September 2006

INTERNET/BROADBAND
Net Neutrality Fans rally in 25 Cities
Citizen Media Beats Big Media, YouTube Blows The Whistle
Vietnam Web Controls Remain as Dissident Released

SPECTRUM
FCC Prepares For Another Big Spectrum Auction

CONTENT
Viewers ask FCC to Impose Fines over President's Swearing
Some Stations To Delay 9/11 Documentary
Anger Over Language at Emmys
Media money will flow to content managers
Advertisers Flock to 'Untrustworthy' Media
Coming To Video Games: Live Ads

TELECOM
IRS Sets Guidelines on Refunds For Discontinued Telephone Tax

QUICKLY -- Media Advocates See Journalist's Sentence as Warning From
China; Murdoch Seeks EchoStar Injunction; Hi Def Nets to Dominate;
Tribune takes control of amNewYork; Baseball Gone Batty

INTERNET/BROADBAND

NET NEUTRALITY FANS RALLY IN 25 CITIES
[SOURCE: C-Net|News.com, AUTHOR: Anne Broache]
With Congress still dispersed for its August recess, advocates of Net
neutrality laws this week took to knocking on office doors of U.S.
senators in 25 cities across the nation. From Seattle to Denver to
Montpelier, Vt., small groups of citizens, small businesses,
nonprofits and individuals allied with the "Save the Internet"
coalition staged rallies on Wednesday and Thursday. Hoisting orange
signs touting their cause, they presented senators' offices with
petitions signed by thousands who support legislation mandating the
divisive concept, defined as a broad prohibition against prioritizing
Internet content and services. The activities were designed to ramp
up momentum for the Internet Freedom Preservation Act, sponsored by
Sen. Byron Dorgan (D-ND) and Sen. Olympia Snowe (R-Maine). The
proposal was narrowly defeated by an 11-11 vote in the Senate
Commerce Committee earlier this summer when it was proposed as an
amendment to a mammoth communications bill. The House of
Representatives in June rejected a similar measure by a wider margin.
The Snowe-Dorgan plan is expected to surface again when the sweeping
Senate communications bill, chiefly sponsored by Sen Ted Stevens
(R-Alaska), goes to a vote in the full Senate, although it's unclear
how soon that formal debate will resume. The politicians, who return
on Sept. 5, already have a heavy agenda and are expected to recess
again by early October so some can return to campaigning on their
home turf for the upcoming elections. According to a running tally
taken by the Save the Internet coalition, 26 senators have publicly
voiced their support for the Snowe-Dorgan approach. Only one of them,
Sen Snowe herself, is a Republican. Sen. Jeffords, an Independent
from Vermont, emerged in favor this week as well. Four of the
senators siding with the Net neutrality lobby publicly declared their
stance just this week, in the midst of the coast-to-coast rallies.
(Four more are still waffling; 14 are opposed; and 56 have not yet
made their positions public, by the coalition's count.)
http://news.com.com/Net+neutrality+fans+rally+in+25+cities/2100-1028_3-6...
* National Outpouring of Support for Net Neutrality
http://www.savetheinternet.com/blog/2006/08/31/national-outpouring-of-su...

CITIZEN MEDIA BEATS BIG MEDIA, YOUTUBE BLOWS THE WHISTLE
[SOURCE: MediaDailyNews, AUTHOR: Tom Siebert]
The whistle-blower who aired allegations on YouTube that Lockheed
Martin sold the U.S. Coast Guard $24 billion worth of refurbished
Coast Guard patrol boats with significant security flaws and other
deficiencies says it was a decision of "last resort." He turned to
YouTube when the mainstream media dismissed his claims as
"outlandish." "I contacted every single mass media outlet on
television and probably 75 separate reporters at different
newspapers," says Michael De Kort, the 41-year-old former engineer
for Lockheed Martin. De Kort was laid off by the military contractor
days after he posted his 10-minute video on August 3, soberly
detailing shortcomings in the boats' security cameras, communications
abilities, and cold weather capabilities. "They wouldn't do the
story." Following De Kort's YouTube airing, however, his allegations
were subsequently reported in the Navy Times, and then picked up by
The Washington Post, NPR and other news organizations. The video has
become the latest example of new media driving the old, cited by ABC
News as "further evidence that the Internet has given the average
person a way to be heard."
http://publications.mediapost.com/index.cfm?fuseaction=Articles.san&s=47...

