September 2000

POLITICAL DISCOURSE
Before a Hollywood Crowd, Democrats Lower the Volume (NYT)
Full of Banter, Bush Takes on 'Oprah' Circuit (NYT)

EDTECH
No Technology Funds for Poor Schools (CyberTimes)

MERGERS
FTC Probes Effect of AOL Merger On Existing Pacts With DSL
Providers (WSJ)
EMI Group and Time Warner Submit Concessions to
Allay Antitrust Worries (WSJ)

COMPETITION
Qwest Opens Local Phone Service To Competitors, Drops Lawsuits (WSJ)
America Online to Roll Out Unmetered Service in U.K (WSJ)

JOBS
Hollywood Has Hope for Happy Ending Before Strike (USA)
Recruiters Hunt for Candidates On the Web in Nocturnal Game (WSJ)

JOURNALISM
Tightening Control on Media Worry Journalists in Angola (NYT)
Strangling Russia's Media (WP)

LEGISLATION/REGULATION
Mark-Up Session (Senate)
Biennial Review 2000 Staff Report Released (FCC)

SPECIAL SECTIONS
Clicking Outside the Box (NYT)
Wired Economy (WP)

POLITICAL DISCOURSE

BEFORE A HOLLYWOOD CROWD, DEMOCRATS LOWER THE VOLUME
Issue: Media & Society
At a fund raising event with 300 of their most generous contributors,
Gore/Lieberman toned down attacks on the entertainment industry. "We will
nudge you," Sen Joe Lieberman, the vice-presidential nominee, said gently.
"But we will never become censors." "Al and I have tremendous regard for
this industry," Sen Lieberman added. "We're both fans of the products that
come out of the entertainment industry -- not all of them, but a lot of
them. And the industry has entertained and inspired and educated us over the
years. And it's true from time to time we will have been, will be, critics,
or noodges, but I promise you this: We will never never put the government
in the position of telling you by law, through law, what to make." Vice
President Gore was a bit more circumspect than Mr. Lieberman in his
comments, praising Rob Reiner, the director, for paving the way for their
visit and referring obliquely to "the controversy of the previous week." The
event raised $4.2 million for the Democratic National Committee.
[SOURCE: New York Times (A1), AUTHOR: Katharine Seelye]
(http://www.nytimes.com/2000/09/20/politics/20GORE.html)
(requires registration)

FULL OF BANTER, BUSH TAKES ON 'OPRAH' CIRCUIT
Issue: Political Discourse
Gov Bush appeared on "Oprah" yesterday, trying to woe the show's 7 million
viewers -- most of them, surprisingly, women. One week after VP Gore's
appearance, Gov Bush resisted some of Oprah's efforts to force him into
introspection and joked at others. resisted some of her efforts to force him
into introspection and joked at others. This type of appearance seems to be
a campaign priority: Bush sat for an interview with Paula Zahn of Fox on
Monday. On Tuesday he sat not just for Ms. Winfrey but also for Diane Sawyer
of "Good Morning America." On Thursday he will be on the Regis Philbin show.
And the Bush campaign tried to work out an appearance with David Letterman
this week, during a brief visit to New York City, but found out that Mr.
Letterman was not taping.
[SOURCE: New York Times (A1), AUTHOR: Alison Mitchell]
(http://www.nytimes.com/2000/09/20/politics/20BUSH.html)
(requires registration)

EDTECH

NO TECHNOLOGY FUNDS FOR POOR SCHOOLS
Issue: Erate
The Urban Institute's new study of the e-rate shows that the poorest schools
cannot make good use of the telecommunications discounts. The study shows
bureaucratic requirements and financing models make it impossible for some
schools to benefit. "There are some areas that are so poor that even with
the 90 percent discount, this 10 percent disables them from using the
e-rate," Education Secretary Richard Riley told education technology
experts. "It's a small band of the poorest of the poor. Those are the very
schools we need to reach." The bureaucracy associated with applying for
e-rate funding is one barrier small and poor schools seem hampered by, said
Duncan Chaplin, a research associate the Urban Institute's Education Policy
Center. "I think the problem is getting the information together," he said.
"I'm guessing it would take about 20 to 30 hours. If you're a really small
school that's only going to get $2,000 or $3,000, it's not worth it."
Small, rural public schools often do not have the personnel needed to
complete the initial application process to participate in the e-rate
program, said Kari Afstrom, project director for public affairs for the
American Association of School Administrators, and vice president of
Organizations Concerned About Rural Education. "We also know some rural
districts are not applying if they are not members of an education services
agency," or regional education entity operated by the state, she said. "If a
state has that entity, rural schools are being covered. If they don't,
they're probably not applying because of a lack of personnel to fill out the
paperwork."
"We're continually doing outreach to simplify the process," said FCC
Chairman William Kennard. "The large urban school districts were able to
aggregate their demand and hire consultants. Smaller districts have not been
able to do that."
[SOURCE: CyberTimes, AUTHOR: Rebecca Weiner (rweiner( at )nytimes.com)]
(http://www.nytimes.com/2000/09/19/technology/20EDUCATION.html)
(requires registration)
See Also:
SCHOOL BOARD MOVES ON AD-FINANCED LAPTOPS
[SOURCE: New York Times (A26), AUTHOR: Edward Wyatt]
(http://www.nytimes.com/2000/09/20/technology/20LAPT.html)
(requires registration)

MERGERS

FTC PROBES EFFECT OF AOL MERGER ON EXISTING PACTS WITH DSL PROVIDERS
Issue:Mergers
To ensure that AOL won't promote its cable service exclusively for its own
use after the company merges with Time Warner, federal regulators are
questioning some regional telephone companies, in spite of the fact that AOL
has said publicly it plans to honor its existing agreements to provide
Internet service through high-speed digital subscriber lines from Verizon
Communications and SBC Communications. AOL Chief Executive Steve Case told
the Federal Communications Commission in July that AOL wants its service to
be available through many delivery methods. Even so, the Federal Trade
Commission is apparently considering codifying some aspects of the promise
into a legally binding requirement as part of a settlement with AOL and Time
Warner. An executive at a leading provider of digital subscriber lines said
he told the FTC that he is worried that, despite its promises, AOL will have
an economic incentive to promote high-speed access to the Web through Time
Warner cable lines.
[SOURCE: Wall Street Journal (B10), AUTHOR: Julia Angwin]
(http://interactive.wsj.com/articles/SB969412624530373680.htm)
(Requires subscription)

EMI GROUP AND TIME WARNER SUBMIT CONCESSIONS TO ALLAY ANTITRUST WORRIES
Issue: Mergers
EMI Group and Time Warner are doing all they can to salvage their proposed
music joint venture. They have submitted to the European Commission a new
set of antitrust remedies involving sales of music labels and copyrights,
and have also offered to sell several catalogs of songs to reduce their huge
market shares in music publishing. The commission indicated last week that
it was prepared to block the merger unless the companies came up with
concrete proposals to allay regulatory concerns. The Warner-EMI joint
venture would surpass Seagram's Universal Music Group to become the biggest
music publisher in the world and one of the two biggest recorded-music
companies. Competitors such as Universal and Walt Disney, which owns
Hollywood Records, have complained to European regulators about the impact
of the EMI-Warner joint venture combined with AOL's acquisition of Time
Warner. The new list of Time Warner-EMI concessions for the first time
includes actual divestitures, rather than the mere promises of future
business conduct that the companies had initially offered.
[SOURCE: Wall Street Journal (A23), AUTHOR: Philip Shishkin And Martin
Peers]
(http://interactive.wsj.com/articles/SB96939844999213710.htm)
(Requires subscription)
See Also:
EMI SAYS IT AND TIME WARNER MAKE DEAL CONCESSIONS
[SOURCE: New York Times (C9), AUTHOR: Edmund Andrews]

