
Technologies -- which makes software that sits between the PC hardware and
the Windows operating system -- recently announced a venture called ebetween
designed to help Internet vendors find and retain consumers by getting
around the "Microsoft blockade."
[SOURCE: ZDNet AnchorDesk, AUTHOR: Jesse Berst]
(http://www.zdnet.com/anchordesk/story/story_3531.html)

BROADBAND

SPRINT TO TACKLE THE BROADBAND MARKET BY SELLING
ITS ION NETWORK TO CONSUMERS
Issue: Broadband
Sprint has announced it will market its Integrated Online Network (ION)
to consumers in Denver, Kansas and Seattle this fall. The ION services will be
delivered directly to the home by Sprint's digital-subscriber lines. This
service will offer multiple telephone lines, speedy Internet access, unlimited
long distance, videoconferencing and interactive video games. Since the cost of
the ION services are estimated at $100 to $150, Sprint will be targeting
consumers who are already writing more than three checks to media companies
monthly. Sprint still has to utilize Baby Bell lines for transmission and must
pay them an access fee. They have also invested $1 billion in wireless-cable
companies, which they hope can be used to bypass the Baby Bells in the near
future.
[SOURCE: Wall Street Journal (B6), [AUTHOR: Nicole Harris]
(http://wsj.com/)

MEDIA & SOCIETY

HOUSE REJECTS MEDIA CONTROL BILLS
Issue: Media & Society
There was a flurry of action in Washington last week concerning media and
children. This summer, the House and Senate will reconcile two versions of a
juvenile crime bill. The Senate version included media-related amendments,
but the House defeated an amendment by Rep Henry Hyde (R-IL) which would
have made it a crime to sell explicit violent or sexual material to minors
under 17. The entertainment industry is worried that it has become a large,
easy target in the wake of violence in schools this Spring. Jack Valenti,
head of the Motion Picture Industry Association of America, said "They are
expressing concern because they believe that some people in Congress have
gone mad and are acting like there is no Constitution."
[SOURCE: Broadcasting&Cable (p.14), AUTHOR: Paige Albiniak]
(http://www.broadcastingcable.com/top/top_article.asp?articleID=692236566)

MINORITIES

NEW TAX CERTIFICATE FOR THE AGE OF CONVERGENCE
Issue: Minorities
FCC Chairman William Kennard detailed a plan to open the doors of
opportunity to women, minority and small-scale entrepreneurs across all
communications industries. As the different communications industries
converge - when phone lines carry movies, cable lines carry phone calls, and
the airwaves carry both, Chairman Kennard declared, "We can and should
initiate a new tax certificate program." He made these remarks
(http://www.fcc.gov/Speeches/Kennard/spwek922.html) at a luncheon in New
York hosted by the Citizenship Education Fund. Kennard outlined five
elements of a new tax certificate program; 1) An effective tax certificate
must apply not just to radio, TV and cable, but to all telecommunications
businesses including wireline, wireless and satellite; 2) A useful tax
certificate program should provide incentives for any small, disadvantaged
business, but it should recognize that companies owned by minorities and
women face unique obstacles which warrant enhanced benefits; 3) A successful
program must impose limits on how many times an entrepreneur can benefit
from a certificate; 4) An efficient plan needs strict standards on firms
eligible to purchase licenses so that large corporations or unscrupulous
dealmakers operating as fronts are not the ones to benefit from this
program; and 5) A cost-effective program needs safeguards to prevent
speculative ventures from indiscriminately flipping properties and to
attract owners committed to building businesses that serve communities.
Chairman Kennard encouraged Congress, industry and activists to support a
new tax certificate. He emphasized the need to preserve this diversity of
viewpoints to keep public debate lively and to keep the nation's democracy
vibrant. He said, "Let's work together - business, Congress, experts,
activists and citizens - to create a new tax incentive program that honors
our most cherished values and creates a communications sector that is truly
open to all Americans." For 17 years under the original tax certificate
program, if an owner of a radio or TV station sold it to a minority, the
broadcaster could defer capital gains tax. In 1995 Congress ended the program.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Miscellaneous/News_Releases/1999/nrmc9045.html)

