June 2004

The FCC's Consumer Advisory Committee meets today and there will be two
town meetings on the Future of Media next week. For these and other
upcoming media policy events, see http://www.benton.org/calendar.htm.

Headlines will publish again THURSDAY JUNE 24.

Communications-related Headlines is a free online news summary service
provided by the Benton Foundation (www.benton.org). Posted Monday through
Friday, this service provides updates on important industry developments,
policy issues, and other related news events. While the summaries are
factually accurate, their often informal tone does not always represent the
tone of the original articles. Headlines are compiled by Kevin Taglang
(headlines( at )benton.org) -- we welcome your comments.

INTERNET
Eroding E-rate

MEDIA
Senate Judiciary Approves SHVIA Legislation
Outside Audit: TV Networks May Not Be 'Upfront'

QUICKLY
The Politics of Spam
House Panel Passes Spyware Permission Bill
Weather Radios Will Carry More Kinds of Alerts
Broadcast Indecency Bill
Video Competition NOI Released

ONE LAST THOUGHT: Juneteenth

INTERNET

ERODING E-RATE
With a House oversight hearing on the e-rate this week, C-Net posted this
long look at the charges of fraud associated with the program to wire
schools and libraries to the Internet. Consumers contribute about $1/per
month to the program which has distributed about $13 billion since 1998 in
the form of discounts for telecommunications services. As of 2001, 87
percent of all classrooms in public schools have Internet access, including
81 percent of all classrooms in schools with minority enrollment of 50
percent or more. And as of 2002, about 95 percent of all public libraries
provide Internet access. "Ten years ago, most classrooms didn't even have
phone lines, much less Internet connectivity," says Sam Simon, chairman of
the Telecommunications Research & Action Center, a consumer advocacy group
in Washington, D.C. "That's changed, and I don't think the country would
have gotten there without E-rate.
This articles chronicles both the program's successes and failures. Take a
look at the URL below.
[SOURCE: C-Net|News.com, AUTHOR: Marguerite Reardon]
http://news.com.com/Eroding+E-rate/2009-1028_3-5236723.html?tag=cd.lede
Also see link to House hearing
http://energycommerce.house.gov/108/Hearings/06172004hearing1291/hearing...
Additional coverage in
USA Today http://www.usatoday.com/usatonline/20040618/6299634s.htm
NYT http://www.nytimes.com/2004/06/18/education/18computer.html

MEDIA

SENATE JUDICIARY APPROVES SHVIA LEGISLATION
The Senate Judiciary Committee approved a version of the Satellite Home
Viewer Improvement Act (SHVIA) on Thursday that had similarities to a
version moving in the House Judiciary Committee, but it appeared not to be
as restrictive on satellite broadcasters. The bill's provisions would 1)
raise royalty rates and require a Copyright Arbitration Royalty Panel
(CARP) to review the rates, 2) apply simpler rules to allow DBS
broadcasters to broadcast out-of-market significantly-viewed stations similar
to the rules placed on cable for significantly-viewed stations, and 3)
allow viewers who either don't receive a local broadcast signal, or receive
a grade B signal, to receive both the local signal and a distant signal.
[SOURCE: Communications Daily, AUTHOR: Terry Lane]
(Not available online)
Also see coverage in:
Multichannel news
http://www.multichannel.com/article/CA428012?display=Breaking+News

OUTSIDE AUDIT: TV NETWORKS MAY NOT BE 'UPFRONT'
The TV broadcast networks have claimed that $9.5 billion in advertising has
been committed for the next TV year, but does this highly touted number
have anything to do with reality? In trying to link upfront numbers in past
years to actual results, "I couldn't find any correlation whatsoever to
reality," says Tom Wolzien, a senior media analyst at Sanford C. Bernstein
& Co. According to Mr. Wolzien, total 2002-2003 upfront commitments were up
21% compared with the previous upfront. The 2003-2004 upfront was up 13%.
In a sign that those figures have little to do with real activity, Mr.
Wolzien wrote in a recent research note that broadcast-network revenue rose
only 1% in calendar year 2003, which spanned parts of two TV seasons, while
the overall ad market for that calendar year rose a mere 2.8%. Although
advertisers make commitments in the spring, deals are not secured in
contracts until August or September. Advertisers often have options to
cancel a portion of their commitments if a network kills off a program and
swaps it for something that the advertiser doesn't think is right for its
products or brand. This happens more often than not -- about 80% of new TV
programs fail. When a show to which an advertiser had committed is
canceled, the network and the advertiser must agree on an alternative. So
then what is the upfront good for? It's still a great way to gauge
advertisers' interest in the effectiveness of broadcast television. This
year, skepticism has been high, with marketers fighting not to pay higher
prices for the networks' dwindling audiences. Consider that for 2003-2004,
the upfront process was completed in a matter of days, while for 2004-2005,
marketers took a trip first to top-tier cable outlets, and bought time
there before starting to negotiate with the broadcast networks in earnest.
This year, the broadcast-net work negotiations took several weeks showing
that advertisers are growing disenchanted with traditional media, such as
TV commercials.
[SOURCE: Wall Street Journal, AUTHOR: Brian Steinberg
brian.steinberg( at )wsj.com]
http://online.wsj.com/article/0,,SB108750553903140525,00.html?mod=todays...
(requires subscription)

QUICKLY

THE POLITICS OF SPAM
This brief piece begins: "It's bracing to encounter a rare government
agency that knows when it has met its match. So a tip of the hat to the
Federal Trade Commission, which this week declined to go mano a mano with
spam." The WSJ appreciates the opportunity to say, "understand that there
are some problems in life that don't have a government solution."
[SOURCE: Wall Street Journal, AUTHOR: WSJ Editorial Staff]
http://online.wsj.com/article/0,,SB108751408723841011,00.html?mod=todays...
(requires subscription)

HOUSE PANEL PASSES SPYWARE PERMISSION BILL
The House Energy and Commerce Committee's Subcommittee on Commerce, Trade
and Consumer Protection approved legislation (H.R. 2929) Thursday that
would regulate computer "spyware," forcing software makers to notify
consumers before installing some kinds of monitoring programs on their PCs.
The bill was introduced by Reps Mary Bono (R-CA) and Ed Towns (D-NY).
[SOURCE: C-Net|News.com, AUTHOR: John Borland]
http://news.com.com/House+panel+passes+spyware+permission+bill/2100-1028...