COMPETITION

QWEST OPENS LOCAL PHONE SERVICE TO COMPETITORS, DROPS LAWSUITS
Issue: Competition
The Denver-based Qwest Communications International has begun a push to open
its local phone business to competition, paving the way for it to eventually
offer combined local, long-distance and Internet services in its home region
(Western and Mountain states). Having bought USWest last June, Qwest is
dropping 17 lawsuits brought by USWest against state regulators, and
moving to make it easier for competitors to set up shop. Qwest is eager to
gain the support of state regulators as it seeks permission to enter the
long-distance market in its home region. To succeed, it must satisfy
regulators that its markets are competitive. Qwest hopes to have
long-distance applications for all 14 Western and Mountain states before the
Federal Communications Commission by the end of 2001 and to have approval in
at least one state by late summer or early fall. "Dropping the lawsuits is
wise, because it's kind of hard to get the states to love you when you are
suing them," said Janney Montgomery Scott analyst Anna-Maria Kovacs.
[SOURCE: Wall Street Journal (B6), AUTHOR: Shawn Young]
(http://interactive.wsj.com/articles/SB969407732667069492.htm)
(Requires subscription)

AMERICA ONLINE TO ROLL OUT UNMETERED SERVICE IN U.K.
Issue: Competition
To encourage home Internet usage in the U.K., AOL's U.K. division said
Tuesday it will roll out a 14.99 pounds-a-month ($21) flat-rate pricing plan
to provide members with unmetered access to its service, akin to pricing in
the U.S. In June, AOL's German unit introduced a monthly flat rate for its
Internet subscribers at 78 German marks ($34). That price undercut the
79-marks rate offered by Deutsche Telekom AG's T-Online International AG
unit. Massachusetts-based AltaVista had started such a plan in the U.K. in
March, but abruptly stopped in August.
[SOURCE: Wall Street Journal (Interactive), AUTHOR: WSJ.COM News
(http://interactive.wsj.com/articles/SB969371177325016782.htm)

JOBS

HOLLYWOOD HAS HOPE FOR HAPPY ENDING BEFORE STRIKE
Issue: Jobs
Actors and writers have threatened a strike that could cripple movie and
TV production, if a settlement cannot be reach through negotiations. The
Writers Guild of America has set a May 1 strike deadline, and the Screen
Actors Guild and the American Federation of Television and Radio Artists
are vowing to walk June 30 if they don't have a new contract. At issue
are so-called residual payments that actors and writers receive when
their movies or TV shows are sold overseas, to cable TV or to Internet
sites, increasingly able to stream video to Web users. The writers
strike in 1988 "was devastating, and we're already feeling the heat
based on the possibility of a strike now," says David Davis, an
entertainment analyst at Houlihan, Lokey, Howard & Zukin. "A strike by
either writers or actors will be a disaster for the industry," says TV
producer Dick Wolf (Law & Order).
[SOURCE: USAToday (1D), AUTHOR: Josh Chetwynd and Gary Levin]
( http://www.usatoday.com/usatonline/20000920/2662681s.htm

RECRUITERS HUNT FOR CANDIDATES ON THE WEB IN NOCTURNAL GAME
Issue:Jobs
Bosses, beware. Someone may steal your best worker tonight. The Internet
after dark is the place to be for job-hunting in the New Economy, with
determined recruiters snapping up hot techie resumes before dawn, contacting
candidates by e-mail and sometimes even by phone. "The competition for
candidates is fierce. As a result, the early bird gets the worm," says K.C.
Ward, former recruiting director for Premier Technical Solutions. Late at
night, when traffic on the Web is low and the system moves data faster, many
headhunters stay up past 2 a.m., combing job sites, surfing chat rooms,
digging out fresh resumes on personal Web pages, posting
help-wanted ads and sending e-mails. Candidates with technical skills that
are especially in demand often find themselves bombarded with calls and
e-mail within minutes of posting a resume online. Late-night job searching
isn't limited to techies. College students now pull famous "all-nighters"
not just to cram for exams, but also to hunt for jobs. Of the students using
Internet job boards at East Coast colleges serviced by experience Inc., a
Boston provider of software for college-career centers, almost 20% did so
from midnight to 4 a.m., the company says. Even off-line aspects of the job
hunt are shifting to off-hours. Kevin Flash, 43, has been looking for a job
for the past three weeks, after his post as a software-development manager
was eliminated at Transamerica Intellitech. As a single father of four kids
ranging from eight to 15 years old, his afternoons and evenings are pretty
full. "Once I get them into bed, I have a little window of opportunity," he
says.
[SOURCE: Wall Street Journal (Interactive), AUTHOR: Rachel Emma Silverman]
(http://interactive.wsj.com/articles/SB96940785537733216.htm)
(Requires subscription)

JOURNALISM

TIGHTENING CONTROL ON MEDIA WORRY JOURNALISTS IN ANGOLA
Issue: Journalism/International
The Angolan government is pushing rules that would sharply restrict the
operations of independent news media. Under the proposed legislation,
journalists who publish or transmit news or facts "which attack the
honor" of government officials or offend "public morals and good habits"
could be imprisoned for two to eight years. "Journalists are very, very
cornered in Angola," said Yves Sorokobi, the Africa program coordinator
for the Committee to Protect Journalists, a New-York based group that
has sharply criticized the legislation. "This new law will make it
almost completely impossible to talk about politics." The government of
President Jos

POLITICAL DISCOURSE
Everybody Can Get Into the Act with Issue Ads (WP)
Personal Attack and Political Editorial Rule Proceeding (FCC)

RADIO
Low Power FM Applications in Second Filing Window (FCC)

TELEVISION
Disclosure Requirements and How Broadcasters Serve
the Public Interest (FCC)
Digital TV Broadcasters' Obligations to Serve Children (FCC)
Reports Concerning Children's Educational Programming (FCC)
Town Hall Meeting (PBTV)
Forum Connection (CRF)

PRIVACY
Online Privacy Technologies Workshop (NTIA)

MERGER
European Regulators Recommend Blocking AOL-Time Warner Deal (WSJ)

VIDEO
Blockbuster Branches Out (WP)

POLITICAL DISCOURSE

EVERYBODY CAN GET INTO THE ACT WITH ISSUE ADS
Issue: Political Discourse
An ad running on television stations in Kansas City shows an actress playing
a worried mother discussing her fears about her son's education. She says
her son Ralph was "hanging with the wrong crowd" at his public school. "We
didn't want him in a place where drugs and violence were fashionable." "That
was a bit more diversity than he could handle." On the screen, a white
teenager at a cafeteria table pulls a pistol on a racially mixed group of
students. Then the message flashes: "Vote Republican." The commercial was
produced by the Republican Ideas Political Committee, an independent group
previously unknown to either the Democratic or Republican Party. And, its
only one of many such adds that come from groups with either fuzzy names -
that distort their identity - or groups not forthcoming with their backers
and funders. These ads, combined with expected spending increases of groups
who traditionally run political spots, can sometimes make life more
complicated for the very politicians and parties they are intended to help.
"Parties, groups and even private individuals are advertising," said Brown
University political scientist Darrell West. "There are a lot more rich
people with money to burn." The Annenberg Public Policy Center backs that
up. "We've found the number of issue ads, the number of groups advertising
with issue ads and the spending on issue ads are going to be higher for this
cycle than in any previous cycle," said Lorie Slass, director of Annenberg's
Washington office, which is set to release a study on the subject this week.

