May 2011

FCC Fines Stations for Public File Violations

[Commentary] In several recent cases, the Federal Communications Commission issued big fines to stations that had significant gaps in their public inspection files - fines of between $10,000 and $14,000.

Unlike many other recent public inspection file fines, these fines did not arise from self-reporting of violations in a license renewal application, nor were they discovered as a result of a complaint from a disgruntled listener or competitor. These fines also did not arise in connection with the discovery of other violations at the stations. Instead, these fines were the result of FCC inspections - inspections that seemingly did not turn up other significant violations. Thus, these cases serve as a warning that broadcasters need to ensure that their file is complete and up-to-date at all times. Curiously, these large fines come at the same time that the FCC is about to consider comments on whether the public file paperwork burden is justifiable.

These fines were large - demonstrating a seeming trend to ever-higher fines for public file violations. The $14,000 fine issued today went to a Class A TV station that had no quarterly programs issues lists in its public file for the entire license renewal term - 34 reports were missing at the time of the inspection. Based on this egregious violation, the FCC decided that an increase over the base $10,000 fine was in order. Two AM stations, which had pretty much the same violation as the Class A station - no QPIs for the same period of time - received $10,000 fines (see decisions here and here). A third AM station received a $10,000 fine for having no new information in its public file since 2006.

Internet privacy measure stalls in California senate

An Internet privacy proposal that would require social networking firms to remove personal information when requested has stalled in the state legislature May 27 amid vocal opposition from Facebook, Twitter, Google and other companies.

The state Senate deadlocked 16-16 on the legislation, which would also give parents the right to edit home addresses, phone numbers and other information out of their children's online postings. Sen. Ellen Corbett (D-San Leandro) said constituents had lobbied for the measure because of worries that criminals made ill use of personal information gleaned from social networking sites. Meanwhile, the tech companies in opposition have argued that the proposal restricts interstate commerce, violates free speech and is badly written.

Microsoft gets $5 for every Android phone made by HTC, report says

Microsoft receives $5 for every Android phone made by Taiwan-based HTC Corp., according to a Citigroup report on Microsoft. The report said that Microsoft gets the money as part of a patent dispute settlement with HTC, which manufactures smartphones and tablets powered by Google's Android and Microsoft's Windows operating systems.

Google, Facebook lose social network patent ruling

Google and Facebook failed to win dismissal of a lawsuit by a New York company related to software designed to let people take part on social networks through their mobile phones.

Wireless Ink, which runs the Winksite service, may pursue claims that Google Buzz and Facebook Mobile infringed its October 2009 patent, U.S. District Judge Kevin Castel in Manhattan wrote in a ruling. The patent related to a method to help novice mobile phone users create mobile websites that other phone users can see. Wireless Ink is seeking a halt to the alleged infringement, and compensatory and triple damages.

FCC Issues CALM Act NPRM

The Federal Communications Commission has quietly released its Notice of Proposed Rulemaking (NPRM) on implementation of the Commercial Advertisement Loudness Mitigation (CALM) Act, which regulates the loudness of commercials on broadcast and cable TV.

It puts the onus on stations and cable operators to mitigate that loudness on all commercials, not just those that are locally inserted, as some industry representatives had argued it should be limited to. The NPRM also asked for input on what challenges some stations and cable operators will have in complying with the new rules, and even more important, proposed solutions. Among the questions it wants answered are if a cable operator retransmits a TV station whose commercials don't comply, who does the FCC hold responsible? The FCC said it will add a "commercial loudness" category to its menu of complaints over "Broadcast (TV and Radio), Cable, and Satellite Issues." The CALM Act empowers the FCC to regularize the volume between programming and commercials. It adopts the Advanced Television Systems Committee's recommended practices for variations in commercial volume in relation to the programs around them.

Smartphone makers bow to demands for more openness

For many Android enthusiasts, "openness" is almost an 11th commandment. So when manufacturers began restricting full access to Android smartphones a couple years ago, many saw it as a cardinal sin. Good news for you smartphone modders: some manufacturers are beginning to see the light.

"Today, I'm confirming we will no longer be locking the bootloaders on our devices," wrote HTC CEO Peter Chou in a Facebook post. "There has been overwhelmingly [sic] customer feedback that people want access to open bootloaders on HTC phones." Essentially, the bootloader is like the backstage area where preparation for a show goes down. When you first turn on a phone, the bootloader is the program that loads the operating system software into a phone's memory and then launches the OS. If your bootloader is unlocked, you can gain "root access" to your phone, which allows for full administrative privileges. That means more control over what's on your device. For many Android phone owners, "openness" is a major draw to the platform. Google's open-source operating system software is published publicly for all to peruse. The Android Market doesn't require a vetting process for app submissions like Apple's App Store does. And being able to modify an Android device via unlocking the bootloader has been very attractive to phone geeks. HTC has long been seen as a relatively modder-friendly phone manufacturer. Although many of their phones have had locked bootloaders, workarounds were easy enough for software developers to spot in order to gain superuser access to their phones. That changed recently, however, when modders discovered that two new Android phones -- the HTC Sensation and Evo 3D -- would come with software that prohibited bypassing locked bootloaders.

