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August 2005

Tracking The Telecommunications Reform Debate

Congress is poised to make a number of critical yet irreversible decisions this year and next that will shape our communications future for decades to come. How Congress addresses these pressing issues, and the priority it puts on ensuring that communications choices and consumer voices will expand, could well be some of the most important decisions in a generation. Public interest advocates and the constituencies they represent need to follow and lend their voices to these important debates.

These decisions, perhaps some of the most important communications policy decisions in a decade, will have a very direct impact on our economy, our livelihood, our ability to innovate, and our time honored values of localism, diversity, and consumer choice.

Key Issues Could Put Consumers In Control of Their Communications Future:
Congress has an important opportunity to unleash unprecedented public interest benefits by answering a number of key policy questions that will determine if, when, and how the public will take advantage of the full promise and potential of our communications landscape.

Legislation to address:
Media effected:
Decisions will determine:

The Digital Television Transition and Public Safety Act
Broadcast, cable and satellite television
How consumers benefit from the switch to digital television. Cable channel choice. Public interest obligations and license renewals for digital TV broadcasters. See these resources: Getting to February 2009: Outstanding DTV Transition Issues

Universal service modernization
Traditional telephone service, wireless phone and new Internet telephone services (VoIP)
How our time-honored commitment to make telephone service is updated in the face of changes in the way consumers use communications.

Telecommunications policy reform
Television, telephone, Internet
How will regulators treat Internet Protocol television and telephony. How should video franchises be awarded. E-911 service for Internet telephone subscribers. Whether the openness of the Internet will be preserved and extended in the broadband world. Community broadband options.

In all of these legislative debates, Congress will set the course for whether:

1) the public interest continues to be a central focus of communications policy,

2) allowing innovation to flourish, competition to thrive and investment to follow will be confused with broad deregulation and concentrating communications choices in the hands of a few, and

3) media choices and consumer voices will expand in the digital age.

Benton’s Guide: A Front Row View Into The Debate
As Congress undertakes this sweeping rewrite of our telecommunications laws, the Benton Foundation is launching this new one-stop online resource to give advocates, academics, policymakers, and others the tools they need to stay abreast of the debate.

This is the second major rewrite of telecommunications Act in 70 years. As Congress debated the last major rewrite—the 1996 Telecom Act—the Benton Foundation played a central role in helping the public keep track of what was happening, why it mattered, and what it meant.

Tools For Tracking Telcom Talk
This non-partisan fact-filled Benton resource is intended to keep the public informed again. It includes up-to-date:

  • Summaries of key bills
  • A guide to what public interest and industry groups are saying
  • Links to the reports that Congress will rely upon and
  • The stories that cover it all

Tools To Stay On Top As the Stories Break:
To stay abreast of the headlines as they break, we also recommend signing up for the Benton Foundation’s Headlines news service for a daily feed of the news that is driving these debates. (Sign up here)

Additional Resources:
Telecommunications Act: Competition, Innovation, and Reform (A report from the Congressional Research Service)

The Fallout From the Telecommunications Act of 1996: Unintended Consequences and Lessons Learned (Common Cause Study)

The Key Member’s of Congress Making the Decisions

The Hill staff in the driver’s seat

The Industry Groups Lobbying For Changes

Latest News: Hurricane Relief to Delay Telecom Bills

Benton's Communications-related Headlines For Wednesday August 31, 2005

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

TODAY'S STORIES
The FCC's Cable Crackdown
Wi-Fi With Its Own Zip Code
Vendors Seek Changes in New List of E-Rate Eligible Services
Most Kids Play Video Games Daily; Web Ads Gaining Importance

QUICKLY-- Broadcast Networks Buy Into Search Key Words; U.K. seeks to ban
violent online porn

TODAY'S STORIES

THE FCC'S CABLE CRACKDOWN
FCC Chairman Kevin Martin has been quietly meeting with religious activists
and industry leaders to organize a push for new indecency standards for
broadcast, cable and satellite television. At the same time, Chairman
Martin's allies in the Senate have been considering new laws that could
increase broadcast indecency fines, break up cable TV offerings to allow
parents to cut off racy channels, and -- most controversially -- give the
FCC the power to fine basic cable programs, like MTV's "Real World" and
Comedy Central's "Daily Show," for crude and lewd content. Television
industry executives fear a possible assault -- on their bottom line [all
puns intended]. "Everybody should be frightened by the notion that this
process could be hijacked by a very few people," says Jim Dyke, a
Republican who now leads TV Watch, a group founded by Viacom (CBS, MTV,
Comedy Central), General Electric (NBC, Bravo) and News Corp. (Fox) to
argue against new regulation. "They are trying to make decisions about what
our children can see." In the coming weeks, observers expect Chairman
Martin to act upon between 30 and 50 outstanding indecency complaints, the
first step in clearing a backlog of hundreds of allegedly inappropriate
broadcasts on television and radio. He has promised to remake the indecency
process, speeding FCC responses and establishing a clearer precedent of
what constitutes indecent programming.
[SOURCE: Salon, AUTHOR: Michael Scherer]
http://www.salon.com/news/feature/2005/08/30/fcc_indecency/index_np.html
(subscribership or watching an ad required)

