March 2011

New Comptel chairman wants access to copper -- or whatever replaces it

A Q&A with new chairman of Comptel Dale Schmick. He talks about network unbundling, special access, AT&T/ T-Mobile merger concerns.

Traffic pumping minutes rose 48% in 2010

A new study from Connectiv Solutions offers both good and bad news about traffic pumping.

Also known as access charge stimulation, traffic pumping refers to a scenario in which the operator of a free conference call or chat line terminates inbound calls to a competitive local exchange carrier in a rural area that charges unusually high per-minute access charges and then shares those revenues with the conference call or chat line operator. Connectiv Solutions offers a service to wireless and wireline carriers that analyzes calling records for their customer base and determines the volume of calls to the highest-volume traffic pumpers so that the carriers can renegotiate terminating access charges with the CLECs. The good news is that the dollar value of access charges paid to traffic pumpers for 2010 came in lower than Connectiv estimated they would be because some carriers were able to renegotiate those rates. The bad news is that the minutes involved increased 48%, indicating the increased popularity of free conference call and chat line services.

Open Sourcing the IT Dashboard & the TechStat Process

The White House released the software code of the IT Dashboard and the TechStat toolkit to the public for two reasons.

First, to take the platform to the next level, we want to tap into the collective talents and ingenuity of the American people, to enhance functionality, improve the code and address existing challenges such as those identified by David Powner and his team at GAO.

Second, CIOs from across the country and around the world such as Maarten Hillenaar of the Netherlands, Kyle Schafer in West Virginia and Jason DeHaan of the City of Chicago are all interested in implementing these platforms in their respective organizations.

EEO Audits Begin

On March 29, 2011, the Federal Communications Commission mailed the first of its Equal Employment Opportunity (EEO) audit letters for 2011 to randomly selected radio and television stations. The FCC annually audits the EEO programs of randomly selected broadcast licensees and multi-channel video programming distributors (MVPDs). Each year, approximately five percent of all radio and television stations and MVPDs are selected for these EEO audits.

Wait until June for a fix? Throttled WoW player wants ISP fined

You can only frustrate your customers for so long before one of them decides to become an expert on the issues at hand and starts filing complaints with government regulators. That's the situation at Rogers, one of the top three Internet providers in Canada, which has admitted to regulators that it had been throttling World of Warcraft for months. One angry customer now wants fines levied against the company and reimbursement for her subscription to the popular game.

March 26-April 1: It's all about... Google?

Yes, sure, the combination of AT&T and T-Mobile continues to grab the most headlines (you can see all the coverage). But there were a few additional policy developments in the last week and the common actor in each seems to be search giant Google.

Google tops paidContent.org's recently released list of the "Most Successful Digital Media Companies in the US" -- that is, the companies bringing in the most money from online content and online advertising. paidContent estimates that Google reaped $14.1 billion in digital revenue in 2010. The company has created a massive business off of others that do create content online. Its search engine culls billions of web pages to return results, which it then sells ads against. Google's AdSense is the largest ad network in the world and funds the operations of thousands of sites. And Google's YouTube hosts videos that are played more than two billion times a day.

And Google is only growing. It gave all of its 24,000 employees a 10% raise this year. And it announced in January that 2011 would be its biggest hiring year ever. How many hires will that mean? Its previous biggest hiring year was 2007, when it added nearly 6,200 people around the globe. YouTube also said it would increase hiring more than 30%.

Google just announced that it will build its ultra high-speed network in Kansas City, Kansas. Next year the proposed network will bring homes and offices gigabit-speed data -- about 100 times faster than most Americans now have. Google said it will invest tens of millions of dollars in the system. It will use existing utility poles and underground conduit to deploy fiber for the system. Schools and other public locations will be able to use the service for free.

But the company has also had a number of setbacks of late.

On March 22, US Circuit Judge Denny Chin has rejected a deal between Google and lawyers for authors and publishers to let the gigantic search engine make money presiding over the world's largest digital library, saying the creation of a universal library would benefit many but would "simply go too far" by "grant[ing] Google significant rights to exploit entire books, without permission of the copyright owners." Judge Chin said the deal gives Goggle "a significant advantage over competitors." He said the deal would be "rewarding [Google] for engaging in wholesale copying of copyrighted works without permission, while releasing claims well beyond those presented in the case." The deal's collapse have some wondering what Google's next move will be to make its Google Books project a reality. Some, like the New York Times, are looking to Congress for a solution. Congress could resolve the problem of orphan books. In 2008, it almost passed a bill that would allow anybody to digitize orphan works without fear of being sued for copyright infringement as long as they proved that they had tried to find the rights’ holder. This would give all comers similar legal protection to that which Google got in its agreement.

On March 30, Google got more bad press when the Federal Trade Commission announced the company had agreed to settle charges that it used deceptive tactics and violated its own privacy promises to consumers when it launched its social network, Google Buzz, in 2010. The agency alleges the practices violate the FTC Act. The proposed settlement:

  • bars the company from future privacy misrepresentations,
  • requires it to implement a comprehensive privacy program,
  • requires the company to obtain users’ consent before sharing their information with third parties if Google changes its products or services in a way that results in information sharing that is contrary to any privacy promises made when the user’s information was collected,
  • calls for regular, independent privacy audits for the next 20 years to assess its privacy and data protection practices.

