May 2007

MEDIA OWNERSHIP
FCC Hears Comments On Media Ownership
Convergence or Consolidation?
Extra! Tribune Sale Involves Tax Dodge.
FCC Completes Review of AWS License Applications
Google Calls Viacom Suit on YouTube Unfounded
U.S. puts China, Russia on copyright piracy watch list
Egan-Jones opposes bid for Clear Channel

JOURNALISM
Newspaper Circulation in Steep Slide Across Nation

CABLE
Why Cable Should Want Net Neutrality
Franchise Bills Dominate State Debates
Florida Senate Passes Franchise Bill

TELECOM
Verizon Fights to Keep Its Landline Customers

QUICKLY -- FCC Proposes $41,000 In Station Fines;=20
EarthLink studying muni Wi-Fi business; Supreme=20
Court hands tech firms patent victories

MEDIA OWNERSHIP

FCC HEARS COMMENTS ON MEDIA OWNERSHIP
[SOURCE: Tampa Tribune, AUTHOR: Richard Mullins rmullins( at )tampatrib.com]
All five commissioners of the Federal=20
Communications Commission hosted a public hearing=20
in Tampa to take comments about potential changes=20
to media ownership rules. The proposals would=20
limit how many TV stations, radio stations or=20
newspapers one company can own in a market. Many=20
people said media outlets already are too=20
consolidated among a few companies. About 300=20
people attended the hearing at the Tampa Bay=20
Performing Arts Center, the fourth of six the FCC=20
plans to hold across the country. Past venues=20
included El Segundo, Calif., and Nashville, Tenn.=20
Two panels of speakers included representatives=20
from large and small media companies, media=20
professors and journalists. "Anyone with a=20
computer can now compete to serve the local=20
audience," said Bill Carey, general manager of=20
WFTS-TV and incoming president of the Florida=20
Association of Broadcasters, who advocated for=20
looser rules that would allow companies to own=20
more outlets. Those new outlets are serious=20
competitors for news, Carey said, and illustrate=20
how traditional media companies need more=20
flexible rules for how they operate. Several=20
media representatives advocated for=20
cross-ownership of news outlets - such as=20
newspaper and television joint projects - arguing=20
that combined resources allow them to distribute=20
stories to whatever platform is most timely or=20
appropriate. [Piece includes short Q&A with FCC Chairman Kevin Martin
http://news.tbo.com/news/metro/MGBE5YDS51F.html
* Tampa Speaks Out for Local Media, Against Consolidation
http://www.freepress.net/press/release.php?id=3D232
* FCC holds Tampa hearings
Radio director attends hearing because he=92s=20
concerned about the lack of competition in the Tampa Bay market.
http://www.wtsp.com/news/local/article.aspx?storyid=3D53849
* Late coverage from St. Petersburg Times TV/media critic Eric Deggans
http://blogs.tampabay.com/media/2007/04/fcc_comments_th.html
-- From the FCC --
* Chairman Martin: "The Commission has three core=20
goals that our rules are intended to=20
further: competition, diversity and localism. I=20
recognize many of the concerns expressed about=20
increased consolidation and preservation of=20
diversity. Also critical to our review is=20
exploring and understanding the competitive=20
realities of the media marketplace. Some of our=20
rules have not been updated for years and may no=20
longer reflect the current marketplace."
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272745A1.doc
* Commissioner Copps: "We don't need to play just=20
defense - we can start playing offense. We can=20
not only defeat bad new rules - although we must=20
still do that. But now we are in a position to=20
revisit the bad old rules that got us into this=20
mess in the first place. And we can go on from=20
there to restore meaningful public interest=20
responsibilities to our broadcast media. For=20
starters, let's go back to an honest-too-goodness=20
licensing system that doesn't grant slam-dunk=20
renewals, but stops to ask if a license-holder is=20
really doing its job to serve the common good....=20
Let's also put what stations are doing to=20
actually meet their public interest obligations=20
up on the Web, so citizens can know how their=20
airwaves are being used. And let's make sure=20
that all that new digital capacity we're giving=20
broadcasters returns something positive for our=20
communities and local talent and civic issues coverage."
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272749A1.doc
* Commissioner Adelstein: "Despite disagreements=20
over the Commission's regulations, there should=20
be no disagreement that media ownership is really=20
about democracy. And fundamental to it is the=20
"uninhibited marketplace of ideas," where=20
everyone has a right to receive, share and=20
exchange a diversity of news, information, and=20
music. By controlling the information you=20
receive and shaping public discourse, media=20
companies influence our culture, politics, and ideas in a very powerful way=
."
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272756A1.doc
* Commissioner Tate: "I welcome the opportunity=20
to hear from the citizens of the Tampa-St.=20
Petersburg, Florida area - a thriving technology=20
center, the largest media market in the state,=20
and 12th largest television DMA in the United=20
States. It is also home to the Tampa Tribune and=20
WFLA-TV, which together constitute one of=20
approximately 40 grandfathered=20
newspaper-broadcast combinations in the country,=20
which should provide us with a unique opportunity=20
to learn about the effects - both positive and=20
negative - such combinations have."
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272747A1.doc
* Commissioner McDowell: "The debate over=20
broadcast ownership is concerns the vitality of=20
our democracy and the appropriate balance among=20
competitive efficiencies, diversity of voices and=20
local focus. I've learned quickly that this=20
debate elicits the opinions and passions of=20
people from all walks of life from all over our nation."
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272746A1.doc

