November 2009

BENTON'S COMMUNICATIONS-RELATED HEADLINES for MONDAY NOVEMBER 2, 2009

Two events kick off the week: 1) the FCC begins a new discussion on media ownership rules and 2) ITIF hosts a discussion on What Will the Internet of the Future Look Like? http://bit.ly/D11hF

GOVERNMENT & COMMUNICATIONS
   White House, Senate Strike Balance on Reporter Protections
   Obama Administration Seeks To Block Wiretap Suit
   Cubans say access to online market site is blocked
   Major University in Russia Eases Fears on Rules

NETWORK NEUTRALITY
   Get Congress Out of the Network Neutrality Debate, Please
   Will the Internet Survive Its 40th?
   Educate the FCC on Economics

NATIONAL BROADBAND PLAN
   NTIA's Broadband Data Collection Efforts to Combine With Census Bureau Questions
   Et Tu, Consumer Electronics Industry?
   CTIA Supports TV Spectrum Reallocation
   Transitioning Today's Rural Access & USF Mechanisms to Broadband
   If Verizon Stops Deploying FiOS, Then What?
   AT&T's Role in the Smart Grid

CYBERSECURITY
   Langevin to seek statutory authority for cyber adviser
   Lieberman previews cybersecurity bill
   It Doesn't Pay to Skimp on Cyber-Security

TELECOM
   Regulators in 3 states OK Frontier Acquisition of Verizon Local Wireline Operations
   Cellphone market growth raises pricing fears

ED TECH
   Parents: Focus more on 21st-century skills
   Colleges axing student e-mail accounts

HEALTH IT
   Feds urged to set simple, expandable HIE standards
   Panel seeks Rx for secure health data exchange
   ONC launches blog for feedback on policy agenda

CABLE/BROADCASTING
   Partisanship and Cable News Audiences
   DVR, Once TV's Mortal Foe, Helps Ratings
   Sacramento jury awards $16.6 million for mom's death in Wii radio contest

OWNERSHIP
   Comcast Said to Be Close to Gaining NBC Universal
   FCC to Explore Capital Acquisition for Developing Entrepreneurs and for Small and Disadvantaged Businesses

ADVERTISING
   Magazine Industry Hooked on Pharma?

MORE ONLINE ...
   Latin to lose its domain over Internet addresses
   When Texting Kills, Britain Offers Path to Prison
   A Tweet Unleashes Vitriol on a User in Britain
   BBC to Cut Pay, Jobs
   E-readers may not solve publisher woes yet
   EU Charges UK With Electronic Privacy Infringement