[SOURCE: Washington Post (A1), AUTHOR: John Mintz]
(http://washingtonpost.com/wp-dyn/articles/A32380-2000Sep18.html)

PERSONAL ATTACK AND POLITICAL EDITORIAL RULE PROCEEDING
Issue: Political Discourse/FCC
Chairman Bill Kennard's statement about his participation in the personal
attack and political editorial rule proceeding. Because of work Kennard had
done in this area in the early 1980s for the National Association of
Broadcasters, the chairman had decided not to participate in the proceeding.
"However, I believe that the public interest, and the efficient conduct of
FCC business, now outweighs the reasons for my cautionary recusal, and thus,
for the reasons stated below, I have now decided that I should participate
in the proceeding. The record demonstrates there has been continued deadlock
at the Commission on this issue. In addition, the D.C. Circuit on more than
one occasion remanded the matter back to the Commission to provide a
definitive determination on the issues, and has shown apparent frustration
with the Commission's failure to act."
[SOURCE: FCC]
(http://www.fcc.gov/Speeches/Kennard/Statements/2000/stwek075.html)

RADIO

LOW POWER FM APPLICATIONS IN SECOND FILING WINDOW
Issue: Radio
From Press Release: The FCC announced that it had received 473 low power FM
radio applications from non-profit community-based organizations and state
and local governments in the second filing window for applications that was
held August 28 to September 1, 2000. The preliminary count of applications
in the 2nd filing window is as follows: Connecticut (38); Illinois (84);
Kansas (36); Michigan (87); Minnesota (63); Mississippi (22); Nevada (23);
New Hampshire (28); Puerto Rico (20); Virginia (58); Wyoming (14). The first
filing window, from May 30 through June 8, resulted in over 700 applications
from Alaska, California, District of Columbia, Georgia, Indiana, Louisiana,
Maine, Mariana Islands, Maryland, Oklahoma, Rhode Island and Utah.
A Public Notice for the third filing window is scheduled to be announced at
the end of October 2000, with a five-day filing window scheduled to begin at
the end of November 2000 for eligible organizations from American Samoa,
Colorado, Delaware, Hawaii, Idaho, Missouri, New York, Ohio, South Carolina,
South Dakota, and Wisconsin. The fourth filing window is scheduled to be
held at the end of February 2001, and the fifth and final filing window is
scheduled to be held at the end of May 2001.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/2000/nrmm0039.html)

TELEVISION

DISCLOSURE REQUIREMENTS AND HOW BROADCASTERS SERVE THE PUBLIC INTEREST
Issue: Television
From Press Release: the FCC proposed to standardize and enhance public
interest disclosure requirements for television broadcasters. In a Notice of
Proposed Rulemaking (NPRM) approved today, the FCC tentatively concluded
that television broadcasters should provide information on how they serve
the public interest in a standardized format on a quarterly basis. The
disclosure form would be maintained in the station's public inspection file
in place of the currently required issues/programs lists. The Commission
noted that given the benefits to be derived from enhanced public disclosure,
it should not wait until after the digital transition to implement this
proposal. The FCC also proposed to enhance the public's ability to access
this public interest information by requiring licensees to make the contents
of their public inspection files, including the standardized disclosure
form, available on the station's or a state broadcasters association's
Internet website.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/2000/nrmm0038.html)

DIGITAL TV BROADCASTERS' OBLIGATIONS TO SERVE CHILDREN
Issue: Television
The FCC asked for comments on the obligation of DTV broadcasters to provide
educational and informational programming for children and the requirement
that DTV broadcasters limit the amount of advertising in children's
programs. In a Notice of Proposed Rulemaking adopted today, the Commission
asked for comment largely on challenges unique to the digital age but also
explored several issues that children's advocates have raised about
children's educational and informational programming in general.
Specifically, the Commission asked for comment on: 1) How the children's
core educational programming processing guideline should be applied to DTV
broadcasters; 2) Whether the guideline should apply only to free broadcast
services or also to pay services, and on commenters' views that a three-hour
guideline may not be sufficient in light of the additional program capacity
made available by digital technology; 3) Whether the Commission's policies
regarding preemption of core programs should be revised in view of the
greater programming flexibility available to DTV broadcasters; 3) Whether
the rules and policies on children's programming advertising limits and
policies
should apply to both free and pay program streams; 5) How these rules and
policies should be interpreted in light of the interactive capabilities made
possible by digital technology; 6) Whether the Commission should revise its
definition of "commercial matter" to include types of program interruptions
that do not currently contribute toward the commercial limits, such as
certain program promotions; 7) How to address the issue of the airing in
programs viewed by children of promotions for age-inappropriate broadcast,
cable or theater movie film content, or other age-inappropriate product
promotions that may be unsuitable for children to watch.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/2000/nrmm0037.html)

REPORTS CONCERNING CHILDREN'S EDUCATIONAL PROGRAMMING
Issue: Television
From Press Release: The FCC amended its rules to continue the requirement
that commercial television broadcasters file with the FCC their quarterly
Children's Television Programming Reports describing their children's
educational and informational programming. Among other things, these reports
identify the educational and informational programs aired by the station
over the previous quarter and the days and times these programs were
regularly scheduled, the age of the target audience for each program, and
the average number of hours per week of core children's programming
broadcast over the past quarter and the children's programming plans for the
next quarter. Under the Commission's 1996 Order implementing the Children's
Television Act, commercial TV stations were required to prepare and place in
their public inspection file quarterly reports on their children's
educational programming. The Order also required that the reports be filed
with the Commission on an annual basis (four quarterly reports filed jointly
once a year) for an experimental period of three years.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/2000/nrmm0036.html)

TOWN HALL MEETING
Issue: Television
Come and meet with community organizations, members of congress, and
concerned citizens to discuss local broadcasters obligation to the public
and the digital television space that belongs to all of us!
Thursday September 21, 2000 6:00pm-9:00pm University of Southern California
Davidson Conference Center 3415 South Figueroa Avenue
Please contact Ofelia Cuevas at (213) 489-5682 or ocuevas1( at )aol.com for more
details.
[SOURCE: People for Better Television]
(http://www.bettertv.org/20000921la.htm)

FORUM CONNECTION
Issue: Telecommunications
The September Forum Connection is available including these articles:
Cold Feet on DTV; Progress on Telephone Service?; looks at party platforms;
and an interview with everyone's favorite public interest lawyer, Andrew Jay
Schwartzman.
[SOURCE: Civil Rights Forum on Communications Policy]
(http://www.civilrightsforum.org/connectionsept2000.html)

PRIVACY

ONLINE PRIVACY TECHNOLOGIES WORKSHOP
Issue: Privacy
From Media Advisory: Commerce Secretary Norman Y. Mineta will deliver the
keynote speech at a workshop hosted by the Commerce Department's National
Telecommunications and Information Administration (NTIA) on Sept. 19, 2000
to examine technological tools and developments that can enhance consumer
privacy online.
The workshop will begin at 9 a.m. in the auditorium of the U.S. Department
of Commerce, 14th and Constitution Ave., N.W., Washington, D.C. NTIA and the
Internet Education Foundation will simultaneously co-host a Technology Fair
to demonstrate the use and capabilities of a broad array of online privacy
technologies. The Fair will allow the public to examine and try out these
technologies. About 20 companies are expected to demonstrate their products.
The public workshop and the Fair will be held from 9 a.m. to 5 p.m. The
Technology Fair will be held in the Department's Main Lobby (14th Street
Entrance). Both the workshop and the Fair are open to the public, free of
charge. No advance registration is required. See agenda at URL below.
[SOURCE: NTIA]
(http://www.ntia.doc.gov/ntiahome/press/2000/mapriv91400.htm)