This is the first time an FTC settlement order has required a company to implement a comprehensive privacy program to protect the privacy of consumers’ information. In addition, this is the first time the FTC has alleged violations of the substantive privacy requirements of the U.S.-EU Safe Harbor Framework, which provides a method for U.S. companies to transfer personal data lawfully from the European Union to the United States.

The action is part of the FTC's stepped-up efforts to protect consumer privacy . FTC's Maneesha Mithal, director of the division of privacy and identity presentation, said this week that the FTC is concerned when companies don't keep users' data secure -- as happened when Twitter security glitches resulted in hackers gaining access to some users' names, passwords and private messages. The agency recently finalized a settlement with Twitter stemming from that data breach. Mithal also said that failing to live up to promises in privacy policies can trigger FTC action. The agency recently settled with ad network Chitika for telling users they could click on a link to opt out of online behavioral targeting, but then setting those opt-outs to expire after only 10 days.

Privacy is one of the few issues in Washington that is inspiring bipartisanship. In the Senate, Communications Subcommittee Chairman John Kerry (D-MA) is meeting with Sen John McCain (R-AZ) in hopes of finally bringing him on board as the lead GOP co-sponsor of a privacy bill. On the other side of the Capitol, Rep Cliff Stearns (R-FL) said that he is seeking a Democratic co-sponsor for legislation he plans to offer soon.

Google's most recent headache came March 31 with an announcement from Microsoft that is filing a formal antitrust complaint with European Union officials. Microsoft has six complaints:

  • Google's ownership of YouTube has disadvantaged Microsoft in the realm of video search,
  • Google has prevented Microsoft phones from running YouTube properly,
  • the Google Books settlement has threatened to lock out competitors,
  • Google's ad services have prohibited advertisers from porting collected user data elsewhere, such as to Microsoft's tools,
  • Google has blocked competing search boxes in part through exclusivity deals, and
  • Google "discriminates against would-be competitors by making it more costly for them to attain prominent placement for their advertisements."

FTC Commissioner J. Thomas Rosch also raised concerns recently that the four major Web platforms -- Google, Facebook, Apple and Microsoft -- could skew the Internet advertising market to the detriment of competitors and potential upstarts.

"We have to be careful about letting the current players manipulate the market in such a way that it does tip prematurely [in their favor] and that it hurts rivals," Commissioner Rosch. "Google is trying to do it though its search methods. Facebook is trying to do it though its huge population of friends. Apple's trying to do it though its app stores. Microsoft is trying to do it through its alliance with Facebook," Commissioner Rosch said. "This is a pretty highly concentrated market, as far as I'm concerned."

Headlines staff are off on Spring Break next week and, we admit -- the timing is terrible. The Senate Commerce Committee is looking at the communications needs of Native Nations, the FCC revs up intercarrier compensation reform and holds a monthly meeting with a packed agenda , the Senate Judiciary Committee consider updating privacy laws for the digital age -- and, of course, there's a host of events in Boston around the National Conference for Media Reform. Here's the full agenda, we'll play catch-up when we return April 11.

Happy April Fool's Day!


April 20-21, 2011
Sheraton Downtown Hotel
1550 Court Place
Denver, Colorado

Please join us to learn more about how to apply for Rural Development’s broadband programs. On March 14, 2011, Rural Development published its new Broadband loan program regulations and a Notice of Solicitation of Applications (NOSA - available at http://www.rurdev.usda.gov/utp_farmbill.html). Rural Development also recently announced a NOSA for the Community Connect Grant Program (available at http://www.rurdev.usda.gov/utp_commconnect.html). Rural Development Broadband Division staff will offer a workshop for prospective applicants for both programs at the Sheraton Downtown Denver Hotel, Denver, Colorado on April 20 and April 21, 2011. The workshop is free; however prior registration is required. See below for registration instructions. The workshop will be recorded and available on our website at a later date.

AGENDA

Day 1: Wednesday, April 20, 2011

7:30 AM - 8:30 AM Registration
8:30 AM - 9:00 AM Opening Remarks
9:00 AM - 10:00 AM Overview of the Farm Bill Broadband Loan Program

10:30 AM - 11:15 AM
Breakout Session 1 - Broadband Loan Program: Equity/Additional Cash Requirements
Breakout Session 2 - Broadband Loan Public Notice Requirements
Optional Breakout Session 3 - Tips from a Broadband Loan Recipient

11:30 AM - 12:00 PM
Breakout Session 4 -Broadband Loan Market Survey Requirements
Breakout Session 5 - Broadband Loan Competitive Analysis
Optional Breakout Session 6 - FCC's Accessing Wireless Spectrum

12:00 PM - 1:30 PM Lunch on your own

1:30 PM - 2:45 PM
Breakout Session 7 - Broadband Loan Financial Analysis
Breakout Session 8 - Broadband Loan System Design

Breakout Session 9 - Broadband Loan Program: Equity/Additional Cash Requirements
Breakout Session 10 - Broadband Loan Public Notice Requirements
Optional Breakout Session 11 - SBA's Tips on How to Write a Business Plan

4:15 PM -4:45 PM
Breakout Session 12 - Broadband Loan Market Survey Requirements
Breakout Session 13 - Broadband Loan Competitive Analysis

Day 2: Thursday, April 21, 2011

9:00 AM - 10:15 AM
Breakout Session 14 - Broadband Loan Financial Analysis
Breakout Session 15 - Broadband Loan System Design

10:30 AM - 11:30 AM
Open Q & A Session
Closing remarks on the Farm Bill Broadband Loan Program
12:00 PM - 1:00 PM
Community Connect Registration (for people just attending Community Connect portion)

1:00 PM - 1:30 PM Community Connect Grant Program: Regulation and Notice of Solicitation of Applications

1:30 PM - 3:00 PM Community Connect Grant Program: Application Process

3:30 PM - 5:00 PM Listening Session - How does RUS improve the DLT, Community Connect, Farm Bill Broadband and Telecommunications Infrastructure Programs?