WI-FI WITH ITS OWN ZIP CODE
As towns across the country launch wireless broadband networks to bring
affordable Web access to their residents, companies from tiny RedMoon to
heavyweights such as Hewlett-Packard are jockeying to become their
partners. Their motivation: Getting in on the ground floor of a potentially
fast-growing business while creating an alternative to the Bells and cable
outfits that control most of the country's broadband pipes. The muni
wireless business is still in its infancy. But with 300 cities launching or
soon to launch Wi-Fi networks, the market could yield roughly $200 million
in revenues a year, according to market tracker Yankee Research. The rush
to build muni wireless zones has got the Bell and cable companies plenty
worried. They have mounted lobbying campaigns in 14 states to bar local
jurisdictions from creating their own networks, but have failed in all but
one. In Congress, the issue will likely get ironed out as part of an
impending overhaul of the 1996 telecom law. To fend off the Bell and cable
lobbies, many cities are opting for outsiders to own their Wi-Fi network.
The new competition already may be having an effect: Verizon Communication
just dropped its DSL pricing to $14.95 a month. Cities, meantime, see these
networks as a necessity of the Information Age. "Just as with the roads of
old, if broadband bypasses you, you become a ghost town," says Dianah L.
Neff, Philadelphia's chief information officer. As more and more burgs rush
to get connected, Techdom senses a potentially lucrative business in the
making.
[SOURCE: BusinessWeek, AUTHOR: Catherine Yang & Ben Elgin]
http://www.businessweek.com/magazine/content/05_36/b3949053_mz011.htm

VENDORS SEEK CHANGES IN NEW LIST OF E-RATE ELIGIBLE SERVICES
The Federal Communications Commission is reviewing the Universal Service
Administrative Company's list of E-rate eligible equipment and services.
Equipment vendors such as Cisco and Citrix Systems told the Commission that
the eligibility rules in general tend to discourage less-costly equipment
configurations. Cisco asked the FCC to "adopt a balanced approach to
eligibility determinations that takes into consideration the goals of the
application and available technologies, and weighs this against the costs
of various configurations." Cisco said such individualized determinations
"may add a layer of complexity to the eligibility determination process"
but "the savings to E-rate beneficiaries and the provision of funding to
additional applicants more than justifies this approach." Several entities
expressed concern about a proposal to require school districts to file
separate funding applications for bundled telecom and Internet access
services. The State E-rate Coordinators' Alliance (SECA) said dual filings
would be "onerous and administratively burdensome."
[SOURCE: Communications Daily, AUTHOR: Edie Herman]
(Not available online)

STUDY: MOST KIDS PLAY VIDEO GAMES DAILY; WEB ADS GAINING IMPORTANCE
According to a recent study from Netherlands-based marketing agency
JuniorSeniorResearch, video games have become a central part of the lives
of today's children. The study polled 4,000 kids up to the age of
15-years-old (both boys and girls) and discovered that 61 percent play
video games on a daily basis. Although much of the industry concentrates
its marketing on the coveted 18 to 35 male demographic, this study also
shed some light on some advertising trends for the younger crowd. Among
children, advertising doesn't appear to be as important as word of mouth.
The study found that 32 percent of children learned about new games through
their friends. Younger children tended to get more information from friends
and family members than from advertising. But practically every child (92
percent) has seen an ad for a game, with television being the predominant
format at 63 percent. The Internet, however, is seen as a growing medium
for advertising to children. More than 15 percent of children said they
view video game ads on the Internet, while only 11 percent said they see
them in print media.
[SOURCE: BusinessWeek]
http://www.businessweek.com/innovate/content/aug2005/id20050829_928076.htm

QUICKLY

BROADCAST NETWORKS BUY INTO SEARCH KEY WORDS
Facing fragmented audiences and a plethora of media choices, marketing
chiefs at the broadcast networks need to find ever more inventive ways to
entice viewers, and this season they're turning to key words -- that is,
online search terms. For instance, for Prison Break a sponsored link on
Google.com leads Web surfers to a promotional site about the fall series.
The site is supported by advertising. Search terms can be bought for 2
cents and up (depending on how fierce the bidding is) per click and can be
bid on by anyone, even a broadcaster's competitors.
[SOURCE: AdAge, AUTHOR: Claire Atkinson]
http://adage.com/news.cms?newsId=45920

UK SEEKS TO BAN VIOLENT ONLINE PORN
The U.K. government is seeking to outlaw the possession of violent
pornography obtained over the Internet. The Home Office on Tuesday
announced a proposal to ban "extreme pornography" and discussed what
changes in the law are necessary to prevent people downloading images of
sexual abuse.
[SOURCE: C-Net|News.com, AUTHOR: Dan Ilett]
http://news.com.com/U.K.+seeks+to+ban+violent+online+porn/2100-1028_3-58...
--------------------------------------------------------------
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.
--------------------------------------------------------------

Benton's Communications-related Headlines For Tuesday August 30, 2005

The USTelecom Association is hosting a webcast today -- "Municipal
Broadband: The Shape of the Debate." For this and other upcoming media
policy events, see http://www.benton.org/calendar.htm

OWNERSHIP
Intelsat Makes a Move To Shed Legacy
Too Many Players Still Shadow Satellite Industry
Sprint Nextel Is Close to Buying Two Affiliates
PK Response to CDT Paper on Broadcast Flag

TELEVISION/RADIO
CT Advocate Expresses Telco-TV Worries
Much is at stake for democracy in transition to digital TV
WGA Unimpressed By CBS Package
New on TV: The Multiple-Channel Screen
Broadcast Station Totals
Nielsen Reports Startling People Meter Findings
Nielsen Revises National TV Households Count
MAP Files On Behalf of LPFM Community and Supporters
NAB Filing Addresses Heated LPFM and Translator Issues

QUICKLY -- Privacy Group Urges FCC to Guard Phone Data; Data Mining; Media
Monopolies Are a Myth; Principles for Broadband and IP Services;
Irreplaceable Exuberance;