MERGER

EUROPEAN REGULATORS RECOMMEND BLOCKING AOL-TIME WARNER DEAL
Issue: Mergers
The European Commission has drafted preliminary recommendations to block the
merger of America Online and Time Warner. At the center of the EC's
objections to the merger are concerns over Time Warner's own plans for a
music joint venture with Britain's EMI Group. The deal would create a $20
billion music powerhouse that would be the world's biggest music publisher
and one of the two biggest recorded-music companies. The companies have
until Sunday to gain clearance for the deal by offering new antitrust
concessions to Brussels regulators or by expanding those they already have
submitted. AOL and Time Warner have submitted a list of four antitrust
remedies to the commission, aimed mostly at cutting its horizontal ties with
Bertelsmann AG and promising nondiscriminatory access to AOL and Time
Warner's competitors. In a statement, AOL said: "We are confident that the
talks will conclude successfully."
[SOURCE: Wall Street Journal (A3), AUTHOR: Philip Shishkin and John Wilke]
(http://interactive.wsj.com/articles/SB969289612515681845.htm)
(requires subscription)
See Also:
EU CALLS WARNER, AOL DEALS TROUBLING
[SOURCE: Washington Post (E1), AUTHOR: William Drozdiak]
(http://washingtonpost.com/wp-dyn/articles/A31426-2000Sep18.html)

VIDEO

BLOCKBUSTER BRANCHES OUT
Issue: Video
Blockbuster is in the process of reinventing itself for a future in which
video rentals may be on the wane. Blockbuster's $10 billion-a-year
video-rental industry, comprising 32 percent of the market, is facing
challenges from satellites, cable, broadband and other avenues that promise
to bring video home. To face the challenge Blockbuster is putting together a
number of deals. Chairman John F. Antioco has called his plan "the ultimate
bricks, clicks and flicks" strategy. It's an ambitious makeover, moving
Blockbuster into virtually every medium through which home entertainment can
be delivered. 1) Blockbuster is teaming with DirecTV Inc. Besides being able
to purchase a DirecTV system at Blockbuster, the company expects to offer
Blockbuster movies next year on a pay-per-view basis. 2) Blockbuster will
soon be on broadband with Enron, offering video on demand. 3) Expanding on
its existing AOL and Web presences, Blockbuster has formed an Internet
alliance with Food.com Inc. that, starting next year, will allow consumers
to order cinema and supper and have it all delivered by Takeout Taxi.
Blockbuster is a publicly traded subsidiary of Viacom.
[SOURCE: Washington Post (E1), AUTHOR: Martha McNeil Hamilton]
(http://washingtonpost.com/wp-dyn/articles/A31570-2000Sep18.html)

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

MEDIA & SOCIETY
Hollywood Insiders Give Thumbs-Down to Critics (NYT)
'Dr Laura' Pulls In Weak Ratings and Ads (NYT)

POLITICAL DISCOURSE
Would-Be Representatives Campaign Via Web Sites (WSJ)
Agency Investigates 'Rats' Ad (NYT)

MERGERS
Europe Watches Warily As AOL Flexes Muscles (WP)
SBC Looking To Seal Deal With Telia For $6B (USA)
Here's The Inside Scoop On All Those Mega-Mergers (USA)
AT&T to Consider Link Ups With British Telecom Units (WSJ)

INTERNET
Sellers Hire Auditors to Verify Privacy Policies and Increase Trust
(CyberTimes)
Get Me That Web Site, Stat! Internet Speeds Up Emergency Medicine
(USA)
Net2Phone Shifts to Software for Routing More Telephone Traffic
Over the Internet (ESJ)

ANTITRUST
Regulator Investigates Deutsche Telekom For Anticompetitive Pricing
Suspicions (WSJ)

JOURNALISM
The Right Strategy for Fox (NYT)
Spread of Violence Against Journalists (NYT)
Tycoon Takes to the Road With Media-vs.-Moscow Wars (NYT)

MEDIA & SOCIETY

HOLLYWOOD INSIDERS GIVE THUMBS-DOWN TO CRITICS
Issue: Media&Socity
Hollywood executives have been somewhat tight-lipped in advance of a second
Congressional hearing on the Federal Trade Commission report about marketing
violence to children. But moviemakers are beginning to chafe at the barrage
from politicians. "I think it's a bunch of weasels scrambling for votes,"
said Larry Kasanoff, president of Threshold Entertainment, a company that
makes, among other things, movies based on action-oriented video games like
Mortal Kombat and Duke Nukem. "In all honesty, I think what they're doing is
reprehensible," he said. "What they should be doing is focusing on why there
is less of a family structure in America today. Instead, they attack us.
These guys attack the easy issue because the hard issue doesn't make for
such big headlines for them." Others are upset that it is VP Al Gore and Sen
Joseph Lieberman at the front of the parade. "When you have Al Gore saying
that Hollywood has six months to get its act together, that sounds like
McCarthyism to me and I find it very troubling," said the screenwriter and
director Rod Lurie. "I worked for Gore in '88 and I am really taken aback by
this. It's one thing to co-opt the enemy's issues, but not in a way that
betrays your most important, fundamental values." "I think two different
things about it," said Budd Schulberg, the veteran screenwriter and author
of the novel "What Makes Sammy Run?," about a quintessential Hollywood
wheeler-dealer. "One is that there is always a real danger in the government
trying to make artistic decisions, which could lead to censorship. At the
same time, I understand why they might want to, because with some of the
films I've seen recently, I wish there was more self-censorship going on in
Hollywood." Rick Hess, president of Propaganda Films, said: "At the moment,
I'm a provider of content, which means that I'm not in the driver's seat in
making those kinds of marketing decisions. But I
also have kids of my own and, I have to tell you, I don't envy those who
have to make those marketing decisions."
[SOURCE: New York Times (A1/A19), AUTHOR: Rick Lyman]
(http://www.nytimes.com/2000/09/18/politics/18HOLL.html)
(requires registration)

'DR LAURA' PULLS IN WEAK RATINGS AND ADS (NYT)
Issue: Television
Dr. Laura Schlessinger's new syndicated daytime television show has so far
failed to attract either viewers or advertisers. Gay and lesbian activists
successfully pressured all the big packaged-goods and retail advertisers
that typically buy spots on daytime talk shows not to become sponsors. Now,
the ratings for the first four "Dr. Laura" programs show that viewership has
fallen 15 to 28 percent compared with the programs that run in time slots
just before "Dr. Laura". "It's a goner," said Marc Berman, media analyst for
the Mediaweek .com. "Viewers are not seeking out the controversial doctor"
on television, Mr. Berman said. "Sometimes it's better to be just heard and
not seen."
[SOURCE: New York Times (C15), AUTHOR: Stuart Elliott]
(http://www.nytimes.com/2000/09/18/business/18LAUR.html)
(requires registration)

POLITICAL DISCOURSE

WOULD-BE REPRESENTATIVES CAMPAIGN VIA WEB SITES
Issue: Political Discourse
Online campaigns aren't just for big-name politicians anymore. Two
first-time candidates, Ann Kitchen and Jill Warren, both of Austin Texas are
running for a seat in the state legislature. Both would-be representatives
are running virtual campaigns side by side with their traditional efforts,
using e-mail and Web pages in addition to leaflets and yard signs to reach
voters. In Austin and in scattered contests around the U.S., the Web's
influence is percolating down to local politics. As a result, voters are
getting a valuable new way to learn about and even interact with those who
would represent them. If proposed online voting systems make casting a
ballot push-button easy, this trend could broaden participation in local
politics. "There are only so many doors I can knock on," says Ms. Warren.
"If I can talk to people online, that's an advantage," says Ms. Warren, a
Republican. "For a local race, people don't get a whole lot of exposure to
the candidates," says Ms. Kitchen, 45, the Democratic opponent. "They don't
get video or audio, yet that gives people a more complete picture." But with
plenty of voters still unwired, there are also questions about the digital
divide. "The Internet is great," Ms. Kitchen adds. "But it's not there yet
for everybody."
[SOURCE: Wall Street Journal (Interactive), AUTHOR: Tom Weber]
(http://interactive.wsj.com/articles/SB969222134607846557.htm)
(Requires subscription)

