October 2011

Diversity, cultural networks power innovation

[Commentary] University of California, Berkeley School of Information’s dean, AnnaLee Saxenian, often talks about a visit, in the ‘90s, by a high-level delegation from Japan. The Japanese kept asking where the government’s administrative offices were. They wanted to meet the people who did the central planning for Silicon Valley in order to learn directly from them. They couldn’t comprehend, said Saxenian, that such an authority didn’t exist -- that Silicon Valley thrives without government intervention.

People in Silicon Valley laugh when they hear these stories. But I have friends in Washington D.C. who, to this day, believe that government has a role to play in Silicon Valley-style innovation. They are mistaken, as are countries, such as Japan, that have invested billions of dollars on science parks and top-down clusters. To stimulate innovation, they have to first understand what really makes the Valley tick. For the past two years, I have been researching the success of one ethnic group: Indian immigrants. Before 1980, hardly any Silicon Valley firms were founded by people from India. But, as AnnaLee Saxenian documented in 1999, of the companies started in the Valley from 1980 to 1998, seven percent had an Indian founder. A survey my research team undertook at Duke University in 2006 found that this proportion had increased to 15.5 percent in the companies founded from 1995 to 2005. This is astonishing considering that, according to the 2000 census, fewer than six percent of the Silicon Valley workforce were Indian born. How did this group achieve this feat? They did so by mastering the Valley’s rules of engagement. They formed mentoring networks and started helping each other.

Military GPS Modernization

As the Department of Defense's (DoD's) Global Positioning System (GPS) satellites reach the end of their service lives, the department plans to replace them with ones that can counter deliberate interference by generating stronger signals.

Analysis by the Congressional Budget Office (CBO) indicates that an alternative approach -- namely, improving military receivers to retain the GPS signal even in the presence of such jamming -- would be less expensive than DoD's plan for upgrading its constellation of GPS satellites. Furthermore, the alternative would yield benefits almost a decade earlier than DoD's plan. However, the improvements to military receivers could make them larger and heavier (and thereby less useful to personnel operating on foot) until they could incorporate the substantial gains that have been achieved in miniaturization in other applications.

H.R. 3035, The Mobile Informational Call Act of 2011

Subcommittee on Communications and Technology
House Commerce Committee
Friday, November 4, 2011
9 am
http://energycommerce.house.gov/news/PRArticle.aspx?NewsID=9057

The Telephone Consumer Protection Act (TCPA) of 1991 limited the ability of telemarketers to make unwanted solicitations to consumers. It also placed additional restrictions on calls to wireless phones because consumers at the time paid high per-minute rates for even receiving calls. The hearing will explore concerns that the restrictions went too far and are inadvertently preventing Americans who rely on wireless phones from receiving useful information, such as alerting consumers of harmful activity on their bank accounts, data breaches, and other pertinent data affecting them directly. H.R. 3035 proposes to amend the TCPA to address some of these issues, especially since a growing number of American households now rely exclusively on cell phones. A background memo and witness list will be posted here as they become available.



October 22-28: Broadband, Broadband – How Do We get Broadband Everywhere?

This week, the United Nation’s Broadband Commission for Digital Development that to ensure that their citizens can be full participants in the increasingly broadband enabled "emerging knowledge societies," governments around the world should:

  1. Make broadband policy universal. By 2015, all countries should have a national broadband plan or strategy or include broadband in their Universal Access/Service Definitions.
  2. Make broadband affordable. By 2015, entry-level broadband services should be made affordable in developing countries through adequate regulation and market forces (for example, amount to less than 5% of average monthly income).
  3. Connecting homes to broadband. By 2015, 40% of households in developing countries should have Internet access.
  4. Getting people online. By 2015, Internet user penetration should reach 60% worldwide, 50% in developing countries and 15% in Least Developed Countries (LDCs).

The panel says that broadband technologies are fundamentally transforming the way we live. It is vital that no one be excluded from the new global knowledge societies we are building. The panel believes that communication is not just a human need – it is a right. The greater communication and understanding made possible through access to information and communication technologies (ICTs) can help us overcome the challenges in our complex and interdependent global society. The group noted broadband’s important role in economic growth; in opening up young minds to new horizons through educational technologies; in empowering women to expand their opportunities through genuine choices; in improving awareness of hygiene and healthcare; and in helping family breadwinners find work, a better salary or return on their goods.

The Commission issued the following Broadband Challenge calling on:

  • World leaders to ensure that at least half the developing world’s population and 40% of households in developing countries are using broadband Internet by 2015. Consumers in all countries should have access to affordable broadband Internet services, including in developing countries.
  • Industry to develop innovative business models needed to realize this vision.
  • Governments to make broadband policy universal and to develop the enabling policy and regulatory frameworks to ensure that industry has a stable regulatory space in which to operate, flourish and harness broadband for sustainable human development.
  • Governments to develop policies and targets for online health and education at the national level to stimulate demand for broadband services.
  • Governments and civil society within a fully inclusive and consultative process to stimulate local content production as well as the development of local language services and applications for an inclusive digital world.

The FCC Creates the Connect America Fund

By way of comparison, on March 16, 2010, the Federal Communications Commission delivered "Connecting America: The National Broadband Plan" to Congress. The plan includes over 200 goals and recommendations to the Federal Communications Commission, Congress and the Administration. Goal #1 of the National Broadband Plan is:

“At least 100 million U.S. homes should have affordable access to actual download speeds of at least 100 Mbps and actual upload speeds of at least 50 Mbps by 2020. As a milestone, by 2015, 100 million U.S. homes should have affordable access to actual download speeds of 50 Mbps and actual upload speeds of 20 Mbps.”

This week, the FCC completed a major effort to implement the National Broadband Plan (NBP). At the heart of the NBP was a call to reform and modernize the Universal Service Fund (USF), a web of subsidies that traditionally made telephone service available and more affordable in rural and other areas that are costly for telephone companies to serve.