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GOVERNMENT & COMMUNICATIONS

WHITE HOUSE, SENATE STRIKE BALANCE ON REPORTER PROTECTIONS
[SOURCE: Associated Press, AUTHOR: Jim Abrams]
Senate supporters of a bill protecting a reporter's right to protect confidential sources in federal court said Friday they've reached a compromise with the Obama administration and media groups that gives the government authority to override those rights in certain national security cases. Sen Charles Schumer (D-NY) said the agreement "strikes the right balance between national security concerns and the public's right to know." He said it would preserve a strong protection for reporters trying to protect sources while making sure the government can do its job of protecting citizens. The original bill centered on the idea that a balancing test should be applied under which a federal judge would weigh the public's right to know versus national security claims made by the government. The administration wanted to eliminate that balancing test in many cases involving terrorism and other security cases. Under the compromise, the balancing test would be eliminated in classified leak cases where the government can show that disclosure of a source's identity is necessary to prevent or mitigate an act of terrorism or substantial harm to the national security. But the government would also have to provide specific facts: it could not make a national security claim and then withhold most of the details. The balancing test would be in order for cases not involving classified leaks, but in criminal cases the burden would be on the journalist to show clear and convincing evidence that guarding the anonymity of sources is in the public interest.
benton.org/node/29333 | Associated Press | B&C | Columbia Journalism Review
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OBAMA ADMINISTRATION SEEKS TO BLOCK WIRETAP SUIT
[SOURCE: Associated Press, AUTHOR: Devlin Barrett]
The Justice Department invoked the state secrets privilege Friday to try to stop a lawsuit over Bush-era wiretapping ­ the first time the Obama administration has done so under its new policy on such cases. Attorney General Eric Holder announced the decision in a California lawsuit challenging the warrantless wiretapping program begun after the Sept. 11, 2001, terrorist attacks. Under the state secrets privilege, the government can have a lawsuit dismissed if hearing the case would jeopardize national security. AG Holder said that in the current case, that review process had convinced him "there is no way for this case to move forward without jeopardizing ongoing intelligence activities that we rely upon to protect the safety of the American people."
benton.org/node/29332 | Associated Press
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MAJOR UNIVERSITY IN RUSSIA EASES FEARS ON RULES
[SOURCE: New York Times, AUTHOR: Ellen Barry]
The authorities at St. Petersburg State University issued a statement last week announcing that researchers in the humanities and social sciences would not be required to submit to an export-control screening before publishing their work overseas, easing fears that new procedures would constrain academic freedom. Professors at the prestigious Russian university raised objections in early October, when an internal university document was posted on a popular Internet forum. The document called for faculty members to provide copies of texts to be published abroad so that they could be reviewed for violations of intellectual property law or danger to national security.
benton.org/node/29337 | New York Times
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NETWORK NEUTRALITY

GET CONGRESS OUT OF NET NEUTRALITY DEBATE, PLEASE
[SOURCE: GigaOm, AUTHOR: Stacey Higginbotham]
[Commentary] Now, more than ever, Congress needs to stay out of legislating network neutrality. The trouble with highly technical issues like network neutrality is that they're complicated, and Congress isn't an ideal place to solve complicated — and constantly evolving — issues (unless we let the telco lobbyists write the legislation). Net neutrality isn't a political issue, it's an economic one. The key is ensuring that telecommunications firms don't discriminate against certain kinds of traffic, especially traffic coming over the Internet that might compete with products the ISPs already offer, as well as that folks trying to offer a web-based service don't have to pay a toll to offer it to consumers. The benefits of such openness accrue to consumers as well as to companies trying to build businesses on the Internet.
benton.org/node/29314 | GigaOm
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WILL THE INTERNET SURVIVE ITS 40TH?
[SOURCE: Wall Street Journal, AUTHOR: L. Gordon Crovitz]
[Commentary] The Internet recently celebrated the 40th anniversary of its founding, just in time to be welcomed in Washington by opposing political visions of its future. One is reflected in a proposal called the Internet Freedom Preservation Act, which would empower regulators to micromanage the Web. The alternative, the Internet Freedom Act of 2009, would keep regulators away. One way to look at the battle over net neutrality is simply as one set of companies against another. There are the network owners and administrators, who want to continue to control access rules, pricing and traffic management on their networks. Then there are content companies and other users of the network, who want regulators to ensure easy access for them. In highly regulated industries, regulations become barriers to entry. It's costly for new competitors to comply with the rules, which are designed for incumbents. As the U.S. falls further behind in broadband, we need more innovation and more competition, not a cozy, regulated cartel. Technology may be changing faster than we can keep track, but we are well acquainted with the frailties and foibles of human institutions in Washington. Sometimes it's wiser for mortals to stand aside and leave technology to advance at its own pace. After its first 40 years delivering freedom and abundance, the Web has earned the benefit of the doubt.
benton.org/node/29340 | Wall Street Journal
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EDUCATE THE FCC ON ECONOMICS
[SOURCE: Federal Communications Commission, AUTHOR: FCC Chief Economist Jonathan Baker]
[Commentary] Four key economic issues facing the FCC as it considers open Internet rules: 1) The implications of possible market failures that might limit innovation in applications complementary to the network. These might include the transaction costs of contracting, spillover benefits of applications innovation, and perhaps the market power of Internet service providers or applications providers. 2) Evaluating the social welfare effects of price discrimination on both sides of two-sided platforms. How do these effects depend on the extent to which mobile Internet service substitutes for fixed service for different types of customers? Or on the number of fixed and wireless providers available in a region? 3) Ensuring adequate incentives for investment and innovation in the network ­ or the platforms, if wireless and wireline service are viewed as imperfect substitutes. 4) Providing incentives for efficient network operation, perhaps through congestion pricing or network management.
benton.org/node/29313 | Federal Communications Commission
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NATIONAL BROADBAND PLAN