THIS WEEK ON THE HILL

DEPLOYMENT OF DATA SERVICES
Issue: Broadband
Thursday, June 24, 1999 10:00 a.m. in 2322 Rayburn House Office Building
Subcommittee on Telecommunications, Trade, and Consumer Protection hearing
on Deployment of Data Services. (Subcommittee Chairman Tauzin (R-LA) is
expected to introduce broadband legislation in the near future. Among other
things, Rep Tauzin's bill would allow BOCs to offer advanced data service
across LATA boundaries.)
[SOURCE: House of Representatives]
(http://www.house.gov/commerce/schedule.htm)

MARK-UP ON BILLS AND NOMINATIONS
Issue: Legislation
Senate Commerce Committee mark-up scheduled for Wednesday, June 23, at 9:30
a.m. in room 253 of the Russell Senate Office Building. Senator McCain
(R-AZ) will preside. Bills include: 1) S.97, Children's Internet Protection
Act, 2) S.761, Millennium Digital Commerce Act, 3) S.798, Promote Reliable
On-Line Transactions to Encourage Commerce and Trade (PROTECT) Act, and 4)
S.800, Wireless Communications and Public Safety Act (E-911 Bill).
[SOURCE: US Senate]
(http://www.senate.gov/~commerce/schedule.htm)

ADVERTISING

NET COMPANIES LOOK OFFLINE FOR CONSUMER DATA
Issue: Internet/Advertising
Advertisers want to use a consumer's offline purchasing history to better
target banner ads to them online. DoubleClick Inc, an Internet advertising
firm, and Abacus Direct Corp, a company that sells information about consumers'
catalogue purchases, announced last week that they plan to merge. Together,
they want to improve the impact of banner advertising on consumers. They say
they need to increase "click-through rates" (the rate at which consumers click
on advertising banners) and CPMs (the cost to advertisers for each 1,000 ad
banners displayed) which have been falling since 1996. With the use of
DoubleClick's advanced technology (ie. "cookies"), consumers are tracked as
they visit an Internet site. Initial information about a consumer is gathered
by DoubleClick (ie. name, address) and instantaneously reviewed and matched
with Abacus' information on that consumer's shopping preferences. Then, a
banner specially targeted to fit his or her buying habits is served. Suppliers
of customer information like Abacus Direct have detailed data on the consumer
shopping preferences of up to 95% of U.S. households. Privacy advocates are
upset at the fact that personal information could be used without a consumer's
knowledge or consent. In response, they plan to file a complaint with the FTC
"protesting the merger, on the grounds that the new company would violate
the standards of fair information collection by using data in ways not
envisioned by consumers when they relinquish that information."
[SOURCE: New York Times (CyberTimes) (B10), AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/06/cyber/commerce/21commerce.html)

JOURNALISM

FOLLOW THE LEAKER
Issue: Journalism
Microsoft's Bill Gates knows how to work the media. During the antitrust trial,
Gates carefully crafted a press release to the Associated Press to get his
comments out and try to shift the dialogue in the case against the government.
Microsoft spokesmen watched, pleased as 'the story', essentially a PR piece,
caught on with other major newspapers. Then, during a lunch break at the trial,
an email was slipped to another AP reporter who was undaunted. "I've been the
beneficiary of leaks," said the reporter, "and I've been the victim of leaks in
terms of having to play catch-up the next day." Microsoft prefers to give leaks
to one source, usually the AP. "It's a dilemma. If we give it to everyone it
looks cooked and no one will cover it. If it appears as a breaking news story
everyone feels they have to cover it. You should know that as soon as AP broke
we got calls from most of the major news outlets to whom we provided a copy and
they wrote it" [Dilemma, indeed.]
[SOURCE: Washington Post (C1), AUTHOR: Howard Kurtz]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/21/010l-062199-idx.html)