OWNERSHIP

INTELSAT MAKES A MOVE TO SHED LEGACY
If Intelsat completes the $3.2 billion deal announced yesterday to acquire
PanAmSat Holding Corp., the combined company would have an estimated 50%
share of the U.S. satellite-services market, a diversified customer base
and $8 billion in long-term contracts. It also would be well positioned to
benefit from high-definition television programming and government
services. But in acquiring PanAmSat, the leading video-over-satellite
company in North and Latin America in terms of the number of television
channels offered, closely held Intelsat is likely to draw scrutiny from
U.S. regulators and countermoves by rivals on both sides of the Atlantic.
Some industry analysts predict that U.S. antitrust enforcers will require
Intelsat to divest itself of certain satellites over the U.S. that it
acquired from Loral Space & Communications Ltd. Intelsat officials said
regulatory reviews are likely to take six to 12 months but expressed
confidence the deal eventually would get a green light. In response to
potential antitrust objections, Intelsat and PanAmSat executives stressed
that ground-based technologies, such as high-speed fiber connections, pose
the greatest challenge to the satellite industry. "Our competition is
really coming from terrestrial operators, and more so every day," said
Joseph Wright, PanAmSat's chief executive, who is expected to be chairman
of the combined company. The company would retain the Intelsat name and
have headquarters in Washington.
[SOURCE: Wall Street Journal, AUTHOR: Andy Pasztor andy.pasztor( at )wsj.com]
http://online.wsj.com/article/0,,SB112536473965026326,00.html?mod=todays...
(requires subscription)

TOO MANY PLAYERS STILL SHADOW SATELLITE INDUSTRY
[Commentary] Intelsat's announcement that it is buying PanAmSat may mark a
new wave of consolidation in the industry. "There are still about three
dozen satellite providers operating worldwide, which means there are too
many players in a market that is no longer growing fast enough to sustain
them all," Belson writes. Transcontinental and transoceanic fiber networks
can often provide service for far less than satellite operators. To combat
these low-cost providers, satellite companies need the size and scale to
drive prices lower. They also need to focus on their unique ability to
offer high-speed data connections, video programming and phone service to
developing countries where markets are just opening and where fiber
networks are scarce. To do that, they need a constellation of satellites
that blanket not just wealthy markets in North America, Europe and parts of
Asia, but also Africa, the Middle East and South America. If Intelsat's
purchase of PanAmSat is approved, the new company would become the industry
leader with 53 satellites, surpassing SES Global of Luxembourg, which has
35 satellites. The only other company with more than 10 satellites is
Eutelsat, the European operator, which has 23 satellites. The remaining
companies are far smaller, which makes the likelihood of another large deal
doubtful. Yet many smaller companies could help one of the big operators
expand into new regions. Loral Space and Communications, which has four
satellites across the globe, is likely to be involved in future mergers and
acquisitions.
[SOURCE: New York Times, AUTHOR: Ken Belson]
http://www.nytimes.com/2005/08/30/business/30place.html
(requires registration)

SPRINT NEXTEL IS CLOSE TO BUYING TWO AFFILIATES
Apparently, Sprint Nextel, the nation's third-largest wireless company by
number of customers, is close to buying two of its small wireless
affiliates for a combined price of about $700 million. Sprint Nextel has 11
affiliated companies that have deals to use the Sprint or Nextel brand
names and airwaves to sell wireless-phone service in smaller cities and
towns scattered around the nation. The company has said it was in
discussions to resolve issues with affiliates stemming from the merger of
Sprint and Nextel. People familiar with the situation expected Sprint
Nextel to buy a few of the smaller affiliates. Sprint Nextel acquired
another affiliate, U.S. Unwired Inc., for $1.3 billion.
[SOURCE: Wall Street Journal, AUTHOR: Shawn Young shawn.young( at )wsj.com and
Almar Latour almar.latour( at )wsj.com]
http://online.wsj.com/article/0,,SB112536750758426368,00.html?mod=todays...
(requires subscription)

PK RESPONSE TO CDT PAPER ON BROADCAST FLAG
Yesterday, Headlines reported on the policy recommendations of the Center
for Democracy and Technology on the broadcast flag. Today, a response from
Public Knowledge. "Center for Democracy and Technology's short paper on
the question of broadcast-flag authorization legislation correctly
characterizes the flag scheme as 'no minor, technical step.' Instead, the
flag regime is example of incredibly broad industrial policy that would put
the FCC in the role of gatekeeper for countless consumer technologies
(including countless technologies that have little directly to do with
communications, the FCC's nominal bailiwick). If CDT and others are correct
to believe that digital TV is more susceptible to large-scale piracy (there
is no evidence to believe so, and the available evidence suggests that
analog TV is more easily subject to piracy), then the proper approach is to
authorize broadcasters to implement schemes that don't require massive
federal oversight of the construction of consumer-electronics and
information-technology equipment. It's important to remember that the
broadcast flag itself doesn't protect anything. It's just a marker. So any
scheme based on the broadcast flag has to require the federal government to
supervise the design and construction of all technologies that might
conceivably receive TV content. In the digital world, that means just about
every device one can conceive of, from computers to cell phones. CDT's
paper is on the right track when it says that authorization of the FCC to
implement the broadcast-flag scheme 'should be carefully and expressly
defined.' The problem here is that any carefully and expressly defined
power to implement the broadcast flag won't reach far enough to solve the
problem it attempts to solve. A better approach is to scrap the broadcast
flag scheme altogether and go back to the drawing board, if protecting TV
content is a problem that needs to be solved. Sure, the movie studios
pitched the broadcast-flag scheme as a solution for TV piracy, but their
advocacy doesn't mean it's the right scheme, and there's plenty of
evidence, largely present in the FCC filings, that it's the wrong one."
[SOURCE: Public Knowldge]
http://www.publicknowledge.org/pressroom/releases/pressrelease.2005-08-2...