The FCC adopted support for broadband-capable networks as an express universal service principle under section 254(b) of the Communications Act, and, for the first time, set specific performance goals for the high-cost component of the USF:

  • preserve and advance universal availability of voice service;
  • ensure universal availability of modern networks capable of providing voice and broadband service to homes, businesses, and community anchor institutions;
  • ensure universal availability of modern networks capable of providing advanced mobile voice and broadband service;
  • ensure that rates for broadband services and rates for voice services are reasonably comparable in all regions of the nation; and
  • minimize the universal service contribution burden on consumers and businesses.

The reforms adopted Oct 27 create a new Connect America Fund (CAF) with an annual budget of no more than $4.5 billion, which will extend broadband infrastructure to over 7 million Americans living in rural areas and who currently have no access to broadband. The CAF will ultimately replace all existing high-cost support mechanisms. Beginning in early 2012, all carriers who accept CAF support must provide broadband with actual speeds of at least 4 Mbps downstream and 1 Mbps upstream, with latency suitable for real-time applications and services such as VoIP, and with monthly usage capacity reasonably comparable to that of residential terrestrial fixed broadband offerings in urban areas.

As part of this reform, the FCC recognizes the growing importance of mobile broadband and makes it an independent universal service objective for the first time in history. Dedicated support to expand mobile broadband nationwide will be provided through a new Mobility Fund. The FCC will provide up to $300 million in one-time support to immediately accelerate deployment of networks for mobile voice and broadband services in unserved areas. This support will be awarded through a nationwide reverse auction, which the FCC expects to occur in third quarter 2012.

The FCC allocates at least $100 million per year to ensure that Americans living in the most remote areas in the nation, where the cost of deploying traditional terrestrial broadband networks is extremely high, can obtain affordable access through alternative technology platforms, including satellite and unlicensed wireless services. The FCC issued a request for public comment on a structure and operational details for that mechanism, including the form of support, eligible geographic areas and providers, and public interest obligations. The FCC expects to finalize the Remote Areas Fund in 2012 with implementation in 2013. The most remote areas represent less than 1% of the U.S. population.

While continuing to require that all eligible telecommunications carriers (ETCs) offer voice services, the FCC will now require that they also offer broadband services. The FCC updated the definition of voice services for universal service purposes, and declined to disrupt any state carrier of last resort (COLR) obligations that may exist. The also established specific and robust broadband performance requirements for funding recipients.

The overhaul could add as much as 50 cents a month to consumers’ phone bills immediately, which could rise to $2.50 a month in five years. But the FCC said that it expected a smaller increase, about 10 cents to 15 cents a month, or up to $1.80 a year.

POTS vs VOIP

Wired’s David Kravets notes that the move to modernize the USF really pitted traditional phone service providers like AT&T against Voice Over the Internet providers like Comcast. The process also exposed the FCC’s intellectual confusion over how to regulate communications in the Internet age. The FCC’s Order fails to address adequately the increasing popularity of Internet telephony, which is expected to expand even further under the program. That failure threatens the future of online phone calling services.

Given that the FCC is shifting subsidies from traditional phone carriers to high-speed broadband providers, it asked for public comments about its authority to regulate Voice-Over-Internet-Protocol (VOIP) calls, such as Comcast’s broadband-based phone service. That’s because it’s legally unclear whether the FCC has the authority to regulate VOIP calls. That puts into doubt a complicated system of FCC-required payments between phone carriers, who reimburse each other via “access charges” as calls move to and from one another’s lines.

AT&T is now seemingly threatening not to pay these fees or abide by rules that require them to let their customers call any number they like. AT&T says it is now clear that internet-based VOIP services are a Title II “telecommunications service” — a designation that comes with a complicated host of FCC common carrier regulations — not a Title I “information service,” which lives outside the FCC’s jurisdiction. And AT&T, ironically, is citing Comcast’s own arguments.

The FCC re-classified broadband access as a Title I service in the George W. Bush administration as a deregulation move, even though it’s tried to retain the right to regulate DSL and cable companies. Most recently, Comcast won a ruling from a federal appeals court that the FCC has no right to regulate Title I services as it fought off an FCC edict that Comcast abide by so-called net-neutrality principles that forbid ISPs from unfairly blocking certain kinds of internet traffic.

The FCC announced that both VOIP and traditional telephone services will be treated as if it was under Title II, although it did not resolve the legal conundrum. “All carriers originating and terminating VOIP calls will be on equal footing in their ability to obtain compensation for this traffic,” the FCC said.

The latest Title I versus Title II debate on VOIP, for the moment, is purely esoteric unless AT&T puts its money where its mouth is, by withholding payment and not allowing its customers to call people using Comcast and other VOIP providers.

Reaction

Reaction to the overhaul have been mostly positive, although many expressed reservations about the plan.

The funding switch is expected to bring high-speed Internet to the 6% of the population that has been saddled with slow or no Internet and is losing ground economically and academically as high-speed Internet have-nots. "This is definitely a step forward," IDC analyst Matt Davis says. "It will go a long way toward solving the digital divide in the United States."

House Communications and Technology Subcommittee Chairman Greg Walden (R-OR) said the FCC’s vote is a “major step toward fundamental reform” of the programs. He added that FCC Chairman Genachowski “ought to be congratulated” for securing final support from all the commissioners. “To get a 4-0 vote on an issue this complex and controversial is pretty impressive,” said Chairman Walden, whose panel began earlier this year to weigh reforms of how the FCC conducts its proceedings.

"Accomplishing this was not easy — each of the commissioners was forced to make tough choices and face criticism and potential challenges from stakeholders who would have preferred a different approach. But the FCC understands that in order to save this important program, it needs to be fundamentally reformed and directed towards the future," said House Commerce ranking member Henry Waxman (D-CA). Rep. Anna Eshoo (D-CA), ranking member on the telecom subcommittee, said the reforms “will have a meaningful impact on consumers across the nation” and said it will go down as “one of the most important infrastructure investments of our time.”

