September 2010

On Sept 16, the House Subcommittee on Communications, Technology, and the Internet held a legislative hearing on H.R. 5828, the "Universal Service Reform Act of 2010", a bill sponsored by subcommittee Chairman Rick Boucher (D-VA). There's a consensus in Washington that the multibillion dollar annual fund needs reform, but rather than fully overhaul the program, the bill targets the high cost fund, the method of fund collection and the inclusion of funds for the support of broadband.

House Commerce Committee Chairman Henry Waxman (D-CA) said he had some concerns about costs, and just what some of the savings might be from proposed changes in the bill. He was also concerned about some of the broad waivers in the bill and their impact on the goal of deployment of broadband to "all Americans".

Addressing the former concern, Chairman Boucher asked Kathleen Grillo, senior VP of Verizon, what she estimated the savings to the fund would be from the bill's provision requiring competitive bidding for wireless carrier support. She said anywhere from $200 million to $500 million. "That is pretty substantial savings," said Boucher. He also pointed to the bill's cutting off of funds to voice-based wireline phone service in areas with competition and looking at net revenues from all supported services when determining the level of support as ways to keep costs down.

Walter McCormick, president and CEO of USTelecom, told the panel that his organization endorsed the legislation. "By addressing intercarrier compensation as well as universal service, the bill takes a comprehensive approach to addressing the financial fundamentals that will help spur private investment in broadband facilities," he said. The National Cable & Telecommunications Association, Verizon, and Qwest Corporation also expressed support for the bill.

Most of the criticism of the bill came from committee Republicans concerned about the lack of a cap on the fund or a way to offset potential increase, led by ranking member Cliff Stearns (R-FL). Rep Stearns cited the FCC's input that the fund could increase without a cap, and said the bill should not proceed without "strong statutory assurances" that that was going to happen.

NBC Universal Sports and Olympics Chairman Dick Ebersol said big-tent broadcast programming, whether it's the Olympics or particularly juicy NFL football matchups, will continue to bring people together en masse. The country's prolonged economic ills, Ebersol said, make compelling television events that much more important to people.

"The country is really looking for a sense of community right now," he said. Ebersol used his address to implore the broadcast world to work together in keeping such events away from pay TV, saying there's no evidence that cable can deliver the same kinds of numbers for a world-class TV event. "It's key that these broadcast events stay broadcast events," he said. "We must support each other in going after them."

With groups like Common Sense Media making news by claiming the majority of parents want certain games controlled by law, it's useful to look at just how well the industry regulates itself.

As there are currently no laws against selling M-rated content to minors, the rating system relies on retailer compliance to be effective. What special interest groups may not understand, however, is that everyone from the retailers to the publishers seem to understand that compliance is in everyone's best interest. Compliance with the ratings system is at an all-time high, making video game sales more tightly controlled than theater ticket, DVD, and music sales. It's not a perfect system, as some children were able to purchase the content, but according to this data, it's the most effective system in place in entertainment.

While bloggers sometimes focus on the same broad subject matter as the mainstream media, as last week illustrated, they can choose to explore very different aspects of those themes. For the week of September 6-10, one-quarter (25%) of the news links on blogs were about the war in Iraq, making it the No. 1 story according to the New Media Index from the Pew Research Center's Project for Excellence in Journalism.

News about the Obama White House was the No. 2 story on blogs (22%) and the No. 5 story in the mainstream media. And while a good chunk of the mainstream coverage focused on someone possibly leaving the administration--chief of staff Rahm Emanuel-the bloggers opted to talk about something that had just arrived--the new rug prominently displayed in the Oval Office. The social media conversation about Iraq followed a column in the September 5 Washington Post concluding that the true cost of the war-factoring in the costs of treating veterans, increases in the cost of oil and the impact on the national debt-is far greater than previously thought. Written by Joseph E. Stiglitz, the chairman of President Bill Clinton's Council of Economic Advisers, and Linda J. Bilmes, a senior lecturer in public policy at Harvard University, the piece expands on an estimate the two made in 2008 when they originally came up with the $3 trillion number-although they offered no specific new price tag.