October 2005

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

AGENDA
Congressional Telecom Agenda
10 Media Trends to Watch

INTERNET
Internet Access Dispute Cut Off Some Businesses
AOL-Deal Talk By Rivals Adds To Verizon's Woes
Internet? Give us irrigation, Peru farmers say

BROADCASTING
FCC Upgrades Telemundo in Phoenix
Crib Sheet: Payola
CEA "Out of Touch," Says Fritts

QUICKLY -- Ferree Resigns From CPB; The Laptop Backlash; Podcasters prepare
to launch video era; India's rural majority gets connected; Overzealous
filters hinder research; European antiterror laws limit free speech

AGENDA

CONGRESSIONAL TELECOM AGENDA
In a new report, the Congressional Research Service speculates about
possible telecom reform legislation. CRS predicts the following issues will
eventually be addressed: 1) Broadband Internet regulation concerning both
broadband deployment in underserved rural areas and whether to apply legacy
rules to new entrants. 2) Broadcast indecency. 3) The transition to digital
television. 4) Restructuring the FCC -- proposals fall into 2 categories:
procedural changes affecting day-to-day operations and Congressionally
mandate policy changes affecting agency oversight of services and industry.
5) Intercarrier compensation. 6) Media ownership rules. Congress may
provide guidance as the FCC revises its regulations to fit a 3rd U.S.
Appeals Court, Philadelphia, decision overturning FCC rules relaxing
multi-ownership restrictions. What's at stake is whether the rules block
mergers that could be beneficial in promoting more in-depth local news
coverage versus creating behemoths that reduce the number of independent
voices in the market. 7) Municipal deployment of broadband. 8) Public
safety communications. The public safety community wants Congress to assure
release of spectrum at 700 MHz for public safety. Other issues include
pressure for laws that require the FCC to support 911 call centers, expand
emergency alert networks and assuring access to wireline and wireless
lifeline telecom services. (9) The "Savings Clause" and Monopoly Issues.
10) Universal Service Fund reform. The Senate and House Commerce Committees
want to figure out how to ensure proper management of the fund and overcome
fraud, waste and abuse.
[SOURCE: Communications Daily, AUTHOR: ]
(Not available online)

10 MEDIA TRENDS TO WATCH
What do we need to know to keep on top of the media world? 1) Technology is
at the root of many current trends in the media landscape, but perhaps one
for which it has the power to have the most influence is the portability of
video content. 2) In the past couple of years, blogs have grown from an
outlet for tech-savvy geeks to something that has reached an almost
mainstream level. 3) The past few years have seen the introduction of a new
crop of celebrity magazines, especially weeklies, including In Touch, Life
& Style, a retooled Us Weekly and Star, and British import OK! 4) For many
media organizations, transparency is a growing trend, 5) The growth of
Hispanic media. 6) Newspapers financial woes. 7) The digital migration of
print media. 8) The model of one media entity owning outlets across
multiple platforms is one that is not new to the industry. And it's likely
to be something that will continue in the future. Conglomerates like
Gannett, Clear Channel, and Time Warner hold a large stake in many forms of
communication that Americans use on a daily basis. 9) The merging of
technology and the 24-hour news cycle has only increased the amount of news
available to consumers. And some believe that the abundance of information
will only decrease the importance of traditional media. 10) The issue of
media measurement has always been a tricky one: How relevant is the
impressions figure when referring to print placements? Are Nielsen ratings
really measuring a good cross-section of the population? Will there be an
equivalent to Arbitron ratings in satellite radio?
[SOURCE: PRWeek, AUTHOR: Erica Iacono]
http://www.prweek.com/us/thisissue/article/520790/10-media-trends-watch