TELEVISION/RADIO

CONNECTICUT ADVOCATE EXPRESSES TELCO-TV WORRIES
Connecticut consumer counsel Mary Healey has advised the state's Department
of Utility Control that telephone company-provided video services should be
regulated to ensure that state residents are not "provided inferior
services." Traditional cable operators are required to provide community
benefits, prevented from redlining on an economic basis and must provide
local community-access programming, Healey noted in a statement. She
expressed concerns over statements officials from SBC Communications Inc.
made before Congress earlier this year, indicating the telephone company
intends to "roll out video services in high-value areas to the exclusion
of economically unattractive potential customers."
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
http://www.multichannel.com/article/CA6252406.html?display=Breaking+News
(requires subscription)

MUCH IS AT STAKE FOR DEMOCRACY IN TRANSITION TO DIGITAL TV
When Congress returns to Washington next month from its summer break, it is
poised to make decisions on communications policy that will affect every
American family and community for years to come. Unfortunately, for a
number of reasons, many people are in the dark about these policy
decisions, and their future impact. The context for the congressional
activity is the transition from analog to digital TV. Congress is trying to
complete the transition from analog to digital TV, which delivers
movie-quality pictures and sounds, and makes it possible for one TV station
to broadcast more efficiently, sending five or more streams of programming
in the broadcast space where only one program could be aired today. That
changeover opens the door to important public policy questions, such as how
the public interest will best be served as more channels become available.
Will Congress ensure that the public gets to use the public resource of the
publicly owned airwaves? And will Congress require that broadcasters, set
to benefit substantially from a new way of broadcasting TV signals, start
paying more than lip service to their obligation to serve the public
interest? Common Cause believes the transition from analog to digital TV
should mean that the public gets more: better quality TV pictures, and more
programming that serves our needs for information on our local
communities. It should also mean that the public airwaves could be used to
make access to the Internet more available at low cost to rural, low-income
and minority households, and to small businesses. This new technology
could better inform and empower all Americans, and give the opportunity to
prosper in this new information age to all of us, regardless of our race,
ethnic backgrounds, income level, or the remoteness of where we live.
[SOURCE: Common Cause]
http://www.commoncause.org/site/apps/nl/content2.asp?c=dkLNK1MQIwG&b=810...{69F059D1-F715-4F5D-A12B-650A3EE1F850}&notoc=1

WGA UNIMPRESSED BY CBS PACKAGE
The Writers Guild of America East says it is "incredibly disappointed" with
CBS' latest offer in ongoing contract negotiations, which ended Aug. 26
with no resolution in sight. The two sides' last agreement expired April 1
(no foolin') and they've been talk, talk, talking since March 15. WGA
negotiator Ann Toback said the union was concerned that CBS would not
assure the guild that if CBS changed from broadcasting to some other
delivery mechanism for its programming -- say broadband or cable -- its
union contracts would still apply. They said that if they stop transmitting
broadcasts over the air, we lose our contract, Toback said.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6252423?display=Breaking+News...
(free access for Benton's Headlines subscribers)

NEW ON TV: THE MULTIPLE-CHANNEL SCREEN
The multiple-channel screen, known in the television industry as a
"mosaic," is about to show up on millions of TVs throughout the country.
It's another sign that satellite and cable systems are beginning to embrace
interactive television after years of hype about the concept. DirecTV's
"SuperFan" can watch 8 football games at once. Dish Network satellite
service has added the mosaic feature to its "Dish Home" channel. Viewers
who tune to Dish Home, where they have access to a wide range of
interactive features like games and shopping, will see what's happening on
six channels, currently all tuned to news stations. For more on interactive
TV, hopes of luring back young audiences and maybe even making some money,
see the URL below.
[SOURCE: Wall Street Journal, AUTHOR: Peter Grant peter.grant( at )wsj.com]
http://online.wsj.com/article/0,,SB112536033078726213,00.html?mod=todays...
(requires subscription)

BROADCAST STATION TOTALS
The Commission has announced the following totals for broadcast stations
licensed as of June 30, 2005... Total broadcast stations: 26,895. Total
full power radio stations: 13,557 (4,759 AM, 6,213 FM and 2,585 FM
Educational). 498 Low Power FM radio stations. 1,747 full power TV stations
(779 UHF commercial, 589 VHF commercial, 379 educational). 2,098 low power
TV stations.
[SOURCE: Federal Communications Commission]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-260747A1.doc

NIELSEN REPORTS STARTLING PEOPLE-METER FINDINGS (Americans, in large
numbers, watch TV!)
Nielsen Media Research is reporting that its controversial
local-people-meter (LPM) system has found startling changes in TV
viewership over the last year among 18- to 34-year-olds. The company said
data from the six local markets with LPMs show dramatic increases in the
number of viewers 18-34 in July 2005 vs. July 2004. The increase occurred
in all the markets and in most day parts. The meters track viewership of
local broadcast and cable stations. In Washington, the 18-34 viewership
increase was 83%; Philadelphia, 56%; San Francisco, 55%; New York, 24%;
Chicago, 21%; and Los Angeles, 10%. A Nielsen spokesman attributed the
changes to the meters' ability to track overall local viewership more
accurately. [Are these the same people Nielsen told us weren't watching TV
this time last year?]
[SOURCE: AdAge, AUTHOR: Ira Teinowitz]
http://adage.com/news.cms?newsId=45913

NIELSEN REVISES NATIONAL TV HOUSEHOLDS COUNT
Measurement firm Nielsen Media Research is revising upward the total number
of TV households in the U.S. Nielsen now estimates that there are 110.2
million TV households in the U.S., up from 109.6 million in the 2004-05
season -- a 0.5% change. According to a company statement, Nielsen also
expanded its count for certain minority groups, reflecting changes in the
nation's own demographic makeup. The most stunning increase is in the
number of Asian TV homes, rising by 3.2% to 4.22 million. Hispanic TV homes
are up 2.9% to 11.23 million and African-American homes are up by 0.8% to
13.2 million.
[SOURCE: AdAge, AUTHOR: Claire Atkinson and Ira Teinowitz]
http://adage.com/news.cms?newsId=45915