INTERNATIONAL

EUROPE PUSHES FOR A 'FREE' NET
Issue: International
European consumers continue to demand that their governments cut local phone
rates for Internet use, despite increases in free Internet access. The typical
European user pays double what Americans pay for Internet access. Not only is
s/he charged a monthly subscription fee for access, but per-minute charges to
the local phone company as well. Freeserve, the pioneer free-access provider in
Europe, started a wave of "zero subscription fee offers" to obtain customers
early-on in the game and "build a stake in future e-commerce." U.S. giants --
like the Microsoft Network, Dell Computer, America Online Europe and
Hewlett-Packard -- have either eliminated their subscription fee or are
considering doing so. Fortunately for them and other local ISPs, they still get
a cut of the local phone charges that their members continue to pay -- to
consumer's continued dismay. The present and future scenarios? Consumers are
currently bouncing around from service to service. In the future, "heavy users
will keep lobbying for flat-rate phone service, light users will stick with the
free-access companies." ISPs with rich parent companies will win and remain a
strong presence in the continent, while phone companies will lose out in the
face of the continued, and strong, public discontent.
[SOURCE: Washington Post (F19), AUTHOR: Victoria Shannon, Special to The
Washington Post]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/21/091l-062199-idx.html)

INFO TECH

SURVEY FINDS PC USAGE IN HOMES HAS DROPPED
Issue: Technology
Computer ownership at home has increased over the past four years. On the other
hand, use of those machines and their services has dropped tremendously.
Arbitron NewMedia, a New York based unit of Ceridian Corp., took a survey
earlier this year of 5,500 consumers by phone and mail. They have tabulated the
respondents aged 16 to 74, but have yet to do the children. This could be one
reason why numbers in use have decreased. Other factors include faster access
at work and the impatience with technical difficulties at home. Roberta
McConochie, Arbitron New Media's Research Director, said she was very surprised
because there was virtually no growth. People who subscribe to Internet
services now represent 38% of U.S. consumers -- but only 24% of them said they
actually use the services they pay for.
[SOURCE: Wall Street Journal (B7), [AUTHOR: Don Clark]
(http://wsj.com/)

FOR YOUR EYES ONLY
Issue: Technology
With endless email distribution and voice mail, there is a growing concern that
some overwhelmed employees are tuning out the most important messages.
MCI Worldcom President, Bernard J. Ebbers, says he is concerned that too many
of his employees are spending their days sending messages and information back
and forth to each other - instead of tackling important work at hand. Ebbers
stated, "In my opinion, it is the biggest deterrent to employee productivity."
Cisco Systems has a selective method for increased information -- the
higher your position at the company, the more information you have access to.
Deloitte Consulting reduces problems created by monitoring internal mail
distribution. Many of their employees can only be added to mailing lists with
the approval of a manager. Companies are trying to decide what strategies to
use to sort through the wealth of information while keeping their employees the
most productive.
[SOURCE: Wall Street Journal (R10), [AUTHOR: Rebecca Blumenstein]
(http://wsj.com/)

--------------------------------------------------------------

Communications-related Headlines for 6/18/99

INTERNET
Study Shows Boom in Net Use (ChiTrib)
Senate Committee Approves Net Gambling Ban (CyberTimes)
Writer Seeks Balance in Internet Power Shifts (CyberTimes)
Embrace Net Now, AOL Exec Warns Executives (ChiTrib)
Wireless ISP Is Unveiled By 3Com (SJM)
Web Music Site Enters Licensing Deal (CyberTimes)
FTC Sues 3 Web Sites Providers for Illegal Billing of
Small Firms (WP)