"For too long, this system has been focused on supporting the technology of the last generation -- basic voice telephone service," said Senate Commerce Committee Chair Jay Rockefeller (D-WV). "I am pleased it will now also tackle the challenge of the digital age -- bringing high-speed Internet and wireless service everywhere in this country. I recognize that reform means that some stakeholders will be unhappy because they prefer the status quo, but our Nation's communications infrastructure is too important to delay reform any longer. Our economy cannot afford missing out on the opportunities broadband enables, such as expanding business, fostering innovation, increasing access to education and healthcare, and even transforming entertainment. And consumers deserve more than a support system built only on the technology needs of the past. So I commend FCC Chairman Julius Genachowski and his colleagues for this effort, and I look forward to learning more about the details."

Sen. John Kerry (D-MA), chairman of the Senate Commerce Subcommittee on Communications, Technology and the Internet, praised the FCC reforms. Residents of his home state historically have paid more on their phone bills — nearly $1.5 billion between 2000 and 2009 — to subsidize telecom services in more rural states. “Now states like Massachusetts should get their fair share, and Universal Service Fund dollars should go where they’re needed most,” Sen Kerry said.

"These programs have needed to be updated for many years, and today’s action is a major step toward modernizing both regimes for the broadband era,” said Senate Commerce ranking member Kay Bailey Hutchison (R-Texas). “While I have not seen the order, I am glad to hear that it keeps the USF focused on bringing critical communication services to unserved parts of the nation. I also appreciate the FCC’s emphasis on halting the USF’s unsustainable growth."

The National Association of Regulatory Utility Commissioners issued this statement: "We are pleased with the proposals to prevent traffic pumping and eliminate inefficient fund disbursements, both of which are long overdue. We also appreciate that the agency recognizes the valuable and essential role Congress reserved to the States regarding carrier-of-last-report obligations and so-called ‘Eligible Telecommunications Carrier' designations...That said, we and many of our members have a number of concerns about preemption of State authority in other aspects of today's decisions. Some elements raise a host of unanswered legal and procedural questions but also the specter of unintended consequences for consumers. As we read through and digest the order, we will have more to say about these concerns. Overall, today's decisions appear to be a mixed bag. It is too early to tell just what the ramifications will be for consumers, but we will be reviewing these plans in short order."

“FCC Chairman Julius Genachowski and the members of the commission are to be commended for their leadership in undertaking reform of universal service and intercarrier compensation,” said USTelecom CEO Walter McCormick. “No previous commission proceeding has been more complex or challenging. For nearly a decade, regulatory uncertainty in this area has been an overhang on capital formation, job creation and economic growth. While we have not yet read the order, and are concerned by what we believe to be significant departures from the carefully balanced reform framework recommended by the companies that have long been dedicated to serving rural America, we are pleased that the commission’s USF reforms appear to remain appropriately focused on the priority objectives of accelerating broadband deployment to consumers in unserved areas of the nation, stimulating investment, and creating jobs. Similarly, the access reforms of today’s order will afford significant benefits to consumers. If implemented properly, they will reduce arbitrage, reward efficiency, and provide a manageable transition for rural carriers and the communities they serve from the voice world to the broadband world. We look forward to continuing to work with the commission in the weeks ahead as it seeks to achieve the delicate balance that is critical to full achievement of the National Broadband Plan’s public policy goals.”

"While we are disappointed in the Commission's apparent decision to ignore its longstanding principle of competitive neutrality and provide incumbent telephone companies an unwarranted advantage for broadband support," said National Cable & Telecommunications Association President Michael Powell, "we remain hopeful that the order otherwise reflects the pro-consumer principles of fiscal discipline and technological neutrality that will bring needed accountability and greater efficiency to the existing subsidy system. We are particularly heartened by the Commission's efforts to ensure that carriers are fairly compensated for completing VoIP calls."

"ACA is disappointed that the fund provides larger telephone carriers with a right of first refusal to provide broadband in high cost, unserved areas worth up to $1.8 billion annually — twice the amount of support these carriers receive under the existing USF program today. More than 500 smaller cable operators who are ACA members and were interested in having the same opportunity to participate in the Connect America Fund program know that consumers would have received better broadband services, such as higher speeds, if the FCC had opted for competitive bidding instead of the right of first refusal," said American Cable Association President and CEO Matthew Polka.

CTIA, the lobbying organization for the wireless industry, said that aiming only 11% of the fund at mobile does "not appear to fully take into account the significant consumer migration to mobile broadband services."

"While no one can say that it is thrilled with all aspects of what the FCC did today,” AT&T said in a statement, “we are cognizant that we shouldn't lose sight of the forest -- the significance of what this decision means to all Americans - through the trees. In the future, the basic level of service that United States policy will encourage and fund will be broadband and not simply voice service. This is a significant achievement worthy of congratulations and its impact on all Americans should not be minimized. With that said, we look forward to carefully reviewing the details of the FCC's order before we can fully understand all of its implications."

Verizon Communications said the agency's "overall approach" seems to put the subsidy fund "on a sustainable path and will enable millions of American households to connect to the high-speed broadband networks that are playing increasingly important roles in our nation's daily life."

"Today, the FCC has taken a historic step to reform intercarrier compensation and to redirect what can only be called a broken universal service system to a more targeted system that encourages broadband," said Jerry James, CEO of COMPTEL. "COMPTEL looks forward to reviewing the details of this order. All of this hard work will be meaningless; however, if the Commission does not maintain its focus on achieving a robust, competitive environment for IP-based services, and it will be from this perspective that COMPTEL will evaluate the FCC's decision."