CONVERGENCE OR CONSOLIDATION?
[SOURCE: Poynter Online, AUTHOR: Pat Walters]
What's changed since the FCC last reviewed media=20
ownership rules in 2003? Perhaps the most=20
fundamental change involves the blurring of=20
boundaries. Blogs, Facebook and YouTube have=20
given the audience the power to publish. News is=20
becoming a dialogue. Boundaries within the=20
newsroom are also crumbling. Print reporters are=20
being asked to take pictures and record audio.=20
Newspaper companies are producing=20
Emmy-award-winning video. This is about=20
convergence. Merriam-Webster says the word means=20
"moving toward union or uniformity." This coming=20
together -- some might call it consolidation --=20
is exactly what the FCC is charged with=20
monitoring. And here we find a thread that=20
connects today's hearing with the one four years=20
ago. It's a corporate connection: Media General.=20
The company, headquartered in Richmond, owns 25=20
daily newspapers and 23 network-affiliated=20
broadcast television stations. It owns one of the=20
largest newspapers -- The Tampa Tribune -- and=20
one of the largest television stations -- WFLA --=20
in Florida. Both are in Tampa. The company calls=20
the city its "most advanced convergence market."
http://www.poynter.org/column.asp?id=3D101&aid=3D122210

EXTRA! TRIBUNE SALE INVOLVES TAX DODGE
[SOURCE: Newsweek, AUTHOR: Alan Sloan]
Whenever you see a deal involving Los Angeles's=20
Chandler family, you usually see a tax dodge. And=20
sure enough, the pending sale of Tribune Co., the=20
big media firm in which the Chandlers are the=20
largest shareholders, exploits a loophole so=20
gaping that we taxpayers can only pray that=20
someone closes it quickly. But it's not the=20
Chandlers, the media magnates (L.A. Times and=20
Newsday) whose shenanigans I've tracked for 15=20
years, who are dodging taxes here. It's Sam Zell,=20
the Chicago real-estate mogul who's buying control of Tribune.
http://www.msnbc.msn.com/id/18367498/site/newsweek/
* Tribune Deal Makes Zell Ace of Tax Dodgers
http://www.washingtonpost.com/wp-dyn/content/article/2007/04/30/AR200704...
1553.html

