January 2011

Comcast NBCU concessions include 'ten-dollar' broadband

Comcast’s concessions to win approval for its merger with NBC Universal include a $9.95/month high-speed Internet service for people earning less than $20,000/year.

Perhaps that concession comes in light of recent research that shows the deal may raise TV prices for consumers. The argument against the deal is that the likes of DirecTV, Dish, RCN, Verizon and AT&T might have to negotiate for access to premium programming, at which point Comcast could hold out for higher prices. Those higher charges for programming would possibly be passed on to subscribers. Although Comcast seems optimistic that the deal will be approved by January, many hope the Comcast sales pitch won't blur the FCC’s vision in considering objectively the full impact of the deal on telecom providers, Web TV players and competitors in satellite and cable. Consumer advocacy groups and legislators amped it up in the last couple weeks. For example, Sen. Bernie Sanders (I-VT) has called on the FCC to block the deal, stating "If this merger is approved, I have little doubt that Comcast-NBCU will retain hundreds of attorneys and lobbyists to exploit gaps and loopholes in any conditions and regulations," he said in a statement. "Once we allow companies to become this powerful, the FCC does not regulate them. They regulate the FCC."

Ten most compelling Independent telco stories of 2010

Here's the 2010 stories that reminded Engebretson why she loves to be a telecom reporter.

Broadband stimulus actually is creating jobs
GPON or active Ethernet? GPON is still the predominant fiber-to-the-home option in the U.S. But with the advent of home-run wiring, active Ethernet is gaining ground.
Infrastructure innovations don't have to be high-tech to be exciting.
The biggest problem with the National Broadband Plan
Universal Service already funds broadband
A new way to maximize spectrum usage
The quintessential community anchor network
The smart grid opportunity
Traffic pumping and USF support for wireless carriers
Verizon breaks new ground with rural LTE strategy

FCC Seeks Comment on Diversity Recommendations

The Media and Wireless Telecommunications Bureaus of the Federal Communications Commission seek comment on a recommendation of the Advisory Committee on Diversity for Communications in the Digital Age that the Commission consider a new preference program in its competitive bidding process to provide bidding credits to individuals and entities who have overcome substantial disadvantage.

The Advisory Committee explains that the new preference ‘‘would expand the pool of designated entities to include those qualified applicants who have overcome substantial disadvantage," noting that the proposed program is analogous in some respects to programs used by educational institutions in their admissions processes.

Comments are due on or before February 7, 2011; reply comments are due on or before February 25, 2011.

FLO Spectrum Sale Hints at UHF Spectrum Value

One of the precepts of the FCC's plan to reallocate up to half the usable broadcast TV spectrum for broadband is that the market value of the spectrum would be much greater if it's used for broadband rather than for broadcasting. If the price AT&T is paying for Qualcomm's prime FLO spectrum is any indication, the Federal Communications Commission may have a hard time convincing broadcasters to voluntarily give up their spectrum.

AT&T is set to pay $1.925 billion for spectrum currently used for Qualcomm's FLO TV operation. While that may sound like a large amount, consider that, according to the TWICE article on the shutdown, FLO was operational in 107 markets. Dividing 107 into $1.925 billion gives an average price per market of only $18 million. The price per channel would be less, as Qualcomm also owns Block E spectrum in some markets. How many TV stations would be willing to give up their TV channel for $18 million? In reality, they would receive much less, as the government would want its cut for deficit reduction. One possible reason for the lower price is this is "unpaired" spectrum -- there isn't a separate block of frequencies to be used for two-way communications. This doesn't appear to be a problem for AT&T, however.

Why KCET never became a major player in the PBS network

Next week, in addition to being without an NFL franchise, Los Angeles will lose another hallmark asset that major cities typically claim — a flagship PBS affiliate.

Why couldn't the nation's second-largest media market sustain a thriving PBS affiliate that operated a top national player? If New York, Boston and Washington (DC) can do it, why couldn't Los Angeles? While KCET officials contend they were marginalized by an institutional bias within PBS toward an elite group of East Coast stations, critics are adamant, at times withering, in their view that the local station squandered its potential, surrendered its ambition of becoming a national player and never truly connected with its viewing public - who after all were counted on to largely fund the endeavor. One need look no further than the amount of prime-time programming hours produced for the national PBS audience last year, say critics. While WNET in New York (125 hours), WGBH in Boston (135 hours) and WETA in Washington, D.C. (337 hours), combined for 597 hours, KCET contributed just 10. KCET officials, proud of their programming that included local hits like "California's Gold" and nationally distributed ones like "Tavis Smiley," maintained they were unfairly blocked from competing nationally. The PBS network greatly favored the "big three" — WETA, WGBH and WNET — which effectively formed an oligarchy that prevented not only KCET but medium and smaller PBS affiliates from grabbing prime programming hours.