MAP FILES ON BEHALF OF LPFM COMMUNITY AND SUPPORTERS
The Media Access Project (MAP) filed comments with the FCC last week for
the LPFM Community and supporters proposing changes to FCC rules. These
changes would help put more LPFM stations on the air and protect them from
encroachment by full power stations. MAP argues that the Commission has a
duty, not only to protect the LPFM service, but to create new opportunities
for the LPFM service. The best method the Commission has for protecting and
creating opportunities for the LPFM service is to adopt a more
sophisticated methodology for interference avoidance.
[SOURCE: Media Access Project]
http://www.mediaaccess.org/LPFMComments.pdf

NAB FILING ADDRESSES HEATED LPFM AND TRANSLATOR ISSUES
The Federal Communications Commission is considering changing rules that
could allow for more low power radio stations to be created around the
country. The National Association of Broadcasters doesn't think that's a
good idea. The NAB's 38-page filing reiterates the association's position
that reducing interference between LPFM's and full power FM's "could deny
thousands of listeners the benefits of FM station upgrades or new FM
service, including digital radio." "The Commission cannot, as a matter of
law, and should not, as a matter of policy, alter its rules to limit the
LPFM interference protections to co- and first adjacent full power FM
stations," NAB said. Instead, the NAB says, the FCC should focus on
"constructive measures" to help LPFM stations that are displaced by a full
power FM's expansion or upgrade of its own signal contour. Among those
measures might be granting the displaced LPFM "priority and expedited
processing over other LPFM applications without the need for opening an
application window." The NAB says the FCC has done something similar with
the low power television service. The broadcast lobbyist says that only one
LPFM has actually been displaced so far.
[SOURCE: Billboard Magazine, AUTHOR: Tony Sanders]
http://billboardradiomonitor.com/radiomonitor/news/business/leg_reg/arti...
* Text of NAB comments:
http://www.nab.org/newsroom/pressrel/filings/LPFM82205.pdf

QUICKLY

PRIVACY GROUP URGES FCC TO GUARD PHONE DATA
In a petition scheduled to be filed today, the Electronic Privacy
Information Center (http://www.epic.org/) urges the Federal Communications
Commission to create tougher rules for how and when landline and wireless
carriers release customer information. The group argues that the active
marketplace for telephone records demonstrates that security practices at
telecommunications companies are lax. Dozens of Web sites operated by data
brokers and private investigators offer to sell detailed calling records
for as little as $110 for the most recent billing cycle. The data are often
collected by impersonating customers or paying off insiders, according to
the petition. Buyers of the information include attorneys trying to find
witnesses or suspects, debt collectors and spurned or suspicious lovers.
But EPIC West Coast Director Chris Jay Hoofnagle said stalkers or those
engaged in industrial espionage could just as easily be the buyers.
[SOURCE: Washington Post, AUTHOR: Jonathan Krim]
http://www.washingtonpost.com/wp-dyn/content/article/2005/08/29/AR200508...
(requires registration)

Data Mining: Agencies Have Taken Key Steps to Protect Privacy in Selected
Efforts, but Significant Compliance Issues Remain (GAO-05-866)
[SOURCE: General Accountability Office]
http://www.gao.gov/cgi-bin/getrpt?GAO-05-866
Highlights - http://www.gao.gov/highlights/d05866high.pdf

MEDIA MONOPOLIES ARE A MYTH
With so many major news outlets spreading propaganda, why shouldn't
Headlines? Adam Thierer and Daniel English write that if the stock market
is any indication, the argument that just a few large media conglomerates
control the market for what we see, hear and read, is completely without
merit. Thierer and English evaluate the market performance of five large
media outlets and deduce that declining stock value -- market caps down 52%
over the last four years -- is a clear indication that the corporations
could not possibly be acting as monopolies. [Yeah, yeah... if you worship
at the alter of the marketplace...]
[SOURCE: Progress and Freedom Foundation]
http://www.pff.org/news/news/2005/082605mediamonopoly.html

PRINCIPLES FOR BROADBAND AND IP SERVICES
In a white paper released last week, the US Internet Industry Association
(USIIA) announced a set of self-regulatory principles for broadband and
Internet Protocol-based services. The principles come in the wake of recent
Supreme Court and Federal Communications Commission decisions that have
significantly changed the telecommunications regulatory environment.
[SOURCE: US Internet Industry Association]
http://www.usiia.org/news/0503principles.doc
Text of paper at:
http://www.usiia.org/pubs/principles.doc

IRREPLACEABLE EXUBERANCE
[Commentary] The growth of the Internet has paralleled that of most
industries based on revolutionary technology. Canals, railroads,
telegraphs, telephones, cars, radios, personal computers -- all progressed
(or are progressing) through four phases of development: boom, bust, mature
growth and decay. During the boom phase, the success of a few visionary
companies like Netscape inspires frantic experimentation and speculation,
as entrepreneurs and investors try to cash in on the trend. Early entrants
usually enjoy temporary success, but the number of competitors soon comes
to exceed the initial opportunity, leading to a collapse. After the
shakeout, a handful of survivors enjoy an extended period of growth and
profitability. Finally, another technology shift leads to an era of
decline, and giants often find themselves reduced to the stature of today's
buggy-whip makers -- or worse. Sometimes, industry life cycles last a
century or more (circuit-switched telephones); sometimes, only a few
decades (Polaroid). But the repetition of the pattern -- as well as its
resemblance to biological evolution -- suggests that the boom-and-bust
phases should be viewed as far more than repeated examples of human folly.
Rather, they should be seen as natural, inevitable bursts of
trial-and-error adaptation, the mechanisms through which industries are formed.
[SOURCE: New York Times, AUTHOR: Henry Blodget]
http://www.nytimes.com/2005/08/30/opinion/30blodget.html
(requires registration)
--------------------------------------------------------------
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.
--------------------------------------------------------------