VIETNAM WEB CONTROLS REMAIN AS DISSENT RELEASED
[SOURCE: Reuters, AUTHOR: Grant McCool]
Vietnam, which released a prominent jailed cyber-dissident this week,
imposes tight legal and technical measures to control access to
writings and people who challenge one-party rule, researchers and
observers say. The Communist government says it monitors Web sites
and Internet cafes to block pornographic content. But a report
published in early August by a western academic group, OpenNet
Initiative, said its researchers easily gained access to
sexually-explicit sites in Vietnamese. "The state filters a
significant fraction -- in some cases, the great majority -- of sites
with politically or religiously sensitive material that could
undermine Vietnam's one-party system," said the group, a partnership
of centers at the University of Toronto, Harvard, Cambridge and Oxford.
http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID...

SPECTRUM

FCC PREPARES FOR ANOTHER BIG SPECTRUM AUCTION
[SOURCE: TelecomDirect News]
Currently in the midst of an advanced wireless services (AWS)
spectrum auction whose bids have already approached $13.6 billion,
the Federal Communications Commission is now gearing up for a 2007
contest on radio frequencies collectively known the 1.4 GHz bands for
both fixed and mobile services. The FCC's Wireless Telecommunications
Bureau said Auction No. 69 slated for Feb. 7, 2007 would involve a
total of 64 licenses in the paired 1392-1395 MHz and 1432-1435 MHz
bands, and in the unpaired 1390-1392 MHz band. The commission appears
relatively open on the permissible services that will be allowed to
winning licensees, suggesting that any combination of fixed and
mobile applications could include local loop Internet access, high
speed data transmission only, advanced two-way mobile and/or paging
services. The auction is now at the stage of the FCC seeking comments
and replies by Sept. 11 and Sept. 18, respectively, on rules,
regulations and procedures. This involves official bureau proposals
for upfront payments, bidding eligibility, minimum acceptable and
opening bid amounts, reserve prices, simultaneous multiple rounds,
package bidding, rule waivers, conditions that can stop bidding,
provisionally winning bids, the removal/withdrawal process, defaults,
post auction matters and numerous other criteria.
http://www.telecomdirectnews.com/do.php/130/19618?199

CONTENT

VIEWERS ASK FCC TO IMPOSE FINES OVER PRESIDENT'S SWEARING
[SOURCE: MarketWatch, AUTHOR: Siobhan Hughes]
The Federal Communications Commission has been asked by about two
dozen people to impose financial penalties in connection with
television and radio broadcasts in which President Bush was heard
swearing at the G-8 summit in July. President Bush apparently thought
a microphone was off last month while he was speaking with Prime
Minister Tony Blair. While discussing political tensions between
Israel and Hezbollah, Bush used the word s***. His comments came just
four months after federal regulators said that the word was one of
the most vulgar, graphic and explicit words relating to excretory
activity in the English language and would likely trigger fines if
broadcast. Many listeners were offended after hearing Bush's remarks
on channels such as CNN, a cable network whose programs aren't
subject to Federal Communications Commission fines. But at least one
person complained that the word was aired on an NBC affiliate - a
station that is subject to FCC penalties since its programs air over
spectrum licensed from the government. If the FCC pursues an
investigation, the Republicans who dominate the agency will be in the
awkward position of focusing on improper language used by President
Bush, who nominated them. If the FCC declines, it will leave itself
open to charges of playing politics and to complaints from
broadcasters who will have more reason to claim that the FCC's
indecency standards are inconsistent.
http://www.marketwatch.com/News/Story/Story.aspx?dist=newsfinder&siteid=...

SOME STATIONS TO DELAY 9/11 DOCUMENTARY
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Some CBS affiliated television stations may delay broadcast of the
documentary 9/11 until after 10pm over concerns about profanities
uttered in the program. The documentary, which has aired uncut twice
before, includes profanities uttered in the heat of the Sept. 11
disaster. CBS has said it expects to have no problems with the FCC,
which has been cracking down on profanity, but apparently some
stations aren't so sure. Indecent content is protected from 10 p.m.
to 6 a.m. when children are less likely to be viewing.
http://www.broadcastingcable.com/article/CA6367905.html

ANGER OVER LANGUAGE AT EMMYS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The Parents Television Council Thursday filed a complaint with the
FCC over NBC's Emmy broadcast. In that broadcast, Actress Helen
Mirren used a descriptive Britishism for taking a tumble. Calista
Flockhart, who came on after Mirren, echoed the phrase in banter with
her co-presenter. NBC delays live awards shows, but chose not to
bleep the language. "During the 9:30 pm CT/MT hour on August 27,
2006, the phrase "t*ts over a*s" was spoken by both Ms. Mirren and
Ms. Flockhart and both times aired unedited during the NBC Network
broadcast of the Emmys" said PTC. "It is utterly irresponsible and
atrocious for NBC to air this vulgar language during the safe harbor
time when millions of children were in the viewing audience," said
PTC President Brent Bozell.
http://www.broadcastingcable.com/article/CA6367890.html?display=Breaking...
* NBC Criticized for Language
http://www.latimes.com/business/printedition/la-fi-nbc1sep01,1,4546426.s...