AGENCY INVESTIGATES 'RATS' AD
Issue: Political Discourse
Responding to complaints from two Democratic senators, the Federal
Communications Commission has begun an investigation into a Republican
campaign television commercial to determine whether it used subliminal
advertising techniques. In letters sent to 217 television stations that may
have aired the ad, Charles W. Kelley, chief of the investigations and
hearings division of the commission's enforcement bureau, asked whether any
of the stations' officers, directors or employees knew before the commercial
was broadcast that it contained the word "rats." The agency has no power to
sanction political campaigns or producers of advertisements. But it can send
a letter of admonishment or even revoke the license of a station that
knowingly broadcasts an advertisement the agency deems unfairly deceptive.
[SOURCE: New York Times (A18), AUTHOR: Steven Holmes]
(http://www.nytimes.com/2000/09/18/national/18FCC.html)
(requires registration)

MERGERS

EUROPE WATCHES WARILY AS AOL FLEXES MUSCLES
Issue: Mergers
This past spring a gag e-mail hit a little too close to home for Michael
Haentjes, chairman and chief executive of Edel Music AG. The e-mail was a
fake press release: "In a surprise announcement, AOL Time Warner announced
Friday that it had acquired France." The e-mail sentiment goes to the heart
of European's fears about America Online $183 billion takeover of Time
Warner. Imagine, Haentjes said, the effect of "Wal-Mart buying Coca Cola,"
where the distributor controls the product. "It's not going to be beneficial
for us," he said. Since January, AOL and Time Warner have insisted that the
deal will benefit all consumers. But lawmakers, consumer groups and business
rivals have raised the specter of a corporate marriage that could control
access to the Internet, restrict consumer choice and stifle competition.
But, for Europe the merger raises other questions as well: Will the
Americans dominate the Internet in Europe? What are the personal privacy
implications of the merger? Will the United States gain greater control over
the distribution here of music, entertainment and media? And what will the
U.S. acquire next? "The concern that the commission has expressed is if they
dominate the market, they're not subject to competition, and consumers don't
have choice then," said Alec Burnside, a Brussels-based lawyer specializing
in antitrust issues. Some worry that children are particularly susceptible
to the practices of online data and targeted marketing. But for all of the
concern about AOL Time Warner, few European brows have been raised about
another deal with similar dimensions, Vivendi SA's recent announcement to
aquire Seagram Co. Why? "Because it's a European company acquiring an
American," Haentjes said.
[SOURCE: Washington Post (A1), AUTHOR: Alec Klein]
(http://washingtonpost.com/wp-dyn/articles/A15200-2000Sep15.html)
See Also
TIME WARNER, EMI OFFER THE EU PROPOSED CONCESSIONS ON VENTURE
[SOURCE: Wall Street Journal (A26), AUTHOR: Brandon Mitchener And Martin
Peers]
(http://interactive.wsj.com/articles/SB969036703659336219.htm)
(Requires subscription)

AT&T TO CONSIDER LINK UPS WITH BRITISH TELECOM UNITS
Issue: Mergers
AT&T and British Telecommunications wants to combine some of their
businesses as well as a range of other options. The Wall Street Journal
reported last month that AT&T's chairman and chief executive, and BT's chief
executive, had discussed the possibility of a merger. While the two sides
haven't ruled out a complete merger, AT&T will now focus on merging specific
operations, such as AT&T's business-services division with BT's
business-customer unit. Although talks are fluid and could still fall apart,
AT&T Wireless and Nextel Communications are discussing a possible merger,
and a deal could be announced as early as next month. AT&T is facing fierce
competition in its long-distance offering from the local Bell phone
companies as they begin offering long-distance service. AT&T is also
considering selling its consumer long-distance business entirely, or
combining it with Liberty Media Group, the cable-programming business that
trades separately as an AT&T tracking stock, and spinning it off. AT&T
management is expected to give presentations and discuss strategy on all
these possibilities at a meeting starting Thursday.
[SOURCE: Wall Street Journal (A3), AUTHOR: Deborah Solomon, Gautam Naik And
Anita Raghavan]
(http://interactive.wsj.com/articles/SB969226095679972212.htm)
(Requires subscription)

SBC LOOKING TO SEAL DEAL WITH TELIA FOR $6B
Issue: Merger/International
USA's second-largest local phone company SBC Communications, is in
negotiations to sell most of its European telecommunications assets to
Swedish state-owned operator Telia for more than $6 billion. SBC is looking
to sell its 42% stake in Tele Danmark, Denmark's leading local and
long-distance carrier, in exchange for Telia stock and cash. The move
reflects SBC Chief Edward Whitacre's desire to shift focus from Europe to
opportunities in the USA and Latin America. Almost a fifth of the former
regional Bell's revenue comes from international operations. SBC has already
begun a partial pullout in Europe, recently selling off its 29.8% stake in
Hungarian flagship carrier MATAV for $2.2 billion.
[SOURCE: USAToday (1B), AUTHOR: Thor Valdmanis]
(http://www.usatoday.com/usatonline/20000918/2652847s.htm)

HERE'S THE INSIDE SCOOP ON ALL THOSE MEGA-MERGERS
Issue: Mergers
USAToday media writer David Leiberman makes some predictions regarding
pending mergers:
*The America Online and Time Warner deal will likely be approved with
conditions: 1)the FTC will probably mandate open access so independent
Internet providers can offer high-speed services on AOL Time Warner's cable
systems, and 2) the FCC will likely insist that AOL opens its messaging
system to rivals.
* The European Union is unlikely to block the AOL/Warner deal because it is
too busy deciding whether to block the music joint venture between Time
Warner and EMI.
* The Vivendi and Seagram merger will likely go through without much
opposition.
* News Corp's Rupert Murdoch will probably make a bid to buy DirecTV,
America's No. 1 satellite TV provider.
[SOURCE: USAToday (B5), AUTHOR: David Lieberman]
(http://www.usatoday.com/usatonline/20000918/2652819s.htm)

INTERNET

SELLERS HIRE AUDITORS TO VERIFY PRIVACY POLICIES AND INCREASE TRUST
(CYBERTIMES)
Issue: Privacy/E-commerce
According to analysts, most Internet users who have not shopped online cite
inadequate privacy as the main reason. 92 percent of online households do
not trust online companies to keep their information private, no matter what
they promise, found a survey earlier this year by the research firm Odyssey.
Some e-businesses are trying to counter the rising tide of distrust by
paying well-known financial services firms to audit their Web sites
compliance with their own privacy policies. Most recently, Expedia.com, the
travel site owned by Microsoft, subjected its privacy policies to an audit
by PricewaterhouseCoopers. While both Truste and the Better Business Bureau
Online use audits as part of their seal programs, they are less consistent
and comprehensive than those performed by the major accounting firms.
Privacy advocates are, predictably, pleased with those who have gone public
with audits, but say more protections are necessary. "We still need baseline
legislation so we can go after bad actors, and we need better technologies
that will increase privacy," said Ari Schwartz, senior policy analyst for
the Center for Democracy and Technology.
[SOURCE: CyberTimes, AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/2000/09/18/technology/18ECOMMERCE.html)
(requires registration)