MERGERS
Frontier's Board Rejects Qwest Hostile Offer (WSJ)
Cisco to Buy TransMedia In Stock Deal (WSJ)
AT&T Bargains for Cable System Swap (USA)

JOURNALISM
Can This Be 'The End of News'? (ChiTrib)

INTERNET

STUDY SHOWS BOOM IN NET USE
Issue: Internet Demographics
"Nearly half of North America uses the Internet," said Mark Resch, executive
vice president at CommerceNet. "We use it to communicate, to learn, to shop
and to buy. It is as integral a part of our lives as the telephone." A study
by Nielsen Media Research and CommerceNet finds that 92 million people over
the age of 16 in the US and Canada are now using the Internet -- and the
number of women making purchases online is rising dramatically. "Certainly
the types of products you can purchase online are so much more diverse than
in years past," Jerome Samson, one of the study's coordinators, said. "The
only thing you could purchase online were hardware, software, things that
mainly appealed to a male audience." The study also found that 72 million
people use the Internet from home, while 46 million use it from work and 28
million from school. The rest use it from other locations, such as a library
or a friend's home.
[SOURCE: Chicago Tribune, AUTHOR: Ted Bridis, Associated Press]
(http://cnews.tribune.com/news/tribune/story/0,1235,tribune-nation-36857,00.
html)

SENATE COMMITTEE APPROVES NET GAMBLING BAN
Issue: Internet/Gambling
The Senate Judiciary Committee wants to stop traditional gambling from
spreading to homes and offices via the Web. On Thursday, it approved a bill by
Sen. Jon Kyl (R-AZ) to prohibit most forms of gambling on the Internet. After
it is endorsed today, the committee is expected to recommend that the
President, Congress and state lawmakers do the same. The Kyl bill would
"prohibit gambling on the Internet by extending the 1961 Wire Act's
prohibitions on interstate sports gambling conducted by phone or wire to the
Internet. It would also outlaw other forms of gambling, including cyber
casinos." Violators could face $20,000 or more in fines and up to four years in
prison. Opponents of the bill criticize it for its exemptions on online horse
and dog track wagers and for limiting the rights of Indian tribes to employ new
technologies to link their casinos. They also claim it is not a "comprehensive
solution" to the problem of online gambling that they say is a complex global
issue.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/18gambling.html)

WRITER SEEKS BALANCE IN INTERNET POWER SHIFTS
Issue: Internet
Is the Internet breaking down barriers in our society and empowering
individuals, or is it propagating isolationism and self-evolvement? This is the
question that Andrew Shapiro grapples with in his new book _The Control
Revolution_. "There's got to be a balance between individual power and the
obligations of the individual to something greater -- a sense of community,
democratic values," said Shapiro who addresses efforts by corporations and
governments to take back control of information from the individual. He
gives the example of music and publishing industries attempts to prevent
copying of information without a digital key. He calls for "fair
hacking" laws that would allow users to make "fair use" copies of
copyrighted works. Shapiro also suggests that companies like America Online
and Microsoft create spaces called "public nets" like public access
channels on cable where marginalized speakers can have a voice.
[SOURCE: CyberTimes, AUTHOR: Carl S. Kaplan]
(http://www.nytimes.com/library/tech/99/06/cyber/cyberlaw/18law.html )

EMBRACE NET NOW, AOL EXEC WARNS EXECUTIVES
Issue: Internet
When rich people talk, people who want to be rich listen. So when 27-year
old multimillionaire Marc Andeerssen gives advice about the Internet..."It's
really time to go at it hard. Waiting is only going to make it worse," said
the co-founder of Netscape. "The price if you wait is (that) someone else
has already done it." Mr. Andeerssen predicts there will be about 1 billion
Internet users within 5 years and that the average time online will continue
to grow. The risks include being "amazoned" -- surpassed by a virtual,
online-only competitor.
[SOURCE: Chicago Tribune (Sec 3, p.3), AUTHOR: Andrew Zajac]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99061802
25,FF.html)

