October 2008

Fearful tech workers tiptoeing along the shaky alleys of Wall Street -- and fretting about losing their jobs -- should take a deep breath. Of the more than 100,000 job losses expected as a direct result of the financial crisis, only a tiny slice will likely be from the tech ranks, figures Sean O'Dowd, an analyst at market researcher Financial Insights. As with any market consolidation, finance companies "will look for redundancies and overlap," O'Dowd says. For IT, that means management, not programmers, admins, and other line staff. "I think [layoffs] will come out of the IT management layer such as CIOs, so you're looking at hundreds [of layoffs], not necessarily thousands. Companies will continue to need a lot of the rank-and-file IT folks."

Hollywood would get a little unexpected boost from the proposed $700-billion bailout of the nation's financial system. The bill wending its way through Congress would provide tax breaks worth more than $470 million over the next decade for movie and TV producers that shoot in the US. That's not a lot of money, given that the average studio movie costs $106.6 million to make and market, but it could keep some low-budget productions -- and jobs -- from going offshore. Hollywood has long sought measures to curb so-called runaway production, which it blames for causing thousands of job losses in Southern California as filmmakers have fled to Canada and other foreign countries that offer cost savings through tax breaks and other incentives. One provision would provide film and TV producers with the same tax deductions that American manufacturers such as General Motors Corp., Boeing Co. and Xerox Corp. receive for making their products in the US. Specifically, the legislation would allow filmmakers who shoot in the U.S. to qualify for a tax deduction granted in 2004 to domestic manufacturers that capped the top tax rate at 32% instead of 35%. Additionally, the tax package lifts the budget cap on the existing tax deduction, which was limited to movies that cost less than $15 million to make -- in effect excluding most studio films, which cost a lot more.

A bill was introduced in the Senate that would allow broadcasters to continue broadcasting in analog for 30 days after the Feb. 17, 2009, date for TV stations to transition to full-power digital TV. Broadcasters would still transition their primary channel feeds to digital Feb. 17, but they could continue to broadcast DTV-education information and emergency information for that 30-day period. The analog cutoff is currently set, by statute, for Feb. 17. The Senate bill was introduced by Sen John Rockefeller (D-WV). Rep. Lois Capps (D-CA) introduced a similar bill in the House last week.

Royalties that digital music companies from Apple Inc. to record labels pay songwriters for selling their music as ringtones, CDs and permanent digital downloads are to be set Thursday by a federal agency. This is the first time in nearly three decades that the industry has been unable to decide the fee for sales of recorded music on its own. Apple has so strongly opposed increasing the rate, now 9.1 cents per song, that it threatened to shut down the iTunes store if the rate goes up — a move experts said was unlikely. More likely is the Copyright Royalty Board hiking the rate incrementally, in line with the fraction of a penny that it has risen every two or three years since 1981, when it was 4 cents per song.