June 2007

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OWNERSHIP
Trib-ulations Ahead? Group Tries to Stop Sale to Zell
Civil rights and rural groups rush to endorse XM/Sirius merger
Big Radio Makes a Grab for Internet Listeners

BROADCASTING
Hold TV Broadcasters Accountable for Inadequate Election and
Government Coverage, Groups Tell FCC
Retransmission Consent Reform: Not So Fast
FCC Gets More Time To Respond On DTV Campaign
Some Analog-Only TV Viewers Could Lose Stereo Sound
FCC Proposes $16,000 In Kids Fines=09

INTERNET/BROADBAND
Candidate Broadband Forum
Kentucky effort on broadband hailed as a model
Time To Refocus The Universal Service Fund

ELECTIONS & MEDIA
YouTube Fuels -- and Foils -- Campaigns
As presidential races change, media coverage must adapt

ADVERTISING
Where's the Money Moving? Out of Media

QUICKLY -- Google limits data retention in=20
compromise with EU; YouTube to Test Software To=20
Ease Licensing Fights; Yahoo, subject of suit,=20
scolds China on rights; New Research on Wireless Substitution

OWNERSHIP

TRIB-ULATIONS AHEAD? GROUP TRIES TO STOP SALE TO ZELL
[SOURCE: Associated Press]
Media Access Project, a public interest law firm,=20
sought Monday to block the sale of Tribune Co.,=20
saying the $8.2 billion deal shouldn't be allowed=20
to go through unless the conglomerate breaks up=20
its joint newspaper and broadcast ownership in=20
five cities. In a filing at the Federal=20
Communications Commission, MAP is urging the=20
FCC to deny Tribune's request for waivers from=20
rules banning same-market ownership of television=20
and newspapers. MAP says the waivers Tribune=20
seeks in the wake of the proposed deal are=20
designed solely to "facilitate a mind-boggling=20
and complex tax-efficient restructuring" and are=20
not in the public's best interest. Andy=20
Schwartzman, the group's president, notes that=20
Tribune had several opportunities to sell its=20
broadcast and newspaper properties separately.=20
The comment came as an FCC deadline expired for=20
public input on the $8.2 billion Tribune deal.=20
The only public comment posted on the FCC's Web=20
site by late Monday, aside from Tribune's, came=20
from the Georgetown University Law Center's=20
Institute for Public Representation. In tandem=20
with the Media Access Project, the institute=20
voiced opposition to allowing a transfer of Tribune's licenses.
http://www.editorandpublisher.com/eandp/news/article_display.jsp?vnu_con...
t_id=3D1003597304
* Tribune deal challenged with FCC
http://www.businessweek.com/ap/financialnews/D8PMSI180.htm
** Learn more about MAP at http://www.mediaaccess.org/index.html

CIVIL RIGHTS AND RURAL GROUPS RUSH TO ENDORSE XM/SIRIUS MERGER
[SOURCE: Lasar's Letter on the FCC, AUTHOR: Matthew Lasar]
Even before the Federal Communications Commission=20
invited public comment on Friday on the proposed=20
XM/Sirius satellite radio merger, the Hispanic=20
Federation weighed in. Although the advocacy=20
group "takes concerns relating to media=20
concentration and mergers seriously," in this=20
case it would make an exception. "For the most=20
part, the mainstream media companies offer very=20
limited music and entertainment programming=20
targeted to the Hispanic community," federation=20
President Lillian Rodriguez-Lopez wrote to the=20
FCC on June 5th. "Satellite radio, by contrast,=20
does provide sought after programming, such as=20
CNN en Espanol, ESPN Deportes, and Mexico Canta."=20
Ditto for the National Black Chamber of Commerce=20
(NBCC), the League of United Latin American=20
Citizens (LULAC), the Latino Coalition, and the=20
League of Rural Voters. They all support the=20
merger; they all fear that without it, satellite=20
radio will fail. All these organizations touch on=20
the same theme in their filings: the=20
consolidation of traditional free radio has left=20
minorities out of the programming loop. Out in=20
the hinterland, there isn't even much of a loop to speak of.
http://www.lasarletter.net/drupal/node/408