WIRELESS ISP IS UNVEILED BY 3COM
Issue: Wireless
Now, if you want to, you can check email while watching a Cubs game in Wrigley
Field, or any other outdoor location. The 3Com corporation is launching a
wireless Internet service provider that will allow people to receive email
through the popular Palm Pilots and other hand held computers and phones.
Jointly owned with Aether Technologies, 3Com's new venture, Open Sky, will be
the third major company to offer wireless data equipment and services. The
other wireless data services have not managed to generate much market demand,
but Open Sky hopes to offer innovated applications -- such as the ability to
trade stock from the road -- that will attract customers.
[SOURCE: San Jose Mercury News, AUTHOR: Jon Healey]
(http://www.mercurycenter.com/svtech/news/indepth/docs/3com061899.htm)

WEB MUSIC SITE ENTERS LICENSING DEAL
Issue: Internet
Despite the strange relationship MP3.com has had with tradition music
entities, ASCAP, the American Society of Composers Artists and Performers,
has entered into a licensing agreement with MP3.com. MP3.com is limited from
what they can divulge because the company recently filed for an initial
public offering, but the deal is going to offer the following: 1) artists on
MP3.com who join ASCAP for a $10 fee will receive royalty payments for music
downloads and CD's sold and 2) MP3.com will have access to artists already
represented by ASCAP online. MP3.com has been pressured by the music
industry because of its easily replicated material. Even though that has
been well known, the number of artists on MP3.com has doubled over the last
four months to 12,000. Cox Enterprise has invested $45 million in the company.
[SOURCE: CyberTimes, AUTHOR: Lisa Napoli]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/18ascap.html)

FTC SUES 3 WEB SITES PROVIDERS FOR ILLEGAL BILLING OF SMALL FIRMS
Issue: Internet Regulation
Web companies are taking advantage of small business firms and the FTC wants to
set them straight. The FTC said yesterday that it has sued three companies
-- CA-based Wazzu Corp. and Shared Network Services and VA-based WebViper -- for
unlawfully billing small firms after their "free trial period" for Internet
services ended and for the making of company Web sites that they promoted as
being "free of charge." "These operators often targeted businesses with less
than 10 employees," said Jodie Bernstein, director of the FTC's bureau of
consumer protection. "[Because] there was less likelihood they [would] have
rigorous accounting procedures." Though the company executives deny any
wrongdoing, the FTC is negotiating settlements with them in the hope that they
will repay the small firms for what they were illegally charged. It is also
working closely with the Small Business Administration on an education campaign
to alert business owners to be wary of hard-sell telemarketing calls.
[SOURCE: Washington Post (E3), AUTHOR: Margaret Webb Pressler]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/18/099l-061899-idx.html)
See also:
FTC FILES 3 SUITS IN CRACKDOWN ON 'CRAMMING'
Issue: Internet Regulation
The Federal Trade Commission has filed charges against three companies for
adding unordered services to consumers' bills. The companies are Wazzu Corp.
of Fountain Valley, CA, Shared Network Services, which does business as 1st
Page, of Lodi, CA, and WebViper, also known as Yellow Web Services, of
Montgomery, AL. The FTC says the companies charged small-business owners for
Internet services they never received by putting the charges on a phone
bill, often under "miscellaneous services." "Many have said that they just
haven't noticed it," said Jodie Bernstein, director of the FTC's Bureau of
Consumer Protection, of the $30 charges that have been appearing commonly on
victims' bills.
[SOURCE: Chicago Tribune (Sec 3, p.1), AUTHOR: William Bohlen]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99061802
08,FF.html)