How to Register: The workshop is free but prior registration is required. Information on how to register can be found at http://www.rurdev.usda.gov/RUSTelecomPrograms.html
Hotel Reservations: Reservations can be made at http://www.starwoodmeeting.com/Book/USDA2011April

For more information, contact Jenifer Stevenson at Jenifer.stevenson@wdc.usda.gov or 202-205-9386. Application and Program Information: Information about the Broadband Loan Program can be found at http://www.rurdev.usda.gov/utp_farmbill.html. Information about the Community Connect Grant Program can be found at http://www.rurdev.usda.gov/utp_commconnect.html



March 31, 2011 (Out Like a Lamb?)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for THURSDAY, MARCH 31, 2011

The USDA's rural development program gets a turn before House appropriators http://benton.org/calendar/2011-03-31/


INTERNET/BROADBAND
   Ultra high-speed broadband is coming to Kansas City, Kansas - Press release
   CBO Score Resolution to Disallow Network Neutrality Rules
   Schools, Health and Libraries Broadband Coalition Holds Broadband Summit
   Bandwidth Caps Force Netflix to Cut Video Quality in Canada [links to web]
   Verizon expects better economics, lower latency with US 100 G deployment [links to web]

AT&T|T-MOBILE
   Analysts: AT&T, T-Mobile could face long review - analysis
   AT&T Sees Some Trade-Offs
   AT&T CEO: Optimistic Obama's Pro-Business Stance Will Help Deal
   AT&T CEO Makes Case T-Mobile Deal Will Boost IPhone Service
   The quest for bandwidth - editorial
   The unholy alliance of NAB, News Corp, and Wall Street Journal’s Jenkins - op-ed [links to web]

MORE ON WIRELESS/SPECTRUM
   Pentagon Raises Concerns About Lightsquared Wireless
   House Republicans to FCC: Back off 'detrimental' spectrum policies [links to web]
   NAB’s Hail Mary Attempts to Thwart Wireless Industry Innovation Need to Stop - op-ed [links to web]
   Cellphone Radiation May Alter Your Brain. Let’s Talk. - analysis [links to web]

NEWS FROM HILL HEARINGS
   Chairman King: Now is Time to Reallocate D Block
   Key holdouts endorse public safety plan
   Chairman Genachowski Testifies on FCC Budget
   FCC's Genachowski ducks Google 'Wi-Spy' questions [links to web]

PRIVACY
   FTC Charges Deceptive Privacy Practices in Google's Rollout of Its Buzz Social Network
   Privacy Makes for Hot Dates in Congress
   Hill eyes phone-tracking policies
   Ad Industry Takes Another Look At 'Do Not Track' in Browsers [links to web]

ADVERTISING
   Antitrust Cry From Microsoft
   FTC Commissioner Rosch: Beware of Google, Facebook, Apple, Microsoft
   Ad Industry Takes Another Look At 'Do Not Track' in Browsers [links to web]

CONTENT
   Google’s Book Deal - editorial
   The Most Successful Digital Media Companies In The US [links to web]

TELEVISION
   The FCC Muzzle - editorial
   Local TV News & Joint Services Agreements
   On NBC, the missing story about parent company General Electric
   House Republicans to FCC: Back off 'detrimental' spectrum policies [links to web]
   PTC To Justice: Appeal Fox Profanity Decision [links to web]
   KCET-TV said to be in talks to sell landmark studio to Church of Scientology [links to web]
   African-Americans Watch Most TV, Asians Least [links to web]

EMERGENCY COMMUNICATIONS
   FCC's Genachowski on Modernizing 911 [links to web]

MORE ONLINE
   When the networks bubble over - op-ed [links to web]
   Are Expiration Dates On Groupon Deals Illegal? [links to web]
   What’s In a Name? [links to web]
   Kevin Martin Sets Up Growth Capital Shop [links to web]