WEATHER RADIOS WILL CARRY MORE KINDS OF ALERTS
The Department of Homeland Security and the National Oceanic and
Atmospheric Administration (NOAA), a branch of the federal government that
oversees the National Weather Service and operates the emergency network
that broadcasts messages to weather radios, have agreed to use the radio
network to notify the public of terrorist attacks and a change in the
color-coded national threat level. About 15-20% of households own a weather
radio which is designed to alert people of an emergency even when the
devise is not turned on.
[SOURCE: USAToday, AUTHOR:Traci Watson]
http://www.usatoday.com/usatonline/20040618/6299661s.htm

BROADCAST INDECENCY LEGISLATION
Senator Sam Brownback (R-KS) has reportedly decided to offer his indecency
bill as an amendment to the Department of Defense authorization bill.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA428022?display=Breaking+News
(requires subscription)

VIDEO COMPETITION NOI RELEASED
The FCC released its Notice of Inquiry for its Annual Report to Congress on
Video Competition. It is now available online at the URL below.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-136A1.doc

ONE LAST THOUGHT: Juneteenth

From "Losing Ground Bit by Bit: Low-Income Communities in the Information
Age" (1998)
http://www.benton.org/publibrary/losing-ground/intro.html

When Tony Riddle, executive director of Manhattan Neighborhood Network,
wants to emphasize the importance of information to social welfare, he
tells the story of "Juneteenth."

June 19 commemorates the day in 1865 when slaves in Texas first learned
that Abraham Lincoln had issued the Emancipation Proclamation. Lincoln
actually signed the proclamation much earlier in 1863. But the Texas
slaves, deprived of this information, had to wait two and a half more years
before finally achieving freedom.

Today, it's hard to imagine anybody being denied information so vital to
his or her well-being for so long. Yet in ways more subtle but nevertheless
insidious, some people lack access to the emerging information resources of
the digital age. By 1998, we may assume that every American has at least
heard of, if not used, the global computer network called the Internet. But
while kids in wealthier households may now take access to technology at
home, at school, or at the local library for granted, the lack of access to
up-to-date computers in low-income communities and to affordable Internet
service in rural areas leaves many people cut off from good jobs and the
chance to participate in the affairs of the broader society.

Indeed, even as digital technologies are bringing an exciting array of new
opportunities to many Americans, they actually are aggravating the poverty
and isolation that plague some rural areas and inner cities. Advances in
telecommunications are speeding the exodus of good jobs from urban areas to
the suburbs, leaving inner cities and rural areas more isolated than ever
from the kinds of jobs, educational opportunities, quality health-care
services, and technological tools that they need to be able to contribute
to the overall economy.
--------------------------------------------------------------
Enjoy the holiday. We'll be back June 24.
--------------------------------------------------------------

For upcoming media policy events, see http://www.benton.org/calendar.htm

Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday =
through=20
Friday, this service provides updates on important industry =
developments,=20
policy issues, and other related news events. While the summaries are=20
factually accurate, their often informal tone does not always represent =
the=20
tone of the original articles. Headlines are compiled by Kevin Taglang=20
(headlines( at )benton.org) -- we welcome your comments.

MEDIA
Stations' Good Deeds Worth $9.6 Billion
A $5 Billion Proposal
Diversity Advisory Committee Adopts Interim Reports
and Recommendations
Eliminating Market Entry Barriers for Small Telecommunications =
Businesses
Piracy Fight Spreads to Radio Airwaves

MEDIA & POLITICS
Voters Are Harder to Reach As Media Outlets Multiply
Gun Group's Radio Show Tests Limits on Advocacy

INTERNET
FTC Declines to Create Do-Not-Spam Registry

MEDIA

STATIONS' GOOD DEEDS WORTH $9.6 BILLION
The National Association of Broadcasters says broadcast stations aired =
$7.3=20
billion worth of public-service announcements (PSAs) and helped raise =
$2.1=20
billion for national and local charities and disaster relief. The latter =

figure includes $158 million for victims of tornadoes, hurricanes,=20
wildfires, and floods. But many regulators and public interest advocates =
do=20
not believe this fulfills broadcasters public interest obligations. FCC=20
Commissioner Michael Powell says he's more interested in what =
programming=20
broadcasters provide to serve communities with the spectrum they receive =

for free. Andrew Schwartzman, of the Media Access Project, dismisses the =

fundraising as cause-related marketing. "It's no different than what =
Giant=20
supermarket does in conjunction with Toys for Tots," he says. "It's not=20
something that is unique or special to broadcasting and would justify =
the=20
free use of the public spectrum. That stuff to me is just feel-good=20
marketing. Sending Bozo the Clown to the hospital doesn't count. It's =
got=20
to be programming." NAB lobbyist Dennis Wharton has heard it all and=20
doesn't like it. "That is the most outrageous assertion you can make," =
he=20
says. "To them, going on the air and raising money for breast-cancer=20
research is not as important as offering a political debate for dog=20
catcher." Mr. Schwartzman also says NAB inflates the value of PSAs. The=20
broadcasters generally use unsold time for the PSAs, he says. The value =
of=20
such time is minimal, yet, he suggests, broadcasters assign it the =
highest=20
possible value in calculating their PSA contribution. According to Mr.=20
Schwartzman, broadcasters have to go beyond the PSAs and the fundraising =

and begin offering "more and better" programming that addresses the =
needs=20
of the community regardless of its commercial attractiveness. "What we =
are=20
looking for is vastly increased service to the community in light of the =

value that broadcasters have been receiving since 1996 when they =
received a=20
second digital channel and greater protection from competition." But the =

NAB's Wharton says broadcasters' public service is second to none: "You =

can look at the amount of money that is raised by foundations, and =
nobody=20
comes close to the billions and billions of dollars that broadcasters =
raise."
[SOURCE: Broadcasting&Cable, AUTHOR: Harry Jessell]
http://www.broadcastingcable.com/article/CA425963?display=3DTop+of+the+We=
ek
(requires subscription)