GET ME THAT WEB SITE, STAT! INTERNET SPEEDS UP EMERGENCY MEDICINE
Issue: Internet/Health
Surveys suggest that the number of U.S. emergency rooms with Internet access
has doubled since 1998. And the number is expected to double again over the
next year. Doctors have found the Internet an invaluable tool for helping
them treat patients, who are expected to receive 18,000 different diagnoses
in U.S. emergency rooms this year. "We're in a hunter-gatherer mode as
physicians," says Dr. Craig Feied. "The effort we have to go through to get
one little bit of information about patients is very large. We wanted to
build something that would allow us to become the information farmers."
Milwaukee emergency doctor Ed Barthell says that the different uses of the
Internet are also growing. "It is most often utilized as a reference tool,
but more specific applications directed toward the specialty are beginning
to evolve,'' Barthell says. "For example, we have a network of hospitals now
collecting stroke research data on an Internet-based system that is much
more efficient than previous data collection methods."
[SOURCE: USAToday (1D), AUTHOR: Rita Rubin]
(http://www.usatoday.com/usatonline/20000918/2652969s.htm)

NET2PHONE SHIFTS TO SOFTWARE FOR ROUTING MORE TELEPHONE TRAFFIC OVER THE
INTERNET
Issue: Internet
Three years ago Net2Phone Inc. made a splash by charging only pennies for
long-distance phone calls made over the Internet. It didn't take long for
Net2Phone to learn the hard lessons long-distance phone service providers
have painfully known for a long time, and as a result, is switching
strategies of doing business. The company has concluded that long-distance
calling is as much of a cutthroat business on the Internet as it is in the
traditional off-line world. Hence, it is planning to market software that
will enable traditional carriers to route more of their traffic over the
Internet -- though that new market is itself becoming a crowded one. While
Internet toll charges now account for 95% of the company's business, the
company hope to shrink that percentage to 50% within two years, with most of
their revenue to come from their new business line: telephone network
management software for major carriers, like AT&T, which are moving more of
their calling to the Internet. Hard lessons: Although it claims a 40% share
of the small but growing market for Internet telephony, the Internet
telephony market is a crowded and unprofitable one, with 300 companies using
price cuts to win customers and driving toll rates to as low as two cents a
minute for domestic Internet calls. Net2Phone is expected to report a loss
of $41.5 million for the fiscal year that ended July 31, on sales of $70
million.
[SOURCE: Wall Street Journal (B10), AUTHOR: Jennifer L. Rewick]
(http://interactive.wsj.com/articles/SB969058211191117045.htm)
(Requires subscription)

ANTITRUST

REGULATOR INVESTIGATES DEUTSCHE TELEKOM FOR ANTICOMPETITIVE PRICING
SUSPICIONS
Issue: Antitrust
Germany's Deutsche Telekom is under investigation on suspicion of
anticompetitive pricing for services to Internet-service providers that use
its network to reach their customers. German regulators charge that
Germany's dominant phone company discriminates against Internet-service
providers because "these offer customers a flat rate, but at the same time
can only receive the necessary service from Deutsche Telekom on a per-minute
basis." The regulator fears that Deutsche Telekom's own service provider,
T-Online, pays less for the services received from Deutsche Telekom than the
company's rivals. The regulator's probe could be the first step towards
establishing flat fees across Europe for the services that Internet-service
providers and online services receive from network operators. While such
fees are the norm in the U.S. and the U.K., elsewhere in Europe per-minute
fees are charged. The German regulators could set a precedent that changes
the economics of offering Internet access, lowering costs to service
providers and their customers.
[SOURCE: Wall Street Journal (A26), AUTHOR: William Boston]
(http://interactive.wsj.com/articles/SB969223392748265472.htm)
(Requires subscription)

JOURNALISM

THE RIGHT STRATEGY FOR FOX
Issue: Cable/Journalism
Fox News Channel, the cable news network created by Rupert Murdoch to
counter CNN's liberal bias, is growing in ratings, household distribution
and revenue. But by staking out this ground, the network may never be
accepted as a mainstream source of news. Democrats, for example, shy away
from appearing on its programs, fearing they will not be treated fairly. And
Republicans sometimes don't appear, prompting Fox executives to speculate
that the party is taking the network's viewers for granted. "I think there
is an underserved audience that is hungry for fair and balanced news," said
Roger E. Ailes, the Fox News Channel chairman and chief executive who put
together the network for Mr. Murdoch. "If the conservative point of view is
not presented anywhere else in journalism, then those people will come to
us."
[SOURCE: New York Times (C1), AUTHOR: Jim Rutenberg]
(http://www.nytimes.com/2000/09/18/business/18FOX.html)
(requires registration)

SPREAD OF VIOLENCE AGAINST JOURNALISTS
Issue: Journalism
An assailant shot a Montreal reporter five times last week, in the parking
lot of the reporter's newspaper. After listening to death threats on his
answering machine for years, Michel Auger may be a victim of the beat he
covers, Montreal's underworld. "All Canadians are shocked at what took place
in the parking lot of Le Journal de Montr

MEDIA & SOCIETY
Hollywood Insiders Give Thumbs-Down to Critics (NYT)
'Dr Laura' Pulls In Weak Ratings and Ads (NYT)

POLITICAL DISCOURSE
Would-Be Representatives Campaign Via Web Sites (WSJ)
Agency Investigates 'Rats' Ad (NYT)

MERGERS
Europe Watches Warily As AOL Flexes Muscles (WP)
SBC Looking To Seal Deal With Telia For $6B (USA)
Here's The Inside Scoop On All Those Mega-Mergers (USA)
AT&T to Consider Link Ups With British Telecom Units (WSJ)

INTERNET
Sellers Hire Auditors to Verify Privacy Policies and Increase Trust
(CyberTimes)
Get Me That Web Site, Stat! Internet Speeds Up Emergency Medicine
(USA)
Net2Phone Shifts to Software for Routing More Telephone Traffic
Over the Internet (ESJ)

ANTITRUST
Regulator Investigates Deutsche Telekom For Anticompetitive Pricing
Suspicions (WSJ)

JOURNALISM
The Right Strategy for Fox (NYT)
Spread of Violence Against Journalists (NYT)
Tycoon Takes to the Road With Media-vs.-Moscow Wars (NYT)

MEDIA & SOCIETY

HOLLYWOOD INSIDERS GIVE THUMBS-DOWN TO CRITICS
Issue: Media&Socity
Hollywood executives have been somewhat tight-lipped in advance of a second
Congressional hearing on the Federal Trade Commission report about marketing
violence to children. But moviemakers are beginning to chafe at the barrage
from politicians. "I think it's a bunch of weasels scrambling for votes,"
said Larry Kasanoff, president of Threshold Entertainment, a company that
makes, among other things, movies based on action-oriented video games like
Mortal Kombat and Duke Nukem. "In all honesty, I think what they're doing is
reprehensible," he said. "What they should be doing is focusing on why there
is less of a family structure in America today. Instead, they attack us.
These guys attack the easy issue because the hard issue doesn't make for
such big headlines for them." Others are upset that it is VP Al Gore and Sen
Joseph Lieberman at the front of the parade. "When you have Al Gore saying
that Hollywood has six months to get its act together, that sounds like
McCarthyism to me and I find it very troubling," said the screenwriter and
director Rod Lurie. "I worked for Gore in '88 and I am really taken aback by
this. It's one thing to co-opt the enemy's issues, but not in a way that
betrays your most important, fundamental values." "I think two different
things about it," said Budd Schulberg, the veteran screenwriter and author
of the novel "What Makes Sammy Run?," about a quintessential Hollywood
wheeler-dealer. "One is that there is always a real danger in the government
trying to make artistic decisions, which could lead to censorship. At the
same time, I understand why they might want to, because with some of the
films I've seen recently, I wish there was more self-censorship going on in
Hollywood." Rick Hess, president of Propaganda Films, said: "At the moment,
I'm a provider of content, which means that I'm not in the driver's seat in
making those kinds of marketing decisions. But I
also have kids of my own and, I have to tell you, I don't envy those who
have to make those marketing decisions."
[SOURCE: New York Times (A1/A19), AUTHOR: Rick Lyman]
(http://www.nytimes.com/2000/09/18/politics/18HOLL.html)
(requires registration)