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INTERNET/BROADBAND

GOOGLE PICKS KANSAS CITY
[SOURCE: Google, AUTHOR: Milo Medin]
Google announced that it will build its ultra high-speed network in Kansas City, Kansas. The company signed a development agreement with the city, and it will be working closely with local organizations, businesses and universities to bring a next-generation web experience to the community. In selecting a city, Google's goal was to find a location where it could build efficiently, make an impact on the community and develop relationships with local government and community organizations. Google found this in Kansas City. Google will be working closely with local organizations including the Kauffman Foundation, KCNext and the University of Kansas Medical Center to help develop the gigabit applications of the future. Pending approval from the city’s Board of Commissioners, Google plans to offer service beginning in 2012. Google will also be looking closely at ways to bring ultra high-speed Internet to other cities across the country.
benton.org/node/54372 | Google | see the video | ABC | KCTV | ars technica | paidContent.org
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CBO SCORES NET NEUTRALITY RESOLUTION
[SOURCE: Congressional Budget Office, AUTHOR: Susan Willie]
The Congressional Budget Office has scored H.J. 37 which would disapprove the rule adopted by the Federal Communications Commission (FCC) on December 21, 2010, that is intended to preserve the Internet as an open network. Report and Order FCC 10-201 establishes rules that would bar broadband providers from blocking lawful content and discriminating in transmitting lawful traffic on the network. The rule also would require broadband providers to disclose to the public information about network management practices, performance, and terms of service.
H.J. Res. 37 would invoke a legislative process established by the Congressional Review Act (Public Law 104-121) to disapprove the open Internet rule. If H.J. Res. 37 is enacted, the published rule would have no force or effect. Based on information from the FCC, CBO estimates that voiding this rule would have no effect on the budget. Enacting H.J. Res. 37 would not affect direct spending or revenues; therefore, pay-as-you-go procedures do not apply. H.J. Res. 37 contains no intergovernmental or private-sector mandates as defined in the Unfunded Mandates Reform Act and would impose no costs on state, local, or tribal governments.
benton.org/node/54393 | Congressional Budget Office
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SHLB SUMMIT
[SOURCE: BroadbandBreakfast.com, AUTHOR: Rahul Gaitonde]
The Schools, Health and Libraries Broadband Coalition assembled broadband stimulus award winners and government officials for their inaugural broadband summit on March 29 to share solutions and success in solving digital literacy and adoption issues. The SHLBC, formed two years ago, comprises libraries, hospitals, schools, non-profit groups and corporations that seek to further broadband availability for community anchor institutions. New Mexico’s State Librarian, Susan Oberlander, provided one of the most descriptive presentations on the state’s digital literacy program. “By holding the programs in the libraries we found that the programs instantly gained credibility,” Oberlander said. “People already trust the library as a source of good information.” Oberlander went on to describe how the state contacted telecommunications providers for assistance with developing and implementing the digital literacy and training programs, but the telecommunications providers were not receptive to providing assistance.
benton.org/node/54348 | BroadbandBreakfast.com
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AT&T|T-MOBILE

DEAL COULD FACE LONG REVIEW
[SOURCE: Washington Post, AUTHOR: Cecilia Kang]
In Washington, what's not said can be a powerful message. And when it comes to AT&T’s proposed acquisition of T-Mobile, a dull response by lawmakers and regulators about the deal has signaled to Wall Street and industry insiders that “an air of inevitability has settled,” according to tech policy analysts. Rebecca Arbogast and David Kaut of Stifel Nicholaus investment house wrote in a research note that instead, a call by lawmakers for a careful and close review of the deal is really more code language for a protracted review. They don't rule out that the Justice Department or Federal Communications Commission will block the transaction. But they believe that after a one-year to 18-month review, regulators could approve the deal with a bevy of conditions. “The deal couldn't be won in a week, but could have been lost, and it wasn't,” the analysts wrote. Yes, an FCC official has said in reports that the companies will face an uphill battle. That’s what they said about Comcast’s joint venture with NBC Universal, too.
benton.org/node/54369 | Washington Post
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AT&T SEES SOME TRADE-OFFS
[SOURCE: Wall Street Journal, AUTHOR: Roger Cheng]
AT&T Chief Executive Randall Stephenson said he expects some divestiture of customers and wireless spectrum as the company marches through the approval process to close its acquisition of T-Mobile USA. "We anticipate there will be some markets we will have to divest," Stephenson said. When the deal was first announced, Stephenson said he was starting with the belief that no concessions would be made. On March 30, he acknowledged that they were commonplace in these kinds of deals. However, he said it was too early to say whether more concessions would be needed beyond asset divestitures, and he didn't comment on which markets might be potentially targeted. Verizon Wireless Chief Executive Dan Mead previously said his company sees an opportunity to potentially scoop up some divested assets.
benton.org/node/54412 | Wall Street Journal | Financial Times
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AT&T OPTIMISTIC OF MERGER APPROVAL
[SOURCE: Dow Jones, AUTHOR: Roger Cheng]
AT&T Chief Executive Randall Stephenson said he is seeing "good signs" from a more pro-business stance from the White House, which he expects will be conducive to approving his deal with T-Mobile USA. AT&T's proposed plan to buy T-Mobile from Deutsche Telekom AG for $39 billion is expected to face heavy scrutiny from regulators and opposition from consumer advocacy groups and rivals. But Stephenson said that over the past few months, President Barack Obama has shown more of a willingness to work with businesses. He added he was encouraged by Obama's push to cover the nation with a mobile broadband network. Stephenson said he doesn't know what the net impact on jobs will be from the deal, but said that these kinds of deals lead to cuts from redundant operations. Over the long term, he sees more hiring as the company invests in wireless. Stephenson said the deal with DT could yield better roaming rates for its customers going to Europe. DT, which will be AT&T's largest shareholder after the deal closes, is working to get roaming rates at a predictable level.
benton.org/node/54367 | Dow Jones
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PITCHING AT&T|T-MOBILE
[SOURCE: Bloomberg, AUTHOR: Greg Bensinger]
AT&T Chief Executive Officer Randall Stephenson, making his case for a proposed takeover of T-Mobile USA, said the deal would boost network capacity and improve service for devices such as Apple’s iPhone. The acquisition would improve capacity on AT&T’s wireless network by about 30 percent in some of the largest U.S. cities, Stephenson said at an event at the Council on Foreign Relations in New York. It could also reduce charges for overseas roaming, he said. “This transaction is very instrumental” in improving network service, said Stephenson at the event. “Virtually on the day you close the deal, getting a 30 percent lift in capacity in New York City: that’s a significant improvement in call quality and data throughput.” Stephenson said concerns about the merger limiting competition in the U.S. are unfounded. “This is an intensely competitive industry,” he said. “It is intense before we do this transaction, it will be intense after we do this transaction.”
benton.org/node/54365 | Bloomberg
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QUEST FOR BANDWIDTH
[SOURCE: Los Angeles Times, AUTHOR: Editorial staff]
[Commentary] The rapidly increasing demand for smartphones and mobile bandwidth has prompted some analysts and regulators to warn of a looming wireless traffic jam — an irritant that some iPhone users in major cities have already experienced. Now, AT&T is proposing what it says is the fastest way to boost the capacity of its wireless network: buying T-Mobile. The $39-billion purchase would eliminate one of the four largest U.S. mobile phone networks and leave just two companies — AT&T and Verizon Wireless — in control of more than 70% of the market. That's reason enough for regulators to take a skeptical view of the deal. Yet AT&T's technical arguments raise the possibility that the acquisition could do more for the burgeoning ranks of smartphone users than the companies are likely to do separately. There's little question that the deal would be good for AT&T. Combining the two companies would cut costs and increase revenue so much, analyst Craig Moffett of Bernstein Research recently wrote, that AT&T would effectively be acquiring T-Mobile's earnings for free. That's true in part because AT&T charges more for service than T-Mobile and would be expected to try to move T-Mobile customers into more expensive plans. Given the high stakes and complexity of the deal, regulators will probably spend more than a year poring over data and developing models for how the mobile phone market would behave if the takeover were approved. In the meantime, AT&T and Verizon will be rolling out higher-bandwidth 4G networks and phones in more markets, which could ease the capacity crunch — or exacerbate it, just as adding lanes on a highway inevitably draws more traffic. Regulators should watch what happens closely for signs that the ballyhooed spectrum crunch is or isn't near at hand. And lawmakers should get to work on the long-term challenge of freeing up more spectrum.
benton.org/node/54364 | Los Angeles Times
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MORE ON WIRELESS/SPECTRUM

