November 2001

DIGITAL DIVIDE
Natives to Canada: Broadband Now (WIRED)

INTERNET
Internet Board to Mull Security Issues (WSJ)
Senate Net Tax Vote Looms (WIRED)

FCC
FCC to Lift Controls on Wireless Spectrum (WP)
FCC To Examine Multiple Ownership Radio Stations (FCC)

DIGITAL DIVIDE

NATIVES TO CANADA: BROADBAND NOW
Issue: Digital Divide
Canada's native people want to create a "First Nations Broadband Network" to
bring high-speed Internet access to all indigenous communities across
Canada, and are calling on the government to make the construction of the
network a high priority. The primary purpose of the high-speed connection
would be to provide health and education services to communities that cannot
support full-time doctors, nurses or teachers said Matthew Coon Come, head
of the Assembly of First Nations (AFN) the national organization of native
people in Canada. "If done properly, this will not be a handout. It will be
a hand up, and an investment by Canada in itself. It will be
'inter-national' development between First Nations and the Canadian nation,"
Coon Come said. The AFN has estimated the cost of building the network at
between $400 and $500 million, $112 million of which it has committed to
raising for the project. AFN drafted the plan in response to the current
government's election promise to make the Internet accessible in every part
of Canada.
[SOURCE: Wired, AUTHOR: Michelle Delio]
(http://www.wired.com/news/politics/0,1283,48184,00.html)

INTERNET

INTERNET BOARD TO MULL SECURITY ISSUES
Issue: Security
The issue of Internet security has gained such urgency that it will dominate
the agenda at next week's quarterly meeting of the Internet Corp. for
Assigned Names and Numbers, or Icann, in Marina Del Rey, Calif., pushing
aside previously scheduled matters. Icann is the nonprofit organization
charged by the federal government with overseeing the allocation of Internet
addresses, a function essential to the Internet's stability. The fear is
that a physical or cyber attack could be launched against computer servers
and other pieces of infrastructure that help steer users to Web sites and
other Internet services. "If we don't have a secure and stable domain-name
system, we can just as well forget about everything else," M. Stuart Lynn,
Icann's president and chief executive, said Thursday during a conference
call with reporters.
[SOURCE: Wall Street Journal, AUTHOR: Peter Loftus]
(http://interactive.wsj.com/articles/SB1005252731411174040.htm)

SENATE NET TAX VOTE LOOMS
Issue: E-Commerce
The Senate may vote as early as Tuesday on a plan that would permit states
to collect Internet sales taxes. The bill, championed by Sen. Mike Enzi
(R-Wyoming), abandons Capitol Hill's hands-off approach to online taxation:
It would usher in a cavalcade of levies on mail order and Internet
purchases. Enzi admits his Internet Tax Moratorium and Equity Act, which
state legislators hope will hand them an extra $50 billion or so in tax
revenue by mid-decade, is controversial. If the Senate adopted Enzi's bill,
it seems unlikely that the House would go along with it.
[SOURCE: Wired, AUTHOR: Declan McCullagh]
(http://www.wired.com/news/politics/0,1283,48250,00.html)

FCC

FCC TO LIFT CONTROLS ON WIRELESS SPECTRUM
Issue: Wireless
Regional telephone companies and other major wireless providers gained more
freedom to buy or merge with their rivals yesterday as federal regulators
began to do away with a cap on limiting how much of the airwaves any one
company can control. The FCC voted 3 to 1 yesterday to begin a two-step
process that would first raise the cap by 22 percent and then abolish it
altogether on Jan. 1, 2003. Without the cap, companies would find it easier
to team up, leaving a market like the Washington area with fewer providers
than the more than half-dozen which now exist. The move is part of a push by
Federal Communications Commission Chairman Michael K. Powell to deregulate
the telecommunications industry. FCC Commissioner Michael Copps, a Democrat
who cast the lone vote against eliminating the cap, worried the decision
would bring little benefit to consumers. "Let's not kid ourselves," Copps
said. "This is, for some, more about corporate mergers than anything else.
Just look at what the analysts are talking about as the specter of spectrum
cap removal approaches: Their almost exclusive focus is on evaluating the
candidates for corporate takeovers and handicapping the winners and losers
in the spectrum bazaar."
[SOURCE: Washington Post, AUTHOR: Christopher Stern]
(http://www.washtech.com/news/telecom/13618-1.html)