NTIA'S BROADBAND DATA COLLECTION EFFORTS TO COMBINE WITH CENSUS BUREAU QUESTIONS
[SOURCE: BroadbandCensus.com, AUTHOR: Rahul Gaitonde]
The National Telecommunications and Information Administration will be collecting large amounts of data through the Census Bureau that they would like to make more broadly available. NTIA has been able to work with the Census Bureau to add questions to the Current Population Survey as a supplement. The following five questions are going to be asked: Do you/does anyone in this household use the Internet at any location? Who is that? Do you/does anyone in this household connect to the Internet from home? Do you currently access the Internet at home using dial-up or broadband? What is the main reason that you do not have high-speed Internet access at home?
benton.org/node/29329 | BroadbandCensus.com
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ET TU, CEA?
[SOURCE: TVNewsCheck, AUTHOR: Harry Jessell]
[Commentary] Although the consumer electronics industry is the sector of the American economy that has benefited most from the transition to digital television broadcasting, the Consumer Electronics Association has implicitly endorsed a Federal Communications Commission proposal to take back most of the broadcast spectrum so that it can auction it off to wireless broadband providers. No doubt CEA members see billions more to be made in selling various pocket-size gizmos if wireless operators can get their hands on more spectrum. But Jessell thinks there's more is at work here. By getting out in front on this, CEA may be trying to win points with Democratic policymakers, pretty much the only ones that count these days. Jessell gossips that the White House is behind the FCC on this.
benton.org/node/29327 | TVNewsCheck
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CTIA SUPPORTS TV SPECTRUM REALLOCATION
[SOURCE: TVNewsCheck, AUTHOR: Harry Jessell]
CTIA, the principal lobby of the wireless telephone industry, is backing the idea of taking back broadcasting spectrum and making it available for wireless broadband access. The Federal Communications Commission should consider "reallocating this valuable spectrum to services better able to serve the needs of U.S. consumers," the wireless operators said in the FCC inquiry into making broadband access less expensive and more widely available. In a plan floated by the FCC's Blair Levin earlier this month, the agency promised broadcasters some share of the proceeds that would come from auctioning the broadcast spectrum to wireless operators. Broadcasters would also be able to retain some spectrum so that they could continue broadcasting a standard-definition-only service for the millions of consumers who still rely solely on over-the-air TV. So far, however, broadcasters are rejecting the plan. Although CTIA doesn't specifically cite the Levin plan, it makes clear its support for reallocation of the broadcast spectrum.
benton.org/node/29326 | TVNewsCheck
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TRANSITIONING TODAY'S RURAL USF TO BROADBAND
[SOURCE: NECA, AUTHOR: ]
On October 29, representatives of NECA met with Federal Communications Commissions staff to discuss the National Broadband Plan. NECA proposed a framework that would allow a consumer-driven, market-oriented transition from today's voice-centric regulatory mechanisms to ones specifically designed to support broadband deployment and adoption in rural America. NECA said the National Broadband plan should: 1) define the "Rural Broadband Network;" 2) establish key policy elements for a High Cost Broadband Universal Service Fund; 3) include a smooth, market-driven transition from existing support mechanisms to a new high-cost broadband fund; 4) allow Rural Broadband Network Providers flexibility to meet customer needs; 5) help small providers make services available in rural areas; and 6) address reforms of the intercarrier compensation system. The FCC formed NECA in 1983 to perform telephone industry tariff filings and revenue distributions following the breakup of AT&T. NECA administers the FCC's access charge plan.
benton.org/node/29312 | NECA
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IF VERIZON STOPS DEPLOYING FIBER, THEN WHAT?
[SOURCE: App-Rising.com, AUTHOR: Geoff Daily]
As Verizon nears the end of its initial $23 billion rollout of FiOS, apparently the company going to focus more on marketing what it has already built rather than expanding its fiber footprint further. This raises some questions: 1) What does this mean to the deployment of full fiber connections around the country? 2) If some policymakers have pointed to Verizon's fiber investments as proof the broadband market's working, how can they say we're headed in the right direction if no one fills the void left by Verizon? 3) If we rely solely on the market for broadband deployment, aren't we going to end up a nation of haves and have nots?
benton.org/node/29311 | App-Rising.com
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AT&T'S ROLE IN THE SMART GRID
[SOURCE: AT&T, AUTHOR: Joseph Marx]
On October 29, AT&T visited the Federal Communications Commission to discuss the requirements for deploying Smart Grid Technology on a wireless service provider
network, the impediments to deployment, and opportunities for the FCC to help overcome these obstacles.
benton.org/node/29320 | AT&T
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CYBERSECURITY