PENTAGON VS LIGHTSQUARED
[SOURCE: Wall Street Journal, AUTHOR: Amy Schatz]
Defense Department and federal transportation officials are expressing concern that wireless startup LightSquared's proposed mobile broadband service will interfere with GPS devices vital to military operations and aviation safety, and they are calling for a "comprehensive" study of the issue. In a joint letter to the Federal Communications Commission, Deputy Defense Department Secretary William J. Lynn and Transportation Department Deputy Secretary John Porcari said that they haven't been sufficiently included in the FCC's review of LightSquared's GPS interference issues. GPS users are concerned LightSquared's service could knock out their systems because LightSquared is proposing to operate on spectrum frequencies that are very close to those used by GPS services. The Defense and Transportation departments "strongly advise that a comprehensive study of all the potential interference to GPS is needed," they wrote in the March 25 letter. "The new LightSquared business plan and the new FCC rules significantly expand the terrestrial transmission environment, increasing the potential for interference to GPS receivers."
benton.org/node/54371 | Wall Street Journal
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NEWS FROM HILL HEARINGS

HILL PUBLIC SAFETY HEARING
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
House Homeland Security Chairman Peter King (R-NY) said it is time to allocate, not auction, D block spectrum for a national interoperable public safety network. Chairman king has introduced legislation that would allocate the D block spectrum and pay for it through auction of broadcast and other spectrum to wireless companies. At a March 30 hearing on the proposal, William Carrow, president of the The Association of Public-Safety Communications Officials (APCO), said that the needs of first responders are not being met, and that young people coming into public safety jobs have more capabilities on their personal communications devices than they do in their jobs. He said allocating the D block to public safety (10 MHz adjacent to the 10 MHz already allocated to public safety) is a unique opportunity to give public safety exactly what it needs. Chairman King pointed out that it has been almost seven years since the 9/11 Commission recommended in 2004 that the network be built ASAP. Sheriff Paul Fitzgerald of the National Sheriffs' Association said that among all the recommendations, the public safety network is the only one that has not been acted on. Rep. Bennie Thompson (D-MS), ranking member of the committee and co-sponsor of the bill, pointed out that House Commerce Committee Chairman Fred Upton (R-MI) still supported auctioning the D block -- for a public-private partnership -- as did the FCC (a recommendation of the national broadband plan). But he called on them both to support allocation of the block.
benton.org/node/54345 | Broadcasting&Cable
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911 CHAIRS ENDORSE D BLOCK PLAN
[SOURCE: The Hill, AUTHOR: Sara Jerome]
Two key supporters of a public safety plan authored by the Federal Communications Commissions (FCC) have changed positions to support a White House proposal instead. Former Gov. Tom Kean (R-NJ) and former Rep. Lee Hamilton (D-IN), the chairmen of the 9/11 Commission, switched their positions to back a spectrum plan offered by key senators and endorsed by the Obama Administration. Both Kean and Hamilton had been frequently invoked by those who want a D-Block auction rather than a direct allocation of airwaves to public safety agencies. If the FCC is to directly allocate airwaves to public safety, it needs a new law. Senate Commerce Chairman Jay Rockefeller (D-WV) has introduced legislation, as has House Homeland Security Chairman Pete King (R-NY). It's unclear whether the proposal can get support from House Republicans worried about cost.
benton.org/node/54347 | Hill, The
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BUDGET TESTIMONY
[SOURCE: Federal Communications Commission, AUTHOR: ]
Testifying before the House Appropriations Committee, Federal Communications Commission Chairman Julius Genachowski said, "With limited resources, the FCC has been making significant progress toward fulfilling its Congressional mandate to ensure that all Americans have access to a robust communications infrastructure for a wide range of purposes - including public safety, personal communications, consumer services, medical care, business expansion, employment, and education." He noted the work the FCC's Managing Director has done to "develop lean and flexible mechanisms and methodologies that make use of the resources that we already have first - before considering alternatives that might require additional financial resources." He outlined the work the FCC has done over the last year developing the National Broadband Plan, launching reform of the Universal Service Fund, identifying and freeing up spectrum for private sector use, spurring broadband deployment, protecting consumers, fostering public safety, and reforming agency operations.
The FCC is requesting a budget of $354,181,000 for fiscal year 2012. The FCC would continue to raise all of its funds through assessment of fees and permissible auction proceeds. Base funding increases are set at $2.5 million and programmatic initiatives are expected to cost $15.9 Million. Most of the base funding increase is for the Office of Inspector General. The requested budget includes $15.9 million in programmatic initiatives to: (1) finalize and support ongoing FCC-wide technology initiatives designed to improve efficiency and save costs; (2) implement specific components of the National Broadband Plan; (3) support the Commission's public safety role; (4) follow-through on studies necessary for finalizing a statutorily required report; and (5) upgrade and maintain services in the Office of Inspector General to combat fraud, waste, and abuse.
benton.org/node/54397 | Federal Communications Commission | B&C
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PRIVACY