INTERNET

INTERNET ACCESS DISPUTE CUT OFF SOME BUSINESSES
Last week, a dispute between Cogent Communications Group and Level 3
Communications, two of the companies that usually move Internet traffic
seamlessly around the world, cut off many of their clients from parts of
the Web. With the Internet as vital to many businesses as the telephone,
the incident prompted calls for the government to step in if the industry
does not prevent such disruptions on its own. "Does it require regulation?
I think if the industry does not show itself to be more mature -- yeah,"
said David J. Farber, a former chief technologist at the Federal
Communications Commission. He said his natural instinct is to avoid
regulation "if you can get more sane solutions from the industry."
Communications experts suggested that companies in such disputes should
agree to arbitration, have a cooling-off period during which they cannot
cut service and warn all customers of any disruption. In this dispute,
Level 3 claims that it was carrying a disproportionate amount of Cogent
traffic and should be paid for it. Cogent said it had sent more traffic to
Level 3 but only at the other firm's request. A Level 3 executive said he
was not aware that his company had made such a request. Neither side made
provisions to arrange connections with other Internet "backbone" providers,
which would have kept all their customers connected after the cutoff. Level
3 appeared chastened by the experience but said government regulation was
not needed because the market policed itself.
[SOURCE: Washington Post, AUTHOR: Arshad Mohammed]
http://www.washingtonpost.com/wp-dyn/content/article/2005/10/13/AR200510...
(requires registration)

AOL-DEAL TALK BY RIVALS ADDS TO VERIZON'S WOES
The news that a venture of Google and Comcast is trying to acquire a
minority stake in America Online could aggravate a headache for Verizon
Communications that has been building all year. Even before word of the
possible deal leaked out, investors were concerned over competitive threats
posed to Verizon by the Internet. Cable companies have been successful at
wooing hundreds of thousands of telephone customers with their relatively
inexpensive Internet-based phone services. An AOL deal with Google and
Comcast adds to Verizon's woes because it poses a new threat to one of its
few growth businesses: the sale of high-speed Internet connections. Comcast
is one of Verizon's biggest competitors in this business, and owning a
piece of AOL would give it new advantages. Initially, Comcast would benefit
by getting access to AOL's 20 million dial-up Internet subscribers, the
most likely consumers to switch to broadband. But even more powerful would
be Comcast's ability to augment its broadband service with AOL's brand name
and content, such as concerts, movies and even new reality shows that AOL
is producing. In the early days of broadband competition, this type of
content wasn't as important to consumers as price and speed in deciding
what service to use. But as the number of broadband users increased --
about one-third of U.S. households have high-speed Internet connections --
the amount of movie trailers, sports highlights, home movies and other
content has proliferated. Moreover, Internet companies like Time Warner's
AOL and Yahoo have done good jobs of developing a sense of community among
subscribers. While AOL has made much of its content available to
nonsubscribers, Comcast would get a powerful marketing lift by being
aligned with one of the most well-known of these online communities and
being able to offer AOL's content on its portal.
[SOURCE: Wall Street Journal, AUTHOR: Dionne Searcey dionne.searcey( at )wsj.com]
http://online.wsj.com/article/SB112925703127368505.html?mod=todays_us_mo...
(requires subscription)
* Portal strategy is key to interest in AOL
http://www.mercurynews.com/mld/mercurynews/business/technology/12895742.htm

INTERNET? GIVE US IRRIGATION, PERU FARMERS SAY
Hundreds of Peruvian farmers living near the huge Las Bambas copper project
plan a two-day protest on Sunday against a government program to spend a
social fund on Internet connections in an area where many cannot read or
write. As part of Swiss-based Xstrata's concession deal to develop the
southern Andes deposit, the company last year paid $45.5 million to a
government-run fund to alleviate poverty in one of the country's most
impoverished regions.
[SOURCE: Reuters]
http://www.freepress.net/news/11806