'DR LAURA' PULLS IN WEAK RATINGS AND ADS (NYT)
Issue: Television
Dr. Laura Schlessinger's new syndicated daytime television show has so far
failed to attract either viewers or advertisers. Gay and lesbian activists
successfully pressured all the big packaged-goods and retail advertisers
that typically buy spots on daytime talk shows not to become sponsors. Now,
the ratings for the first four "Dr. Laura" programs show that viewership has
fallen 15 to 28 percent compared with the programs that run in time slots
just before "Dr. Laura". "It's a goner," said Marc Berman, media analyst for
the Mediaweek .com. "Viewers are not seeking out the controversial doctor"
on television, Mr. Berman said. "Sometimes it's better to be just heard and
not seen."
[SOURCE: New York Times (C15), AUTHOR: Stuart Elliott]
(http://www.nytimes.com/2000/09/18/business/18LAUR.html)
(requires registration)

POLITICAL DISCOURSE

WOULD-BE REPRESENTATIVES CAMPAIGN VIA WEB SITES
Issue: Political Discourse
Online campaigns aren't just for big-name politicians anymore. Two
first-time candidates, Ann Kitchen and Jill Warren, both of Austin Texas are
running for a seat in the state legislature. Both would-be representatives
are running virtual campaigns side by side with their traditional efforts,
using e-mail and Web pages in addition to leaflets and yard signs to reach
voters. In Austin and in scattered contests around the U.S., the Web's
influence is percolating down to local politics. As a result, voters are
getting a valuable new way to learn about and even interact with those who
would represent them. If proposed online voting systems make casting a
ballot push-button easy, this trend could broaden participation in local
politics. "There are only so many doors I can knock on," says Ms. Warren.
"If I can talk to people online, that's an advantage," says Ms. Warren, a
Republican. "For a local race, people don't get a whole lot of exposure to
the candidates," says Ms. Kitchen, 45, the Democratic opponent. "They don't
get video or audio, yet that gives people a more complete picture." But with
plenty of voters still unwired, there are also questions about the digital
divide. "The Internet is great," Ms. Kitchen adds. "But it's not there yet
for everybody."
[SOURCE: Wall Street Journal (Interactive), AUTHOR: Tom Weber]
(http://interactive.wsj.com/articles/SB969222134607846557.htm)
(Requires subscription)

AGENCY INVESTIGATES 'RATS' AD
Issue: Political Discourse
Responding to complaints from two Democratic senators, the Federal
Communications Commission has begun an investigation into a Republican
campaign television commercial to determine whether it used subliminal
advertising techniques. In letters sent to 217 television stations that may
have aired the ad, Charles W. Kelley, chief of the investigations and
hearings division of the commission's enforcement bureau, asked whether any
of the stations' officers, directors or employees knew before the commercial
was broadcast that it contained the word "rats." The agency has no power to
sanction political campaigns or producers of advertisements. But it can send
a letter of admonishment or even revoke the license of a station that
knowingly broadcasts an advertisement the agency deems unfairly deceptive.
[SOURCE: New York Times (A18), AUTHOR: Steven Holmes]
(http://www.nytimes.com/2000/09/18/national/18FCC.html)
(requires registration)

MERGERS

EUROPE WATCHES WARILY AS AOL FLEXES MUSCLES
Issue: Mergers
This past spring a gag e-mail hit a little too close to home for Michael
Haentjes, chairman and chief executive of Edel Music AG. The e-mail was a
fake press release: "In a surprise announcement, AOL Time Warner announced
Friday that it had acquired France." The e-mail sentiment goes to the heart
of European's fears about America Online $183 billion takeover of Time
Warner. Imagine, Haentjes said, the effect of "Wal-Mart buying Coca Cola,"
where the distributor controls the product. "It's not going to be beneficial
for us," he said. Since January, AOL and Time Warner have insisted that the
deal will benefit all consumers. But lawmakers, consumer groups and business
rivals have raised the specter of a corporate marriage that could control
access to the Internet, restrict consumer choice and stifle competition.
But, for Europe the merger raises other questions as well: Will the
Americans dominate the Internet in Europe? What are the personal privacy
implications of the merger? Will the United States gain greater control over
the distribution here of music, entertainment and media? And what will the
U.S. acquire next? "The concern that the commission has expressed is if they
dominate the market, they're not subject to competition, and consumers don't
have choice then," said Alec Burnside, a Brussels-based lawyer specializing
in antitrust issues. Some worry that children are particularly susceptible
to the practices of online data and targeted marketing. But for all of the
concern about AOL Time Warner, few European brows have been raised about
another deal with similar dimensions, Vivendi SA's recent announcement to
aquire Seagram Co. Why? "Because it's a European company acquiring an
American," Haentjes said.
[SOURCE: Washington Post (A1), AUTHOR: Alec Klein]
(http://washingtonpost.com/wp-dyn/articles/A15200-2000Sep15.html)
See Also
TIME WARNER, EMI OFFER THE EU PROPOSED CONCESSIONS ON VENTURE
[SOURCE: Wall Street Journal (A26), AUTHOR: Brandon Mitchener And Martin
Peers]
(http://interactive.wsj.com/articles/SB969036703659336219.htm)
(Requires subscription)

AT&T TO CONSIDER LINK UPS WITH BRITISH TELECOM UNITS
Issue: Mergers
AT&T and British Telecommunications wants to combine some of their
businesses as well as a range of other options. The Wall Street Journal
reported last month that AT&T's chairman and chief executive, and BT's chief
executive, had discussed the possibility of a merger. While the two sides
haven't ruled out a complete merger, AT&T will now focus on merging specific
operations, such as AT&T's business-services division with BT's
business-customer unit. Although talks are fluid and could still fall apart,
AT&T Wireless and Nextel Communications are discussing a possible merger,
and a deal could be announced as early as next month. AT&T is facing fierce
competition in its long-distance offering from the local Bell phone
companies as they begin offering long-distance service. AT&T is also
considering selling its consumer long-distance business entirely, or
combining it with Liberty Media Group, the cable-programming business that
trades separately as an AT&T tracking stock, and spinning it off. AT&T
management is expected to give presentations and discuss strategy on all
these possibilities at a meeting starting Thursday.
[SOURCE: Wall Street Journal (A3), AUTHOR: Deborah Solomon, Gautam Naik And
Anita Raghavan]
(http://interactive.wsj.com/articles/SB969226095679972212.htm)
(Requires subscription)