Benton's Communications-related Headlines For Monday August 29, 2005

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

AGENDA
DTV Bill Tops Busy D.C. Docket

TELEVISION
FCC Chief Considers Forcing Cable TV Competition
Comcast Flexing Content Leverage
Is there a sweatshop behind 'Survivor'?
NCTA Seeks Signal-Fee Reform
FEC Change Could Hurt PSAs
Cable Nets Grab a Bigger Share

OWNERSHIP
Intelsat Sets Deal To Buy PanAmSat For $3.2 Billion
Media Executives Court China, but Still Run Into Obstacles
CDT Offers Recommendations on Broadcast Flag Legislation

QUICKLY -- $34.6 Million in Rural Technology Development Funds; NAB Zeros=
=20
In On Fritts Successor; Interactive Ads: Beyond Watercooler Buzz; FCC=20
Extends VoIP/E-911 Deadline; Copps: Martin=92s FCC Strongly Committed To=20
Homeland Security

AGENDA

DTV BILL TOPS BUSY DC DOCKET
A digital transition bill, two new FCC commissioners and the start of the=
=20
rewrite of media-ownership rules will all be on the to-do list when=20
policymakers and regulators get back to business after Labor Day. While=20
Members have been away, Congressional aides have been working on the text=
=20
of digital television bills -- a DTV bill needs to get to the budget=20
committee by Sept. 16 to be included in a larger budget-reconciliation=20
package that requires various committees to find money for the treasury.=20
Slowing the DTV bills has been debate over subsidies for analog-only TV=20
households and whether to require cable systems to carry all the non-pay=20
channels a broadcaster can fit into its digital channel. The hard date is=
=20
now expected to be June or July 2009. Originally, it had been targeted for=
=20
Jan. 1, 2009, but that date will likely change to push it past the January=
=20
college bowl games, the Super Bowl and the May sweeps and into the=20
low-viewing summer months. In early September, look for the White House to=
=20
finally nominate two new FCC commissioners and renominate Democrat Michael=
=20
Copps. Still expected to get the nods for the two Republican seats are=20
telecom policy adviser Richard Russell and Tennessee utility commissioner=
=20
Deborah Tate.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6252080?display=3DNews&referral=
=3DSUPP
(free access for Benton's Headlines subscribers)
Also --
* Sept. 7 - 8 Event to Lobby for Multicast Must-Carry
More than 85 broadcasters from 22 states plan to meet September 7 - 8 in=20
Washington, DC to educate members of Congress on the need for cable=20
carriage of multicast signals. Legislation to complete the digital=20
television transition is accelerating in both the House and Senate.=20
Specifically, it is expected the House Commerce Committee will consider=20
digital television language the week of September 5, the first week=20
Congress returns from its August recess. The Senate Commerce Committee will=
=20
likely consider its own DTV bill the following week. "Given this compressed=
=20
timetable," the NAB tells its members, "and the need to make our case=20
before the two Committees vote in September, make your plans today to=20
attend the NAB Washington DTV Fly-In." For more info, contact the NAB at=20
1-800-424-8806 or publicaffairs( at )nab.org.
[SOURCE: National Association of Broadcasters]

TELEVISION

FCC CHIEF CONSIDERS FORCING CABLE TV COMPETITION
Reported one week ago, FCC Chairman Kevin Martin apparently thinks the=20
Cable Act of 1992 gives the FCC authority to compel cities to let the=20
regional Bells compete head-on with cable TV operators -- and to do so=20
quickly. The provision of the '92 act -- Section 621(a)(1) -- states that=
=20
local franchising authorities "may not unreasonably refuse to award an=20
additional competitive franchise" for video. By some readings, that means=
=20
cities can't erect obstacles to keep out video competitors. Verizon and SBC=
=20
are spending billions to deploy advanced broadband services =97 voice, data=
=20
and video =97 across the country. Before they can deploy video, however,=20
cities want them to submit to the cable TV franchising process. But there=
=20
are thousands of local franchising authorities, and each has its own=20
licensing process and timetables
[SOURCE: USAToday 8/22, AUTHOR: Leslie Cauley]
http://www.usatoday.com/money/industries/telecom/2005-08-22-telecom-usat...
htm

COMCAST FLEXING CONTENT LEVERAGE
Comcast is taking some bold steps to transform and beef up its content=20
portfolio, from acquiring professional hockey for Outside Living Network=20
(OLN) to starting affiliate-sales consolidation for its networks. According=
=20
to industry sources, Comcast=92s game plan is to use sports programming --=
=20
from its emerging OLN as well as its regional sports networks -- to gain=20
what major programmers like News Corp. and Walt Disney all have: leverage=
=20
with distributors. That leverage will be a tool for top cable operator to=
=20
seek license-fee increases and wider carriage for its growing programming=
=20
stable, by packaging the various services through one central=20
affiliate-sales force.
[SOURCE: Multichannel News, AUTHOR: R. Thomas Umstead & Linda Moss]
http://www.multichannel.com/article/CA6252103.html
(requires subscription)

IS THERE A SWEATSHOP BEHIND 'SURVIVOR'?
In an Aug. 23 move that Writers Guild of America (WGA) calls "the largest=
=20
organizing effort" since its founding in 1933, ten reality TV writers=20
alleged that Fox Broadcasting Co. and Rocket Science Laboratories have=20
violated California labor laws. On behalf of 1,000 other story editors,=20
field producers, and editor assistants at over 70 companies, the=20
WGA-supported class action lawsuit also claims unlawful practices of=20
perpetrating and concealing overtime. Observers say the litigation will=20
shine light into the behind-the-scenes world of television's newest genre,=
=20
reality TV, whose emergence is generally dated to the debut of "Survivor"=
=20
in 2000. Because the Guild has signed up so many complaints at other=20
production companies, some say the suit could have serious repercussions on=
=20
the way production companies and networks treat the creators of reality=20
shows, and determine union protections for the future. Some observers say=
=20
the legal action could curtail further development of reality shows, which=
=20
are attractive to networks because they carry lower price tags compared to=
=20
dramas and sitcoms. Others say a more likely outcome could be the emergence=
=20
of a higher quality of show, as the genre could attract and hold better=20
writers.
[SOURCE: The Christian Science Monitor, AUTHOR: Daniel B. Wood]
http://www.csmonitor.com/2005/0829/p02s02-wmgn.html