A $5 BILLION PROPOSAL
Public Broadcasting Service President Pat Mitchell is quietly pushing an =

plan that would free public-TV stations from their annual federal=20
allowance. PBS would get a one-time $5 billion payment from the =
government=20
in return for a 2007 return of spectrum noncommercial stations currently =

use for analog television broadcasts. An auction of these airwaves would =

then generate revenue for the government. But Ms. Mitchell's plan is =
also=20
to deliver more innovative programming to the public and free PBS from=20
finding deep-pocketed, corporate sponsors for programming. "We must =
figure=20
out a more sustainable model for public broadcasting to work in this=20
country," she says, noting that the government's annual contribution to=20
PBS, which covers about 15% of its budget, lags far behind that of most=20
other countries. "It's astonishing that we've survived this long with so =

little coming from Congress. It's a fundamental flaw. We can't have such =
a=20
small foundation."
[SOURCE: Broadcasting&Cable, AUTHOR: Bill McConnell]
http://www.broadcastingcable.com/article/CA425964?display=3DTop+of+the+We=
ek
(requires subscription)

DIVERSITY ADVISORY COMMITTEE ADOPTS INTERIM REPORTS AND RECOMMENDATIONS
The FCC Advisory Committee on Diversity for Communications in the =
Digital=20
Age at its third meeting adopted a wide range of resolutions and=20
recommendations aimed at promoting opportunities for minorities and =
women=20
in telecommunications and related industries. Initially, the Committee=20
expressed its strong belief that tax-based incentives such as the former =

tax certificate program would open opportunities for socially and=20
economically disadvantaged persons, including minorities and=20
women. Recognizing that any revitalization of such a program is not =
within=20
the FCC's immediate power, the Committee went on to recommend that the=20
Commission consider ways to use its own rules to promote opportunity. =
Those=20
recommendations included: retaining and possibly expanding the =
Commission's=20
Distress Sale Policy; creating incentives within FCC ownership and=20
licensing rules; and considering a Supplier Diversity Program that might =

provide auction credits to companies that do business with diverse=20
entities. The Committee also recommended that the Commission adopt a =
rule=20
specifically prohibiting intentional discrimination on the basis of =
race,=20
color, national origin, or gender in the purchase or sale of any=20
FCC-licensed facility.
Committee member Henry Rivera, a partner at law firm Vinson & Elkins, =
also=20
serve's on the Benton Foundation board of directors.
[SOURCE: FCC]
http://www.fcc.gov/Daily_Releases/Daily_Business/2004/db0614/DOC-248391A1=
.doc

ELIMINATING MARKET ENTRY BARRIERS FOR SMALL TELECOMMUNICATIONS =
BUSINESSES
The FCC's Media Bureau is seeking comment on constitutionally =
permissible=20
ways to further the mandates of Section 257 of the Telecommunications =
Act=20
of 1996 which directs the FCC to identify and eliminate market entry=20
barriers for small telecommunications businesses, and Section 309(j) of =
the=20
Communications Act of 1934 which requires the FCC to further =
opportunities=20
in the allocation of spectrum-based services for small businesses and=20
businesses owned by women and minorities. The Commission is =
specifically=20
encouraging commenters to discuss possible next steps to further these=20
statutory objectives in a constitutionally permissible manner, =
especially=20
in light of two recent Supreme Court decisions (Grutter v. Bollinger and =

Gratz v. Bollinger). Commenters should discuss and proffer specific=20
recommendations for building on the series of market entry barrier =
studies=20
listed at the URL below.
For further information, contact Anne Levine at (202) 418-7027 or via =
email=20
at Anne.Levine( at )fcc.gov.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-04-1690A1.doc

PIRACY FIGHT SPREADS TO RADIO AIRWAVES
The Recording Industry Association of America is expected to ask the FCC =

today to require broadcasters to either encrypt their digital signals or =

transmit a special marker that discourages replication. The fight over=20
digital radio could echo battles over digital television, which promises =

sharper pictures and clearer sound than traditional analog broadcasts. =
The=20
rollout of digital television, originally scheduled to be completed in=20
2006, has been slowed, in part, by squabbles between studios and TV-set=20
manufacturers over copy protection. The consumer electronics industry =
and=20
broadcasters say that the RIAA position will just slow down the rollout =
of=20
digital radio service so they do not support it.
[SOURCE: Los Angeles Times, AUTHOR: Jube Shiver Jr]
http://www.latimes.com/business/printedition/la-fi-hdradio16jun16,1,59663=
80.story?coll=3Dla-headlines-pe-business
(requires registration)
Public Knowledge is a public interest advocate which has great deal of=20
work in this area. For more information see =
http://www.publicknowledge.org/

MEDIA & POLITICS

VOTERS ARE HARDER TO REACH AS MEDIA OUTLETS MULTIPLY
Political campaigns are finding it harder to reach people with political =

advertising as their media options grow and harder to poll public =
opinion=20
as people use technology to screen unwanted phone calls or use cell =
phones=20
which pollsters are prohibited from calling. Political consultants =
compare=20
rising media costs to an arms race, as ever-greater sums produce =
messages=20
that reach fewer and fewer eyes and ears. Media costs are by far the=20
biggest single expenditure for the two major-party presidential =
campaigns.=20
Advertising and promotion of all types accounted for about 60 percent of =

President Bush's record spending of $129.8 million, and about 48 percent =
of=20
Sen Kerry's $88.7 million through the end of April, according to Federal =

Election Commission figures.
Find out more about modern campaigns at the URL below.
[SOURCE: Washington Post, AUTHOR:Paul Farhi]
http://www.washingtonpost.com/wp-dyn/articles/A44697-2004Jun15.html
(requires registration)

