June 2006

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NEWS FROM CONGRESS
Senate Won't Quiz Telecoms about NSA Spying
Broadcast Content Gets Hammered on Floor
Google founder Lobbies for Net Neutrality
Markey, Dingell Plan Build-Out Amendment

BROADCASTING & CABLE
Analysts Bullish on Broadcast; Cable Cloudy
NAB Testing New Multicast Legal Theory
NAB to FCC: Investigate Satellite Radio's Free Access Practices
FCC Cites Stations But Renews Licenses
Cox Sermonizes on Franchise Reform

QUICKLY -- AT&T/BellSouth Opponents Talk Litigation; Pennsylvania's
Turn for Reform Bill; Parents and the Web: 'Complete dichotomy'

NEWS FROM CONGRESS

SENATE WON'T QUIZ TELECOMS ABOUT NSA SPYING
[SOURCE: C-Net|News.com, AUTHOR: Anne Broache]
Sen Arlen Specter (R-PA) said that after discussions with the Bush
administration and Senate Intelligence Committee colleagues who had
been more fully briefed on the National Security Agency program, he
was "prepared to defer on a temporary basis" requiring
representatives from AT&T, Verizon Communications and BellSouth to
testify before the Senate Judiciary Committee, which he leads. He had
promised to organize such a hearing after USA Today reported last
month that the nation's three leading telecom companies had opened up
their lines to the NSA. (Some of those companies have since denied
their participation.) He said Tuesday that the companies voiced
willingness to discuss the topic in a closed session but wouldn't be
able to reveal classified information, a stance he found
"insufficient and unacceptable." Sen Specter said he was willing to
suspend the inquiry largely because Vice President Dick Cheney had
provided assurances that the White House would be more receptive to
pending legislation -- including a proposal chiefly backed by Specter
himself -- that would send the existing NSA program and all future
surveillance plans to a special court for review of their
constitutionality. Sen Sen. Dianne Feinstein -- an Intelligence
Committee member who said she'd been briefed "very thoroughly" on the
program -- said she agreed with Chairman Specter's decision. "I
don't know what would be served by issuing a subpoena here," she
said. "It seems to me that the Intelligence Committee, having
reviewed that program, knows what questions to ask, and they cannot
be asked in open session." She did suggest, however, that the
Intelligence Committee bring in the telecom company representatives
for its own private round of questioning.
http://news.com.com/Senate+wont+quiz+telecoms+about+NSA+spying/2100-1028...
* Senators won't grill phone companies
http://www.usatoday.com/printedition/news/20060607/a_nsa07.art.htm

BROADCAST CONTENT GETS HAMMERED ON FLOOR
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The House began consideration of S.193, the Senate-passed bill upping
FCC indecency fines to $325,000 per violation. There was just 15
minutes of consideration of the bill before a vote was called and the
formality of passage is expected today. Rep Diane Watson (D-CA) rose
in opposition to the bill. She argued that the root cause of indecent
programming is media consolidation and a lack of competition, and
that the solution is less consolidation and more public-interest
requirements for media companies. Taking issue with the business of
broadcasting, she said that a "consolidated media market controlled
by a profit-driven conglomerate is bound to offer cheaply made,
shocking entertainment for the sake of increasing viewership and
making a spectacle of itself." She suggested the FCC consider the
connection between consolidation and content when it starts to review
ownership rules later this month, and put in a plug for reinstituting
the fairness doctrine.
http://www.broadcastingcable.com/article/CA6341598?display=Breaking+News
* House Moves to Boost Indecency Fines
http://www.dailycomet.com/apps/pbcs.dll/article?AID=/20060606/APE/606060727

GOOGLE FOUNDER LOBBIES FOR NET NEUTRALITY
[SOURCE: Reuters, AUTHOR: Joel Rothstein]
Google co-founder and President Sergey Brin met with lawmakers on
Tuesday to press for legislation that would prevent Internet access
providers from charging Web sites more for faster content delivery.
"The only way you can have a fast lane that is useful -- that people
will pay a premium for -- is if there are slow lanes," Brin told
reporters after meeting with Sen John McCain (R-AZ). Brin
acknowledged large companies such as Google would be able to cut
deals with the network owners to get their content through. But he
added that Google searches are only valuable if consumers can then
quickly access the sites listed in the results. "The thesis is that
some content providers will pay for premium service. Why are they
paying? Just because they feel charitable toward the telcos and
ISPs?" Brin asked. "I assume they are paying because otherwise they
would have worse performance, or maybe it won't really work."
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...
* Google Is a Tourist in D.C., Brin Finds
http://www.washingtonpost.com/wp-dyn/content/article/2006/06/06/AR200606...