SBC LOOKING TO SEAL DEAL WITH TELIA FOR $6B
Issue: Merger/International
USA's second-largest local phone company SBC Communications, is in
negotiations to sell most of its European telecommunications assets to
Swedish state-owned operator Telia for more than $6 billion. SBC is looking
to sell its 42% stake in Tele Danmark, Denmark's leading local and
long-distance carrier, in exchange for Telia stock and cash. The move
reflects SBC Chief Edward Whitacre's desire to shift focus from Europe to
opportunities in the USA and Latin America. Almost a fifth of the former
regional Bell's revenue comes from international operations. SBC has already
begun a partial pullout in Europe, recently selling off its 29.8% stake in
Hungarian flagship carrier MATAV for $2.2 billion.
[SOURCE: USAToday (1B), AUTHOR: Thor Valdmanis]
(http://www.usatoday.com/usatonline/20000918/2652847s.htm)

HERE'S THE INSIDE SCOOP ON ALL THOSE MEGA-MERGERS
Issue: Mergers
USAToday media writer David Leiberman makes some predictions regarding
pending mergers:
*The America Online and Time Warner deal will likely be approved with
conditions: 1)the FTC will probably mandate open access so independent
Internet providers can offer high-speed services on AOL Time Warner's cable
systems, and 2) the FCC will likely insist that AOL opens its messaging
system to rivals.
* The European Union is unlikely to block the AOL/Warner deal because it is
too busy deciding whether to block the music joint venture between Time
Warner and EMI.
* The Vivendi and Seagram merger will likely go through without much
opposition.
* News Corp's Rupert Murdoch will probably make a bid to buy DirecTV,
America's No. 1 satellite TV provider.
[SOURCE: USAToday (B5), AUTHOR: David Lieberman]
(http://www.usatoday.com/usatonline/20000918/2652819s.htm)

INTERNET

SELLERS HIRE AUDITORS TO VERIFY PRIVACY POLICIES AND INCREASE TRUST
(CYBERTIMES)
Issue: Privacy/E-commerce
According to analysts, most Internet users who have not shopped online cite
inadequate privacy as the main reason. 92 percent of online households do
not trust online companies to keep their information private, no matter what
they promise, found a survey earlier this year by the research firm Odyssey.
Some e-businesses are trying to counter the rising tide of distrust by
paying well-known financial services firms to audit their Web sites
compliance with their own privacy policies. Most recently, Expedia.com, the
travel site owned by Microsoft, subjected its privacy policies to an audit
by PricewaterhouseCoopers. While both Truste and the Better Business Bureau
Online use audits as part of their seal programs, they are less consistent
and comprehensive than those performed by the major accounting firms.
Privacy advocates are, predictably, pleased with those who have gone public
with audits, but say more protections are necessary. "We still need baseline
legislation so we can go after bad actors, and we need better technologies
that will increase privacy," said Ari Schwartz, senior policy analyst for
the Center for Democracy and Technology.
[SOURCE: CyberTimes, AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/2000/09/18/technology/18ECOMMERCE.html)
(requires registration)

GET ME THAT WEB SITE, STAT! INTERNET SPEEDS UP EMERGENCY MEDICINE
Issue: Internet/Health
Surveys suggest that the number of U.S. emergency rooms with Internet access
has doubled since 1998. And the number is expected to double again over the
next year. Doctors have found the Internet an invaluable tool for helping
them treat patients, who are expected to receive 18,000 different diagnoses
in U.S. emergency rooms this year. "We're in a hunter-gatherer mode as
physicians," says Dr. Craig Feied. "The effort we have to go through to get
one little bit of information about patients is very large. We wanted to
build something that would allow us to become the information farmers."
Milwaukee emergency doctor Ed Barthell says that the different uses of the
Internet are also growing. "It is most often utilized as a reference tool,
but more specific applications directed toward the specialty are beginning
to evolve,'' Barthell says. "For example, we have a network of hospitals now
collecting stroke research data on an Internet-based system that is much
more efficient than previous data collection methods."
[SOURCE: USAToday (1D), AUTHOR: Rita Rubin]
(http://www.usatoday.com/usatonline/20000918/2652969s.htm)

NET2PHONE SHIFTS TO SOFTWARE FOR ROUTING MORE TELEPHONE TRAFFIC OVER THE
INTERNET
Issue: Internet
Three years ago Net2Phone Inc. made a splash by charging only pennies for
long-distance phone calls made over the Internet. It didn't take long for
Net2Phone to learn the hard lessons long-distance phone service providers
have painfully known for a long time, and as a result, is switching
strategies of doing business. The company has concluded that long-distance
calling is as much of a cutthroat business on the Internet as it is in the
traditional off-line world. Hence, it is planning to market software that
will enable traditional carriers to route more of their traffic over the
Internet -- though that new market is itself becoming a crowded one. While
Internet toll charges now account for 95% of the company's business, the
company hope to shrink that percentage to 50% within two years, with most of
their revenue to come from their new business line: telephone network
management software for major carriers, like AT&T, which are moving more of
their calling to the Internet. Hard lessons: Although it claims a 40% share
of the small but growing market for Internet telephony, the Internet
telephony market is a crowded and unprofitable one, with 300 companies using
price cuts to win customers and driving toll rates to as low as two cents a
minute for domestic Internet calls. Net2Phone is expected to report a loss
of $41.5 million for the fiscal year that ended July 31, on sales of $70
million.
[SOURCE: Wall Street Journal (B10), AUTHOR: Jennifer L. Rewick]
(http://interactive.wsj.com/articles/SB969058211191117045.htm)
(Requires subscription)

ANTITRUST

REGULATOR INVESTIGATES DEUTSCHE TELEKOM FOR ANTICOMPETITIVE PRICING
SUSPICIONS
Issue: Antitrust
Germany's Deutsche Telekom is under investigation on suspicion of
anticompetitive pricing for services to Internet-service providers that use
its network to reach their customers. German regulators charge that
Germany's dominant phone company discriminates against Internet-service
providers because "these offer customers a flat rate, but at the same time
can only receive the necessary service from Deutsche Telekom on a per-minute
basis." The regulator fears that Deutsche Telekom's own service provider,
T-Online, pays less for the services received from Deutsche Telekom than the
company's rivals. The regulator's probe could be the first step towards
establishing flat fees across Europe for the services that Internet-service
providers and online services receive from network operators. While such
fees are the norm in the U.S. and the U.K., elsewhere in Europe per-minute
fees are charged. The German regulators could set a precedent that changes
the economics of offering Internet access, lowering costs to service
providers and their customers.
[SOURCE: Wall Street Journal (A26), AUTHOR: William Boston]
(http://interactive.wsj.com/articles/SB969223392748265472.htm)
(Requires subscription)

JOURNALISM

THE RIGHT STRATEGY FOR FOX
Issue: Cable/Journalism
Fox News Channel, the cable news network created by Rupert Murdoch to
counter CNN's liberal bias, is growing in ratings, household distribution
and revenue. But by staking out this ground, the network may never be
accepted as a mainstream source of news. Democrats, for example, shy away
from appearing on its programs, fearing they will not be treated fairly. And
Republicans sometimes don't appear, prompting Fox executives to speculate
that the party is taking the network's viewers for granted. "I think there
is an underserved audience that is hungry for fair and balanced news," said
Roger E. Ailes, the Fox News Channel chairman and chief executive who put
together the network for Mr. Murdoch. "If the conservative point of view is
not presented anywhere else in journalism, then those people will come to
us."
[SOURCE: New York Times (C1), AUTHOR: Jim Rutenberg]
(http://www.nytimes.com/2000/09/18/business/18FOX.html)
(requires registration)

SPREAD OF VIOLENCE AGAINST JOURNALISTS
Issue: Journalism
An assailant shot a Montreal reporter five times last week, in the parking
lot of the reporter's newspaper. After listening to death threats on his
answering machine for years, Michel Auger may be a victim of the beat he
covers, Montreal's underworld. "All Canadians are shocked at what took place
in the parking lot of Le Journal de Montr