GUN GROUP'S RADIO SHOW TESTS LIMITS OF ADVOCACY
"There are 90 million gun owners in America," says National Rifle=20
Association executive vice president Wayne LaPierre. "And a lot of them=20
don't believe they are getting accurate news from the media." For these =
90=20
million truth-deprived Americans, a new voice will be hitting the=20
(satellite) airways -- NRANews. The 3-hour news and commentary is viewed =
by=20
some as a way for the gun lobby to get around new campaign finance laws=20
aimed at curtailing political advertising in the days just prior to the=20
election. "If the N.R.A. is successful at this, we will definitely see=20
other groups explore going down the same road," said Larry Noble, =
executive=20
director of the Center for Responsive Politics and former general =
counsel=20
to the Federal Election Commission. Mr. LaPierre said the program, to be =

broadcast on Sirius satellite radio, would be a step toward a larger =
media=20
enterprise. The organization is looking to acquire radio stations in the =

Midwest, the Rockies and the South
[SOURCE: New York Times, AUTHOR: James Dao]
http://www.nytimes.com/2004/06/16/national/16nra.html
(requires registration)

INTERNET

FTC DECLINES TO CREATE DO-NOT-SPAM REGISTRY
In the law intended to crack down on junk e-mail (spam) that passed last =

December, Congress ordered the Federal Trade Commission to report on the =

feasibility of allowing e-mail users to place their e-mail addresses on =
a=20
registry for those who do not want unsolicited messages. But in its =
report,=20
the FTC finds that a do-not-spam list might be counterproductive,=20
suggesting such a list might help spammers find legitimate e-mail=20
addresses. Instead, the FTC says that the most promising way to reduce =
spam=20
is to create new technology that can verify that an e-mail message was =
sent=20
from the address that it claims to be from. Senders of the most =
offensive=20
spam often use false return addresses. The FTC said it would defer to =
the=20
private sector on which authentication standard should be employed. If a =

standard does not emerge, the commission proposed creating a federal=20
advisory committee to encourage the adoption of a standard.
[SOURCE: New York Times, AUTHOR: Saul Hansell]
http://www.nytimes.com/2004/06/16/technology/16spam.html
(requires registration)
See http://www.ftc.gov/opa/2004/06/canspam2.htm for a release from the =
FTC=20
and a link to the report to Congress.
--------------------------------------------------------------

Next week, the FCC will hear from the Advisory Committee on Diversity for=20
Communications in the Digital Age and a House subcommittee will look at=20
problems with the E-rate program. But Headlines will not be back to remind=
=20
you until WEDNESDAY JUNE 16. For upcoming media policy events, see=20
http://www.benton.org/calendar.htm

NEWS FROM THE FCC
FCC Chair to Pen New Phone-Line Rules
Long-Distance Carriers Take a Blow, but It's No Knockout
Deployment of Wireless Broadband Services
Inquiry Concerning Report to Congress on Video Competition
Spectrum Sharing Plan

QUICKLY
Univision Sues to Stop TV Rating System in Los Angeles
FTC: All Eyes on Consumer Privacy
Health of US Democracy Tied to New Model for Public Access to
Online Information

NEWS FROM THE FCC

FCC CHAIR TO PEN NEW PHONE-LINE RULES
On Thursday, FCC Chairman Michael Powell announced plans to draft new rules=
=20
for leasing access to the local telephone carriers' networks after the Bush=
=20
administration decided not to defend the old ones. "We will begin=20
immediately," he told reporters after the agency's monthly open meeting.=20
"I'm quite optimistic with the new guidance and, understanding what our=20
limits are, we'll be relatively expeditious at this." Chairman Powell hopes=
=20
to have new rules by the end of the year. "My goal will be to do something=
=20
that will limit disruption and will be as simple and as easy to execute as=
=20
possible," Chairman Powell said. He added that the agency has several=20
options available from its past attempts to rewrite the rules. One analyst=
=20
said the agency would likely have a hard time fashioning interim rules that=
=20
would satisfy the Bells. "From a Bell perspective, they think the rules are=
=20
going away in a few days," said Legg Mason analyst Blair Levin. "The=20
question is, are there any burdens the Bell guys will find OK?"
[SOURCE: Reuters]
http://news.com.com/FCC+chair+to+pen+new+phone-line+rules/2100-1037_3-52...
1.html?tag=3Dnefd.top
Also see:
STATES' BIG ROLE IN PHONE RATES MAY BE ONLY A CAMEO
If the Supreme Court does not entertain an appeal concerning the FCC's=20
phone competition rules (and most expect it will not intervene), then=20
states will have authority to oversee commercial negotiations and=20
arbitration to set new phone network leasing rates. But their authority may=
=20
be short-lived. In the long run, the new position of the commission and the=
=20
Bush administration could make state regulators the biggest losers.
[SOURCE: New York Times, AUTHOR: Stephen Labaton]
http://www.nytimes.com/2004/06/11/business/11regs.html
(requires registration)
WSJ=20
http://online.wsj.com/article/0,,SB108690495206534344,00.html?mod=3Dtoda...
s_marketplace
LATimes=20
http://www.latimes.com/business/printedition/la-fi-phones11jun11,1,30897...
tory?coll=3Dla-headlines-pe-business

LONG-DISTANCE CARRIERS TAKE A BLOW, BUT IT'S NO KNOCKOUT
Phone companies like AT&T, MCI and Sprint, with their long-distance=20
businesses in trouble, suffered a big blow on Wednesday with the Bush=20
administration's decision to side with the regional Bell companies on the=20
issue of local access fees. But that decision is unlikely to cause any=20
immediate consolidation in the industry or damage the long-distance giants=
=20
as quickly or harshly as they have predicted, industry analysts said. That=
=20
is because those carriers have been pushing to develop new sources of=20
revenue, the analysts said, and this week's bad news will most likely=20
accelerate those efforts. Legal challenges by the long-distance carriers,=20
state governments and others could also delay any damage.
[SOURCE: New York Times, AUTHOR: Ken Belson & Matt Richtel]
http://www.nytimes.com/2004/06/11/business/11phone.html
(requires registration)
Also coverage in:
WSJ=20
http://online.wsj.com/article/0,,SB108690160089634192,00.html?mod=3Dtoda...
s_marketplace
See Also
PHONE FIRMS APPEAL OVER LOCAL ACCESS
[SOURCE: Washington Post, AUTHOR: Christopher Stern]
http://www.washingtonpost.com/wp-dyn/articles/A32762-2004Jun10.html
(requires registration)