Rural telephone companies said, “Positive aspects of today's FCC order appear to include the FCC's action to confirm that VoIP traffic falls within the ICC framework and to resolve long-standing concerns about so-called "phantom traffic" and other arbitrage schemes. The Rural Telecom Associations also are pleased that the FCC appears to have recognized the need for an ICC restructure mechanism to help carriers of last resort continue providing affordable services in rural America. They commend the FCC for its leadership and engagement in moving this process and these issues forward. "At the same time, the Rural Telecom Associations remain eager to push forward for a long-term USF reform plan that will provide greater certainty and sufficient support, and they remain concerned that parts of the current reform package will have substantial adverse impacts on rural consumers and the small, community-based carriers of last resort committed to serve them.”

"The Federal Communications Commission deserves kudos for keeping the public interest in mind in tackling the complex problem of intercarrier compensation and the high cost fund," said Consumer Federation of America (CFA) Research Director Mark Cooper. "It rejected the totally self-service industry proposal (the ABC Plan) and handled four of the five major challenges it confronted well." Cooper praised the fact that companies who get subsidies for broadband build-out must meet "clear public interest obligations" to provide "adequate facilities at reasonable charges" for all people of the United States. He says the five-year transition away from the current system to a bidding model -- incumbent telcos had wanted 10 years--was a "demanding but fair" adjustment period. "For the first time, public funds are being used to ensure that broadband is available at affordable rates," said Cooper, something CFA has been pushing for. He said the FCC's one failure was not to reduce subscriber line charges as part of its reform of intercarrier compensation. He pointed to the FCC's unwillingness to reduce the charges to cost, and said CFA would challenge that part of the order, either through a motion for reconsideration or a court challenge. "[T]he Commission cannot close the book on rate reform and the best way to protect consumers is to eliminate the excessive costs recovered through the SLC," he said.

Parul Desai, Policy Counsel for Consumers Union, said, “We share the FCC’s goal of expanding broadband service. We appreciate the Commission’s push to deliver the benefits of broadband to more people in unserved areas. Today’s vote points us in the direction of universal broadband service, but we remain concerned about the details that allow companies to increase consumer bills. We don’t want the burden to be placed squarely on the backs of consumers, especially when many of these companies are hauling in big revenues. We’re going to press the FCC to ensure that these are temporary increases, because history has shown that these types of costs tend to stick around and go on and on and on.”

Jerry Ellig, a senior research fellow at the Mercatus Center said the key would be for the FCC to monitor the subsidies to make sure they were accomplishing their goal, including "clear measures of outcomes." Another goal for the reforms is to better protect against waste fraud and abuse.

John Windhausen, director of the Schools, Health and Libraries Broadband Coalition (SHLB), was pleased that the FCC had made serving anchor institutions one of the public interest conditions to receiving broadband build-out funds. "The SHLB Coalition applauds the FCC for following the recommendations of Representatives Matsui, Markey, Eshoo and Doyle to ensure that recipients of USF support must serve the broadband needs of community anchor institutions in rural America. We are particularly pleased that anchor institutions are given an opportunity to participate in the design of the broadband networks serving their areas and that the recipients of USF funding must include the anchor institutions served in their annual reports. Providing rural schools, libraries, healthcare providers and other community anchors with affordable, high-capacity broadband will go a long way toward improving educational opportunities, medical care and economic growth in rural America."

“We appreciate the effort and commitment the Federal Communications Commission dedicated to tackling the universal service system, which is in need of serious reform,” said Public Knowledge President Gigi Sohn. “We also appreciate that the Commission recognizes the importance of non-traditional broadband providers, such as community-based institutions, and will seek comment on how to enhance the ability of these entities to serve their local communities. At the same time, however, we share the concerns of other consumer organizations that the Commission's actions will lead to higher prices at a time when the average American is watching every penny. We hope that the mechanisms adopted by the Commission to prevent this prove adequate, and that this and future Commissions will have the political will to address problems that may arise. We are deeply disappointed that the Commission has once again evaded the central problem which threatens to bring down the entire plan -- that of resolving the Commission's authority over interconnected Voice Over Internet Protocol (VOIP) and broadband services generally. The Commission requested comments on the authority issue, but declined to deal with it. VoIP services are becoming an integral part of the telecommunications network, serving millions of consumers. By declining to address this issue, the Commission is condemning the industry to more years of uncertainty, consumers and others will be powerless to complain about industry practices and the future of the network is left in limbo."

Free Press Political Advisor Joel Kelsey said, “An order of this magnitude surely has important pieces buried in the text, so we will reserve final judgment until we've had time to analyze the full item. We’re glad the Commission didn’t rubber-stamp the industry-authored ABC plan, but the agency missed a historic opportunity to bring pro-consumer reform to a system that has been plagued with waste and abuse for decades. The Commission should have used this rule-making to establish meaningful oversight mechanisms to ensure subsidies are being directed to places they are truly needed, and aren’t being used to pad industry profits. Despite a lack of meaningful evidence to justify a rate increase, the Commission’s move will allow carriers to impose new charges on local phone subscribers. The Commission did take steps to narrow the scope of these rate increases, but asking consumers to pay more into a broken system and letting the industry divvy up the pot will not increase broadband adoption. If the goal is to increase broadband adoption, prices should be going down, not up.”

Genachowski’s Legacy?
Politico notes that FCC Chairman Julius Genachowski succeeded where his predecessors failed in taking on the telecom industry’s 800-pound gorilla: an $8 billion telephone subsidy program written in the dial-up era. Past chairmen have been unsuccessful in their attempts to revamp the antiquated subsidies. In 2008, Republican FCC Chairman Kevin Martin came close to reaching an order but industry support for his proposal fell apart at the last minute.