NCTA SEEKS SIGNAL-FEE REFORM
Cable operators deserve a break in the fees they pay for compulsory=20
licenses to carry stations affiliated with broadcasters Fox, UPN, The WB=20
and Paxson Communications Corp., the National Cable & Telecommunications=20
Association asserts in a recent filing with the federal Copyright Office.=
=20
In its Aug. 17 petition for rulemaking, the NCTA contends that stations in=
=20
those groups now meet the definition of network, not independent, stations.=
=20
The definition is important: cable systems pay a full distant-signal=20
equivalent, calculated at 0.956 of 1% of a station's gross revenues, as=20
royalties for an independent station. The payment drops by three-quarters=
=20
for network stations.
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
http://www.multichannel.com/article/CA6252104.html?display=3DTop+Stories
(requires subscription)

FEC CHANGE COULD HURT PSAs
The Federal Election Commission is seeking comment on changes to campaign=
=20
finance rules that could narrow the exemptions from prohibited=20
"electioneering communications" and change the definition of "publicly=20
distributed" to include PSAs by excluding unpaid as well as paid TV or=20
radio appearances by a federal candidate. The current definition of=20
"publicly distributed" is "aired, broadcast, cablecast or otherwise=20
disseminated for a fee through the facilities of a television station,=20
radio station, cable TV system or satellite system." The FEC wants comment=
=20
on whether removing the "for a fee" language and subjecting PSAs to the=20
electioneering restrictions would discourage broadcasters from airing them.=
=20
The FEC is also considering narrowing or even eliminating, the=20
"electioneering" exemption for national and local charities and nonprofits.=
=20
The controversial status of so-called 527s, like Swift Boat Veterans for=20
Truth, is not addressed in the notice of proposed rulemaking issued Aug.=20
24, which is targeted to addressing the specific court findings. Comments=
=20
are due Sept. 30 and a hearing is slated for Oct. 19.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6251760?display=3DBreaking+Ne...
referral=3DSUPP
(free access for Benton's Headlines subscribers)
For more info from the FEC see=20
http://www.fec.gov/pdf/nprm/exemption_doc_films/notice_2005-20.pdf

CABLE NETS A BIGGER SHARE
Projections for summer season television viewing ratings have cable winning=
=20
a 61% share to broadcast's 32%. Broadcast=92s showing marks an all-time low=
=20
for the medium, its largest decline since 1997. This will be the fifth=20
summer in a row that cable has outdelivered broadcast in primetime.
[SOURCE: Multichannel News, AUTHOR: Linda Moss]
http://www.multichannel.com/article/CA6252109.html
(requires subscription)
* Summer Migration: Viewers Turn to Cable
http://www.nytimes.com/2005/08/29/business/29drill.html

OWNERSHIP

INTELSAT SETS DEAL TO BUY PANAMSAT FOR $3.2 BILLION
Intelsat will acquire PanAmSat for $3.2 billion, bidding to create the=20
world's largest commercial-satellite fleet with unparalleled influence over=
=20
new offerings such as high-definition television and Internet access. With=
=20
its global reach, 53-satellite fleet and ability to manage in-orbit=20
satellites to cope with malfunctions and minimize outlays for additional=20
launches, the merged company would have unparalleled influence over the=20
satellite-communications sector. The nearest competitor would be SES Global=
=20
SA of Luxembourg, which has been the industry leader and trendsetter in=20
terms of major acquisitions and joint ventures. Consolidation has been=20
building among satellite operators for years, as they struggle amid weak=20
demand to pare the costs of launching and operating spacecraft designed to=
=20
beam television programs, voice traffic and all sorts of government and=20
corporate data. But even more powerful forces have prodded major shifts in=
=20
strategy and management: Seeking to leverage the ability of satellite firms=
=20
to generate cash, a long list of well-known private equity firms pumped=20
about $9 billion into the sector in recent years. They also have taken=20
advantage of generous capital markets to unveil a series of initial public=
=20
offerings, special dividends and merger plans to notch significant profits.=
=20
The Federal Communications Commission and the government's antitrust=20
authorities will review the deal.
[SOURCE: Wall Street Journal, AUTHOR: Dennis K. Berman=20
dennis.berman( at )wsj.com and Andy Pasztor andy.pasztor( at )wsj.com]
http://online.wsj.com/article/0,,SB112528363497425318,00.html?mod=3Dtoda...
us_page_one
(requires subscription)
See more coverage:
http://www.washingtonpost.com/wp-dyn/content/article/2005/08/28/AR200508...
1185.html
http://www.nytimes.com/2005/08/29/business/29deal.html

MEDIA EXECUTIVES COURT CHINA, BUT STILL RUN INTO OBSTACLES
The long-held optimism of Western media companies about venturing into the=
=20
Chinese market has suffered several setbacks recently. At the beginning of=
=20
the month, as part of an effort to tighten control over cultural products,=
=20
China's Propaganda Department, the Ministry of Culture and four other=20
regulators published new rules that further restricted what foreign=20
filmmakers and television companies can do in China. Last week, the News=20
Corporation's plan for a new television channel to be co-owned with a=20
Chinese company was quashed by the government. The question facing Western=
=20
media companies is how long the newly tightened restrictions will hold.=20
Pessimists in media organizations worry whether the latest crackdown=20
reflects a longer-term shift under a more cautious Chinese president, Hu=20
Jintao. Optimists suggest that the recent moves are just the latest in a=20
long series of episodic, sometimes short-lived efforts by the Chinese=20
Communist Party to preserve social control. Over the longer term, access to=
=20
the China media is crucial to American companies like Time Warner and Walt=
=20
Disney, in addition to Viacom and the News Corporation. Growth at these=20
giant conglomerates has slowed and their stock prices have been under=20
pressure. If they can export their feature films, cable and TV programs, or=
=20
even co-produce new shows with Chinese companies, the returns could be=20
substantial.
[SOURCE: New York Times, AUTHOR: Geraldine Fabrikant]
http://www.nytimes.com/2005/08/29/business/worldbusiness/29china.html
(requires registration)