MARKEY, DINGELL PLAN BUILD-OUT AMENDMENT
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Ranking minority members of the House Commerce Committee Ed Markey
(D-MA) and John Dingell (D-MI) have told their colleagues they plan
to introduce an amendment establishing build-out requirements in the
House video franchise reform bill, scheduled for a floor vote this
Friday, June 9. It will be up to the rules committee, however, to
determine what, if any amendments, can be added on the floor. The
committee meets Wednesday, June 7. Reps Diane Watson and Hilda
Solis, both of California, joined in on the letter to their House
colleagues informing them of the amendment to the COPE Act (HR 5252).
http://www.broadcastingcable.com/article/CA6341492?display=Breaking+News

BROADCASTING & CABLE

ANALYSTS BULLISH ON BROADCAST; CABLE CLOUDY
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Credit Suisse analysts Tuesday were bullish on the prospects for
broadcast deregulation and media stock performance in general. In a
summary of an investor update on FCC regulations Tuesday, the company
reported that it believed there would be liberalization of FCC
ownership rules. The Wall Street handicapper said that it expected
relief on newspaper/TV crossownership and duopoly restrictions, which
would benefit companies like Tribune. That trend, they said, should
"generally be positive for most media stocks over time." The picture
was not so positive for cable however: "We believe that regulatory
developments over the next two years will be mostly negative for the
cable companies." Concerning telecommunications, Credit Suisse
predicts the FCC will be "generally deregulatory."
http://www.broadcastingcable.com/article/CA6341485?display=Breaking+News

NAB TESTING NEW MULTICAST LEGAL THEORY
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
A federal mandate requiring digital-only broadcasting in 2009 is a
new and important governmental interest that justifies the need to
broaden the digital-TV-carriage obligations of cable operators, the
National Association of Broadcasters argued in a legal analysis
recently submitted to the Federal Communications Commission. The
NAB's reliance on the 2009 "hard date" bringing analog TV to an
abrupt halt represented a novel legal argument in the trade group's
eight-year quest to require cable operators to carry a requesting
digital-TV station's entire signal, whether that's one HD service or
6-12 multicast services. Today, cable is required to carry one
program service of each station that elects mandatory carriage. The
NAB's introduction of the hard date as new and important development
ordered by Congress could give the FCC the necessary legal support to
explain convincingly the need to impose multicast must carry after
refusing twice to do so. "Extending must-carry rules to multicasting
advances both of these clearly established interests [free TV and
access to multiple sources of information], as well as interest in
fair competition in the video-programming market," the NAB said. "In
addition, carriage rights for multistream broadcasting further the
more recent government interest in transitioning from analog to
digital delivery of programming."
http://www.multichannel.com/article/CA6341508.html?display=Breaking+News

NAB TO FCC: INVESTIGATE SATELLITE RADIO'S FREE ACCESS PRACTICES
[SOURCE: National Association of Broadcasters press release]
The National Association of Broadcasters has urged the Federal
Communications Commission to open an investigation examining the
issues raised by free access to satellite radio programming. In a
letter sent Monday to FCC Chairman Kevin Martin, NAB President and
CEO David K. Rehr said the unequal regulatory treatment between free
over-the-air and satellite radio "appears increasingly unjustifiable,
particularly in light of the availability of satellite radio content
to nonsubscribers." Nonsubscribers often receive satellite radio
service free for a number of months after purchasing a new car that
has a satellite radio receiver pre-installed. Other non-subscribers
are often subjected to satellite radio content free when renting a
car through many popular car rental services. Rehr, citing recent
news accounts in The Baltimore Sun and The Boston Globe, also noted
several instances where over-the-air radio listeners were inundated
with "indecent" satellite radio programming caused by interference
from satellite radio devices.
http://www.nab.org/newsroom/pressrel/releases/060606_DKR_Martin_SatRadio...