MEDIA MONEY WILL FLOW TO CONTENT MANAGERS
[SOURCE: Financial Times, AUTHOR: Graham Elton and Harris Morris]
[Commentary] During the past two decades, broadcasters, station
groups, cable television operators and other distributors garnered
most of the profits in media because they controlled access to the
consumer. Now, thanks to an explosion of content and new delivery
platforms, control has shifted to consumers of media. As a result,
the money made by managing content will grow faster than profits in
any other part of the media value chain. Profits from content
management, boosted by the "aggregation" of content and communities
by popular Internet portals and cable network brands, are rising
about 12 per cent a year. That is roughly twice the rate of growth in
profits from distribution. Traditional industry players are spending
billions on content management. But it will take more than the right
investments to win these sweepstakes. To succeed as content managers,
media companies need to know more about their customers than the
customers know about themselves. They must anticipate customers'
changing preferences and rapidly turn those insights into new
offerings. Skillful content management requires making the right
calls about what content gets targeted at which audiences, which
platforms to use in transmitting that content and how best to support
it through advertising, subscriptions or a combination of the two.
What will it take to win? First, media companies need to be
disciplined about where not to invest. Second, media companies should
identify which audiences to pursue first and develop strategies to
"own" those segments wherever the audience tunes in. Third, companies
need to determine where they have significant gaps. Finally,
companies must build a strong consumer focus. The key is capturing
the right customer information and quickly incorporating these
insights into product development and content management.
http://www.ft.com/cms/s/833fded2-3916-11db-a21d-0000779e2340.html
(requires subscription)

SURVEY: ADVERTISERS FLOCK TO 'UNTRUSTWORTHY' MEDIA
[SOURCE: Brandweek, AUTHOR: Todd Wasserman]
Though more marketers plan to advertise on blogs and public forums
next year, only a small amount of consumers consider those formats to
be trustworthy, according to a new report from Jupiter Research. Only
21 percent of consumers trust product information within such social
media when mulling a product purchase. Consumers are twice as likely
to trust information on a corporate Web site or on a professional
review site. Nevertheless, the survey, which was released Aug. 29 by
the New York-based Jupiter, found about 20% of advertisers surveyed
planned to use viral marketing next year, mostly for branding purposes.
http://www.mediaweek.com/mw/news/recent_display.jsp?vnu_content_id=10030...

COMING TO VIDEO GAMES: LIVE ADS
[SOURCE: Washington Post, AUTHOR: Mike Musgrove]
Game publisher Electronic Arts Inc. announced yesterday that it has
inked deals with two ad companies that will stream live advertising
into its games. Players of the latest version of EA's Need for Speed
see the same billboard ads on the side of the virtual roads whenever
they play the street-racing game. But with live ads streamed via the
Internet in the next version of the game, players could see different
ads every time they turn the game on. Some players find such
advertising objectionable -- after all, many games for the Xbox 360
cost $60 apiece. But many game fans say they like the ads because
they contribute to the illusion of a realistic urban or sports-arena
environment. Generally, publishers have avoided putting advertising
in fantasy titles or other types of games where a billboard
advertisement would seem out of place.
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/31/AR200608...
(requires registration)

