July 2006

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TELECOM REFORM
Barton Predicts Passage Of Narrow Telecom Bill
Should Net Companies Pay More for Speed?

DIGITAL TELEVISION
Limits proposed on digital TV converter coupons
TV Industry Unites On Viewer Education
FCC May Send MASN Nationals Issue to Judge

SPECTRUM
WiFi Eyes the Empty Airwaves

INTERNET/BROADBAND
Municipal Broadband is Making Progress
Hearing looks at Internet name privatization plan
The Gambling Is Virtual; the Money Is Real
Options Expand For High-Speed Internet
Videos on Web Widen the Lens On the Conflict

QUICKLY -- Media Ownership Proceeding Released; AOL founder says he
is 'sorry' for Time Warner merger; Does cell phone's impact outweigh
PC's?; Still Sexy at 60?; Net telephony quality worsening; CEA Slams
Studios; FTC wants beefed-up powers against Net scammers

TELECOM REFORM

BARTON PREDICTS PASSAGE OF NARROW TELECOM BILL
[SOURCE: Technology Daily 7/20, AUTHOR: Heather Greenfield]
House Energy and Commerce Chairman Joe Barton (R-TX) told technology
industry leaders that Congress can get a telecommunications bill
done, but he predicted that lawmakers will produce a narrow
bill. Pending Senate legislation is much broader than what the House
passed. It includes provisions to strengthen and revamp the universal
service program, which is aimed at ensuring that all Americans,
particularly those in rural areas, have access to affordable
telephone service. Speaking at the annual legislative strategy
meeting of the Electronic Industries Alliance, Barton said he
believes Senate Commerce Chairman Ted Stevens (R-Alaska) will muster
the votes needed for floor passage. "Stevens doesn't yet have the 60
votes" needed to limit debate on the legislation, Rep Barton said,
noting why the bill has yet to be passed. "When we get to conference,
we will have some differences because the House (version) is a
narrower bill," Rep Barton said. One key difference that would
require a compromise is universal service, which the House bill does
not address at all. Universal service "was a great idea 100 years
ago. It is not a good idea today," Rep Barton said. "I understand the
political necessity in the Senate. We'll have to have a meeting of
the minds on that." One area where both Barton and Stevens do agree
is network neutrality: They oppose it. Barton told reporters "net
regulation is dead." He said instead of making a law against
discrimination, the FCC will be asked to monitor discrimination
complaints. "That may not be perfect, but until we have more of a
track record, that seems to be more of a middle-ground approach," Rep
Barton said.
http://www.njtelecomupdate.com/lenya/telco/live/tb-OYUK1153768152185.html

SHOULD NET COMPANIES PAY MORE FOR SPEED?
[SOURCE: BusinessWeek, AUTHOR: Mark Gimein]
A Q&A with Thomas J. Tauke, Verizon's executive vice-president for
public affairs, is the company's point person in Washington. Here's
some of the language he employs: 1) "what we have been attempting to
do as a company is to turn the world upside-down." 2) "what is
happening is that we are the insurgents who are trying to come in and
change the marketplace, and there are other players out there, some
who may have different reputations for being innovative, who are
trying to hold on to what they have." 3) Our position on municipal
systems has been essentially this: We look at the track record and
don't think that the track record is very good. We think taxpayers
ought to be fairly concerned about governments investing in these
communications networks. We do think that systems should not be
subsidized by taxpayers over the long haul, that they ought to pay
for themselves, and they ought to play by some of the same rules that [we do]."
http://www.businessweek.com/magazine/content/06_31/b3995074.htm?chan=tc&...