AUTHORITY FOR CYBER ADVISOR
[SOURCE: CongressDaily, AUTHOR: Chris Strohm]
Expressing frustration with the Obama administration, House Armed Services Strategic Forces Subcommittee Chairman Jim Langevin (D-RI) said he will introduce a bill soon to codify the powers of a White House adviser for national cybersecurity efforts. He is worried that momentum is fading to tackle the nation's major cybersecurity vulnerabilities. Chairman Langevin said he worries that even when an adviser is appointed, he or she will not have the necessary powers to force federal agencies into action. He said in an interview that he plans to introduce a bill possibly at the beginning of 2010 to give the adviser budget and personnel authority. Langevin's bill would mark the first effort in the House to legislate on cybersecurity since Obama came into office. Across Capitol Hill, key senators are at odds over how best to improve federal cybersecurity efforts.
benton.org/node/29310 | CongressDaily
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LIEBERMAN PREVIEWS CYBERSECURITY BILL
[SOURCE: nextgov, AUTHOR: Jill Aitoro]
Homeland Security and Governmental Affairs Committee Chairman Joe Lieberman (I-CT) previewed the bullet points of a measure he plans to introduce later this year. Here's five principles of the bill: 1) A Senate-confirmed cybersecurity coordinator in the Executive Office of the President, 2) Authority and personnel for the Homeland Security Department to monitor federal civilian networks and defend against malicious traffic, 3) A mandatory risk-based approach, established by DHS, to sure the nation's critical infrastructure, including financial systems, electric power, and mass transit, and voluntary guidance for less critical companies, 4) New acquisition policies to tighten the security of government systems, and 5) Recruitment strategy for hiring, retaining, and training cyber security personnel in the federal government.
benton.org/node/29309 | nextgov
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IT DOESN'T PAY TO SKIMP ON CYBERSECURITY
[SOURCE: Government Technology, AUTHOR: Paul Taylor]
[Commentary] On the heels of the sixth annual National Cybersecurity Awareness Month, information security has been generally accepted as a cost of doing business. The question is how to pay the tab. Confronted by the Great Recession, some states and localities have deferred security spending to survive the budget crisis, making the same kind of Faustian bargain uninsured motorists do when they choose rent and food over insurance premiums. They perilously calculate that they'll catch up eventually and gamble that they can avoid accidents in the meantime. When the bet goes bad, there's hell to pay. Fresh guidance from the U.S. Department of Homeland Security on federal grant prioritization would help. So too would fresh thinking about a unified cyber-security funding model that accounts for potential weak links regardless of whether they are at the center or the periphery of what ultimately is government's shared operating environment.
benton.org/node/29321 | Government Technology
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TELECOM