Chairman Genachowski called the decision a “once-in-a-generation” overhaul that will help carry out President Barack Obama’s vision for a hyperconnected nation. It may also to halt some grumblings that Chairman Genachowski hasn’t done enough in his term. He’s been criticized in the past, from the right and the left, for either throttling industry with regulations like last year’s net neutrality rules or shying away from more controversial pro-consumer decisions by being more of a peacemaker than a regulator. Instead, Genachowski’s political victory in overhauling the largest part of the USF most likely will become his legacy.

“This is something the FCC has been trying to do for years,” said Anna-Maria Kovacs, a telecom expert and visiting senior policy scholar at the Georgetown University Center for Business and Public Policy. “Getting it done is an enormous accomplishment.”

Senate Commerce Committee
Nov 15 2011
2:30 PM

The Senate Commerce Committee will hold a full committee hearing on the nominations of Jon Leibowitz and Maureen Ohlhausen, to be Federal Trade Commissioners. Leibowitz’s nomination is for reappointment as FTC chairman.

Witness Panel 1

Mr. Jon D. Leibowitz
to be Federal Trade Commissioner (Reappointment)

Ms. Maureen K. Ohlhausen
to be Federal Trade Commissioner

Maureen K. Ohlhausen is an attorney at Wilkinson Barker Knauer, LLP, where she is a partner in the firm’s privacy, data protection, and cybersecurity practice. Previously, she worked at the Business Software Alliance as Technology Policy Council. From 1997 to 2008, she served at the Federal Trade Commission in a number of leadership roles, including as Director of the Office of Policy Planning and, earlier, as an attorney advisor for Commissioner Orson Swindle. Earlier in her career, Ms. Ohlhausen worked at the U.S. Court of Appeals for the D.C. Circuit as a law clerk for Judge David Sentelle and clerked for Judge Robert Yock of the U.S. Court of Federal Claims. She is also a senior editor of the American Bar Association Antitrust Law Journal and has taught privacy law and unfair trade practices as an adjunct professor at George Mason University School of Law. Ms. Ohlhausen received a B.A. from the University of Virginia and a J.D. from George Mason University School of Law.



October 28, 2011 (FCC Meeting Recap)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, OCTOBER 28, 2011

Friday, yes, but still a busy day http://benton.org/calendar/2011-10-28/


NEWS FROM THE FCC
   FCC Creates 'Connect America Fund' to Help Extend High-Speed Internet to 18 Million Unserved Americans
   FCC Launches Proceeding Aimed at Modernizing Broadcasters’ Public Inspection Files
   FCC Wants More Info from AT&T
   FCC Finalizes Rules for Broadband From Wall Sockets

INTERNET/BROADBAND
   Reps Walden, Rogers Urge President to Practice His Own “Common Sense Test” on Network Neutrality
   How Netflix, entertainment and changing usage patterns are affecting networks - analysis
   Streaming TV On Rise, More Millennials Watch Traditional TV [links to web]
   Time Warner Cable continues big bet on broadband
   Just 14% Of Internet Customers Disappointed With Speeds: J.D. Power [links to web]

LOBBYING
   Tech industry pushes policy agenda with supercommittee
   Google’s Spreading Tentacles of Influence
   Venture Capitalists Take Fight Against IP Bill To The Hill [links to web]

CYBERSECURITY
   DHS Sec Napolitano Gives Rundown on U.S. Cybersecurity Efforts
   DHS Sec Napolitano Calls For Army Of 'Cyber Geeks'
   Cybersecurity and the missing sense of urgency
   Defense cyber chief: The cloud is the military's next Internet [links to web]
   Security researcher finds major flaw in Facebook [links to web]

WIRELESS/BROADBAND
   LightSquared is jilting taxpayers out of billions, GPS industry claims
   LightSquared Says It Has Yet Another GPS Antenna Fix [links to web]
   NETAmerica Rural 4G Pilot Network
   San Francisco cellphone warning law fails science, says judge
   RIM Facility Helps India in Surveillance Efforts
   Samsung's Smartphone Sales Surpass Apple's [links to web]

EDUCATION
   Social media savvy: The new digital divide? [links to web]
   Crossing the Digital Divide: Bridges and Barriers to Digital Inclusion [links to web]
   Chicago-area school district gives free iPads to freshmen [links to web]

ENERGY
   Illinois Legislature overrides Gov. Pat Quinn's veto to allow smart grid

JOURNALISM
   Bloggers Back Occupy Wall Street protests [links to web]
   David Carr: The News Diet Of A Media Omnivore [links to web]

RADIO
   Clear Channel Cuts DJ’s Across the Country

MORE ONLINE
   In U-Turn, H-P Will Hold On to PCs [links to web]
   With new fees on the line, is it time to ditch your home phone? - analysis [links to web]
   Should you care how high your Klout score is? [links to web]
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NEWS FROM THE FCC