MERGERS

FRONTIER'S BOARD REJECTS QWEST HOSTILE OFFER
Issue: Mergers
Responding to the bid from long distance company Qwest to purchase Frontier,
Frontier CEO Joseph Clayton stated, "We will of course continue to monitor
events and, where appropriate, respond in our shareholders' best interest."
But Frontier would have to pay a fee of $270 million to Global Crossing if
GC's $11.1 billion offer is rejected -- making an end to that deal unlikely.
[SOURCE: Wall Street Journal (B6), AUTHOR: Stephanie N. Menta and Joann S.
Lublin]
(http://wsj.com/)
[SOURCE: Washington Post (E1), AUTHOR: Noelle Knox]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/18/114l-061899-idx.html)

CISCO TO BUY TRANSMEDIA IN STOCK DEAL
Issue: Mergers
Cisco Systems, which originally specialized in hardware for computer network
connections, is attempting to become more diverse and compete with companies
such as Lucent Technologies. In a deal with TransMedia Communications, Inc,
a 66-employee start-up company in San Jose, CA, Cisco would acquire a
technology it has been unable to develop on its own. TransMedia develops
hardware that converts telephone calls into different formats. Cisco was
trying to develop the technology, but did not have the capacity and costs
were to high for phone companies and ISP's. This will be Cisco's 35th
acquisition as they attempt to acquire more diverse technologies.
[SOURCE: Wall Street Journal (Don Clark), AUTHOR: B6]
(http://wsj.com/)

AT&T BARGAINS FOR CABLE SYSTEM SWAP
Issue: Mergers/Cable
We are all aware how the regional Bell operating companies dominate the US
phone market. Leo Hindery, CEO of AT&T's broadband and Internet Service,
said of his latest dealings to control the cable industry, "I call it the
RBOC-ization of the cable industry." Hindery says if he is successful, New
York and Los Angeles will be the only major cities with any competition. He is
working on deal to acquire the smaller cable companies that are remaining
after AT&T's deal with MediaOne and he says these deals would mark "the end
of the industry as I know it."
[SOURCE: USA Today (B1), AUTHOR: David Lieberman]
(http://usatoday.com/)

JOURNALISM

CAN THIS BE 'THE END OF NEWS'?
Issue: Journalism
A look at how 24 hr cable news channels and the Internet are affecting
traditional news outlets -- newspapers and broadcast networks -- through the
eyes of a veteran reporter (now columnist). In 1965, 71% of American adults
had read a daily paper the previous day -- now, just 50% have and most
people (75%) think it is OK if they don't get a chance to read the paper
'cause there are so many different news outlets. Samuelson thinks newspapers
are much better today than they were 30 years ago -- it is more a bundle of
products (news, sports, business, lifestyle, health, cooking, science) meant
not merely to satisfy readers various interests, but to attract readers with
different interests. "Because this splintering of audiences threatens the
advertising and profits of newspapers and broadcasters, it also affects the
nature of news. For years, journalists and academics have criticized 'greedy
media monopolies' for 'shortchanging the news' to fatten profits. These
attacks were exactly backward. As long as newspapers and broadcasters were
highly profitable--and enjoyed market power and captive audiences--they
provided a fair amount of space and freedom for news. Growing competition
changes this." Now a story must sell -- or why bother?
[SOURCE: Chicago Tribune (Sec 1, p.31), AUTHOR: Robert Samuelson]
(http://chicagotribune.com/news/opinion/commentary/article/0,2669,SAV-990618
0405,FF.html)

--------------------------------------------------------------
...and we are outta here. Have a great weekend.

Communications-related Headlines for 6/17/99

INTERNET
Banner Ads are Under the Gun and On the Move (CyberTimes)
Tools and Pep Talks for Novice Investors (NYT)
Sotheby's and Amazon.com Strike a Deal to Sell Online (NYT)

MEDIA&SOCIETY
House Rejects Curbs on Sales of Violent Film (WSJ)

TELEPHONY
Wireless Carriers Struggle to Meet Demand (USA)
Pr. George's Loses Lawsuit on Phone Fee (WP)
Cable and Wireless Prepares for Future With International Digital in
Fold (NYT)