TELEVISION

LIMITS PROPOSED ON DIGITAL TV CONVERTER COUPONS
[SOURCE: Reuters, AUTHOR: Jeremy Pelofsky]
An estimated 21 million U.S. households, those that rely solely on
over-the-air television broadcasts, would be eligible to get coupons
to buy digital converter boxes, according to a Commerce Department
agency proposal released on Monday. Coupons would not be offered to a
majority of U.S. households because they already have an alternative.
The Government Accountability Office estimates about 85 million
households watch television using cable or satellite services. U.S.
television stations are required to switch to airing only digital
broadcasts in February 2009. However, millions of Americans have yet
to buy new televisions that receive the higher-quality broadcast
signals. Congress last year passed a law that would provide an
initial $990 million, and as much as $1.5 billion, to help Americans
buy converter boxes that would keep their old, analog televisions
working when the digital transition is finished. NTIA sought public
comment on the proposal and other ideas such as whether to limit the
coupons to low-income households, like those families living below
the poverty level.
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...
See also --
* NTIA press release:
http://www.ntia.doc.gov/ntiahome/press/2006/dtvcoupon_072406.htm
* NTIA request for comments:
http://www.ntia.doc.gov/ntiahome/frnotices/2006/couponprogram_nprm_07202...
* FAQ: http://www.ntia.doc.gov/otiahome/dtv/FAQ_v6_07212006.htm
* Cable Households Won't Get Converter Subsidy
http://www.broadcastingcable.com/article/CA6355923.html?display=Breaking...
* Digital-TV Aid Proposed for 21 Million Households
http://www.latimes.com/business/printedition/la-fi-coupon25jul25,1,46374...

TV INDUSTRY UNITES ON VIEWER EDUCATION
[SOURCE: Washington Post, AUTHOR: Frank Ahrens]
All three major television distributors -- broadcast stations, cable
networks and satellite services -- have united for the first time in
a media campaign to educate parents on how to block objectionable
programming from their children, as cable and satellite outlets fear
that the government crackdown on broadcast indecency will spread to
them. The government's recent tenfold increase in fines for broadcast
indecency combined with the public's nearly nonexistent use of
blocking technology, such as the V-chip, has motivated the three
rivals to join forces in contributing airtime for a series of public
service announcements. Two TV spots -- each with a 15-second and a
30-second version -- are to debut Wednesday on local broadcast
stations and the top 100 cable channels, as seen on cable and
satellite systems, said Peggy Conlon, chief executive of the Ad
Council, which creates public service announcements for use on
donated airtime. The ads direct parents to a Web site,
http://www.thetvboss.org , which instructs viewers on the use of
blocking technology. The public service announcements, created by ad
giant McCann-Erickson, feature a parent talking to television
characters visiting the parent's home. "I like your show," the parent
says -- in one spot, to mobsters -- "but it's too graphic for my
children, so I'll have to block it." The man behind the campaign is
longtime motion picture industry lobbyist Jack Valenti, who met with
Sens. Ted Stevens (R-Alaska) and Daniel K. Inouye (D-Hawaii) in
November when the two leaders of the Senate Commerce Committee
convened a working group of industry, government and advocacy
representatives on the topic of indecency. The senators asked the
entertainment industry for a plan to counter the rising coarseness of
television broadcasts. The alternative was a further crackdown on
indecency and the possibility of legislation requiring cable and
satellite operators -- such as Comcast Corp. and the DirecTV Group --
to change the way they sell channels.
http://www.washingtonpost.com/wp-dyn/content/article/2006/07/24/AR200607...
(requires registration)

FCC MAY SEND MASN NATIONALS ISSUE TO JUDGE
[SOURCE: Washington Post, AUTHOR: Arshad Mohammed]
After more than a year of inaction, Federal Communications Commission
Chairman Kevin J. Martin yesterday addressed a dispute that has kept
Washington Nationals games off the region's biggest cable network.
The Mid-Atlantic Sports Network (MASN), which carries most of the
team's games, asked the FCC in June 2005 to order Comcast Corp. to
begin carrying the games immediately, but the agency took no action.
Yesterday, Chairman Martin proposed sending MASN's complaint to an
administrative law judge, who would have 45 days to recommend a
resolution of the dispute, according to sources familiar with the
matter. The proposal needs approval by a majority of the FCC's five
commissioners, who could vote on it at any time. It was not clear why
Martin acted on the complaint more than a year after MASN approached
the agency.
http://www.washingtonpost.com/wp-dyn/content/article/2006/07/24/AR200607...
(requires registration)