FCC, CBS Continue To Battle Over Janet Jackson Reveal

The Federal Communications Commission, backed by the Justice Department, says that broadcasters give up full First Amendment status when they get a government license, and so should be subject to government regulation of swearing and nudity when kids could be watching.

That was the gist of the FCC's supplemental brief to the Third Circuit Court of Appeals, which is reviewing its earlier decision that the FCC's $550,000 fine of CBS for Janet Jackson's partially exposed breast on the 2004 Super Bowl halftime show broadcast was arbitrary and capricious. The Third Circuit had sought input on whether, if CBS was found to have knowledge of the "reveal," the FCC should be applying the criminal or civil recklessness standard. The FCC argues it should be the latter, which would mean CBS could be culpable even if it was not aware of what Jackson and Justin Timberlake were going to do, so long as it should have been aware. The criminal recklessness standard applies only if CBS had been aware of the risk and chose to disregard it.

Update: Revised Broadcast License Renewal Forms Head To OMB

Changes to the broadcast license renewal application form (Form 303-S) appear to have passed the first bureaucratic hurdle: having invited public comments (which were due by December 13) and then having waited a decent interval (that would be about two days), the Federal Communications Commission has passed its proposed changes along to the Office of Management and Budget for OMB’s review. Notice of that development has now been published in the Federal Register. This gives everybody yet another opportunity to toss in any comments they might have about the revised form – but this time those comments should be directed to OMB. If you've got anything to say to OMB, you've got until January 26, 2011 to say it. Once that deadline has come and gone, look for the revised form to be officially released by the Commission, just in time for the next round of renewal applications which are due by June 1.

All Americans Do Not Have Access to Broadband Services – Have We Forgotten Puerto Rico?

[Commentary] Implementation of the National Broadband Plan (NBP) in Puerto Rico has thus far proven to be a significant hurdle for the Federal Communications Commission (FCC).

The NBP was well received by the telecommunications and technology industries, policymakers, and several leading national Hispanic, Asian, and African American groups, all of which are quickly realizing that, without access to broadband services, they will not be able to compete and participate in the 21st century’s digital economy. The FCC’s recent study on broadband adoption found that no one in Puerto Rico has access to broadband.

1/6 of Americans (3,954,000 people) without broadband access live in Puerto Rico, which accounts for almost the entire population of Puerto Rico.
Broadband download speeds for Puerto Rico fall below 1.0 Mbps (below that of Mexico and all 33 OECD countries), while U.S. download speeds average nearly 3.8 Mbps.
Puerto Rico has a population greater than 24 U.S. states but an average median household income of only $13,189, compared to $34,809 for all areas of the United States and $28,627 for unserved areas generally. Poverty is a significant issue in Puerto Rico, with 44.8% of Puerto Rico’s residents living below the poverty line.
Puerto Rico has by far the lowest telephone penetration rate of any U.S. state. Prior Census studies suggest the actual telephone penetration rate may lie somewhere between 73% and 80%, while the local regulator in Puerto Rico estimates the rate at 40%.

US Mobile Technographics

The first step in building or refining a mobile strategy is understanding the mobile behaviors of your target audience. In April 2009, Forrester first published Mobile Technographics, offering consumer product strategists a means of obtaining a quick overview of the level of mobile sophistication of their target audience. For this update in 2010, Forrester has designed and fielded questions to create consistent profiles across geographies. The definitions have changed slightly to accommodate this goal. With growth in the adoption of smartphones, the opportunities are greater than ever.

Apple Sued Over Mobile App Privacy

Apple and four app developers have been hit with a lawsuit that alleges violations of computer fraud and privacy laws by allowing ad networks to access users’ personal information.

The suit was filed on Dec 23 by the law firm KamberLaw on behalf of Jonathan Lalo, a Los Angeles County resident, in federal court in San Jose, California. It seeks class-action status. The complaint names app developers Pandora, Dictionary.com, The Weather Channel and Backflip Studios, the maker of the Paper Toss app, as well as Apple. The complaint accuses Apple of allowing ad networks to track users’ app activity based on a unique identification number. It also charged that apps were selling other information to ad networks including “users’ location, age, gender, income, ethnicity, sexual orientation and political views.”

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