FCC COMPLETES REVIEW OF AWS LICENSE APPLICATIONS
[SOURCE: Federal Communications Commission]
On Monday, the FCC's Wireless Telecommunications=20
Bureau completed its review of the applications=20
for the Advanced Wireless Services (AWS) licenses=20
won in Auction No. 66, which closed on September=20
18, 2006, and has granted all of the 1,087=20
licenses won in the auction. The grant of these=20
licenses, it is hoped, will promote the further=20
deployment of broadband services across the=20
United States, as they can be used to provide a=20
wide array of innovative wireless services and=20
technologies, including voice, data, video, and=20
other wireless broadband services. Fifty-eight=20
of the 107 applicants receiving AWS licenses are=20
small and very small businesses that qualified=20
for a designated entity bidding credit. The $13.7=20
billion in auction revenue collected from Auction=20
No. 66 nearly equals the approximately $14=20
billion in total revenue from all other FCC=20
auctions combined and nearly doubles the amount=20
of auction revenue transferred to the U.S.=20
Treasury. This revenue also will fully fund the=20
estimated cost of relocating the federal=20
government operations currently occupying the=20
lower half of the AWS band (1710-1755 MHz), as=20
required by the Commercial Spectrum Enhancement Act (CSEA).
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-272748A1.doc
* Public Notice
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-07-1953A1.doc

GOOGLE CALLS VIACOM SUIT ON YOUTUBE UNFOUNDED
[SOURCE: New York Times, AUTHOR: Miguel Helft]
Responding to Viacom=92s $1 billion copyright=20
infringement suit over video clips on YouTube,=20
Google said Monday that it would not back off,=20
declaring that the law was on its side. In March,=20
Viacom, the parent company of MTV, Comedy Central=20
and Nickelodeon, sued Google and YouTube, the=20
video sharing site it acquired last year, saying=20
they were deliberately building a business on a=20
library of copyrighted video clips without=20
permission. Earlier this year, Viacom had asked=20
YouTube to take down 100,000 clips that it said=20
infringed on its copyrights. On Monday, Google=20
filed a response to the lawsuit in Federal=20
District Court in Manhattan but gave few new=20
details of its legal thinking, which relies=20
heavily on the so-called =93safe harbor=94 provisions=20
of the Digital Millennium Copyright Act, enacted=20
in 1998. Those provisions generally hold that Web=20
sites=92 owners are not liable for copyright=20
material uploaded by others to their site as long=20
as they promptly remove the material when asked=20
to do so by the copyright owner. Viacom said=20
Google=92s response misses the mark. =93This response=20
ignores the most important fact of the suit,=20
which is that YouTube does not qualify for safe=20
harbor protection under the D.M.C.A.,=94 Viacom=20
said. =93It is obvious that YouTube has knowledge=20
of infringing material on their site, and they are profiting from it.=94
http://www.nytimes.com/2007/05/01/technology/01google.html
(requires registration)
* Google says Viacom lawsuit threat to Internet use
http://www.reuters.com/article/internetNews/idUSN3047264820070501

US PUT CHINA, RUSSIA ON COPYRIGHT PIRACY WATCH LIST
[SOURCE: Associated Press]
China, Russia and 10 other nations were targeted=20
by the Bush administration Monday for failing to=20
sufficiently protect U.S. producers of music,=20
movies and other copyrighted material from=20
widespread piracy. The Bush administration placed=20
the 12 countries on a "priority watch list,"=20
which will subject them to extra scrutiny and=20
could eventually lead to economic sanctions if=20
the administration decides to bring trade cases=20
before the World Trade Organization. An=20
additional 31 countries were placed on=20
lower-level monitoring lists, indicating that the=20
concerns about copyright violations in those=20
nations did not warrant the highest level of=20
scrutiny. The designations occurred in a report=20
that the administration is required to provide=20
Congress each year highlighting problems that=20
U.S. companies are facing around the world with=20
copyright piracy, which they contend is costing=20
them billions of dollars in lost sales annually.
http://www.latimes.com/business/printedition/la-fi-piracy1may01,1,241718...
tory?coll=3Dla-headlines-pe-business
(requires registration)

EGAN-JONES OPPOSES BID FOR CLEAR CHANNEL
[SOURCE: Reuters 4/27, AUTHOR: Megan Davies]
Proxy advisory service Egan-Jones recommended on=20
Friday that shareholders oppose a sweetened $19.5=20
billion bid to take radio station operator Clear=20
Channel Communications private. Egan-Jones said=20
the $39-a-share bid "remains insufficient." It=20
said Clear Channel could generate greater value=20
by staying independent and selling selected assets.
http://www.reuters.com/article/technology-media-telco-SP/idUSN2738356020...
427