SPECTRUM

WIFI EYES THE EMPTY AIRWAVES
[SOURCE: BusinessWeek, AUTHOR: Mark Gimein]
The white space -- unused spectrum between TV channels -- could be
key to new wireless services, but big telcos say it's a threat. Ever
since the government licensed the first radio stations, we've been
accustomed to thinking of the airwaves as a scarce resource. Once
handed out to the politically well-connected, in more recent years it
has been auctioned off to services such as wireless phones for many
billions of dollars. Now Michael Calabrese, a vice-president at the
New America Foundation, a Washington think tank, has advanced a new
plan to use some of the wireless spectrum. It qualifies as one of the
most promising and innovative ideas in communications. The idea: to
open up "white space" -- unused frequencies between TV channels --
for unlicensed use to anybody who wants to put up a transmitter. When
he first proposed it in 2001, Calabrese says it seemed like a
quixotic plan. That's no longer so. The Federal Communications
Commission is interested enough in the proposal that it has gone to
the stage of soliciting public comments. And technology companies are
very much behind it. Broadcasters have opposed the new plan, waging
what Calabrese calls a "scorched earth" campaign against it. They
claim their main concern is interference with TV signals. But
regulators have been trying to pry some of their spectrum away from
broadcasters for years, and there might be a lot more at work than
just concerns about interference. In earlier decades, having a
broadcast license meant having a right to deliver one kind of service
-- radio or TV, for instance. But now lots of new data services can
use just about any frequency. Letting new services into the space
between TV channels reduces broadcasters' hopes that eventually they
would just get to keep their big swaths of spectrum and might be
allowed use them to offer new services without having to spend
billions to buy spectrum at auction.
http://www.businessweek.com/magazine/content/06_31/b3995073.htm?chan=tc&...

INTERNET/BROADBAND

MUNICIPAL BROADBAND IS MAKING PROGRESS
[SOURCE: Telecommunications Online, AUTHOR: Sean Buckley]
The municipal broadband network industry continues to incite great
debate and interest. And while the providers may not be household
names, the municipal broadband market is not something the large
carriers should readily dismiss as a passing fad. Despite continued
legal challenges by the large operators that argue that municipal
utilities should not be allowed to utilize taxpayer dollars to build
such networks, the municipal broadband trend is not going away
anytime soon. According to a new report by Pike & Fischer, cable,
telcos and other incumbent broadband service providers could
eventually see a 48 percent decline in their revenue as a result of
competition from city-run broadband networks. "The competitive
impacts of municipal broadband will be especially threatening to
incumbents to the extent that muni nets can be cost- justified by
increased efficiencies, cost savings and other 'internal' or social
benefits captured by local governments, schools, and other public
institutions," the report states. And while Pike & Fischer admits
that the true impact that municipal networks will have on the
incumbent network operators will "remain largely speculative, there
is a real possibility that even a modest realization of [their
potential] could add significantly to Wall Street concerns regarding
the financial prospects" of those providers.
http://telecommagazine.com/newsglobe/article.asp?HH_ID=AR_2244

HEARING LOOKS AT INTERNET NAME PRIVATIZATION PLAN
[SOURCE: Reuters, AUTHOR: Joel Rothstein]
The U.S. Commerce Department will hold a Wednesday hearing on the
government's September deadline to give up control over Internet
domain names, a schedule that some high-tech industry advocates say
should be delayed. The U.S. government controls the naming system for
".com" and all web addresses through the Internet Corporation for
Assigned Names and Numbers (ICANN), a California-based not-for-profit
company that decides what names can and cannot be registered.Some
foreign governments and critics have been concerned that the U.S.
government has too much control over what has become a global
commerce, communications and social engine. The transition is
currently slated to take place by September 30, but the U.S. Commerce
Department has the option to extend its control. The Commerce
Department scheduled the Wednesday hearing to consider "the progress
of this transition" to the private sector, according to a department statement.
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...
* Public Meeting and Webcast Info Page
http://www.ntia.doc.gov/forums/2006/726dns/index.htm

THE GAMBLING IS VIRTUAL; THE MONEY IS REAL
[SOURCE: New York Times, AUTHOR: Matt Richtel & Heather Timmons]
Can the United States handcuff online wagering? Few experts expect
the crackdown on Internet gambling to do anything more than dent the
industry. Sebastian Sinclair, an analyst with Christiansen Capital
Advisors, which tracks online gambling trends, said offshore gambling
could be "curtailed but it cannot be stopped." Other experts see the
recent moves as little more than an elaborate cat-and-mouse game
serving only to benefit Las Vegas and Atlantic City casinos, along
with Indian gambling operations, rather than seriously protecting
Americans from falling prey to excessive gambling. Some eight million
Americans wager $6 billion annually through the Internet. About half
of all online wagers come from the United States. Critics say that
online gambling is the equivalent of putting a slot machine in every
home, providing an easy chance to lose money with a few mouse clicks,
all without the social controls at a bricks-and-mortar casino.
http://www.nytimes.com/2006/07/25/business/25gamble.html
(requires registration)

