May 2009

K Street, watchdogs praise new lobbying rules

Lobbyists and government watchdogs are applauding revisions made by the White House on Friday to lobbying restrictions on stimulus funds. After completing a 60-day review last week, the administration modified the rules to extend a speaking ban not just to lobbyists but to others who contact government officials about specific stimulus projects. But that ban only occurs now after a grant application has been filed for the project. Those interested in the project have to file their views in writing with administration officials, which will then be disclosed on the Internet. All contacts with lobbyists will still have to be disclosed, though. The changes were announced in a blog post by Norm Eisen, the special counsel to President Obama for ethics and government reform, on the White House's website Friday evening.

The Need for Speed: Why is the United States still waiting for the future to download?

[Commentary] For the United States to catch up in broadband, we need to figure out a way to get fiber lines all the way to our homes, instead of just to switching stations, where the information is then transferred to slow copper wires to get to us. There are four existing options for doing this:

1) Massively subsidizing the existing providers is the Asian model,

2) Creating competition is, in general, the way the Europeans have built their networks, and there are some great ideas that can be taken from the other side of the Atlantic,

3) Let customers own their own fiber connections instead of leasing them from the telecom companies, and

4) The government provides broadband itself, as Australia has recently announced.

All these solutions would require massive government investment. But it's time for the country to stop thinking of high-speed Internet access as a useful luxury. Instead, we should consider it a crucial part of the infrastructure of the twenty-first century. And in the race to reap the benefits from this infrastructure, the United States has fallen abysmally behind, and only truly big and creative thinking will help the nation catch up.

Verizon, Frontier ask FCC to back license transfers

Verizon Communications and Frontier Communications on Friday asked the Federal Communications Commission to approve the transfers of phone line licenses as part of the companies' $5.25 billion deal. Under a deal announced earlier this month, Verizon would sell 4.8 million rural phone lines to Frontier, which would become the largest rural-only service provider in the United States. The deal came amid a wave of consolidation in the rural phone market, as providers seek to cut costs and more consumers cancel landlines. "The proposed transaction will not cause competitive harm and will bring significant public interest benefits, including the increased deployment of broadband to rural areas, which both the President and Congress have identified as a national priority," the joint filing said. In their filing with the FCC, the companies asked for a "favorable and expedited" action. They also reassured regulators that the change would be seamless for both retail and wholesale customers, and Frontier will honor existing tariffs and contracts.

Broadband-media consumers fall into distinct categories

A new Nielsen study focused on broadband-media consumers reveals that these folks are hardly a homogeneous group of gizmo geeks. Because who they are and how they get involved with broadband media can help advertisers and producers figure out how best to market their products, Nielsen did a deep dive into data and came up with eight distinct categories of such consumers. Far ahead of the tech-adoption curve is what the study terms "extreme techies": tech innovators at the forefront of adoption behavior. Watching as much as 91 minutes of online video content in an average week, they represent 8% of the adult broadband population in the U.S., or 4.6 million viewers. A good majority watch TV online in addition to regular TV viewing (64%) and have specific targets for online video content (60%). They also own an average of four cross-platform devices, such as console gaming systems and cell phones, to view TV or movie content, with 38% also having connected TV sets to their computers. These extreme techies are chiefly male (63%), with a mean age of 31 and an average annual household income of $67,000. Also, nearly half (47%) are married, and 57% have children younger than 18 at home.

Does hush-hush meeting of newspaper executives violate antitrust law?

On Thursday, top executives from major newspapers have gathered to plot the future of their business, including the possibility of charging for Web content. Antitrust law is complicated, but one principle is very simple: Competitors cannot get together and agree on price or the terms on which they will offer their services to their customers. It doesn't matter if the industry is ailing or if collusion would be "good" for society or necessary to preserve democracy. An agreement regarding pricing is "per se"—automatically—illegal under Section 1 of the Sherman Act, the main federal antitrust law. All but a few newspapers currently give away their Web content for free. Many would like to start charging but are afraid that if they're the first to make the leap, their readers will abandon them for the remaining free alternatives. One obvious solution would be for them to agree to make a collective leap behind a pay wall. But such an agreement would be blatantly illegal, says Kenneth Ewing, a partner at Steptoe & Johnson who, as head of his firm's antitrust practice, advises corporations on how to stay out of trouble. "It's Antitrust 101. If you're a competitor of another company, you violate federal and state law if you agree on the price or the general terms on which you are willing to compete."

FCC's Chessen: Fairness Doctrine talk is 'conspiratorial'

Federal Communications Commission Acting Chief of Staff told House Commerce Committee Chief Counsel Roger Sherman earlier this year that concerns about reviving the so-called Fairness Doctrine are "conspiratorial." The two exchanged e-mail to coordinate a strategy of responding to an Internet report on reinstating the Fairness Doctrine, which would force stations to make equal time for liberal and conservative talk radio.

Solicitor-General sides with Cablevision on DVR

The Solicitor General has sided with Cablevision in the cable operator's long-running dispute with several program-makers over the roll-out of its network-based video recorder. Solicitor General Elena Kagan on Friday denied plaintiffs including Time Warner, News Corp, CBS Corp and Walt Disney Co, their petition for a Supreme Court hearing. The media companies have argued that Cablevision's proposed service -- which, like TiVo's, would allow viewers to record any program on TV -- would infringe the copyrights of the movies and television programs they produce. They had been hoping to overturn a ruling by the U.S. Court of Appeals in New York which would allow Cablevision subscribers to record and play back programs on the remote system based within Cablevision's own cable plant.

Has TV Advertising 'Bottomed Out'?

Television advertising has "bottomed out" and broadcasters may post better-than-expected advance sales for the 2009-2010 TV season, NBC Universal Chief Executive Officer Jeff Zucker said. Zucker's comments echo those of CBS Corp., Walt Disney Co.'s ABC and Viacom Inc., owner of MTV and Nickelodeon, which have reported signs ad revenue is leveling off. Last week broadcasters released schedules for the 2009-2010 TV season, ahead of talks with big advertisers. NBC Universal also operates cable channels such as Bravo and USA. Broadcast network advertising will fall 10 percent this year to $12.8 billion, Michael Nathanson, an analyst at Sanford C. Bernstein & Co., projected in a May 26 note to investors. National cable advertising will drop 3 percent to $20.9 billion.

Small, Rural Practices Can Adopt Health IT Effectively

Preliminary findings from the American Academy of Family Physicians' National Demonstration Project found that health IT such as electronic health records, Web portals and chronic disease registries can be implemented by a variety of practices, including small and rural offices. The evaluators said small and rural practices "may be better positioned to adopt technology because they are usually very nimble and self-sufficient." They added that these practices also might view health IT spending as a "personal investment" because the decision to implement EHRs was not imposed on them by a larger health system.

Senate bill supports 21st-century skills

States offering students curriculum options that integrate key 21st-century skills would receive matching federal funds through an incentive bill introduced in the Senate May 13 by Sen John D. Rockefeller (D-WV). The legislation was developed using ideas generated from West Virginia educators and the Partnership for 21st Century Skills, which researched and surveyed the skills students need in the classroom to remain competitive for the future. The bill, which is co-sponsored by Sens Olympia Snowe (R-Maine) and John Kerry (D-MA), suggests several areas where states could expand their curricula to encompass 21st-century skills, such as global awareness; financial, economic, business, and entrepreneurial literacy; civic literacy; and health and wellness awareness. If passed, the bill would appropriate $100 million a year for the U.S. Department of Education to pass on to states that have developed a comprehensive plan for implementing a statewide 21st-century skills initiative and are able to supply matching funds for their initiative.

Benton

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