CONNECT AMERICA FUND
[SOURCE: Federal Communications Commission, AUTHOR: Press release]
The Federal Communications Commission voted unanimously to comprehensively reform its Universal Service Fund and intercarrier compensation systems. Those systems have been widely viewed as broken, and long overdue for reform. Efforts to expand high-speed Internet to rural America over the next six years will increase economic growth by $50 billion over that period, the FCC estimates. These reforms create a new Connect America Fund with an annual budget of no more than $4.5 billion, which will extend broadband infrastructure to the millions of Americans who currently have no access to broadband. As a result, today’s action has the potential to be one of the biggest job creators in rural America in decades. The FCC estimates that approximately 500,000 jobs will be created over the next six years by expanding high-speed Internet access to over 7 million Americans living in rural areas. And by increasing the overall size of the U.S. marketplace, small Main Street businesses across the country will benefit from the opportunity to sell to new customers. The Connect America Fund will put America on the path to universal broadband and advanced mobile coverage without increasing costs to consumers. By eliminating waste and targeting support where it is most needed, these reforms put universal service funding on a firm budget, and they will impose strict new accountability on fund recipients.
As part of this reform, the FCC recognizes the growing importance of mobile broadband and makes it an independent universal service objective for the first time in history. Dedicated support to expand mobile broadband nationwide will be provided through a new Mobility Fund.
The FCC provided few details about its plan to phase down ICC charges, although one staff member said the reforms initially will cap interstate and intrastate access charges with the ultimate goal of moving toward a “bill and keep” approach via a “transition path.” She also referenced an access charge replacement mechanism, although details of that mechanism were not provided. Based on what was said, ICC reforms appear to be in line with what was proposed in a proposal brokered by telephone companies. As expected the FCC also said it would require service providers to pay access charges on calls that originate or terminate on the PSTN. In addition officials said the order takes steps to prohibit access charge arbitrage, including access stimulation and phantom traffic. Although the order apparently does not address how IP-to-IP interconnection should be treated, FCC officials said the order does require all carriers to negotiate such agreements in good faith. In addition, the commission said it will seek comment on how calls connected directly via IP should be treated. One of the more surprising comments made at today’s meeting was that all carriers would be on an “equal footing” in their ability to obtain ICC compensation -- a comment that appears directed at meeting the requests of cable operators, who have asked for greater ability to collect access charges.
benton.org/node/99047 | Federal Communications Commission | Executive summary of Report and Order | Washington Post | Associated Press | B&C | Connected Planet
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FCC TAKES FIRST STEP TO MODERNIZE TELEVISION BROADCAST PUBLIC INSPECTION FILES
[SOURCE: Federal Communications Commission, AUTHOR: Press release]
The Federal Communications Commission (FCC) took a major step toward modernizing the way television broadcasters inform the public about how they serve their communities. The FCC adopted an Order on Reconsideration that vacates a 2007 Report and Order (R&O), and a Further Notice of Proposed Rulemaking (FNPRM), which proposes a new approach that would require commercial and noncommercial television stations to submit documents to an online public file hosted by the FCC. The 2007 R&O largely replaced a decades-old requirement that television stations maintain a paper public inspection file in their main studio with one that required the files be available on their stations’ Internet website, if they had one. Those rules were never put into effect because of legal challenges. The FNPRM seeks comment on proposals that would reduce burdens on the broadcast industry. The Further Notice proposes to streamline the information broadcasters will need to provide by requiring the FCC to import information already filed with the FCC, and exempts certain items from being posted online such as letters and emails from the public. It further seeks comment on posting sponsorship identification information, now disclosed only on-air, and shared services agreements online as part of the public inspection file hosted by the FCC.
The FCC’s action is consistent with the government-wide effort to increase transparency, and the FCC’s broader efforts to modernize data and move its processes from paper to digital. The FCC seeks comment on any other revisions or additions to its rules that would make the information about broadcast service more accessible to the public, improving the dialogue between broadcast stations and the communities they serve while reducing compliance burdens on broadcasters.
FCC Chairman Julius Genachowski says the agency will act on the enhanced disclosure NOI in the “very near future.” Later, at a press briefing, the chairman reiterated that both items are on "a fast track" and will be acted upon "in the spring." FCC Commissioner Michael Copps expressed his disappointment that the agency was “starting over.” He said he would have preferred that the FCC would have “looked for ways to revise our early work and expedite its completion.” FCC Commissioner Robert McDowell said he was “glad” the FCC was vacating its 2007 rules. While he approved the FNPRM, he said he is concerned that it might result in additional regulatory burdens on broadcasters. FCC Commissioner Mignon Clyburn noted that she was assured by FCC Chairman Genachowski that both the FNPRM and the NOI will move expeditiously.
benton.org/node/99045 | Federal Communications Commission | TVNewsCheck | B&C
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NEW INFO REQUEST
[SOURCE: Federal Communications Commission, AUTHOR: Renata Hesse]
The Federal Communications Commission’s Senior Counsel to the FCC Chairman for Transactions has written to AT&T requesting additional documents and information concerning its acquisition of T-Mobile including:
Any documents filed by AT&T in the Department of Justice’s suit to block the purchase of T-Mobile.
Any documents submitted to the Department of Justice.
Any AT&T documents since January 1, 2009 that reference T-Mobile.
The FCC requests the information by Thursday, November 3, 2011.
benton.org/node/99043 | Federal Communications Commission
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BROADBAND OVER POWERLINES
[SOURCE: Television Broadcast, AUTHOR: ]
Broadband access from ordinary wall sockets may yet become a reality. The Federal Communications Commission affirmed its rules for Broadband over Power Lines with minor modifications. “These rules provide an appropriate balance between the dual objectives of providing for Access BPL technology that has potential applications for broadband and Smart Grid while protecting incumbent radio services against harmful interference.” Those incumbent radio services primarily comprise ham radio operators. Hams started lobbing grenades at BPL when the commission first adopted rules for it in 2004, saying it interfered with their operations. Their national organization, the American Radio and Relay League, filed a lawsuit against the FCC in federal court, seeking full access to unredacted versions of staff technical studies upon which the rules were predicated. The FCC was ordered to cough up the studies, allow public comment on them, and explain its method for measuring radiated emissions from BPL systems. In its Second Report and Order, the FCC said the resulting cycle of comments did not “warrant any changes to the emissions standards or the extrapolation factor,” but they were making “several refinements” anyway. The SR&O modifies the rules “to increase the required notch filtering capability for systems operating below 30 MHz from 20 to 25 dB; establish a new alternative procedure for determining site-specific extrapolation factors...; and adopts a definition for the ‘slant-range distance’ used in the BPL measurement guidelines to further clarify its application.” Slant-range refers to the diagonal distance of a measurement device to a BPL transmitter mounted at the top of a power pole.
benton.org/node/99019 | Television Broadcast
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INTERNET/BROADBAND