FCC TO EXAMINE MULTIPLE OWNERSHIP RADIO STATIONS
Issue: Ownership
In a Notice of Proposed Rulemaking (NPRM) adopted today, the FCC seeks to
undertake a comprehensive examination of the rules and policies concerning
multiple ownership of radio stations in local markets. The FCC said it
intends to be more responsive to current marketplace realities while
continuing to address its core public interest concerns of promoting
diversity and competition
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/2001/nrmm0115.html)

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

JOURNALISM
Network Coverage a Target of Fire From Conservatives (NYT)

INTERNET
Broadband Defectors on the Rise (CNET)
ICANN Critics Oppose Governance Recommendations (WP)
File-Swapping Case May Break New Ground (CNET)
Brazil To Open Post Office Internet Booths (WP)

COMPETITION
States Split on Microsoft Deal (WP)
FCC to Ease Airwave Restrictions (WP)
Justice Withholds Support for BellSouth's Bid To Sell Long Distance
in Georgia, Louisiana (WSJ)

PRIVACY
Consumer Groups Urge FCC to Protect Phone Privacy (EPIC)

JOURNALISM

NETWORK COVERAGE A TARGET OF FIRE FROM CONSERVATIVES
Issue: Journalism
The television news networks are increasingly coming under criticism from
conservatives who say they exhibit a lack of patriotism or are overly
negative toward the government as they cover the war. Many of the critiques
stem from information provided by a conservative media watchdog organization
called the Media Research Center, which hires full-time monitors to watch
the network newscasts. How their criticism will affect coverage of the war
is an open question. But news executives at CNN, ABC and MSNBC said they
were conscious of the criticism while making their day-to-day decisions
about coverage. Brit Hume, the Fox News Channel anchor, said that in this
conflict, traditional rules no longer applied. "Look, neutrality as a
general principle is an appropriate concept for journalists who are covering
institutions of some comparable quality," Mr. Hume said. "This is a conflict
between the United States and murdering barbarians."
[SOURCE: New York Times, AUTHOR: Jim Rutenberg And Bill Carter]
(http://www.nytimes.com/2001/11/07/politics/07MEDI.html)
(requires registration)

INTERNET

BROADBAND DEFECTORS ON THE RISE
Issue: Broadband
Broadband subscribers are beginning to do what some believed could not
happen: abandon a new technology for an older one. Specifically, consumers
are dumping their broadband connections in favor of dial-up. While it is yet
to be determined whether these defectors will eventually re-up, what is
clear is the economy, continuing broadband price hikes and a lack of
compelling broadband content are prompting some to cancel their higher-speed
connections. The impact is noticeable in the San Francisco Bay Area, where
thousands of high-tech employees have lost their jobs. CNET notes that the
defectors may not show up in the industry's earnings reports: broadband
providers report quarterly growth in the overall number of subscribers - not
losses. "I think the churn is just now beginning," adds Imran Khan, a Yankee
Group research analyst. The industry disputes the analysis: EarthLink
spokesman Kurt Rahn says that high-speed subscribers would "rather sell
their grandmothers" than go back to a pokey dial-up connection. Maybe, but
home broadband consumers can rely on their office's fast connection, rather
than incur the cost at home. According to a recent Jupiter Research study,
fewer than half of broadband subscribers used their connections for heavy
multimedia use - they are still basically downloading email and surfing the
Web as usual, practices not worth a $50 per month broadband bill.
[SOURCE: CNET News.com, AUTHOR: John Borland]
(http://news.cnet.com/news/0-1004-200-7789746.html)

ICANN CRITICS OPPOSE GOVERNANCE RECOMMENDATIONS
Issue: Internet
Critics of ICANN have blasted a new proposal for selecting the publicly
elected members of the ICANN board. Should the Internet Corporation for
Assigned Names and Numbers (ICANN) approve the proposal, rank-and-file Web
users would be effectively barred from "meaningful" participation in the
ICANN process, critics said. A board recommended to ICANN that individual
domain name owners around the world be permitted to elect one-third of the
ICANN board of directors, which has final say in all ICANN decisions. In
past years anyone over the age of 16 with an email address could vote for
the publicly elected members. However, the potential for fraud through dummy
email addresses led ICANN to reconsider the process. Additionally critics
objected to the proposed revised number of publicly elected officialys.
ICANN critics say that publicly elected officials should fill half of the 18
board seats, rather than 4 seats as outlined in the proposal.
[SOURCE: Washington Post, AUTHOR: David McGuire]
(http://www.washtech.com/news/netarch/13583-1.html)