BIG RADIO MAKES A GRAB FOR INTERNET LISTENERS
[SOURCE: New York Times, AUTHOR: Jeff Leeds]
After ceding ground (and potential advertising=20
dollars) for years to an army of autonomous=20
Internet radio stations, some of which are run=20
from basements and spare bedrooms, the nation=92s=20
biggest broadcasters are now marching online,=20
determined to corral the next generation of=20
listeners. The result may be a showdown to define=20
the future of the medium. Confronted by a slow=20
erosion of listeners who are turning to iPods,=20
podcasts and other sources for entertainment, the=20
radio corporations are trying to merge their=20
over-the-air music and D.J. chatter with the Web,=20
adding online streams of their broadcasts and=20
features already found on many independent=20
Web-based stations. These include live chat=20
rooms, blogs and MySpace-style social networking=20
features. All of this comes at an inopportune=20
moment for small, Internet-based radio stations,=20
which are facing a sharp increase in the=20
royalties they must pay to record labels (and=20
artists) for playing their music. The online=20
stations had previously paid a percentage of=20
their revenue for music streamed to United States=20
listeners, in effect ensuring that their costs=20
would not exceed whatever sales they received.=20
But a federal panel, the Copyright Royalty Board,=20
has set new rates effective July 15 that alter=20
that structure so the Internet radio stations are=20
charged a fee each time a user listens to a song.
http://www.nytimes.com/2007/06/12/arts/music/12RADIO.html
(requires registration)

BROADCASTING

HOLD TV BROADCASTERS ACCOUNTABLE FOR INADEQUATE=20
ELECTION AND GOVERNMENT COVERAGE, GROUPS TELL FCC
[SOURCE: Midwest Democracy Network]
An alliance of Midwest civic and political reform=20
groups is calling on the Federal Communications=20
Commission (FCC) to impose stronger public=20
interest obligations on local television=20
broadcasters as part of the new regulatory=20
framework that will govern the pending transition=20
from analog to digital broadcasting. In a letter=20
sent to the FCC and federal lawmakers from five=20
Midwestern states, the alliance cites recent=20
studies showing that the viewing public is being=20
shortchanged on coverage of state and local=20
elections and critical government issues. The=20
studies show that coverage of government and=20
elections gets much less air time than crime,=20
sports, and weather, and that during election=20
season political ads outweigh election coverage=20
by nearly three to one. "The findings from the=20
Midwest News Index (MNI) reports reveal a retreat=20
from responsibility by local television=20
stations," the groups said in their letter,=20
citing studies conducted during the past year by=20
the University of Wisconsin NewsLab. "They also=20
reveal an equally distressing failure by the=20
Federal Communications Commission to regulate=20
broadcasting in accordance with the 'public=20
interest, convenience, or necessity,' a principle=20
first enshrined in the Radio Act of 1927 and=20
later in the Communications Act of 1934." The FCC=20
is currently considering new rules to reflect the=20
national transition from analog to digital=20
broadcasting. The conversion, which is to be=20
completed by February 2009, will allow=20
single-license holders to air programming over=20
several separate channels. Given the impact this=20
transition will have on overall programming and=20
the broadcast business generally, the alliance=20
believes it is vitally important to strengthen=20
and clarify broadcasters' public interest=20
obligations -- and to do it before the transition is complete.
www.joycefdn.org/MidwestDemocracyNetwork.aspx

RETRANSMISSION CONSENT REFORM: NOT SO FAST
[SOURCE: tvnewsday, AUTHOR: Marianne Paskowski]
Given that it represents cable operators and=20
programmers, the National Cable &=20
Telecommunications Association had always taken a=20
neutral position on retransmission consent. But=20
no more. After two of its smaller cable members,=20
Mediacom Communications and SuddenLink, found=20
themselves battling with TV station groups over=20
retrans fees -- and losing -- NCTA decided it was=20
time to step in, something nobody in cable=20
expected to occur. In this Q&A, NCTA President=20
Kyle McSlarrow explains why he's seeking retrans=20
reform on Capitol Hill, while conceding that it=20
will not be quick or easy. In the meantime, he=20
also says, cable and broadcasters can work=20
together on common interests -- ensuring a smooth=20
digital transition and heading off effort to regulate TV violence.
http://www.tvnewsday.com/articles/2007/06/12/daily.3/