HEALTH
Video Health Care Aids Rural Clinics (CyberTimes)

BROADBAND
At Home Questions GTE Test (WP)

INTERNET

BANNER ADS ARE UNDER THE GUN AND ON THE MOVE
Issue: Internet/Advertising
While advertisements used to be confined to the top and left margins of Web
pages, now ads can be found almost anywhere on a Web site -- even appearing out

of nowhere. As advertisers work to make their pitches more attention-grabbing
for Internet users, uncertainty remains about how effective web
advertising really is. One recent study found that only 3.2 % of companies
reported that banner ads were successful in driving traffic to their sites.
Other studies, however, claim that this measurement is inconclusive in
determining the true ability of banner ads to build brand and market products.
"One of
the bedrock problems is a lack of trustable research," Glassberg said. "There's

no bedrock yet in this medium, like in television, where there's been 40 years
of research to show what a 30-second spot can do."
[SOURCE: CyberTimes, AUTHOR: Lisa Napoli]
(http://www.nytimes.com/library/tech/99/06/cyber/articles/17advertising.html)

TOOLS AND PEP TALKS FOR NOVICE INVESTORS
Issue: Internet
Studies found that women generally feel less comfortable investing than men.
Some sites on the Web are trying to change this. Several Web sites
aimed at women are beginning to feature sections or columns that offer
investment advice. Many of these sites allow women to ask questions of both
peers and experts in an environment they may feel comfortable in.
[SOURCE: New York Times (E12), AUTHOR: Laurie Flynn]
(http://www.nytimes.com/library/tech/99/06/circuits/articles/17libe.html)

SOTHEBY'S AND AMAZON.COM STRIKE A DEAL TO SELL ONLINE
Issue: Internet/E-Commerce
Perhaps the world's best known auction house, Sotheby's has just entered
into a deal with the online book giant, Amazon.com. Together, the companies
will try to make their mark on the highly competitive field of online auctions.

The joint auction site will offer a wide variety of collectable, all sold by
professional dealers who can guarantee all objects for sale. "One of the
biggest problems in the online auction business is the ability to authenticate
what we sell, and that's something Sotheby's can help us do," said Jeffrey P.
Bezos, founder and chief executive of Amazon.com. "There's no other partner
out there that could help us build this."
[SOURCE: New York Times (C8), AUTHOR: Carol Vogel]
(http://www.nytimes.com/library/tech/99/06/biztech/articles/17auction.html)

MEDIA&SOCIETY

HOUSE REJECTS CURBS ON SALES OF VIOLENT FILM
Issue: Media/Violence
The House rejected a bill yesterday that sought to outlaw the sale of extremely
violent movies, video games and books to minors. The bill was rejected 282 to
146. It proved to be too controversial, as the opposition to the bill
complained of infringement of the First Amendment. The entertainment industry
lobbied Congress hard this week. As Jack Valenti, lobbyist for the
movie-industry said, "This isn't cigarettes or alcohol. This is creative work
that is protected by the First Amendment." The House is expected to vote to
approve a teen crime bill this week. The bill includes heavier gun control,
including background checks at gun shows.
[SOURCE: Wall Street Journal (B12), AUTHOR: Jeffery Taylor]
(http://wsj.com/)

TELEPHONY

WIRELESS CARRIERS STRUGGLE TO MEET DEMAND
Issue: Wireless
The price of wireless has dropped 40% in the last three years, says Federal
Communications Commission Chairman William Kennard. Bob Egan, a wireless
analyst at the Gartner Group, says prices for heavy users will drop to 5-7
cents a minute within the next three. Some companies seem to be paying a steep
price for this decrease. Pocket Communications, NextWave Telecom and General
Wireless have sought bankruptcy protection. They say they do not have the money
to pay creditors or build new networks. Demand for AT&T's Digital One Rate in
New York City is phenomenal, causing AT&T to race to improve their service. The
reason for all of the craziness: Thanks to the FCC's continuous selling of
wireless spectrum, there are up to five wireless carriers in many major
markets.
[SOURCE: USA Today, AUTHOR: Steve Rosenbush]
(http://www.usatoday.com/life/cyber/tech/ctf402.htm)