FILE-SWAPPING CASE MAY BREAK NEW GROUND
Issue: Intellectual Property
The Electronic Frontier Foundation (EFF), which has represented hackers,
cryptographers and computer scientists in its push for digital rights,
agreed to defend MusicCity against copyright infringement charges by movie
studios and record labels. The EFF and other supporters argue that the suit,
aimed at the popular MusicCity, Grokster and Kazaa networks, represents a
clear instance of the entertainment industry trying to shut down a
technology that has many uses--something the U.S. Supreme Court has stopped
before. "This case is about the freedom of technologists to innovate and the
public's right to communicate," said Fred von Lohmann, senior intellectual
property attorney for the EFF. Representatives of the Recording Industry
Association of America (RIAA) Chief Executive Hilary Rosen has tried to
reach out to the technology community to quell fears that copyright holders
are looking to shut down development of peer-to-peer software itself. "The
question isn't whether peer-to-peer or any other particular technology is
good or bad," Rosen said. "The question is...whether they'll respect what
artists create just like we in the recording business respect what the
business sponsors and software developers in this audience create."
[SOURCE: Cnet, AUTHOR: John Borland]
(http://news.cnet.com/news/0-1005-200-7798704.html?tag=mn_hd)

BRAZIL TO OPEN POST OFFICE INTERNET BOOTHS
Issue: Digital Divide
Brazil is pledging to install Internet booths in 4,000 post offices next
year, giving free Web access to some 150 million people in a massive effort
to bridge the country's gaping digital divide, President Fernando Henrique
Carodoso announced. The Internet, contrary to what many people still think,
is of great use to all people,'' said Cardoso. ``Citizens who have business
with organs of the federal government -- like pension requests, taxes,
judicial questions or even a project in Congress, need the Internet. Poor
students need the Net for their research.'' That's why the government will
give residents free access for 10-minute long sessions, Cardoso said. The
kiosks will be placed in cities with 10,000 residents or more, and then put
in areas with smaller populations.
[SOURCE: Washington Post, AUTHOR: Associated Press]
(http://www.siliconvalley.com/docs/news/tech/033749.htm)

COMPETITION

STATES SPLIT ON MICROSOFT DEAL
Issue: Antitrust
Nine states and the District of Columbia said yesterday they would not go
along with the settlement already approved by the company and the Department
of Justice. Nine other states told U.S. District Court Judge Colleen
Kollar-Kotelly in a proceeding this afternoon. The 19 jurisdictions had
joined the federal government in the original litigation against Microsoft.
New York, Illinois, North Carolina, Kentucky, Michigan, Ohio, Wisconsin,
Louisiana and Maryland signed off on the deal. Additionally, Microsoft
rejected a state suggestion of another round of settlement talks to reach a
more appealing deal. "The issues in this case have been beaten to death and
they have been beaten to death by people who are worn out," said John
Warden, outside counsel for the software giant. "Let me be as clear as I
possibly can. ... Microsoft believes the settlement process has come to an
end."
[SOURCE: Washington Post, AUTHOR: Ariana Eunjung Cha and Jonathan Krim]
(http://www.washingtonpost.com/wp-dyn/articles/A47104-2001Nov6.html)

FCC TO EASE AIRWAVE RESTRICTIONS
Issue: Wireless
The FCC will vote tomorrow on whether to change the cap on spectrum that a
single mobile telephone company can own in a market. The vote tomorrow is on
whether to raise the current spectrum cap by 20 percent before it moves to
completely abolish the limit in 12 to 18 months. Lifting the cap and its
complete removal would certainly lead to greater consolidation in the
wireless arena. "We have a spectrum shortage, and this is the down payment
to overcome that by allowing there to be more efficient use of what spectrum
is out there," said Thomas E. Wheeler, president and chief executive of the
Cellular Telecommunication & Internet Association. The current cap limits a
company to owning no more than 45 megahertz of spectrum out of the 185
megahertz available in each market.
[SOURCE: Washtech.com, AUTHOR: Christopher Stern]
(http://www.washtech.com/news/telecom/13585-1.html)