STATES APPROVING FRONTIER PURCHASE OF VERIZON LINES
[SOURCE: Verizon, AUTHOR: Press release]
State regulators in California, Nevada and South Carolina approved the acquisition by Frontier Communications of the local wireline operations of Verizon Communications serving residential and small-business customers in all or parts of those states. The Federal Communications Commission and state regulators in Arizona, Illinois, Ohio, Oregon, Washington state and West Virginia also must approve the transaction. In addition, Frontier has received cable television franchise approval from 10 of the 41 communities the company will serve in Oregon and Washington state. On May 13, Verizon announced plans to divest its local wireline operations serving residential and small-business customers in predominantly rural and small to medium-sized areas in 14 states, and that Frontier would acquire these operations. The operations Frontier will acquire include all of Verizon's local wireline operating territories in Arizona, Idaho, Illinois, Indiana, Michigan, Nevada, North Carolina, Ohio, Oregon, South Carolina, Washington, West Virginia and Wisconsin. In addition, the transaction will include a small number of Verizon's exchanges in California, including those bordering Arizona, Nevada and Oregon.
benton.org/node/29303 | Verizon
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CELLPHONE MARKET GROWTH RAISES PRICING FEARS
[SOURCE: Reuters, AUTHOR: Tarmo Virki]
The global cellphone market is set to grow in the holiday sales-fueled October-to-December quarter, after four quarters of falls, raising fears of pricing battles, analysts said on Friday. The mobile phone industry is ending its worst year ever, with top handset vendor Nokia forecasting earlier this month that 2009 market volumes would fall 7 percent from 2008, indicating a small rise in the fourth quarter.
benton.org/node/29324 | Reuters
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ED TECH

PARENTS: FOCUS MORE ON 21ST-CENTURY SKILLS
[SOURCE: eSchool News, AUTHOR: ]
Although parents, K-12 students, and educators agree that using technology is essential to learning and student success, parents are largely dissatisfied with the technology skills their children are learning in schools, according to a new analysis of survey data released Oct. 29 by the nonprofit Project Tomorrow and Blackboard. According to the survey data, only one-third of parents and 40 percent of students in grades 6-12 believe that schools are doing a good job of preparing students for the 21st century. In contrast, more than half of principals surveyed believe they are doing a good job of preparing students. "The disconnect between educators and parents reveals the need for schools to improve the integration of technology into the learning environment and students' learning experiences," said Julie Evans, CEO of Project Tomorrow. "Parents do not feel that schools are effectively preparing students for the jobs of the 21st century, and [they] view technology implementation as essential to student success."
benton.org/node/29308 | eSchool News
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COLLEGES AXING STUDENT EMAIL ACCOUNTS
[SOURCE: eSchool News, AUTHOR: Dennis Carter]
Some campuses are doing away with school-issued e-mail addresses as students increasingly enter college with a personal e-mail account, according to a nationwide survey by education-technology group EDUCAUSE. The survey also showed that more colleges and universities are offering 24-7 help-desk support for students and staff, and the vast majority employ some kind of bandwidth-shaping practices to manage traffic on their networks.
benton.org/node/29307 | eSchool News
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HEALTH IT