PR. GEORGE'S LOSES LAWSUIT ON PHONE FEE
Issue: Telephony
Who has the right of way in your town? A Baltimore federal judge ordered Prince
George's County to stop charging telecommunication companies for use of public
lands. The county wanted telecommunications companies to negotiate an agreement
with them to lay cables and build cellular transmissions towers on public land.
In return, the companies would give the county 3% of their gross revenue or
provide Internet service or phone lines to their schools and government
offices. The local government officials say that the fees would be used for
much needed road repairs and maintenance to improve uneven and broken roadways
for their residents. Acting cable administrator for Howard County, Jack Foley
said, "If you don't control the right of way, you lose it, and if you lose it,
the public land gets torn up." Several telecommunication companies have
lawsuits pending stating this type of ordinance violates the Telecommunications
Act of 1996. This could be a question the U.S. Supreme Court will have to
decide in the near future.
[SOURCE: Washington Post (B1), AUTHOR: Jackie Spinner]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/17/238l-061799-idx.html)

CABLE AND WIRELESS PREPARES FOR FUTURE WITH INTERNATIONAL DIGITAL IN FOLD
Issue: Mergers/International
The British telecommunications company Cable and Wireless is quickly moving to
extend its reach across the globe. After successfully acquiring Japan's
International Digital (IDC), Cable and Wireless is reportedly looking to
purchase or ally itself with a local carrier that will give them access to
domestic phone lines. Without local lines, the newly formed Cable and Wireless
IDC will face high access charges that will impede the company's ability to
offer low-cost telecommunications services to large corporate customers in
Japan.
[SOURCE: New York Times (C4), AUTHOR: Stephanie Storm]
(http://www.nytimes.com)

HEALTH

VIDEO HEALTH CARE AIDS RURAL CLINICS
Issue: Video/Health
In Alabama, video technology will bring patients in rural clinics closer to the
hospital services they need. The University of South Alabama has created new
high-tech equipment to allow the image of a patient to be projected more than
100 miles away to a hospital where they can get medical testing, diagnoses and
drug prescriptions. High-speed telecommunications lines and video-conferencing
will allow the live image of an eardrum, for example, to travel from a tiny ear
scope to a specialist who can view and diagnose it for treatment. Four "health
stations" will be set up in remote sites to be serviced by six prominent
medical centers. The university's "Telemedicine" program -- which is financed
in part by a $2.7 billion grant from the U.S. Department of Health's Office for
the Advancement of Telehealth -- is scheduled to begin July 1.
[SOURCE: San Jose Mercury News, AUTHOR: Associated Press]
(http://www.mercurycenter.com/svtech/news/breaking/ap/docs/552825l.htm)

BROADBAND

AT HOME QUESTIONS GTE TEST
Issue: Broadband
On Monday, GTE announced in Washington that it had a low-cost technology that
allows multiple Internet service provides (ISPs) to use the wires of a single
cable TV system. At Home, an affiliate of AT&T and provider of high-speed
Internet service, implied it was a political move to "incite other
municipalities to do what Portland did." A federal district court recently
ruled that Portland had authority to mandate cable companies to provide open
access to ISPs to service over cable networks. At Home criticized GTE's
conclusions on two counts, but GTE said At Home's concerns were misleading and
not relevant to "open access." AT&T has been on an acquisition spree of cable
systems which has created concern among Internet companies that they will not
be able to use AT&T's lines to reach customers.
[SOURCE: Washington Post (E6), AUTHOR: Shu Shin Luh]
(http://washingtonpost.com/wp-srv/WPlate/1999-06/17/210l-061799-idx.html)

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