JOURNALISM

NEWSPAPER CIRCULATION IN STEEP SLIDE ACROSS NATION
[SOURCE: New York Times, AUTHOR: Richard Perez-Pena]
Newspaper sales continue a steep slide=20
nationally. The industry reported a 2.1 percent=20
drop in weekday circulation, and 3.1 percent on=20
Sundays, in the six months ended March 31,=20
compared with the period a year earlier. The=20
figures, compiled by the Audit Bureau of=20
Circulations but not yet audited, reflect 745 of=20
the nation=92s more than 1,400 daily newspapers.=20
The figures follow first-quarter reports for the=20
nation=92s major newspaper companies that showed=20
falling earnings, declines in advertising and=20
plans for continued staff cuts, heightening fears=20
about the future of newspapers. Circulation=20
figures have dropped gradually for two decades,=20
beginning in the 1980s, but since 2004, the=20
decline has picked up speed as readers and=20
advertisers have migrated to the Internet.
http://www.nytimes.com/2007/05/01/business/media/01paper.html
(requires registration)
* NAA Analysis of ABC Confirms Overall Circ Slide
http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_con...
t_id=3D1003578103
* Behind the Numbers: The 'Other' Side of Today's FAS-FAX
Why? Blame the cutting of other-paid circulation=20
for some of the losses. Also, publishers are=20
dialing back on their distribution areas,=20
focusing on the "core market." And, sad to say:=20
Fewer individuals are simply motivated to buy.
http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_con...
t_id=3D1003578427

CABLE

WHY CABLE SHOULD WANT NET NEUTRALITY
[SOURCE: Multichannel News, AUTHOR: Art Brodsky]
[Commentary] Network Neutrality is not about=20
giving anyone below-cost access to the cable=20
network. It is not about government price=20
controls. It is not about protecting the business=20
plans of Google or Yahoo or any other Internet=20
company. It is about allowing every customer=20
access to content and applications on whatever=20
speed network they pay for. It is about allowing=20
individual consumers or small companies or large=20
companies to reach consumers with whatever=20
resources they have without the network operator=20
influencing the choice. Cable companies should=20
support non-discrimination because they need it=20
too -- when they connect to the telephone company=20
network. Cable operators need fair treatment from=20
the telcos for their interconnection rates. They=20
don't want their traffic sent to the back of the=20
queue. Cable doesn't want to be discriminated=20
against and shouldn't be able to discriminate, either.
http://www.multichannel.com/article/CA6437704.html?industryid=3D47197

FRANCHISE BILLS DOMINATE STATE DEBATES
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
For the second consecutive year, franchise-reform=20
bills continue to nearly monopolize the time and=20
lobbying muscle of the state cable trade=20
associations. But a few of those groups are also=20
trying to be proactive, addressing such problems=20
as the soaring pole-attachment rates charged by in-state telephone provider=
s.
http://www.multichannel.com/article/CA6437693.html

FLORIDA SENATE PASSES FRANCHISE BILL
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
The Florida state Senate approved a statewide=20
franchising bill, but not before stripping it of=20
an amendment added in committee that would have=20
required new entrants such as telephone companies=20
to pass 50% of the low-income homes in their=20
video-service areas within three years. The bill,=20
SB998, approved April 27, now gives authority to=20
the state's Attorney General to investigate=20
charges that a provider discriminated against=20
potential consumers based on economic factors.
http://www.multichannel.com/article/CA6437970.html

TELECOM

VERIZON FIGHTS TO KEEP ITS LANDLINE CUSTOMERS
[SOURCE: Wall Street Journal, AUTHOR: Dionne Searcey dionne.searcey( at )wsj.com]
As cable competitors and other Internet companies=20
are entering the phone business, Verizon is=20
fighting back with new high-tech services. At the=20
same time, the New York-based company is trying=20
to prevent phone customers from disconnecting=20
landline service in favor of wireless or=20
Internet-based phone service. Verizon Chief=20
Financial Officer Doreen Toben said in an=20
interview she hopes to stem the losses with=20
promotions for new packages of services that=20
include landline service. The company also has=20
put in place a new program for customers with=20
second homes in Florida and along the shores of=20
Long Island and New Jersey in hopes of ensuring=20
they maintain landlines in their main homes when=20
they go away. Verizon also plans to reach out to=20
customers who have reported trouble with their=20
lines more than twice to attempt to stop them=20
from dropping their service in frustration.
http://online.wsj.com/article/SB117793378297186809.html?mod=3Dtodays_us_...
ketplace
(requires subscription)
* AT&T gives Net phone service a new push
http://www.usatoday.com/printedition/money/20070501/3b_attvoip01.art.htm