BROADCASTING

FCC UPGRADES TELEMUNDO IN PHOENIX
The FCC said Thursday it would allow NBC Universal's Telemundo station KPHZ
Holbrook (AZ) to relocate to Phoenix, saying it would create needed
competition to Univision in the top 10 Hispanic market. In an unusual move,
Telemundo will swap its Holbrook channel (ch. 11) for that of noncommercial
KDTP Phoenix (ch. 39), effectively dereserving one of the two Phoenix
channels reserved for noncommercial broadcasting. In addition to getting
the Holbrook channel to deliver noncom programming to a population of
4,917, KDTP owner CTE will get Telemundo's Class A low power in Phoenix,
KDRX-CA, so it can continue to serve that market with noncom programming.
The move leaves Holbrook with no commercial station, but the FCC concluded:
"We find that this detriment is outweighed by the benefit of preserving
Holbrook's sole local television transmission service, the opportunity to
foster local and national Spanish-language network competition, and to
expand and improve local programming in Phoenix." FCC Commissioner Michael
Copps saw the move as justified because it promoted competition in
Spanish-language. "Over the past few years, we have seen consolidation in
Spanish-language media taken to new and threatening heights. Today's
decision should promote at least somewhat greater diversity and competition
for those who receive their news and entertainment in Spanish in one of the
largest Hispanic markets in the country."
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6271683?display=Breaking+News...
(free access for Benton's Headlines subscribers)
FCC Order: http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-175A1.doc
Statement by Commissioner Copps:
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-05-175A2.doc

CRIB SHEET: PAYOLA
[Commentary] Local radio stations everywhere have been swallowed up by a
handful of giant corporations, playlists have shrunk, and local and
independent acts have been drowned out, as Big Radio soaks listeners in a
mind numbing mix of bland commercial acts. The rapid concentration of radio
ownership has also ushered in a new age of "payola." Major recording labels
now shower radio station owners with money and prizes to plug and play
their most bankable stars, securing spins of Dion, Ricky Martin, J. Lo,
Jessica Simpson and even major label indie kids Franz Ferdinand at the
expense of struggling local acts. There's the catch: Payola is against the
law. The New York Attorney General's Office, Federal Communications
Commission and members of Congress are investigating radio industry
corruption. There's no better time than now for music lovers to protect the
radio airwaves from insatiable corporate greed and end payola once and for
all. Here's the Top 10 things you need to know about Payola.
[SOURCE: Campus Progress, AUTHOR: Tim Karr]
http://www.campusprogress.org/tools/585/crib-sheet-payola

CEA "OUT OF TOUCH," SAYS FRITTS
National Association of Broadcasters President Eddie Fritts said Thursday
that the Consumer Electronics Association is not up to speed on the
technical challenges of DTV. Responding to CEA's suggestion, in comments at
the FCC, that NAB's proposed new digital-to-analog converter box would
include too many extras and thus be pricier than the low-cost box Congress
is looking to subsidize, Fritts said: "CEA demonstrates again that it is
out of touch with the realities of the technical challenges of DTV
reception as well as two of its largest members. NAB is proud to stand with
CEA members LG Electronics and Thomson in their effort to ensure that all
Americans have affordable and reliable access to local television signals
both during and after the transition to digital."
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6271569?display=Breaking+News...
(free access for Benton's Headlines subscribers)

QUICKLY

FERREE RESIGNS FROM CPB
CPB Executive VP and Chief Operating Officer Ken Ferree resigned Wednesday
to join California law firm Sheppard & Mullin, which is expanding its D.C.
telecommunications presence. Ferree, former Media Bureau Chief under FCC
Chairman Michael Powell, had joined CPB as COO in March, when Powell also
exited, and was named acting president when Kathleen Cox left abruptly last
April. Ferree had thrown his hat in the ring for the top spot, but the CPB
board picked Patricia Harrison, the choice of board Chairman Ken Tomlinson,
to be president. Fred DeMarco, executive VP and senior adviser to President
Patricia Harrison, will assume Ferree's duties.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA6271549.html?display=Breaking...
(free access for Benton's Headlines subscribers)