FTC-GOOGLE DECISION ON BUZZ LAUNCH
[SOURCE: Federal Trade Commission, AUTHOR: Press release]
Google Inc. has agreed to settle Federal Trade Commission charges that it used deceptive tactics and violated its own privacy promises to consumers when it launched its social network, Google Buzz, in 2010. The agency alleges the practices violate the FTC Act. The proposed settlement bars the company from future privacy misrepresentations, requires it to implement a comprehensive privacy program, and calls for regular, independent privacy audits for the next 20 years. This is the first time an FTC settlement order has required a company to implement a comprehensive privacy program to protect the privacy of consumers’ information. In addition, this is the first time the FTC has alleged violations of the substantive privacy requirements of the U.S.-EU Safe Harbor Framework, which provides a method for U.S. companies to transfer personal data lawfully from the European Union to the United States.
The proposed settlement bars Google from misrepresenting the privacy or confidentiality of individuals’ information or misrepresenting compliance with the U.S.-E.U Safe Harbor or other privacy, security, or compliance programs. The settlement requires the company to obtain users’ consent before sharing their information with third parties if Google changes its products or services in a way that results in information sharing that is contrary to any privacy promises made when the user’s information was collected. The settlement further requires Google to establish and maintain a comprehensive privacy program, and it requires that for the next 20 years, the company have audits conducted by independent third parties every two years to assess its privacy and data protection practices.
The FTC will publish a description of the consent agreement package in the Federal Register shortly. The agreement will be subject to public comment for 30 days, beginning March 30, 2011 and continuing through May 2, 2011, after which the Commission will decide whether to make the proposed consent order final.
Sen John Kerry (D-MA) said the settlement underscores the need for legislation that outlines how businesses can use consumer information collected online.
Center for Democracy & Technology President Leslie Harris said: "The terms of this agreement are strong medicine for Google and will have a far-reaching effect on how industry develops and implements new technologies and services that make personal information public. We expect industry to quickly adopt the new requirement for opt-in consent before launching any new service that will publicly disclose personal information. This settlement sends the message that companies not only have to keep the promises they make to consumers, they must give users control over any technologies that make their information public."
benton.org/node/54357 | Federal Trade Commission | Wash Post
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PRIVACY PARTNERSHIPS
[SOURCE: National Journal, AUTHOR: Juliana Gruenwald, Dan Friedman]
Bipartisanship appears to be alive and well in Congress -- at least when it comes to privacy legislation. Lawmakers in both the House and Senate are looking hard for dates from the other party to join in offering legislation to boost consumer privacy online. In the Senate, Communications Subcommittee Chairman John Kerry (D-MA) is meeting this week with Sen. John McCain (R-AZ) in hopes of finally bringing him on board as the lead GOP co-sponsor of the Massachusetts Democrat's draft privacy bill. On the other side of the Capitol, Rep Cliff Stearns (R-FL) said that he is seeking a Democratic co-sponsor for legislation he plans to offer "soon," though did not offer a specific date. Rep Stearns, a senior Commerce Committee member, did not provide any names of potential Democratic partners but is eyeing members of the Commerce Committee, which has jurisdiction over the issue, according to an industry source.
benton.org/node/54335 | National Journal
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PHONE TRACKING POLICIES
[SOURCE: Politico, AUTHOR: Tony Romm]
Reps. Ed Markey (D-MA) and Joe Barton (R-TX), co-chairmen of the Congressional Bipartisan Privacy Caucus, sent letters to the four wireless providers, asking them to detail at length how they collect, use and store cell phone location data. The letters follow a story in The New York Times this week that revealed the extent to which Deutsche Telekom ­ the German company that seeks to sell T-Mobile to AT&T ­ had stored data on the whereabouts of Malte Spitz, a Green Party politician. The Times discovered that Deutsche Telekom had tracked the German lawmaker's longitude and latitude coordinates more than 35,000 times over a six-month period. Cell phone providers typically track the location of a customer's iPhone, BlackBerry, Android or other device as a means of servicing calls with the closest cell towers. Experts told the Times that providers and phones perform similarly when users access their e-mail accounts. But the extent to which Deutsche Telekom had tracked Spitz has prompted Reps Markey and Barton to ask AT&T, Verizon, Sprint and T-Mobile to explain their own collection practices.
benton.org/node/54334 | Politico | B&C
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ADVERTISING