FCC CITES STATIONS BUT RENEWS LICENSES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The FCC Tuesday proposed $38,000 in fines against stations for
information-reporting violations and, in one case, numerous
violations of kids-TV ad limits. But it renewed their licenses
anyway, concluding the violations were not sufficiently serious to
warrant a license hearing. All the stations had volunteered the
violations as part of their license-renewal applications. The biggest
proposed fine, $18,000, was for commercial overages on WDKA Paducah,
Ky. The FCC limits commercial time in kids TV programs to 10.5
minutes per hour on weekends and 12 minutes per hour on weekdays.
http://www.broadcastingcable.com/article/CA6341591?display=Breaking+News

ESSER SERMONIZES ON FRANCHISE REFORM
[SOURCE: Multichannel News, AUTHOR: Karen Brown]
Cox Communications Inc. president Pat Esser turned his podium into a
pulpit at the Globalcomm telecom convention Tuesday, delivering a
stern sermon-like keynote accusing Bell competitors of trying to gain
a regulatory free pass into video to make up for their own delays in
developing those services.
http://www.multichannel.com/article/CA6341513.html?display=Breaking+News
* Cox president calls for level playing field
http://news.com.com/Cox+president+calls+for+level+playing+field/2100-103...

QUICKLY

AT&T/BELLSOUTH OPPONENTS TALK LITIGATION
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Opponents of the proposed merger of AT&T and BellSouth said that if
the FCC does not block or put strong conditions on the deal, "some
parties" will likely sue. In a conference call with reporters
discussing their filings with the FCC in opposition to the merger,
several of the groups argued that, unless the FCC requires AT&T to
spin-off wireless company Cingular after the merger and to divest
itself of wireless spectrum they argue has been warehoused, the "best
case" scenario from the merger would be an "entrenched DSL cable
monopoly for Internet access. That's because they said the merged
company would likely sit on spectrum that could be used for wireless
Internet access in competition to DSL. Merger opponents also
discussed the merger and net neutrality, red-lining and the
reconstruction of the AT&T monopoly.
http://www.broadcastingcable.com/article/CA6341363?display=Breaking+News
See also --
* Telecom companies fight BellSouth merger with AT&T
http://atlanta.bizjournals.com/atlanta/stories/2006/06/05/daily14.html
* Groups Oppose AT&T Deal
http://www.latimes.com/business/printedition/la-fi-phones7jun07,1,254367...

PENNSYLVANIA'S TURN FOR REFORM BILL
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
Pennsylvania legislators believe state franchise approval will speed
deployment and lower cable rates, so a bipartisan team is set to
introduce a reform bill. They will introduce a bill that will allow
new competitors to gain statewide franchise approval 15 days after
they file an application with the state Corporation Bureau. Incumbent
operators will be held to their current agreements until their
stipulated expiration date unless a municipality and provider reach a
mutual agreement to let the cable provider out of a current
franchise. New competitors may identify their own intended service
area. The only reference to a build-out in the draft requires new
providers to provide service, without discrimination based on a
consumer's income, in a "reasonable period of time."
http://www.multichannel.com/article/CA6341486.html?display=Breaking+News

PARENTS AND THE WEB: 'COMPETE DICHOTOMY'
[SOURCE: USAToday, AUTHOR: Janet Kornblum]
Most parents love the Internet and want their children to use it. But
a new survey finds that almost as many also fear the online world --
especially social networking sites such as MySpace -- and worry that
their kids will get in trouble with people they meet.
http://www.usatoday.com/printedition/life/20060607/bl_bottomstrip07.art.htm
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Communications-related Headlines is a free online news summary
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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
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Headlines are compiled by Kevin Taglang headlines( at )benton.org -- we
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