August 2010

Tenants at 165 Pinehurst Avenue, a six-story brick building on a hilltop in Washington Heights (NYC), have something most modern Americans would envy: impeccable cellphone service. But it comes with a cost. They worry their building in northern Manhattan is going to collapse.

Their reception is so crisp because of two cellphone base stations and 20 antennas positioned on their building's roof, sending and receiving thousands of calls each day for T-Mobile and AT&T. To the cellphone providers, this hub — and others like it — are essential to accommodating the explosion of mobile data and voice communications. But the tenants, as much as they like their clear reception, are in an uproar because they argue that their 82-year-old building cannot bear the weight of the base stations. Long, zigzagging cracks have appeared along the building's outer walls, and mortar has crumbled from the parapet, which supports hefty I-beams that the base stations sit upon.

Republican Senators raised concerns over reports that a firm with ties to the Chinese military is bidding to supply equipment to Sprint Nextel and potentially the U.S. government.

Eight Republican senators wrote August 18 to senior Obama administration officials, including Treasury Secretary Timothy Geithner and Director of National Intelligence General James Clapper, to question reports that the Chinese telecom firm Huawei Technologies is seeking clearance to do business in the United States. The senators claim Huawei has questionable ties to the Chinese military and has supplied equipment to Iran, the Taliban and Saddam Hussein's regime in Iraq. They argue allowing Huawei to supply equipment to Sprint Nextel, a major defense contractor, could threaten national security.

The economy is still shaky, but that won't stop politicians from spending a record amount this year on advertising to sway mid-term election results.

And the political advertising floodgates will open right after Labor Day spewing messages -- and an inordinate amount of mud, according to analysts -- right up to Election Day on Nov. 2. According to Borrell Associates, political ad spending will reach $4.2 billion this year, double the $2.1 billion the firm estimated was spent in 2008. And Campaign Media Analysis Group (CMAG), a unit of WPP's Kantar, also expects a record total, with up to $2.8 billion being spent by candidates and various special interest groups, vs. the $2.6 billion it said was spent two years ago.

Political spending this year is eye opening given that general market advertisers aren't expected to return to pre-recession spending levels until at least 2013, according to PricewaterhouseCoopers. It's also striking given that 2010 is a mid-term election, when spending usually dips below the previous presidential campaign cycle. But not this year: "It's become an endless campaign, that's really what we're seeing," said Kip Cassino, vp research at Borrell.

Evan Tracey, president of CMAG, notes that this mid-term cycle has an unusual amount of highly competitive races, including close to 100 congressional elections, vs. the normal 35 to 40. In addition more than half of all the gubernatorial and senate seats are up for grabs. "I can't remember that much turnover before and they all feel like they're in the cross-hairs of voters," he said of the candidates. "And that competitiveness drives the spending."

[Commentary] In the year since the Federal Communications Commission reached its full complement of members, it has been "picking at crumbs while there was a roast sitting on the table." Indeed, when the FCC became whole last August, there was a veritable buffet of tempting items from which to choose, any one of which would have set the FCC off on a course of action and shown that the Obama FCC represented the change for which the president's supporters voted and in which they believed.

To wit:

1. On February 20, 2007, Skype filed a petition with the FCC asking for the common-sense ruling that would apply the 1968 decision allowing any wired telephone to be connected to the network to the wireless world as well.
2. On December 11, 2007, Public Knowledge and others filed a petition with the FCC asking that texting and accompanying short codes be protected.
3. On May 20, 2008, rural cellular carriers asked the FCC to take a look at deals between carriers with cellphone manufacturers which left the rural consumers unable to have access to those phones if a particular carrier doesn't provide service in a given area.

Right there are three key groups of people in the country - wireless customers generally; those who use text messaging, generally younger customers; and rural customers - who could have been helped with minimal effort from the FCC. No new proceedings would have been needed. Even today, none of those petitions has been acted upon.