Defense, Homeland Security jointly respond to cyber attack on Lockheed Martin

The Pentagon and the Homeland Security Department are aiding contractor Lockheed Martin on an investigation into a cyber attack that reportedly infiltrated the firm's security networks, federal officials said May 28.

"DoD is aware of a cyber incident impacting Lockheed Martin and, together with the Department of Homeland Security, is working with the company in determining the extent of the incident," Pentagon spokeswoman Lt. Col. April Cunningham said. "Impact to DoD is minimal and we don't expect any adverse effect." According to Reuters, which first reported the Lockheed incident on May 27, unidentified hackers "breached [Lockheed] security systems designed to keep out intruders by creating duplicates to SecurID electronic keys," according to one person who was not authorized to publicly discuss the matter. The offenders learned how to copy the security keys with data stolen during the RSA attack, the Reuters story said.

Internet business era demands widespread broadband access

[Commentary] There still are people who doubt the importance of the Internet and universal broadband access to the information superhighway. A recently released study by Connected Tennessee should help doubters come to grips with the importance and the value of high-speed Internet access.

According to the statewide study, the first of its kind in Tennessee, businesses with broadband connections generate more revenue and create more jobs. State businesses with high-speed Internet connections report median annual revenue more than $400,000 greater than businesses without broadband access. The Connected Tennessee report presents strong evidence that no education is complete without a strong technology component. Across the state, we hear businesses pleading for a better-prepared workforce. Economic development efforts hinge on broadband access and a computer literate workforce. A study by the Tennessee Higher Education Commission predicts that 97 percent of future jobs that will support a middle-class standard of living will require some post-secondary education. You can bet that the vast majority of those jobs will be in businesses that rely on broadband Internet access and use computers and sophisticated computer software to conduct their business.

Meet Facebook, the Web’s Social Entertainment Operating System

[Commentary] Earlier this week, when networking goliath Cisco all but confirmed it had shut down an ambitiously named Entertainment Operating System (EOS), I suspect some folks at Facebook may have chuckled quietly to themselves. After all, the big social network, which is reportedly in negotiations with all sorts of entertainment companies to integrate their services, may have designs on becoming for real what the Cisco product was only in name: a social entertainment operating system for consumers. The growing importance of Facebook as a social entertainment layer is due to two main factors. First, the social Web is becoming the new EPG for a generation of consumers. Fading is the old-world model of corporate-programmed guides and tastemakers; ascending is a world where entertainment is personalized and social, and where much of it will be driven by Facebook. Second, time and place restrictions on media are going away, making way for anytime, anywhere on-demand consumption across any screen. And as these linear models break down and anytime-anywhere media consumption rises, Facebook can become the recommendation and consumption layer that enables, organizes and make sense of the media chaos.

Hearing mixed messages over the AT&T-T-Mobile merger

[Commentary] While consumer groups seem universally opposed to the merger of AT&T and T-Mobile, the two operators’ actual competitors are more of a mixed bag. I don't think a single operator wants to see this deal go through. And if there was any chance at stopping it they'd probably present a unified front with the sole exception of Verizon, which is more concerned with how the deal goes through. But knowing there is little they can do to stop it, they’re now focusing on the post-merger spoils. Everyone has an angle in this scenario.

Depending on where they stand in relation to AT&T and T-Mobile, they seem to see different opportunities and different dangers if the AT&T and T-Mobile were allowed to create a single mega-carrier. Sprint is the only major operator that has come out unequivocally against the deal with CEO Dan Hesse using whatever pulpit he can find to denounce it. Verizon Wireless has publicly remained neutral, but it’s easy to get the impression it’s actually in favor of the merger. Verizon’s primary concern is what impact a failed merger or a successful merger loaded down with conditions would have on its own ability to buy competitors and spectrum in the future."

The reactions of the regional operators, however, have been more puzzling. The Rural Cellular Association and the Rural Telecom Group have come out firmly against deal, as have some of the smaller Tier II operators like Cincinnati Bell. But the larger Tier II operators have sent some mixed signals.

MetroPCS has said it could ultimately benefit from the merger as it would require spectrum divestitures in major markets Metro could pounce on. Yet MetroPCS has also taken up with Sprint and rural carrier groups in some of their anti-merger efforts such as asking the FCC to review all of AT&T’s proposed acquisitions in a single proceeding. Leap Wireless has done much the same. Earlier this week Leap issued a statement making it fairly clear it thinks the merger would stymie competition and negatively impact small carriers, (Briefing Room: Leap opposed proposed AT&T acquisition). Yet like MetroPCS, Leap officials have said they see the opportunity to expand in its current markets or into new markets in the merger’s aftermath.

The operators who are really going to hosed are the rural GSM operators, whatever’s left of them. Rather than have two nationwide GSM operators to pit against each other for competitive roaming agreements there will be only one. The new AT&T will be free to dictate rates.