ANTITRUST CRY FROM MICROSOFT
[SOURCE: New York Times, AUTHOR: Steve Lohr]
Microsoft, whose domination of the technology industry provoked a landmark federal antitrust case, is crying foul against Google and urging European Union antitrust officials to go after the search giant. Microsoft plans to file a formal antitrust complaint on March 31 in Brussels against Google, its first against another company. Microsoft hopes that the action may prod officials in Europe to take action and that the evidence gathered may also lead officials in the United States to do the same. In Europe, Microsoft is joining a chorus of complaints, but until now they have come mainly from small Internet companies saying that Google’s search engine unfairly promotes its own products, like Google Product Search, a price comparison site, over rival offerings. The Internet and smartphones are the markets where energy, investment and soaring stock prices reside. Microsoft, still immensely wealthy, is pouring billions into these fast-growing fields, especially Internet search. Yet the champion of the PC era trails well behind Google. The litany of particulars in Microsoft’s complaint, the company’s lawyers say, includes claims of anticompetitive practices by Google in search, online advertising and smartphone software. But a central theme, Microsoft says, is that Google unfairly hinders the ability of search competitors — and Microsoft’s Bing is almost the only one left — from examining and indexing information that Google controls, like its big video service YouTube. Such restraints, Microsoft contends, undermine competition — and thus pose a threat to consumer choice and better prices for online advertisers.
benton.org/node/54414 | New York Times | Politico | FT | Bloomberg
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FTC'S ROSCH ON ONLINE ADVERTISING
[SOURCE: Politico, AUTHOR: Mike Zapler]
Federal Trade Commission member J. Thomas Rosch said that he's concerned that four major Web platforms — Google, Facebook, Apple and Microsoft — could skew the Internet advertising market to the detriment of competitors and potential upstarts. "We have to be careful about letting the current players manipulate the market in such a way that it does tip prematurely [in their favor] and that it hurts rivals," Rosch said after his talk at an antitrust conference held by the American Bar Association. Commissioner Rosch declined to say specifically what activities or potential activities worry him. But he singled out the four Web giants that he has his eye on, all trying to monetize their large audiences through advertising, albeit in different ways. "For example, Google is trying to do it though its search methods. Facebook is trying to do it though its huge population of friends," Commissioner Rosch said. "Apple's trying to do it though its app stores. Microsoft is trying to do it through its alliance with Facebook." "This is a pretty highly concentrated market, as far as I'm concerned," Commissioner Rosch added.
benton.org/node/54395 | Politico
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CONTENT

GOOGLE'S BOOK DEAL
[SOURCE: New York Times, AUTHOR: Editorial staff]
[Commentary] Google’s ambitious proposal to scan, index and make available every book ever written promised a cultural revolution. Yet for all its promise, Judge Denny Chin of the United States District Court in Manhattan was right to strike down the plan last week, ruling that a settlement with the Authors Guild and publishers that would allow Google to put millions of books online without the explicit consent of their authors “would simply go too far.” Google, like anybody else, is entitled to scan and post books that are in the public domain. As for new books, most publishers cut deals for Google to provide access to portions of their new titles and give readers an option to buy a digital copy. The settlement, signed in 2005 and revised in 2008, covered books in the middle, those out of print but still protected by copyright. Congress, meanwhile, can resolve the problem of orphan books. In 2008, it almost passed a bill that would allow anybody to digitize orphan works without fear of being sued for copyright infringement as long as they proved that they had tried to find the rights’ holder. This would give all comers similar legal protection to that which Google got in its agreement. Congress should approve this legislation. While it’s at it, it should consider promoting a nonprofit digital library, perhaps seeded with public dollars. The idea of a universal library available to all is too good to let go.
benton.org/node/54411 | New York Times
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TELEVISION