FEDS URGED TO SET SIMPLE, EXPANDABLE HIE STANDARDS
[SOURCE: GovernemntHealthIT, AUTHOR: Mary Mosquera]
Technology executives from across the business world told a federal health IT advisory group it should establish simple but expandable health information exchange standards or risk overwhelming healthcare practitioners. The Health IT Standards Committee, which is helping establish the ground rules for the administration's health IT incentive plan, has recommended a set of standards for delivering "meaningful use" of health IT by 2011. But some healthcare providers say they are too broadly-based and might be difficult and costly to adopt. Instead, a standard that is destined to be accepted should be easy enough that small provider practices can apply it.
benton.org/node/29306 | GovernemntHealthIT
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PANEL SEEKS RX FOR SECURE HEALTH DATA EXCHANGE
[SOURCE: FederalComputerWeek, AUTHOR: Alice Lipowicz]
The Health IT Standards Committee's Implementation Workgroup heard from several large and small health plans, hospitals, doctors' practices and vendors. The workgroup, chaired by federal Chief Technology Officer Aneesh Chopra, is gathering information on how to set standards for secure health data exchange systems. The committee will forward its recommendations to the Health and Human Services Department, which will consider them for upcoming regulations later this year for distributing $20 billion in Medicare and Medicaid incentive payments. The payments will go to providers who buy and "meaningfully use" certified electronic health record systems. Some of the health plans have set up pathways to exchange data through HHS' Nationwide Health Information Network (NHIN) pilot project.
benton.org/node/29319 | FederalComputerWeek
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CABLE/BROADCASTING

PARTISANSHIP AND CABLE NEWS
[SOURCE: Pew Research Center for the People & the Press, AUTHOR: ]
The recent debate over the partisan composition of cable news network audiences has focused on data from the Pew Research Center for the People & the Press. As we reported in our 2008 biennial news media consumption survey, there are stark differences in the partisan composition of the Fox News Channel, CNN and MSNBC audiences. And each cable network's audience profile differs from the partisan balance of the public at large by approximately the same amount. Among regular Fox News Channel viewers, 39% identified as Republican, 33% as Democrats and 22% as independents. Among regular CNN viewers, 51% identified as Democrats, 23% were independents and just 18% were Republicans. In short, Democrats comprise a larger share of the Fox News audience than Republicans do of CNN's audience. However, it should be noted that there are more Democrats than independents or Republicans in the general public. In the 2008 news consumption survey on which this analysis is based, 36% identified as Democrats, 29% as independents and 25% as Republicans. In terms of partisan affiliation, the audiences for both news networks differed substantially from the public.
benton.org/node/29304 | Pew Research Center for the People & the Press
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DVR, ONCE TV'S MORTAL FOE, HELPS RATINGS
[SOURCE: New York Times, AUTHOR: Bill Carter]
Television network executives have fallen in love with a former tormentor: the digital video recorder. The reason is not simply that more households own DVRs — 33 percent compared with 28 percent at this point in 2008 — helping some marginal shows become hits. It is also that more people seem content to sit through the commercials than networks once thought. These factors combined mean DVR ratings now add significantly to live ratings and thus to ad revenue. Against almost every expectation, nearly half of all people watching delayed shows are still slouching on their couches watching messages about movies, cars and beer. According to Nielsen, 46 percent of viewers 18 to 49 years old for all four networks taken together are watching the commercials during playback, up slightly from last year. Why would people pass on the opportunity to skip through to the next chunk of program content? The most basic reason, according to Brad Adgate, the senior vice president for research at Horizon Media, a media buying firm, is that the behavior that has underpinned television since its invention still persists to a larger degree than expected.
benton.org/node/29338 | New York Times
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SACRAMENTO JURY AWARDS $16.6 MILLION FOR DEATH IN RADIO CONTEST
[SOURCE: Sacramento Bee, AUTHOR: Andy Furillo]
A Sacramento jury set an eye-popping standard Thursday on the cost of radio station contests that kill and the resulting loss of a mother's love and a wife's companionship. The tab for Entercom Sacramento came to $16,577,118 in the water-intoxication death of Jennifer Lea Strange in a contest put on by radio station KDND. Such was the award rendered by a Sacramento Superior Court jury of seven men and five women in the trial to settle a wrongful death lawsuit filed on behalf of Strange's survivors. The 28-year-old woman died Jan. 12, 2007, after she participated in KDND's "Hold Your Wee for a Wii" contest.
benton.org/node/29334 | Sacramento Bee | Sue Wilson
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OWNERSHIP