JUSTICE WITHHOLDS SUPPORT FOR BELLSOUTH'S BID TO SELL LONG DISTANCE IN
GEORGIA, LOUISIANA
Issue: Competition
The Telecommunications Act of 1996 requires incumbent carriers like
BellSouth to make "unbundled network elements," such as local loops, switch
ports, and transport facilities, available to competitors for lease on the
basis of incremental cost. In return, the Baby Bells may apply to provide
long-distance service. The Department of Justice on Tuesday declined to
support BellSouth application to the Federal Communications Commission to
provide long-distance telephone service in Georgia and Louisiana.
[SOURCE: Wall Street Journal, AUTHOR: Dow Jones Newswires]
(http://interactive.wsj.com/articles/SB1005092682739023160.htm)
(requires subscription)

PRIVACY

CONSUMER GROUPS URGE FCC TO PROTECT PHONE PRIVACY
Issue: Privacy
On November 1, EPIC and seventeen civil liberties and consumer groups filed
comments with the Federal Communications Commission urging the FCC to adopt
opt-in for customer calling data. The FCC's request for comments followed a
federal court decision that the FCC's original opt-in proposal violated the
First Amendment because there was not adequate evidence that opt-in would
protect customer privacy interests. The new comments note that 86% of
consumers favor opt-in for communications services.
[SOURCE: Electronic Privacy Information Center]
(http://www.epic.org/)

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

ANTITRUST
States Weigh Going It Alone in Legal Battle With Microsoft (NYT)
Settling the Microsoft Case (NYT)

BROADBAND
Whither the Broadband Revolution? (Wired)

DIGITAL DIVIDE
Laptops: To Have and Have Not (Wired)

INTELLECTUAL PROPERTY
Some I.B.M. Software Tools to Be Put in Public Domain (NYT)
Networks See Threat in New Video Recorder (NYT)

ANTITRUST

SETTLING THE MICROSOFT CASE
Issue: Microsoft Settlement
[Editorial] Although a sensible settlement, the terms of the agreement are
likely to leave many disappointed. Specifically, as outlined, the terms will
modify Microsoft's future behavior to a lesser extent than its competitors
would have wanted. Under the terms of the proposed consent decree, 1)
Microsoft would be barred from "entering into restrictive contracts and
pricing deals aimed at using its Windows monopoly to unfairly undercut
competitors"; 2) Computer makers would be given more flexibility in how they
configure windows and competing third-party software; 3) Microsoft would be
forced to disclose more of its technical data, including actual code, that
would enable other competing software, and 4) and independent team of
monitors would work to assure Microsoft's compliance. However, the Times
notes that "Microsoft has a poor track record when it comes to reforming
itself, and some of the states involved in the litigation have been dubious
about the Bush administration's determination to pursue this case. So they
were right to ask for a few more days, until tomorrow, to carefully review
the terms of the deal hammered out before Friday's deadline by the software
giant and Justice officials." In summary, "...the settlement strives to
balance the convenience that consumers derive from not having to shop
separately for each software application against the need to keep Microsoft
- gatekeeper to the computer desktop and by extension the Internet - from
fencing out innovation by others." If the agreement works as envisioned.
[SOURCE: New York Times, AUTHOR: New York Times Editorial Staff]
(http://www.nytimes.com/2001/11/05/opinion/05MON2.html)

STATES WEIGH GOING IT ALONE IN LEGAL BATTLE WITH MICROSOFT
Issue: Antitrust
Attorneys general from 18 states are under deadline to inform Judge Colleen
Kollar-Kotelly of the Federal District Court for the District of Columbia of
their decisions on the acceptance of the Microsoft settlement by Tuesday
morning. Weighing on the attorneys general is a substantially weakened
settlement bartered by the federal Justice Department and the complaints of
many in the computer industry over the weekend. "Does anyone think this
settlement is going to change Microsoft's behavior?" said Scott G. McNealy,
the chairman of Sun Microsystems (news/quote), reflecting the widespread
dissatisfaction that he and other industry leaders expressed to the
attorneys general. "These guys are unfettered." But the Justice Department
and Microsoft are unwilling to change the agreement at this point, leaving
the state attorneys general to decide whether they should forego their own
cases and support a decree that is drawing fire, or use their own limited
finances to challenge a decree authored by the federal government and an
industry behemoth. "They are trying to decide whether this proposal is in
the public interest," said James E. Tierney, a former attorney general of
Maine who has been consulting with the state prosecutors in the case. "Will
it be a strong deterrent to illegal behavior for a defendant who has not
even acknowledged any liability? They are extraordinarily concerned about
these issues."
[SOURCE: New York Times, AUTHOR: Stephen Labaton and Steve Lohr]
(http://www.nytimes.com/2001/11/05/technology/05SOFT.html)