FCC GETS MORE TIME TO RESPOND ON DTV CAMPAIGN
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
House Commerce Committee Chairman John Dingell=20
(D-MI) and Telecommunications and Internet=20
Subcommittee Chairman Ed Markey (D-MA) had given=20
FCC Chairman Kevin Martin until June 11 to fill=20
them in on what the FCC was doing about educating=20
the public on the DTV transition, including how=20
it planned to spend the $1.5 million it got from=20
Congress and when it planned to begin the=20
campaign. They also asked whether the FCC should=20
compel broadcasters to start their education=20
campaign. But the FCC has asked for and received=20
a couple more days to provide that answer.
http://www.broadcastingcable.com/article/CA6450968.html
* NAB To Launch DTV PSA's Before End of Year
http://www.broadcastingcable.com/article/CA6450885.html

SOME ANALOG-ONLY TV VIEWERS MAY LOSE STEREO SOUND
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
According to Les Tyler, president of audio tech=20
licensing firm THAT Corp., most of the=20
digital-to-analog TV converter box manufacturers=20
he has talked to plan to produce boxes to the=20
minimum standard required by the National=20
Telecommunications and Information=20
Administration, the government agency overseeing=20
the converter-box program. Those minimum=20
standards do not require the boxes to pass=20
through the stereo sound of most of today's=20
analog sets. To keep it from being a subsidy to=20
high-end users boxes with DVR functions,=20
picture-in-picture capability, and other bells=20
and whistles will not qualify, but Tyler argues=20
that being able to hear those 'bells and=20
whistles' in stereo sound should be part of the=20
TV experience. He said that after the transition=20
millions of viewers could have their sound=20
downgraded, and they must be made aware of that=20
possibility. Tyler offered a few solutions. One,=20
NTIA should require the boxes to identify whether=20
or not they are stereo. Two, and a better option,=20
is the boxes could be converted to stereo for=20
about 40 cents apiece. The second option is=20
better for his organization, which licenses=20
integrated circuit technology like the one needed=20
for stereo. But he also says he has a rooting=20
interest since he was part of a the group that=20
helped come up with the TV stereo standard back in the early 1980's.
http://www.broadcastingcable.com/article/CA6450881.html

FCC PROPOSES $16,000 IN KIDS FINES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The FCC has proposed another $16,000 in total=20
fines for TV stations that violated its kids TV=20
rules. The FCC limits advertising in kids shows=20
to 10.5 minutes on weekends and 12 minutes on=20
weekdays--and the commission has been cracking=20
down on violations. The biggest fine- was slapped=20
on KRRT Kerryville, Texas for exceeding the FCC's=20
limits on ads in kids TV shows on five occasions,=20
including two program-length commercials. The=20
station has been asked to pay $8,000.
http://www.broadcastingcable.com/article/CA6450940.html

INTERNET/BROADBAND

CANDIDATE BROADBAND FORUM
[SOURCE: Wireless Communications Association International]
A new website comparing all announced U.S. 2008=20
Presidential candidates on their broadband=20
communications policies was announced in=20
conjunction with WCA=92s annual convention.=20
=93Because the applications for broadband are at=20
the forefront of domestic policy debates,=94=20
commented WCA President Andrew Kreig, =93WCA sees=20
an enormous educational opportunity in assembling=20
the most relevant news and opinion on these hot=20
topics, and providing the option to=20
comment. Participation is invited from our=20
high-tech industry, the media, the campaigns and=20
voters.=94 He continued: "Broadband is creating=20
unprecedented productivity gains in such vital=20
sectors as education, health care and prevention,=20
border patrol, civil preparedness, military=20
defense and first responder capabilities by=20
police, fire and emergency workers =AD as well as=20
community economic development in such disparate=20
regions as inner-cities and rural America. These=20
applications and their delivery timetables in the=20
U.S. and abroad are central for the WCA 2007=20
roster of 140+ speakers =AD and also for each of=20
the U.S. Presidential candidates, in varying=20
degrees. So, WCA this week launches an=20
authoritative web portal about the latest=20
developments. Our plan is to keep it timely,=20
non-partisan and otherwise fair, and to implement=20
over time the same kind of cutting-edge,=20
interactive multimedia that the broadband=20
industry increasingly provides in other=20
respects. We recognize challenges in these=20
goals. We also recognize that website=92s value is=20
best realized if the focus includes the full=20
array of broadband technologies and platforms."
http://www.wcai.com/taskforce/politics/index.php