THE LAPTOP BACKLASH
Bringing laptops and wireless Internet access into classrooms was supposed
to enrich classroom discussions by, for example, allowing students to
import information from the Internet and share it with the rest of the
class. But instead some students are using their laptops to message
friends, shop online, peruse Web sites and pursue part-time jobs. The
result: There is a rising backlash against classroom computer use from
professors and schools. (Hmmm. Young people are not using technology in the
way authority figures intended them to... who coulda guessed?)
[SOURCE: Wall Street Journal, AUTHOR: Gary McWilliams
gary.mcwilliams( at )wsj.com]
http://online.wsj.com/article/SB112924976699568321.html?mod=todays_us_ma...
(requires subscription)

PODCASTERS PREPARE TO LAUNCH VIDEO ERA
Podcasting is on the verge of setting off a video revolution (will we call
it "vodcasting"?) and users of Apple Computer's new video iPod can expect a
deluge of outspoken commentary, religious sermons and pornography.
Podcasting, a term based on the name for Apple's portable media player,
allows customers to download audio, and now video, segments for free to
their computers and portable devices. Radio shows are among the most
popular podcasts, but amateurs have helped turn podcasting into an eclectic
global phenomenon. Success in the video realm may depend largely on
programmers' resources and ability to grasp the complexities of a medium
that is much more complicated than audio.
[SOURCE: Reuters, AUTHOR: Pascal Pinck]
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...

INDIA'S RURAL MAJORITY GETS CONNECTED
India's mobile phone market may be growing faster than any other in the
world -- at 35 per cent a year over the next five years in terms of
revenues, but people in rural areas -- the majority of the population --
have not been invited to the party. The Telecom Regulatory Authority of
India is hoping to bring the mobile revolution to those people through a
set of recommendations that would give wireless operators an incentive to
spread coverage to non-urban areas. The TRAI recommended that ~$1.8 billion
from the Universal Services Obligation Fund, to which all telecoms
operators in India already contribute, be used to set up 20,000 new base
stations across the country. The subsidies, however, would only be given to
operators that shared infrastructure. Analysts said the plan was largely
workable, but that the regulatory body should impose restrictions on
rolling out base stations because operators were likely to flock only to
rural areas they thought lucrative, like the western states of Punjab,
Gujarat, and Maharashtra, while ignoring poorer states like Utter Pradesh
or Bihar.
[SOURCE: Financial Times, AUTHOR: Anita Jain]
http://news.ft.com/cms/s/391a5da6-3bfa-11da-94fb-00000e2511c8.html
(requires subscription)

OVERZEALOUS FILTERS HINDER RESEARCH
The Internet-content filters most commonly used by schools block needed,
legitimate content more often than not, according to a study by a
university librarian. Her report was presented at the American Association
of School Librarians (AASL) conference in Pittsburgh last week. Better
communication between technology staff and classroom teachers is the key to
ensuring that school and library Internet filters, installed as part of a
federal effort to protect children from inappropriate online content, do
not preclude students from accessing legitimate educational materials, the
new study found.
[SOURCE: eSchool News, AUTHOR: Corey Murray]
http://www.eschoolnews.com/news/showStoryts.cfm?ArticleID=5911

EUROPEAN ANTITERROR LAWS LIMIT FREE SPEECH
European countries, struggling to deal with firebrand Islamic clerics, have
scrambled for laws to tone down the imams' provocative pronouncements. But
in cracking down on such rhetoric, which some have blamed for encouraging
youth to take up radical, violent jihad, European authorities are in danger
of trespassing on the right of free speech, widely viewed as a fundamental
principle of democratic societies.
[SOURCE: The Christian Science Monitor, AUTHOR: Mark Rice-Oxley]
http://www.csmonitor.com/2005/1014/p06s02-woeu.html
--------------------------------------------------------------
...and we are outta here. Have a great weekend. Who do ya got? 'Stros or
Cards? Sox or Halos?
--------------------------------------------------------------
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.
--------------------------------------------------------------