DEPLOYMENT OF WIRELESS BROADBAND SERVICES
As part of its ongoing efforts to promote the deployment of wireless=20
broadband services, the FCC adopted a Report and Order (Order) and Further=
=20
Notice of Proposed Rulemaking (Further Notice) that transforms the rules=20
governing the Multipoint Distribution Service (MDS) and Instructional=20
Television Fixed Service (ITFS) in the 2495-2690 MHz band. These rules=20
provide greater flexibility and a more functional band plan for licensees.=
=20
In the Order, the FCC takes a number of important steps to restructure the=
=20
2495-2690 MHz band and facilitate more efficient use of the=20
spectrum. First, the Order creates a new band plan for 2495-2690 MHz which=
=20
eliminates the use of interleaved channels by MDS and ITFS licensees and=20
creates distinct band segments for high power operations, such as one-way=20
video transmission, and low power operations, such as two-way fixed and=20
mobile broadband applications. By grouping high and low power users into=20
separate portions of the band, the new band plan reduces the likelihood of=
=20
interference caused by incompatible uses and creates incentives for the=20
development of low-power, cellularized broadband operations, which were=20
inhibited by the prior band plan. In order to reflect these new=20
opportunities for providing broadband service, today's Order renames the=20
MDS service the Broadband Radio Service (BRS), while maintaining the ITFS=20
label for ITFS licenses and operations. The Order also expands the original=
=20
MDS-ITFS band by adding to it five megahertz of additional spectrum from=20
below 2500 MHz, which increases the total size of the band to 194=20
megahertz. This will provide room for the future relocation of MDS Channels=
=20
1 and 2, which are presently located in the 2.1 GHz band. The Order retains=
=20
the existing eligibility rules for ITFS spectrum. Therefore, ITFS licenses=
=20
in the new band plan will continue to be subject to existing rules that=20
limit eligibility for licensing to qualified educational institutions. The=
=20
Order also allows ITFS licensees to lease spectrum to BRS providers,=20
provided they comply with existing educational content requirements, and=20
grandfathers all existing MDS-ITFS leases. In addition, the Order lifts=20
all non-statutory eligibility restrictions on BRS spectrum, including those=
=20
applicable to cable operators. However, the cable/BRS cross-ownership=20
restriction prohibiting cable operators from providing multichannel video=20
programming distribution (MVPD) services using BRS licenses, which is=20
mandated by statute, will remain in effect. The Order establishes simpler=20
and more flexible rules for licensees, including geographic area licensing=
=20
and the ability to employ the technology of their choice. In addition, the=
=20
new rules allow for spectrum leasing under the FCC's secondary market=20
rules, but grandfather all existing leasing arrangements between MDS and=20
ITFS licensees. Finally, the Order establishes a mechanism for transition=20
from the existing band configuration to the new band plan. BRS and ITFS=20
providers will have a three-year period during which they may propose=20
transition plans for relocating existing facilities of all other licensees=
=20
within the same Major Economic Area (MEA) to new spectrum assignments in=20
the revised band plan. Plan proponents must notify all licensees in the=20
MEA and file their plans with the Commission. This will trigger a 90-day=20
Transition Planning Period during which licensees negotiate and coordinate=
=20
their transition with other licensees in the MEA. Transitions to the new=20
band plan must be completed within 18 months of the conclusion of=20
negotiations. In the Further Notice, the Commission seeks comment on=20
alternative transition options for markets in which no transition plan is=20
proposed within the initial three-year period. Among other options, the=20
Further Notice seeks comment on whether to accomplish the transition in=20
such markets by offering existing licensees tradable instruments that they=
=20
can use to bid for spectrum at auction.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-248267A1.doc
See coverage in:
WSJ=20
http://online.wsj.com/article/0,,SB108688250788033800,00.html?mod=3Dtoda...
s_marketplace
WP http://www.washingtonpost.com/wp-dyn/articles/A32706-2004Jun10.html

INQUIRY CONCERNING REPORT TO CONGRESS ON VIDEO COMPETITION
The FCC initiated its 11th annual inquiry, as required by Congress, into=20
the status of competition in the market for the delivery of video=20
programming. The Notice of Inquiry is designed to assist the FCC in=20
gathering the information, data, and comments for the 2004 Competition=20
Report. In the 2004 Competition Report, the FCC expects to report on=20
changes in the competitive environment over the last year. The NOI seeks=20
information that will allow the FCC to evaluate the status of competition=20
in the video marketplace, changes in the market since the 2003 Report,=20
prospects for new entrants to that market, factors that have facilitated or=
=20
impeded competition, and the effect of competition on industry groups and=20
most importantly, consumers. The Notice seeks comments and information on=20
video distributors in the market for the delivery of video programming=20
including those using both wireline and wireless technologies. Video=20
programming distributors include cable systems, direct broadcast satellite=
=20
(DBS) providers, home satellite dish providers, broadband service=20
providers, private cable or satellite master antenna television systems,=20
open video systems, multichannel multipoint distribution services or=20
wireless cable systems (MMDS), local exchange carrier (LEC) systems,=20
utilities, and over-the-air broadcast television stations. Video=20
programming is also distributed on videocassettes and DVDs through retail=20
distribution outlets and over the Internet. The Notice also requests=20
information that will allow the FCC to evaluate horizontal concentration in=
=20
the video marketplace, vertical integration between programming=20
distributors and programming services, and other issues relating to the=20
programming available to consumers. The Notice requests information on=20
technical issues, including equipment and emerging services. The Notice=20
further asks for comments regarding developments in foreign markets, as=20
they may contribute to the FCC's understanding of domestic markets.
The 2004 Competition Report should be sent to Congress by the end of the=
year.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-248338A1.doc

SPECTRUM SHARING PLAN
The FCC adopted a spectrum sharing plan for low earth orbit satellite=20
systems (Big LEOs) in the 1.6 GHz and 2.4 GHz bands. The spectrum sharing=
=20
plan will further the Commission's goal of efficient spectrum utilization=20
by increasing the number of providers offering services to consumers over=20
the same spectrum, and will promote the deployment of more innovative=20
services to consumers.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-248343A1.doc