KENTUCKY EFFORT ON BROADBAND HAILED AS A MODEL
[SOURCE: Louisville (KY) Courier-Journal, AUTHOR: Bill Wolfe]
ConnectKentucky, a program for expanding=20
high-speed Internet access throughout the=20
commonwealth, is being held up as a model for a=20
proposed federal program. The statewide effort in=20
the past two years has helped increase broadband=20
Internet use by 50 percent and has brought access=20
to an additional 518,000 previously unserved=20
Kentucky households. Currently, 93 percent of=20
Kentucky homes can access broadband, and=20
ConnectKentucky expects every household to be=20
capable of using high-speed Internet by the end of the year.
http://www.courier-journal.com/apps/pbcs.dll/article?AID=3D/20070609/BUS...
SS/706090388

TIME TO REFOCUS THE UNIVERSAL SERVICE FUND
[SOURCE: The Digital Edge Blog, AUTHOR: John=20
Mahoney john( at )thedigitaledgeblog.com]
[Commentary] There should be only one goal for=20
the Universal Service Fund: universal Internet=20
connectivity. Every other goal of the program=20
will spring naturally from that. Money should be=20
spent to deploy technologies like WiMax that can=20
cost effectively address data connectivity needs=20
in demographically sparse areas. After the=20
initial build out, it=92s possible that the fund=20
could be scaled back to focus on a more narrow,=20
tactical mandate, or eliminated all together as=20
an open IP based infrastructure drives costs down=20
and competition up. Hopefully, this would end up=20
leaving the folks in urban areas clamoring for=20
the same benefits their rural brethren would be=20
enjoying through their open infrastructure. If it=20
did, it could help us reach the tipping point=20
that topples the antiquated gatekeeper/monopoly=20
based telecommunications infrastructure we have=20
today, and replace it with an IP based one that=20
is open and competitive. One we can build a 21st=20
century society on. Getting us to that point=20
should be the real goal of =93Universal Service."
http://www.thedigitaledgeblog.com/2007/06/11/time-to-refocus-the-univers...
service-fund/

ELECTIONS & MEDIA

YOUTUBE FUELS -- AND FOILS -- CAMPAIGNS
[SOURCE: Wall Street Journal, AUTHOR: Amy Schatz Amy.Schatz( at )wsj.com]
For months, the presidential wannabes have been=20
churning out serious, talking-to-the-camera=20
videos for YouTube. So far, viewers prefer the=20
spontaneous, unauthorized, less flattering fare.=20
Traffic on YouTube related to the 2008=20
presidential race spiked in March and April,=20
largely on two unofficial, critical videos, one=20
about Democratic front-runner Hillary Clinton,=20
the other about Republican John McCain, according=20
to a study of YouTube traffic by Nielsen/Net=20
Ratings. While overall viewership of political=20
videos is relatively small, the clips are=20
becoming increasingly important in the elongated=20
2008 presidential campaign cycle. Lesser-known=20
candidates are using YouTube as a low-cost method=20
to get some attention, while the leading=20
candidates are trying to avoid any embarrassing=20
on-the-trail goofs that can be exploited by=20
opponents or their supporters. This early in the=20
election cycle, it's hard to say that Internet=20
volume at candidate Web sites is an indicator of=20
ultimate success at the polls. If anything, the=20
data show that the increasing attention being=20
placed on the Internet by candidates is a=20
double-edged sword, since they are getting the=20
most attention online for video clips beyond their control.
http://online.wsj.com/article/SB118161443560632154.html?mod=3Dtodays_us_...
e_one
(requires subscription)

AS PRESIDENTIAL RACES CHANGE, MEDIA COVERAGE MUST ADAPT
[SOURCE: The Christian Science Monitor, AUTHOR: Dante Chinni]
[Commentary] With no clear nominee on either=20
side, big issues looming, and a war on, the=20
stakes are high in the 2008 elections. The media=20
are responding with early (and often), much hyped=20
"debates" of candidates for President. These "I=20
need a memorable sound bite" gatherings have=20
additional weight because you might actually want=20
to know who these people are if you choose to=20
vote in primary season. With possibly 20=20
primaries moved up to take place on Feb. 5, 2008,=20
it's likely you will go into the voting booth=20
with a laundry list of options on your ballot.=20
Because the primary schedule is so compressed=20
now, it's hard to imagine that any candidate with=20
a prayer and a few bucks will drop out before=20
Feb. 5. That's where the debates come in, and=20
that is a problem. The broadcast and cable=20
outlets like debates. It's what they are familiar=20
with. And despite the events' many flaws, seeing=20
two or three candidates on stage together=20
answering questions about their positions gives=20
viewers a longer and more in-depth look than=20
they'll get in TV ads or most quick news=20
appearances. But when you multiply the number of=20
candidates two or three times, the flaws of these=20
debate formats become more pronounced.
http://www.csmonitor.com/2007/0612/p09s01-codc.html