THE FCC MUZZLE
[SOURCE: Wall Street Journal, AUTHOR: Editorial staff]
[Commentary] Congress tried and failed last year to limit corporate political speech in the wake of the Supreme Court's Citizens United decision, but the threat hasn't gone away. The new liberal hope is that the Federal Communications Commission will do the deed. Liberal activists at the Media Access Project filed a petition last week asking the FCC to re-interpret decades of law to require that groups that run political ads disclose the names of their top donors. The 1934 Communications Act already requires any group paying for an ad—whether commercial or political—to disclose its identity as part of the ad. But liberals want President Obama's FCC to stretch this reading to require the on-air disclosure of any donor providing 25% or more of funding. (The petition is unclear whether that means funding for the ad or for the group.) They also want the FCC to require ad buyers to disclose in public records all financial backers who contribute more than 10% of their budget. The goal here is to use "transparency" to intimidate businesses out of making political donations. Disclosure sounds good, but liberals have begun to wield it as a weapon to vilify business donors. If Republicans can't stop the FCC from imposing backdoor restrictions on speech, they can make clear that partisan rule-making will jeopardize its funding.
benton.org/node/54409 | Wall Street Journal
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LOCAL TV NEWS & JOINT SERVICES AGREEMENTS
[SOURCE: Benton Foundation, AUTHOR: Danilo Yanich]
In October 2009, a Shared Services Agreement (SSA) among three of the five television stations in Honolulu, Hawai’i went into effect. As a result of the SSA, three stations, KIVE, KHNL and KGMB combined their news operations as a new entity entitled Hawai’i News Now. Even before the SSA became a reality, there were serious concerns expressed by local citizens regarding the effect such an arrangement would have on the diversity of news in the market. Media Council Hawai’i (MCH), a local non-profit organization, filed a complaint and a request for emergency relief with the Federal Communications Commission to stop the implementation of the agreement. MCH contended that the SSA would negatively affect the content, diversity and competition of the Honolulu television market. The SSA owners argued, on the other hand, that television news in the DMA would be improved. This research, Local TV & Shared Services Agreements: Examining Content in Honolulu, essentially tested those propositions. It was a content analysis of the daily newscasts of all five of the television stations in the Honolulu DMA and a comparison of their newscasts before and after the Shared Service Agreement went into effect. What was the result of the analysis? The short answer is that the implementation of the Shared Services Agreement had a profound effect on the local news broadcasts in the market. The most significant finding is that two stations that were part of the three-station SSA group simply duplicated their newscasts through the mechanism of a simulcast.
http://benton.org/node/54385
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NO GE NEWS ON NBC
[SOURCE: Washington Post, AUTHOR: Paul Farhi]
It’s the kind of accountability journalism that makes readers raise an eyebrow, if it doesn't raise their blood pressure first. General Electric Co., reported the New York Times, earned $14.2 billion in worldwide profits last year, including $5.1 billion in the United States — and paid exactly zero dollars in federal taxes. The front-page story drew widespread commentary in newspapers and on many Web sites. ABC News and Fox News, among others, were all over it. But the story was conspicuously absent from the reportage of one news organization: NBC. During its March 25 broadcast, “NBC Nightly News With Brian Williams” had no time to mention that America’s largest corporation had essentially avoided paying federal taxes in 2010. Or its March 26, March 27 or March 28 broadcasts, either.
benton.org/node/54359 | Washington Post
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Antitrust Cry From Microsoft (updated)

Microsoft, whose domination of the technology industry provoked a landmark federal antitrust case, is crying foul against Google and urging European Union antitrust officials to go after the search giant.

Microsoft plans to file a formal antitrust complaint on March 31 in Brussels against Google, its first against another company. Microsoft hopes that the action may prod officials in Europe to take action and that the evidence gathered may also lead officials in the United States to do the same. In Europe, Microsoft is joining a chorus of complaints, but until now they have come mainly from small Internet companies saying that Google’s search engine unfairly promotes its own products, like Google Product Search, a price comparison site, over rival offerings. The Internet and smartphones are the markets where energy, investment and soaring stock prices reside. Microsoft, still immensely wealthy, is pouring billions into these fast-growing fields, especially Internet search. Yet the champion of the PC era trails well behind Google. The litany of particulars in Microsoft’s complaint, the company’s lawyers say, includes claims of anticompetitive practices by Google in search, online advertising and smartphone software. But a central theme, Microsoft says, is that Google unfairly hinders the ability of search competitors — and Microsoft’s Bing is almost the only one left — from examining and indexing information that Google controls, like its big video service YouTube. Such restraints, Microsoft contends, undermine competition — and thus pose a threat to consumer choice and better prices for online advertisers.

Update:

Microsoft's Brad Smith writes in a blog post: "the spread by Google of new and disconcerting practices in the United States" has hardly been stemmed by Washington scrutiny, and he notes that is the case in Europe too. But many of the complaints he outlines in his lengthy post transcend geography.

Smith aired six points: Google's ownership of YouTube has disadvantaged Microsoft in the realm of video search; Google has prevented Microsoft phones from running YouTube properly; the Google Books settlement, recently nixed in court, has threatened to lock out competitors; Google's ad services have prohibited advertisers from porting collected user data elsewhere, such as to Microsoft's tools; Google has blocked competing search boxes in part through exclusivity deals; and Google "discriminates against would-be competitors by making it more costly for them to attain prominent placement for their advertisements."

AT&T Sees Some Trade-Offs

AT&T Chief Executive Randall Stephenson said he expects some divestiture of customers and wireless spectrum as the company marches through the approval process to close its acquisition of T-Mobile USA.

"We anticipate there will be some markets we will have to divest," Stephenson said. When the deal was first announced, Stephenson said he was starting with the belief that no concessions would be made. On March 30, he acknowledged that they were commonplace in these kinds of deals. However, he said it was too early to say whether more concessions would be needed beyond asset divestitures, and he didn't comment on which markets might be potentially targeted. Verizon Wireless Chief Executive Dan Mead previously said his company sees an opportunity to potentially scoop up some divested assets.