QUICKLY

FCC PROPOSES $41,000 IN STATION FINES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The FCC Monday proposed fining five TV stations a=20
collective $41,000 for violating ad limits in=20
kids TV shows and public filing omissions. It is=20
a clear signal to stations that the FCC expects=20
them to do a better job of accounting for their=20
programming for children and others. The biggest=20
proposed fine was $15,000 levied against Acme=20
Television's WBUI in Decatur, Ill. for "willful=20
and repeated" violations of the limit on the=20
number of commercial minutes in kids programming.=20
The current limit is 10.5 minutes per hour on=20
weekends, 12 minutes on weekdays. The station was=20
cited for the following: four overages of 90=20
seconds, one overage of two minutes and four=20
violations for airing program-length commercials.=20
Acme attributed most of the overages to human error and mechanical error.
http://www.broadcastingcable.com/article/CA6438055.html

EARTHLINK STUDYING MUNI WI-FI BUSINESS
[SOURCE: Associated Press, AUTHOR: Giovanna Dell'Orto]
EarthLink said Thursday it will study the=20
performance of its municipal wireless Internet=20
networks in four cities =97 Philadelphia, New=20
Orleans and California's Anaheim and Milpitas =97=20
before deciding how to move forward with similar=20
Wi-Fi networks elsewhere. While more cities are=20
expressing interest in striking deals with the=20
company, EarthLink is "not yet able to establish=20
that comfort level" that the investments are=20
really profitable, said Kevin Dotts, EarthLink's=20
chief financial officer. That doesn't mean=20
EarthLink is pulling the plug on cities under=20
contract, like Houston, which would eventually be=20
the nation's largest network at about 600 square=20
miles, Dotts said. Instead, the company wants to=20
review a range of factors to determine where it=20
would be most profitable to invest what Dotts=20
estimates are up to $40 million a year in capital=20
expenditure. Such factors include topography =97=20
less dense cities like Atlanta are harder to=20
cover; concentration of households; and=20
alternative revenue opportunities, Dotts said.
http://news.yahoo.com/s/ap/20070426/ap_on_hi_te/earthlink_wi_fi
* EarthLink scales back, focuses muni Wi-Fi effort
http://news.yahoo.com/s/infoworld/20070428/tc_infoworld/88116_2

SUPREME COURT HANDS TECH FIRMS PATENT VICTORIES
[SOURCE: Reuters, AUTHOR: Peter Kaplan]
The U.S. Supreme Court on Monday sided with=20
software and technology companies in two major=20
patent rulings that could leave them less=20
vulnerable to infringement lawsuits. The high=20
court moved to curb the liability of firms for=20
infringing products sold overseas and in another=20
case loosened a key legal standard making it=20
easier to invalidate some patents on the grounds=20
they are obvious inventions. In the latter=20
ruling, the Justices unanimously said the courts=20
should be more flexible in the way they interpret=20
the standard governing whether patents are valid=20
or merely "obvious" combinations of previous=20
inventions that should be rejected. The decisions=20
were applauded by software and technology companies.
http://www.reuters.com/article/technologyNews/idUSN3046605620070430
* Supreme Court loosens patent 'obviousness' test
http://news.com.com/Supreme+Court+loosens+patent+obviousness+test/2100-1...
_3-6180220.html?tag=3Dnefd.lede
--------------------------------------------------------------
Communications-related Headlines is a free online=20
news summary service provided by the Benton=20
Foundation (www.benton.org). Posted Monday=20
through Friday, this service provides updates on=20
important industry developments, policy issues,=20
and other related news events. While the=20
summaries are factually accurate, their often=20
informal tone does not always represent the tone=20
of the original articles. Headlines are compiled=20
by Kevin Taglang headlines( at )benton.org -- we welcome your comments.
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