WALDEN VS NETWORK NEUTRALITY
[SOURCE: House of Representatives Commerce Committee, AUTHOR: Press release]
Reiterating longstanding concerns about a controversial plan to impose new government rules for the Internet, House Communications and Technology Subcommittee Chairman Greg Walden (R-OR) and Rep. Mike Rogers (R-MI) urged President Barack Obama to pull back the Federal Communications Commission’s network neutrality rules. Two weeks after the President made a commitment before the joint session of Congress to cut down on government regulations, the FCC proceeded to publish the Internet rules in the Federal Register, triggering lawsuits and starting the clock for expedited action in the Senate on the House’s Resolution of Disapproval of the rules. While the Administration has recently taken action to stop the implementation of other controversial initiatives, the FCC remains on track to begin enforcement of its rules on November 20.
Reps Walden and Rogers wrote, “For the last year, you have called upon your administration’s leadership to review regulations that will stifle job growth and innovation. The net neutrality rules at best create uncertainty in the technology sector and at worst could hinder this vital economic engine from creating the jobs Americans need. The people of this country demand policies that promote economic growth. Regulating an industry that continues to invest billions each year in broadband networks, provides hundreds of thousands of jobs, and leads the world in innovation is not such a policy. We urge you to bring the FCC’s vision for regulation in line with your stated policy by stopping the implementation of the FCC’s net neutrality rules.”
benton.org/node/99042 | House of Representatives Commerce Committee | | B&C
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BROADBAND USAGE PATTERNS
[SOURCE: Connected Planet, AUTHOR: Michelle Maisto]
A closer look at the latest Global Internet Phenomena report from Sandvine. Three notable findings in the report, relevant to the North American market, are:
Network use, both fixed and mobile, is becoming more concentrated. Peak usage hours shrank in September to a duration of just two hours, though gigabyte usage remained flat, suggesting users are performing the same activities, just in a narrower window. The trend is a worrying one for providers, which must engineer their networks for peak bandwidth. One suggested fix is to offer unlimited data at off-peak times and caps during the peak. If users equate data consumption with value, the offer would doubly be a win for providers, as users would perceive it as a higher-value service.
Entertainment is driving the Internet. While entertainment-geared traffic accounted for nearly 30% of traffic in 2009, it's now closer to 54% of aggregate utilized bandwidth and 60% of downstream traffic. Moreover, 55% of entertainment bytes are now headed for smart TVs, tablets and phones than laptops or desktops, now seeing just 45% of that traffic. As Sony demonstrated this morning, manufacturers, content producers and service providers are now concentrating on a "three screen approach."
Netflix, missteps or not, is increasingly impacting the industry. With a television, smartphone, tablet, laptop and smart TV in most homes, entertainment is being viewed on multiple screens. Netflix currently allows two concurrent streams and has considered "family plans" that would allow more.
benton.org/node/99002 | Connected Planet
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TWC BETS ON BROADBAND
[SOURCE: GigaOm, AUTHOR: Ryan Lawler]
Time Warner Cable continued to see a slide in its video subscribers, but it’s trying to make up for those losses by betting more heavily on broadband as its core service. On the company’s third-quarter earnings call, Time Warner Cable executives continued to talk up its high-speed data service as a key differentiator, particularly when it goes up against telecom competitors mostly offering DSL services. But it’s also seeing huge amounts of growth for broadband subscribers who might not want to subscribe to its traditional video services. “Broadband is a powerful service for which there appears to be unquestionable consumer thirst,” Time Warner Cable CEO Glenn Britt said on the investor call. “Over time, we will contribute more of our plant’s capacity to broadband.” Time Warner Cable added 89,000 high-speed data subscribers in the quarter, but that’s only part of the story. While the company saw 128,000 video subscribers flee, it actually added single-play high-speed data subscribers. Time Warner Cable is focused both on winning over broadband users from both those who already subscribe to its video service, as well as those who aren’t already customers. When talking about bringing existing video subscribers on-board with broadband, Time Warner Cable is most likely convincing users to upgrade from DSL services from a telco operator to cable broadband. “There’s no reason for a customer who does business with us to buy an inferior product from someone else,” COO Rob Marcus said.
benton.org/node/99008 | GigaOm | paidContent | GigaOmPro on post-video cable
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LOBBYING

TECH AGENDA
[SOURCE: The Hill, AUTHOR: Brendan Sasso]
A coalition of tech companies and associations wrote to the congressional supercommittee on deficit reduction, pressing the lawmakers to move forward on a broad array of policy priorities for the industry. The letter recommends a tax holiday to encourage companies to move earnings onshore, government investments in research and development, incentive auctions of broadcast spectrum, immigration reform for high-skill foreign workers and improved information technology for federal agencies. Gary Shapiro, president of the Consumer Electronics Association and one of the signers of the letter, said there are three ways to reduce the deficit: raise taxes, cut spending or grow the economy. "This is an innovation agenda," Shapiro said. "What it really comes down to is growing the economy." The Business Software Alliance, Tech America, TechNet and the Information Technology Industry Council were other trade groups that joined in the recommendations. Individual companies included Microsoft, eBay, Oracle, Cisco and T-Mobile. The groups urged the lawmakers to give tax incentives to encourage companies to move foreign earnings back to the U.S. The letter claims that a tax holiday could bring $1 trillion back to the country. Critics of a tax holiday argue that a similar program in 2004 failed to create the jobs or economic boost that its proponents promised. The letter also urged "target investments" in research and development to spur innovation. The groups recommended cutting some programs to allow for increased spending on "pro-growth" investments. The groups voiced their support for incentive spectrum auctions, which would give the Federal Communications Commission the authority to sell broadcast spectrum for wireless broadband use. After splitting the auction revenue with participating television broadcasters, the government could still raise more than $24.5 billion to reduce the deficit from the program, according to the letter.
benton.org/node/99016 | Hill, The
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GOOGLE’S INFLUENCE
[SOURCE: Bloomberg, AUTHOR: Rob Levine]
Google isn’t hurting for a voice in Washington. Facing increasing regulatory scrutiny, the company spent $5.4 million on political outreach in the first three quarters of 2011, more than it did in all of 2010, and more even than Microsoft. But Google also exerts influence in more subtle—and pervasive—ways. Through donations, fellowship programs, and at conferences, the company has established a network of ties to advocacy organizations, public intellectuals, and academic institutions. Although independent, these groups and people often take Google’s side in public debates and on national policy issues. In a recent interview with the Washington Post, Google Chairman Eric Schmidt suggested there are two kinds of lobbying: One is “where you pay an ex-senator to get the current senator to write a sentence into a bill,” he says. The other way—Google’s preferred way—is “to lobby based on ideas.” The company is hardly the first to cozy up to organizations that share some of its interests. Pharmaceutical makers have been known to fund support groups for patients with illnesses that can be treated by the company’s drugs. Media companies often ally themselves with artists’ organizations to fight copyright abuses, even though the two sides oppose each other on other issues. Still, few technology companies have pursued such campaigns vigorously, in part because the issues they hope to affect (such as bandwidth licensing and patent reform) feel remote to the average citizen. Google’s high profile and “don’t be evil” image has made the public more receptive to its policy agenda. One focus of Google’s efforts is the debate over the Preventing Real Online Threats to Economic Creativity and Theft of Intellectual Property Act of 2011, better known as the Protect IP Act.
benton.org/node/99041 | Bloomberg
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CYBERSECURITY