QUICKLY

UNIVISION SUES TO STOP TV RATING SYSTEM IN LOS ANGELES
Univision Communications filed a lawsuit in Los Angeles Superior Court on=20
Wednesday, seeking to stop Nielsen from introducing electronic devices=20
known as local people meters to gather ratings data in Los Angeles, where=20
they are scheduled to begin July 8. Univision, the country's largest=20
Spanish-language television broadcaster, contends in its lawsuit that=20
Nielsen is engaging in unfair, unlawful and deceptive business practices=20
because the changes would significantly undercount Univision's core viewers=
=20
in Los Angeles: Hispanics who are younger, in large families and speak=20
mostly Spanish rather than mostly English.
[SOURCE: New York Times, AUTHOR: Stuart Elliott]
http://www.nytimes.com/2004/06/11/business/media/11nielsen.html
(requires registration)

FTC: ALL EYES ON CONSUMER PRIVACY
According to Director of Consumer Protection Howard Beales, the Federal=20
Trade Commission plans to make consumer privacy rights a higher priority.=20
The FTC is gearing up to bring more privacy-related cases against Internet=
=20
operators, with one expected in the coming weeks.
[SOURCE: C-Net|News.com, AUTHOR: Stefanie Olsen]
http://news.com.com/FTC%3A+All+eyes+on+consumer+privacy/2100-1024_3-5230...
html?tag=3Dcd.top

HEALTH OF U.S. DEMOCRACY TIED TO NEW MODEL FOR PUBLIC ACCESS TO ONLINE=20
INFORMATION
The Free Expression Policy Project released "The Information Commons", a=20
report that links the vitality of 21st century democracy to the creation of=
=20
online communities dedicated to producing and sharing information. The=20
report begins: =93For democracy to flourish, citizens need free and open=20
access to information. In today=92s digital age, this means access to=20
information online.=94 The information commons movement promoted by the=20
report recognizes that public access to online information is being damaged=
=20
by a combination of restrictive technology, unbalanced changes to=20
intellectual property law, onerous licenses, and media industry=20
consolidation. Essential ingredients for a healthy democracy =AD political=
=20
discourse, free speech, civic participation, and creativity =AD all suffer=
as=20
a result. According to the report, these threats to democracy can be=20
remedied, or at least dampened, by adopting the emerging concept of the=20
information commons.
Nancy Kranich, a former president of the American Library Association, is=20
the report=92s author.
[SOURCE: Brennan Center for Justice at NYU School of Law/Press Release]
http://www.brennancenter.org/presscenter/releases_2004/pressrelease_2004...
8b.html
http://www.fepproject.org/policyreports/infocommons.contentsexsum.html
--------------------------------------------------------------
...and we are outta here. Have a great weekend. We'll be live from the home=
=20
office on K Street come Wednesday.
--------------------------------------------------------------

For upcoming media policy events, see http://www.benton.org/calendar.htm

MEDIA
Broadcast Decency Amendment Proposed for DoD Authorization Bill
Radio Giant In Record Indecency Settlement
Group Calls on FTC to Launch Investigation of Interactive Advertising=20
Targeted at
Children, "Tweens," and Teens
Fewer Republicans Trust the News, Survey Finds
Ads of Both Campaigns Zero in on a Typical City
Nielsen Picks People Meter Panel
Comcast Plans to Create 24-Hour Network -- for Toddlers

TELECOM
Fraud, Waste Mar Plan to Wire Schools to Net
Semiannual Report of FCC Inspector General
Universal Service Proceeding
Broadband Internet Use Up 42% in 2003
Civil Society Policy Websites Set Up in Ten Nations

MEDIA

BROADCAST DECENCY AMENDMENT PROPOSED FOR DOD AUTHORIZATION BILL
Just when you thought it was safe to curse on TV again... it's back! Sen=20
Sam Brownback (R-KS) apparently has proposed an amendment to Department of=
=20
Defense authorization legislation that will raise the fines for=20
broadcasters who air indecent programming. The DoD bill will be considered=
=20
next week. The indecency provisions are likely to be focused just on=20
increased fines and not include more controversial provisions concerning=20
rolling back the FCC's new media ownership rules.
[SOURCE: Communications Daily, AUTHOR: Terry Lane]
(Not available online)
Also coverage in:
WSJ=20
http://online.wsj.com/article/0,,SB108673926033632255,00.html?mod=3Dtoda...
s_page_one
(requires subscription)
LATimes=20
http://www.latimes.com/business/printedition/la-fi-clear9jun09,1,4052108...
ry?coll=3Dla-headlines-pe-business
(requires registration)
NYT http://www.nytimes.com/2004/06/09/business/media/09radio.html
(requires registration)

RADIO GIANT IN RECORD INDECENCY SETTLEMENT
An announcement could be made today that Clear Channel will pay $2 million=
=20
to the FCC to settle indecency charges against the radio giant including=20
on-air remarks made by shock jock Howard Stern. Perhaps most important, one=
=20
source said, the deal would cover not only Clear Channel's outstanding=20
fines but also dozens of listener complaints in the FCC's indecency=20
pipeline that have not been ruled on. If those complaints were to result in=
=20
fines, they could cost the radio company millions. Apparently, the FCC's=20
three Republican commissioners -- Chairman Michael Powell, Kevin J. Martin=
=20
and Kathleen Q. Abernathy -- voted for the deal while Democratic=20
Commissioner Jonathan S. Adelstein agreed in part. But fellow Democrat=20
Michael J. Copps voted against the settlement instead wanting each=20
complaint against Clear Channel to be examined rather than grouped into a=20
universal settlement.
[SOURCE: Washington Post, AUTHOR: Frank Ahrens]
http://www.washingtonpost.com/wp-dyn/articles/A26431-2004Jun8.html
(requires registration)