TELECOM

IRS SETS GUIDELINES ON REFUNDS FOR DISCONTINUED TELEPHONE TAX
[SOURCE: Wall Street Journal, AUTHOR: Robert Guy Matthews
robertguy.matthews( at )wsj.com]
The Internal Revenue Service said it will refund taxpayers up to $60
next year to reimburse them for the now-defunct long-distance
telephone tax, a move expected to cost the government about $10
billion. Taxpayers need no proof they paid the tax and can claim a
refund on their 2006 federal income-tax returns. Refunds will be
subtracted from the bills of taxpayers who wind up owing the
government or added to the refunds for those who overpaid their
taxes. Businesses, which have paid a total of $3 billion in
long-distance taxes since February 2003 -- the date back to which the
refunds are being set -- must document the charges to collect refunds
but aren't subject to the $60 maximum. Individuals who think they are
being shortchanged can figure out the amount owed on their own and
can collect what they document above $60. But it could be a tedious
and expensive process for people who don't keep their bills going
back to Feb. 28, 2003, the earliest date eligible for the refund.
Phone companies have said that they will charge customers to search
the data, if they have it at all.
http://online.wsj.com/article/SB115707012957651270.html?mod=todays_us_pa...
(requires subscription)
* Call It the Teddy Roosevelt Refund
http://www.washingtonpost.com/wp-dyn/content/article/2006/08/31/AR200608...
* IRS Sets Up Phone-Tax Refund
http://www.latimes.com/business/printedition/la-fi-phonetax1sep01,1,4824...

QUICKLY

MEDIA ADVOCATES SEE JOURNALIST'S SENTENCE AS WARNING FROM CHINA
[SOURCE: Los Angeles Times, AUTHOR: Ching-Ching Ni]
The sentencing of a Hong Kong reporter Thursday to five years in
prison on espionage charges sends a chilling message to the
journalism community in China to not cross the party line, analysts
watching the case said. The case brought widespread outcry from
international advocates of press freedom. They fear a further
tightening of media control in China that might intimidate foreign as
well as domestic journalists. China is believed to have put more
journalists behind bars than any other country, often under vague
charges of violating national security laws.
http://www.latimes.com/news/printedition/asection/la-fg-reporter1sep01,1...
(requires registration)

MURDOCH SEEKS ECHOSTAR INJUNCTION
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
Rupert Murdoch's Fox Broadcasting on Thursday asked a federal judge
in Florida to block EchoStar from offering ABC, CBS, NBC and Fox
programming to hundreds of thousands of viewers around the country.
If Fox's legal move pays off, EchoStar subscribers that lose access
might decide to turn to DirecTV for their network programming.
Murdoch's News Corp. owns a controlling stake in DirecTV. At issue is
the delivery of "distant network" programming. Satellite carriers are
allowed to beam the Big Four signals from New York and sell them to
customers around the country, but those consumers are ineligible if
they can pick up their local affiliates with an antenna. A federal
appeals court found that EchoStar sold the programming to hundreds of
thousands of ineligible subscribers, ordering a lower court to issue
an injunction that would ban EchoStar from providing distant network
signals to anyone, even legally eligible customers.
http://www.multichannel.com/article/CA6367824.html?display=Breaking+News

RESEARCH: HI DEF NETS TO DOMINATE TV LANDSCAPE IN FUTURE
[SOURCE: MediaWeek, AUTHOR: Anthony Crupi]
A new study from Kagan Research is forecasting that high-definition
cable networks will generate revenues of up to $1.9 billion by 2010,
as capacity constraints are overcome and the number of HD subscribers
increases. According to Kagan estimates, HD penetration of total U.S.
TV households is expected to reach nearly 30 percent by the end of
this year, rocketing to 81 percent, or 180 million units, by 2010. As
the number of deployed HD sets grows, so will the dollars generated
by hi-def network sub fees and ad sales.
http://www.mediaweek.com/mw/news/recent_display.jsp?vnu_content_id=10030...

TRIBUNE TAKES CONTROL OF FREE DAILY amNEWYORK
[SOURCE: Reuters]
Tribune Co. said on Thursday it has acquired full control of
amNewYork after buying a minority interest from the free daily
newspaper's management group led by co-founder Russel Pergament.
Tribune -- which also owns the Los Angeles Times, Chicago Tribune and
other papers and Web sites -- did not disclose financial terms. A
company spokesman declined to say what percentage Tribune previously
owned, but said it was more than 50 percent. AmNewYork competes with
Metro, a free daily offered by Luxembourg- and Britain-based Metro
International. Metro International also publishes U.S. editions in
Boston and Philadelphia.
http://today.reuters.com/news/articlenews.aspx?type=industryNews&storyID...

BASEBALL GONE BATTY
[SOURCE: Los Angeles Times, AUTHOR: Chris Gaither]
A minor league team lets fans help manage as part of a Web reality
show. Some say the interactivity runs afoul of the sport's tradition.
The Tribune-owned Chicago Cubs are mulling going with a 'Web of
coaches' next year if the experiment turns a profit.
http://www.latimes.com/news/printedition/front/la-fi-baseball1sep01,1,61...
(requires registration)
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...and we are outta here/ Have a great weekend. See you Tuesday Sept 5.
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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.
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