CDT OFFERS RECOMMENDATIONS ON BROADCAST FLAG
As Congress considers mandating a "broadcast flag" regime to protect=20
digital television signals from piracy, the Center for Democracy and=20
Technology is urging lawmakers to ensure that such a law does not interfere=
=20
with the rights of individuals to use digital content, or of inventors to=
=20
develop new technologies. To that end, CDT has drafted a report outlining=
=20
key considerations for Congress. Though it is unclear whether Congress will=
=20
move on legislation this year, pressure to enact a law has increased since=
=20
a federal court struck down broadcast flag rules written by the Federal=20
Communications Commission. CDT is not endorsing a flag regime, but believes=
=20
if one is passed, it must include appropriate limitations and safeguards.
[SOURCE: Center for Democracy and Technology]
http://www.cdt.org/copyright/20050822BroadcastFlag.pdf
http://www.cdt.org/copyright/20020825broadcastflagletter.pdf
* Digital Group Changes Its Stance On 'Broadcast Flag'
http://www.njtelecomupdate.com/lenya/telco/live/tb-NKRO1124989543658.html

QUICKLY

$34.6 MILLION IN RURAL TECHNOLOGY DEVELOPMENT FUNDS FOR RURAL AMERICA
On August 18, Agriculture Deputy Secretary Chuck Conner announced the=20
approval of $34.6 million in USDA Rural Development funds to support the=20
development and expansion of rural telecommunication technologies in=20
targeted rural areas in the states of Alabama, Indiana, Maryland, Michigan,=
=20
New Hampshire and Virginia. The funding will bring first-time telephone=20
service to remote areas of Michigan, and for the first time, USDA will=20
finance broadband infrastructure using electric power lines.
[SOURCE: US Department of Agriculture]
http://www.usda.gov/wps/portal/!ut/p/_s.7_0_A/7_0_1OB?contentidonly=3Dtr...
contentid=3D2005/08/0317.xml

NAB ZEROS IN ON FRITTS SUCCESSOR
Apparently the National Association of Broadcasters has narrowed its list=
=20
for a successor for outgoing president Eddie Fritts: 1) former Congressman,=
=20
nonprofit executive, Love Boat co-star, and WMAL radio morning jock Fred=20
Grandy; 2) Disney/ABC Lobbyist Mitch Rose (ABC has just rejoined the NAB);=
=20
and perhaps the leading candidate David Rehr, president of the National=20
Beer Wholesalers Association.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6252029?display=3DBreaking+Ne...
referral=3DSUPP
(free access for Benton's Headlines subscribers)

INTERACTIVE ADS: BEYOND WATERCOOLER BUZZ
Given the rate of digital-TV deployment -- particularly digital video=20
recorders, video-on-demand and broadband video options that allow consumers=
=20
to time-shift or bypass ads -- advertisers believe they must shape the=20
future of interactive TV themselves.
[SOURCE: Broadcasting&Cable, AUTHOR: Joe Mandese]
http://www.broadcastingcable.com/article/CA6252123?display=3DAdvertising...
ferral=3DSUPP
(free access for Benton's Headlines subscribers)

FCC CUTS VOIP PROVIDERS SLACK TO GET CUSTOMER E-911 REPLIES
The FCC Enforcement Bureau delayed imposition of a rule requiring VoIP=20
providers to disconnect subscribers who haven't responded to alerts about=
=20
911 service limitations. The FCC will extend the August 30 cutoff date 30=
=20
days, until September 28. But VoIP providers must file two more reports on=
=20
their progress educating customers and gaining their acknowledgments.=20
Reports filed in early August indicated some providers have replies from=20
90% or more of customers. Vonage claimed a 96% response rate. But tens of=
=20
thousands of phones still could have been cut off next week without the=20
extension.
[SOURCE: Communications Daily, AUTHOR: Edie Herman]
(Not available online)
See the Bureau's announcement at:=20
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-05-2358A1.doc

COPPS:MARTIN'S FCC STRONGLY COMMITTED TO HOMELAND SECURITY
Speaking to the Association of Public-Safety Communications Officials last=
=20
week, FCC Commissioner Michael Copps expressed confidence that the=20
Commission under Chairman Kevin Martin will be strongly committed to public=
=20
safety and homeland security. Commissioner Copps offered his own ideas for=
=20
the FCC to focus on as it proceeds. =93The Commission needs to be=20
front-and-center in the action, pushing for interoperability, striving for=
=20
redundancy, acting as a convener, an expediter and a planning innovator.=94=
=20
=93The FCC is not even mentioned in The 9/11 Commission Report,=94 Commissi=
oner=20
Copps noted. =93We need a higher profile -- not for the sake of profile but=
=20
for the sake of progress. The Commission has more to contribute than it=20
has.=94 One focus of a separate FCC homeland security office -- which Copps=
=20
has long advocated -- =93could be to help local public safety organizations=
=20
share ideas, prepare plans, vet proposals and coordinate them with both=20
government and industry.=94
[SOURCE: Communications Daily, AUTHOR: Susan Polyakova]
(Not available online)
--------------------------------------------------------------
OK, OK, there's always next year, Cubs fans.
--------------------------------------------------------------
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.
--------------------------------------------------------------

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