ADVERTISING

WHERE'S THE MONEY MOVING? OUT OF MEDIA
[SOURCE: AdAge, AUTHOR: Bradley Johnson]
U.S. ad spending -- at least the measured kind --=20
fell 0.3% in the January-to-March period, the=20
first down quarter since the ad recovery began in=20
2002. But a drop in reported ad spending does not=20
mean a drop in marketing spending. That's because=20
what marketers need isn't just measured media;=20
it's measurable results. Budgets are gravitating=20
from old-line measured media to an array of=20
marketing-services -- digital, direct, customer=20
relationship management -- that offers better=20
tools to quantify results. Marketing services=20
includes some media offerings, such as online=20
ads. But much of marketing services doesn't fit=20
in the box of an ad to be sold. For companies in=20
the business of selling media space and time, a=20
shift to non-media forms of marketing poses a fundamental challenge.
http://adage.com/article?article_id=3D117247

QUICKLY

GOOGLE LIMITS DATA RETENTION IN COMPROMISE WITH EU
[SOURCE: Reuters, AUTHOR: Eric Auchard]
Google is scaling back how long it keeps=20
personally identifiable data accumulated from its=20
Web users, seeking to mollify a European Union=20
watchdog that has questioned its privacy=20
policies. The world's top provider of Web search=20
services said late on Monday that it is ready to=20
curtail the time it stores user data to a=20
year-and-a-half, the low end of an 18 to 24 month=20
period it had originally proposed to regulators=20
in March. But Peter Fleischer, Google's global=20
privacy counsel said in a letter addressed to the=20
Article 29 Data Protection Working Party in=20
Brussels that any regulatory requirement to keep=20
data for less than 18 months would undermine Google's services.
http://www.reuters.com/article/internetNews/idUSN1144069820070612
* Do you find Google creeping you out?
http://news.com.com/Is+googling+creeping+you+out/2100-1032_3-6190319.htm...
ag=3Dnefd.lede

YOUTUBE TO TEST SOFTWARE TO EASE LICENSING FIGHTS
[SOURCE: Wall Street Journal, AUTHOR: Kevin J. Delaney kevin.delaney( at )wsj.co=
m]
Google's YouTube says it will begin testing=20
advanced video identifying technology to spot=20
clips on the video-sharing site with media=20
companies including Time Warner Inc. and Walt Disney Co. starting in a mont=
h.
http://online.wsj.com/article/SB118161295626932114.html?mod=3Dtodays_us_...
ketplace
(requires subscription)

YAHOO, SUBJECT OF SUIT, SCOLDS CHINA ON RIGHTS
[SOURCE: Associated Press]
China should not punish people for expressing=20
their political views on the Internet, Yahoo Inc.=20
said Monday, a day after the mother of a Chinese=20
reporter announced she was suing the U.S. company=20
for helping officials imprison her son. Yahoo=20
criticized China in a brief statement that didn't=20
mention the case of jailed journalist Shi Tao,=20
whose mother visited Hong Kong on Sunday. Shi was=20
sentenced to 10 years in 2005 after sending an=20
e-mail about Chinese media restrictions. The=20
company has acknowledged sharing information=20
about Shi with Chinese authorities.
http://www.latimes.com/business/printedition/la-fi-yahoo12jun12,1,538005...
tory?coll=3Dla-headlines-pe-business
(requires registration)

NEW RESEARCH ON WIRELESS SUBSTITUTION
[SOURCE: Centers for Disease Control]
While cell phones are widely used across most=20
segments of the US adult population this is=20
especially true for those under 30. Remarkably,=20
over half of US adults who only use a cell phone=20
are under 30. And, furthermore, one-third of 18=20
to 29 year olds only use a cell phone or the=20
Internet for making phone calls.These are some of=20
the results of a special analysis of three Harris Poll surveys.
http://www.cdc.gov/nchs/data/nhis/earlyrelease/wireless200705.pdf
--------------------------------------------------------------
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.
--------------------------------------------------------------