GROUP CALLS ON FTC TO LAUNCH INVESTIGATION OF INTERACTIVE ADVERTISING=20
TARGETED AT CHILDREN, "TWEENS," AND TEENS
The Center for Digital Democracy (CDD) urged the Federal Trade Commission=20
Tuesday to review and analyze the interactive marketing and branding=20
technologies and techniques used by advertisers to target the country's=20
children, "tweens," and teens. In a letter to FTC Chairman Muris and the=20
other four commissioners, the nonprofit , public interest advocacy=20
organization wrote that the "immersive, relational, and ubiquitous nature=20
of such marketing raises serious questions about the ability of existing=20
safeguards and rules to protect our nation's children and young=20
people." The letter urged the Commission to use its subpoena power to=20
obtain any needed documents, including proprietary research studies. CDD=20
also called on the ad industry to adopt a moratorium on all interactive=20
techniques that -- in the absence of independent research suggesting=20
otherwise -- could potentially harm or negatively affect children and youth.
See more at the URLs below.
[SOURCE: Center for Digital Democracy Press Release]
http://www.democraticmedia.org/news/FTCAdPR.html
Text of letter to FTC
http://www.democraticmedia.org/resources/filings/FTCletter.html

FEWER REPUBLICANS TRUST NEWS, SURVEY FINDS
The Pew Research Center finds that Republicans have come to distrust the=20
media in greater numbers since President Bush took office while Democratic=
=20
views are mostly unchanged. "CNN's once-dominant credibility ratings have=20
slumped in recent years, mostly among Republicans and independents," the=20
survey says. "By comparison, the Fox News Channel's believability ratings=20
have held steady -- both overall and within partisan groups." While the=20
percentage of people who rate CNN as highly credible has slid from 42=20
percent six years ago to 32 percent now, the study says, "more continue to=
=20
say they can believe all or most of what they hear on CNN than say that=20
about Fox News Channel," whose credibility rating is 25 percent. MSNBC=20
clocks in at 22 percent. ("60 Minutes" edged the field with 33=20
percent.) In a finding that surprised Andrew Kohut, the Pew center's=20
director, 29 percent of Republicans say Fox News Channel is credible, only=
=20
slightly more than the 26 percent of GOPers who feel that way about CNN.=20
Among Democrats, though, 45 percent give CNN a thumbs up for credibility,=20
compared with 24 percent for Fox News Channel. The changing views "reflect=
=20
the political polarization we've seen," says Andrew Kohut, the Pew center's=
=20
director. "It reflects anger on the part of Republicans about the way the=20
media's treated Bush lately, and also reflects the appeal of Fox News."=20
Readers and viewers, he says, are "reacting to a perception of a political=
=20
point of view, whether that means bias in political reports or tone."
There's much more at the URL below.
[SOURCE: Washington Post, AUTHOR: Howard Kurtz]
http://www.washingtonpost.com/wp-dyn/articles/A26345-2004Jun8.html
(requires registration)

ADS OF BOTH CAMPAIGNS ZERO IN ON A TYPICAL CITY
A look at ad spending in Columbus, Ohio -- one of the most evenly-divided=20
cities in one of the most evenly-divided states during this election.=20
Rarely if ever has so much been spent to sway so few (population, 704,000)=
=20
so early in a presidential campaign. Approximately $4 million has been=20
spent to show the typical TV viewer there 3,000 political ads since March.
[SOURCE: New York Times, AUTHOR: Jim Rutenberg]
http://www.nytimes.com/2004/06/09/politics/campaign/09ads.html
(requires registration)

NIELSEN PICKS PEOPLE METER PANEL
On Tuesday, Nielsen Media Research named the members of its task force that=
=20
will advise the ratings company on ways to insure that the household=20
samples it creates for local people meter service in the top 10 markets=20
accurately reflect the audiences being measured. Former Illinois=20
Congresswoman Cardiss Collins will serve as the chair and be joined by Bob=
=20
Barocci, President/CEO of The Advertising Research Foundation; Melody=20
Spann-Cooper, President and General Manager of WVON-AM Chicago;Rev. James=20
L. Deemus III, Executive Director of the NAACP Chicago (Southside); Ray=20
Durazo, Chair of the Latin Business Association in Los Angeles; Mary=20
Gonzales Koenig, President of the Spanish Coalition for Jobs, Inc.; Scott=20
McDonald, Senior Vice President for Market Research at Cond=E9 Nast=20
Publications and the former top research executive at Time Warner;Byron E.=
=20
Lewis, Chair and CEO of UniWorld Group; Guillermo Linares, former member of=
=20
the New York City Council; Manuel Mirabal, President of the National=20
Puerto-Rican Coalition,Inc.; Elinor Tatum, Publisher of The Amsterdam News.=
=20
"It is important to determine the best possible method to accurately=20
reflect the choices being made by media audiences, and particularly by=20
black and Latino viewers who have been historically undercounted, because=20
of the enormous social, cultural and financial implications arising from=20
the measured popularity of media programming," said New York Congressman=20
Charles Rangel (D), who helped put the task force together.
[SOURCE: Broadcasting&Cable, AUTHOR: Steve McClellan]
http://www.broadcastingcable.com/article/CA424631?display=3DBreaking+News
(requires subscription)

COMCAST PLANS TO CREATE 24-HOUR NETWORK -- FOR TODDLERS
Here's a solution for all our four-year old readers searching for quality=20
video entertainment at 4am -- a new 24-hour cable channel for preschoolers=
=20
brought to you by Comcast, the Public Broadcasting System, Sesame Street=20
Workshop and HIT Entertainment. The as-yet-unnamed network would carry no=20
commercials and would have rights to "Barney & Friends," "Sesame Street,"=20
"Bob the Builder" and "Thomas the Tank Engine," among others. The network=20
is likely to be a digital channel. Negotiations could be finalized in weeks=
=20
and the channel could be launched by year's end.
[SOURCE: Wall Street Journal, AUTHOR: ]
http://online.wsj.com/article/0,,SB108674158907832328,00.html?mod=3Dtoda...
s_marketplace
(requires subscription)