OPTIONS EXPAND FOR HIGH-SPEED INTERNET
[SOURCE: Wall Street Journal, AUTHOR: Shawn Young shawn.young( at )wsj.com
and Dionne Searcey dionne.searcey( at )wsj.com]
The race between phone and cable companies to offer faster Internet
service is giving consumers a wider variety of options. Cable
companies until recently had the upper hand in delivering faster
connections, leaving phone companies to compete in the broadband
business by offering lower prices. But as companies such as AT&T and
Verizon have upgraded their networks, they've made speeds available
to consumers that they previously sold mainly to business customers.
Cable companies have had to pick up their own speeds to stay ahead.
Some operators are offering as many as 50 megabits, or 50 million
bits, per second. AT&T, whose fastest speed was 1.5 megabits per
second three years ago, raised it to three megabits in 2004 and six
megabits in April. Comcast, the country's largest cable operator with
more than 21 million subscribers, has increased speeds four times in
the past three years and now offers most customers six megabits.
Broadband speeds are picking up especially in regions with fierce
competition. In parts of the New York area, where Verizon and
Cablevision Systems Corp. are in a head-to-head battle, Verizon last
week cranked up its fastest connections to 50 megabits per second.
The move came just weeks after Cablevision gave its customers in the
region a free bump to 15 megabits from 10 megabits and also came out
with a 30-megabit offer. But the higher speeds typically cost extra.
Verizon's charges for its 50-megabit service range from $90 in New
York to $140 a month in New Jersey and Connecticut. Cablevision
charges $40 to $60 for its 30-megabit service and close to $200 for a
50-megabit service, which it doesn't heavily advertise. Most major
cable companies' standard Internet packages have download speeds of
up to seven megabits per second for about $42 a month. Telephone
companies, which offer "digital subscriber line," or DSL service,
typically offer speeds of 1.5 to six megabits for $20 to $30 a month.
Some slower DSL service sells for as little as $13 a month, with AT&T
currently offering a 384 kilobit to 1.5 megabit connection for that
price. BellSouth Corp. offers four speed options ranging from $25 for
a 256 kilobit link to $47 for up to six megabits.
http://online.wsj.com/article/SB115378836438616021.html?mod=todays_us_pe...
(requires subscription)

VIDEOS ON WEB WIDEN THE LENS ON CONFLICT
[SOURCE: Washington Post, AUTHOR: Sara Kehaulani Goo]
Here's how the Israel-Hezbollah conflict is playing out on the
Internet's latest window into the human experience, YouTube.com:
Videos of young girls driving around smoking and joking about
Hezbollah, next to shaky footage of grieving men toting dead bodies
through rubble. Internet video sites such as YouTube became a hit
this year, as people shared their funny homemade movies with the
world. Now the site serves as an unfiltered look at a wide spectrum
of experience as rockets and bombs are falling on Israel and Lebanon.
http://www.washingtonpost.com/wp-dyn/content/article/2006/07/24/AR200607...
(requires registration)

QUICKLY

MEDIA OWNERSHIP PROCEEDING RELEASED
[SOURCE: Federal Communications Commission]
The FCC released the Further Notice of Proposed Rulemaking on media
ownership. Comments are due Friday September 22 and reply comments
are due Tuesday November 21.
http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-06-93A1.doc

AOL FOUNDER SAYS HE IS 'SORRY' FOR TIME WARNER MERGER
[SOURCE: Reuters]
Steve Case, co-founder of the one-time biggest online service AOL,
apologized for the company's merger with media conglomerate Time
Warner. The deal, known as one of the worst corporate mergers in
history, destroyed some $200 billion in shareholder value. Last
October, Case argued in a Washington Post article that AOL should be
split from Time Warner, echoing sentiments shared by billionaire
investor Carl Icahn, who earlier this year sought to break up the
world's largest media company to boost shareholder value. Although
Case called the deal's aftermath a "disappointment," he said he still
believed it was "a good idea."
http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID...