BROADBAND

WHITHER THE BROADBAND REVOLUTION
Issue: Broadband
The slowdown in consumer broadband and rollback of existing services could
mark the end of several new subscription services that depend on consumers'
access to high-speed Internet connections. The FCC has noted that consumer
uptake of broadband services is leveling off. In the past month, several
large phone companies announced they would begin rolling back their DSL
service expansion plans in the face of an untenable economy. These setbacks
come just as movie studios, record companies, and other Internet media
interests were hoping to launch subscription-based online entertainment
ventures. "Current slowdowns in broadband proliferation have likely forced
anyone who'd planned to build a business on streaming video to drastically
scale back growth projections," said Ric Dube, senior analyst with Webnoize,
an Internet research firm. "Nobody will ever pay for streaming video content
at speeds below broadband."
[SOURCE: Wired, AUTHOR Brad King]
(http://wired.com/news/mp3/0,1285,47968,00.html)

DIGITAL DIVIDE

LAPTOPS: TO HAVE AND HAVE NOT
Issue: Digital Divide
A Palo Alto middle school's laptop proposal has met with resistance from
frustrated parents. The Palo Alto Unified School District recently sent a
letter to parents announcing that Jordan Middle School planned to buy 45 new
Apple iBooks to share among 300 sixth-grade students. Parents could choose
to purchase a laptop for their own student if they wanted. Parents
criticized the plan, pointing out that it would divide students into two
group: those who had their own laptop, and those who don't. The school will
still buy the 45 iBooks, but the parent portion of the plan, predictably,
won't be put in place.
[SOURCE: Wired, AUTHOR: Katie Dean]
(http://wired.com/news/school/0,1383,48106,00.html)

INTELLECTUAL PROPERTY

SOME I.B.M. SOFTWARE TOOLS TO BE PUT IN PUBLIC DOMAIN
Issue: Open Source
I.B.M. plans to announce today that it is placing $40 million of its
software tools in the public domain as the first step toward founding an
open-source organization for developers. The move is the latest step in
International Business Machines embrace of the open-source software model,
in which programmers around the world share software code for joint
development and debugging. The new open-source organization, called Eclipse,
will focus on the programming tools used to build applications and other
software. More than 150 software companies, from Linux distributors like Red
Hat and SuSE to applications developers like Rational and Bow Street, are
lined up to join the Eclipse community. I.B.M. considers it a worthwhile
investment to place in the public domain software tools that it spent $40
million to develop, seeing the move as one that further undermines the
leading operating system suppliers, like Microsoft.
[SOURCE: New York Times, AUTHOR: Steve Lohr]
(http://www.nytimes.com/2001/11/05/technology/05OPEN.html)
(requires registration)

NETWORKS SEE THREAT IN NEW VIDEO RECORDER
Issue: Television
Three years ago, television executives watched as so-called personal video
recorders allowed viewers, for the first time, to pause and replay
programming even as it was being broadcast. The new recorders can even tape
one program while the viewer is watching another. But last week, one company
appeared to have crossed the networks' line in the sand - by making it
easier to skip commercials. ABC, CBS and NBC filed a lawsuit against
SonicBlue, maker of the ReplayTV personal video recorder, arguing that the
latest version of the ReplayTV device would deprive them of revenue and
reduce their incentive to create programming. The three big networks are
hoping to block sales of the device, which also lets viewers send stored
programs to other users over the Internet, a feature the three networks says
infringes their copyrights.
[SOURCE: New York Times, AUTHOR: Laurie J. Flynn]
(http://www.nytimes.com/2001/11/05/technology/05TIVO.html)
(requires registration)

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