TELECOM

FRAUD, WASTE MAR PLAN TO WIRE SCHOOLS TO NET
While the $2.25 billion-a-year E-Rate program has helped bring the Internet=
=20
to more than 90% of the nation's classrooms, lawmakers and investigators=20
say it also is riddled with waste, mismanagement and fraud. A series of=20
House hearings on E-rate will kick off on June 17 with an examination of=20
flaws in the management of E-rate. Consultants and public-interest=20
advocates say blame is shared by everyone involved in the program: public=20
officials so eager, they say, to get the much-hyped program going that they=
=20
imposed few safeguards; school administrators who welcome the federal=20
largesse but who often have little expertise in setting up high-tech=20
systems; vendors who prey on wide-eyed school officials in hopes of feeding=
=20
at the trough of taxpayers' money. E-rate's management says critics=20
overstate the fraud and waste. And E-rate backers say the program's good=20
far outweighs the bad. One problem with rules compliance is E-rate's=20
complex application process. Schools must submit detailed plans and get=20
bids before applying. As a result, districts -- especially small or poor=20
ones with little technical support -- often rely on vendors to fill out=20
requests for bids. FCC officials say that can let vendors steer proposals=20
to their own offerings. Another problem: The FCC doesn't require schools to=
=20
keep records on competitive biddings. They need only follow state and local=
=20
rules. The FCC is considering stricter record-keeping rules. Bob Williams=20
of the Center for Public Integrity believes Universal Services=20
Administrative Company scrutiny is limited because half its board are=20
telecom, cable and Internet executives -- industries that gain from E-rate.=
=20
"You basically have an industry group handing out and watching the money."
[SOURCE: USAToday, AUTHOR: Paul Davidson, Greg Toppo and Jayne O'Donnell]
http://www.usatoday.com/usatonline/20040609/6270165s.htm

SEMIANNUAL REPORT OF THE FCC INSPECTOR GENERAL
The FCC's Office of Inspector General (OIG) provided Chairman Michael=20
Powell with a review of the OIG's actions over the during the six-month=20
period ending March 31, 2004. During this reporting period, as in the=20
previous one, OIG activity continued to focus on the Universal Service Fund=
=20
(USF) -- which includes the E-rate program --activities because of=20
continuing allegations of waste and fraud, and the results of beneficiary=20
audits performed by contract auditors and Commission staff. Despite limited=
=20
resources, the OIG has implemented an aggressive program for independent=20
oversight of the USF. The oversight program includes: (1) audits conducted=
=20
using internal resources; (2) audits conducted by other federal Offices of=
=20
Inspector General under reimbursable agreements; (3) review of audit work=20
conducted by the Universal Service Administrative Company; and (4) active=20
participation in federal investigations of E-rate fraud.
[SOURCE: FCC]
http://www.fcc.gov/oig/SAR_31_FCC-OIG.pdf

UNIVERSAL SERVICE PROCEEDING
In a Notice of Proposed Rulemaking (Notice) released Tuesday, the FCC=20
announced it is seeking comment on the Recommended Decision of the=20
Federal-State Joint Board on Universal Service (Joint Board) concerning the=
=20
process for designation of eligible telecommunications carriers (ETCs) and=
=20
the Commission's rules regarding high-cost universal service support. In=20
its Recommended Decision, the Joint Board recommended that the Commission=20
adopt permissive federal guidelines for states to consider in proceedings=20
to designate ETCs under federal law. In addition, the Joint Board=20
recommended that the Commission limit the scope of high-cost support to a=20
single connection that provides a subscriber access to the public telephone=
=20
network. Finally, the Joint Board recommended that the Commission further=20
develop the record on specific issues identified in its Recommended=20
Decision relating to the high-cost support mechanism, including=20
identification of mobile wireless customer location, and standards for the=
=20
submission of accurate, legible, and consistent maps. The Commission seeks=
=20
comment on whether the Joint Board's recommendations should be adopted, in=
=20
whole or in part, in order to preserve and advance universal service,=20
maintain competitive neutrality, and ensure long-term sustainability of the=
=20
universal service fund. The Commission also seeks comment on several=20
related proposals to streamline rules governing annual certifications and=20
submission of data by competitive ETCs seeking high-cost support.
Hey, hey, slow down! Let's not have everyone click on the URL below at the=
=20
same time. Comments are not due until 30 days after publication in the=20
Federal Register.
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-04-127A1.doc

BROADBAND INTERNET USE UP 42% IN 2003
The FCC reported Tuesday that there were 28.2 million broadband lines in=20
use by the end of 2003 up 42% from 2002. The growth was fueled by=20
residential and small-business subscriptions. Cable-based services=20
continued to be the most popular form of broadband service, the FCC found,=
=20
accounting for 16.4 million lines. Telephone-based digital subscriber line=
=20
service accounted for 9.5 million lines, while 2.3 million high-speed lines=
=20
used satellite, fiber-optic or wireless technologies.
The summary statistics released include state-by-state, population density,=
=20
and household income information, ranked by zip codes. For more info=20
contact: FCC's Industry Analysis and Technology Division at (202) 418-0940
[SOURCE: Reuters]
http://www.reuters.com/newsArticle.jhtml?type=3DinternetNews&storyID=3D5...
62
See FCC Press Release:=20
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-248089A1.doc
The report is available online
http://www.fcc.gov/Bureaus/Common_Carrier/Reports/FCC-State_Link/IAD/hsp...
4.pdf

CIVIL SOCIETY POLICY WEBSITES SET UP IN TEN NATIONS
APC has spent the last two years advocating for civil society involvement=20
in international ICT (information and communications technologies)=20
policy-making processes. Now 10 APC members have created national ICT=20
policy portal websites in their own countries in a joint initiative. The=20
portals which are all uniquely adapted to address each country's particular=
=20
situation all use free software that allows content-sharing in different=20
languages and between multiple information databases hosted in different=20
parts of the world. The portals have been set up by APC members -=20
organizations who work with ICTs for sustainable development, and social=20
and environmental justice- locally in Argentina, Australia, Bulgaria,=20
Colombia, the Democratic Republic of Congo*, Italy, Mexico, the=20
Philippines, South Africa, Spain, the UK and Uruguay.
More at the URL below.
[SOURCE: Association for Progressive Communications (APC) Press Release]
http://www.apc.org/english/news/index.shtml?x=3D20966
--------------------------------------------------------------
Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday through=20
Friday, this service provides updates on important industry developments,=20
policy issues, and other related news events. While the summaries are=20
factually accurate, their often informal tone does not always represent the=
=20
tone of the original articles. Headlines are compiled by Kevin Taglang=20
(headlines( at )benton.org) -- we welcome your comments.
--------------------------------------------------------------