DOES CELL PHONE'S IMPACT OUTWEIGH PC's?
[SOURCE: C-Net|News.com, AUTHOR: Stefanie Olsen]
Which technology has had the most impact in the last 25 years? The
cell phone, according to well-known IBM software developer and
blogger Sam Ruby. Though his represents just one opinion, Ruby made a
strong case for why the cell phone outstrips the PC in terms of
effect on the world. "It's killing the landline; it's killing
watches; it's changing the camera business; it's changing the TV
industry, the music industry," Ruby said Monday at the New Paradigms
for Using Computers (NPUC) 2006 workshop at the IBM Almaden Research
Center here. "It's destroying the pay-phone industry. It's hurting
the hotel industry and putting the squeeze on universities," he said
during a talk titled "Teenagers on the Go." To highlight the future
stability of the device, he added, "Teenagers love the cell phone."
http://news.com.com/Does+cell+phones+impact+outweigh+PCs/2100-1041_3-609...

STILL SEXY AT 60?
[SOURCE: Wall Street Journal, AUTHOR: Kelly Greene kelly.greene( at )wsj.com]
A growing number of new ventures are targeting aging baby boomers,
their obsessions in the final third of their lives -- and their $2
trillion in annual spending power. Start-up magazines with titles
like GeezerJock, Grand and What's Next are beckoning to boomers with
advice on triathlons, grandchildren or new careers. Advertisers of
everything from autos to electronics have traditionally preferred to
link their brand images with younger consumers, and they reveled in
baby boomers as children and teens in decades past. Now, with the
oldest boomers turning 60 this year, the new ventures raise the
inevitable question: Will marketers have any use for them when they're 64?
http://online.wsj.com/article/SB115379490208516195.html?mod=todays_us_ma...
(requires subscription)

STUDY: NET TELEPHONY QUALITY WORSENING
[SOURCE: C-Net|News.com, AUTHOR: Marguerite Reardon]
While it's no secret that Net phone services don't offer the same
call quality as traditional phones, a new study suggests that the
quality of voice over Internet Protocol is actually getting
worse. Brix Networks, a company that develops monitoring tools for
service providers, analyzed data it gathered from a free Web site it
created two years ago called TestYourVoip.com. The site allows
consumers to test the quality of their VoIP services. In its study,
published Monday, the company discovered that call quality has
declined by about 5 percent in the past 18 months. With almost 1
million VoIP connections tested through its Web site, Brix said that
about 20 percent of all calls had unacceptable quality. This is up
from about 15 percent of calls made about a year ago.
http://news.com.com/Study+Net+telephony+quality+worsening/2100-7352_3-60...

CEA SLAMS STUDIOS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Branding as "totalitarian" the efforts of content producers to block
Google's use of thumbnail pictures as copyright infringement the
Consumer Electronics Association filed a court brief Friday defending
Google. "The content community's trampling of consumer rights has
never been more open and brazen," said CEA President Gary Shapiro.
"The content industry is in a non-stop battle to stop new technology,
limit existing products and frustrate consumers." CEA also filed a
brief last week defending XM Satellite radio's use of an iPod-like
device that allows users to save songs and create their own playlist,
though it prevents any redistibution of that playlist.
http://www.broadcastingcable.com/article/CA6355630?display=Breaking+News

FTC WANTS BEEFED-UP POWERS AGAINST NET SCAMMERS
[SOURCE: C-Net|News.com, AUTHOR: Anne Broache]
Past and present Federal Trade Commission officials on Monday renewed
their call for Congress to expand the agency's international Internet
policing powers and its ability to slap fines on wrongdoers --
spammers, spyware companies and phishers. The federal regulators'
push for authority on the international front is nothing new. In
2003, the FTC lobbied Congress for powers that would, among other
things, allow them to serve secret requests for subscriber
information on Internet service providers, peruse FBI criminal
databases, and swap sensitive information with foreign law
enforcement agencies.
http://news.com.com/FTC+wants+beefed-up+powers+against+Net+scammers/2100...
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