COMCAST SAID TO BE CLOSE TO GAINING NBC UNIVERSAL
[SOURCE: New York Times, AUTHOR: Michael de la Merced, Andrew Ross Sorkin]
Apparently, General Electric and the cable giant Comcast have moved closer to a deal giving control of NBC Universal to Comcast, and a formal announcement could be made sometime next week. After a series of meetings last week, the two companies reached a tentative agreement on Friday over the main points of a deal. Comcast would own about 51 percent of NBC Universal, contributing several billions of dollars in cash and its own stable of cable networks to the new venture. GE, which currently owns 80 percent of the entertainment company, would retain the other 49 percent and would contribute about $12 billion in debt to the new entity, though it is expected eventually to sell its ownership interest over several years. Much work remains before the deal can be completed. The main issue is the negotiations with Vivendi, the French conglomerate that owns 20 percent of NBC Universal. Talks with Vivendi are continuing, focused largely on how to reach an acceptable valuation of NBC Universal, these people said. The French media company gained its stake in NBC Universal in 2004 through a deal with GE, which combined NBC with Vivendi's Universal Entertainment.
benton.org/node/29339 | New York Times
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CAPITALIZATION STRATEGIES WORKSHOP
[SOURCE: Federal Communications Commission, AUTHOR: ]
The Federal Communications Commission's Office of Communications Business Opportunities will host a Capitalization Strategies Workshop focused on capital acquisition both for developing entrepreneurs and for Small and Disadvantaged Businesses. The Workshop is open to the public and will be held on November 12, 2009 from 9:30 a.m. until 3:30 p.m. Entrepreneurs, SDBs, and others interested in telecommunications and/or broadcasting, for which raising capital is a prerequisite, will hear remarks presented by panelists on each of two panels. The first panel will be made up of government sector representatives and the second panel will be made up of finance experts from the private sector. Specifically, the panelists will address issues involved in obtaining public-sector or private-sector financing for those entrepreneurs or SDBs who seek either to launch new enterprises or to facilitate growth in existing businesses. Panelists will discuss capitalization strategies applicable in a variety of business sectors, i.e. broadband technologies, cable and broadcast TV, broadcast radio, wireless services, and common carrier facilities. Capitalization strategies will also be discussed in the context of ownership of ancillary services that provide technological, marketing, and administrative support systems for businesses in the communications industry.
benton.org/node/29328 | Federal Communications Commission
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ADVERTISING

MAGAZINE INDUSTRY HOOKED ON PHARMA?
[SOURCE: MediaWeek, AUTHOR: Lucia Moses]
Change is in the wind for the pharmaceutical industry and magazines, as a rash of potential curbs on pharma advertising spotlights one of the medium's most dependable categories. With healthcare issues on the front burner, lawmakers are taking aim at the tax deduction on ad expenses for prescription drugs, while TV ads for sex aids like Viagra are coming under scrutiny. Even before President Obama took office, buyers and publishers noticed a tempering in pharma spending, which some interpreted as an anticipation of a less-friendly attitude toward the industry. Some drug marketers—including Pfizer, Johnson & Johnson and Merck—last year said they had voluntarily put a moratorium on advertising for new drugs. Direct-to-consumer drug advertising has long been politically sensitive, but since the Food & Drug Administration relaxed its rules for drug ads on TV in 1997, spending to reach healthcare consumers directly has ballooned. Magazines have shared in the wealth. From 2003-'08, drugs & remedies in consumer magazines soared 58 percent to $2.2 billion, ranking it No. 2 behind toiletries & cosmetics, according to Publishers Information Bureau. And with mainstay print categories like financial, auto and travel tanking, pharma is one category that's been a bright spot.
benton.org/node/29323 | MediaWeek
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