US CUBERSECURITY EFFORTS
[SOURCE: Government Technology, AUTHOR: Hilton Collins]
Department of Homeland Security (DHS) Secretary Janet Napolitano shared her latest thinking about the nation’s cybersecurity during a Washington, D.C., symposium on Thursday, Oct. 27, at which she said government continues to struggle identifying who exactly is response for cyberattacks. The United States faces threats from overseas, both from state actors and from criminal groups in those states. “We don’t have good attribution in many of these cases,” she said. Sec Napolitano said the No. 1 type of cyberattack that worries her is one that would damage the nation’s critical infrastructure and cause loss of life or disrupt everyday living. She was vague, though, when asked if the U.S. had already come close to experiencing that type of attack. Sec Napolitano merely said that the DHS is learning from every incident. Sec Napolitano offered sobering figures, such as that Web-based intrusions have increased 90 percent since 2009. In many cases, the government must rely on corporate players to deal with these threats. According to Napolitano, the country experiences thousands of cyberattacks daily. They include theft of intellectual property, instruction into critical infrastructure via denial-of-service attacks and malware planting, and the infiltration of government networks.
benton.org/node/99038 | Government Technology
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CALLING ALL CYBER GEEKS
[SOURCE: National Journal, AUTHOR: Josh Smith]
Homeland Security Secretary Janet Napolitano wants an army of "cyber geeks," and she wants it now. When asked what she would do tomorrow to secure cyberspace if possible, Sec Napolitano said she would hire every "cyber geek" who knows anything about hacking and securing computers. DHS has been given authority to hire 1,000 new cybersecurity professionals, but budget constraints and a lack of trained people makes filling that order difficult, she said. To help overcome the lack of resources and to help cover all the wide-ranging cyberthreats, the government must partner with the private sector, Sec Napolitano said. "The government has its capabilities but this will have to an area where everyone has a shared responsibility," she said. Hackers have "come close" to shutting down parts of American infrastructure that are connected to the Internet, Sec Napolitano said.
benton.org/node/99036 | National Journal
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CYBERSECURITY URGENCY
[SOURCE: Washington Post, AUTHOR: Melissa Steffan]
Daily cybersecurity intrusions are threatening America’s ability to remain the world leader in innovation, yet few are paying attention, according to co-chairman of the Congressional Cybersecurity Caucus Rep. James Langevin (D – RI). “Large amounts of data are being siphoned off – stolen – on a daily basis,” said Rep Langevin, during a panel discussion at the Brookings Institution. “If someone was hauling off filing cabinets of information, that would be tantamount to an act of war. But because it’s happening in the digital realm, there isn’t that sense of urgency. “ But the threat of a major cyber-attack is real, as evidenced by a series of attacks on Estonian banking Web sites in 2007. The threat of a similar attack in the United States, according to Rep Langevin, requires a new cybersecurity approach that balances tax breaks and insurance incentives with government regulations. “Cybersecurity is a moving target. It’s an evolving threat,” said Rep Langevin. “We are never going to be able to get to the point where we are 100 percent successful. What we need to do, basically, is to close the window of vulnerability.”
benton.org/node/99034 | Washington Post
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WIRELESS/BROADBAND

SAVE OUR GPS
[SOURCE: Connected Planet, AUTHOR: Kevin Fitchard]
The Coalition to Save our GPS has opened up a new front of its war of words with LightSquared. It’s now claiming that if LightSquared really had permission to build a terrestrial mobile broadband network than it should have paid billions of dollars for that right at auction, just like any other U.S. wireless operator. The Coalition is claiming that LightSquared is trying to pull a regulatory slight-of-hand to gain a windfall in mobile broadband frequencies outside of the normal auction channels. By turning L-band spectrum formerly designated only for satellite transmission into terrestrial mobile spectrum, LightSquared is effectively increasing the value of its licenses by $10 billion, the Coalition said. Normally any designation of spectrum for mobile broadband would require a competitive auction among operators, raising billions of dollars for the U.S. Treasury. If LightSquared receives permission to build its terrestrial network, the Coalition said, it would circumvent that process, jilting taxpayers out of gobs of revenue during in financial troubled times and giving it an unfair advantage against traditional wireless operators.
benton.org/node/99030 | Connected Planet | National Journal
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RURAL 4G
[SOURCE: NetAmerica Alliance, AUTHOR: Press release]
NetAmerica Alliance has deployed and gone live with its 4G LTE pilot network, offering mobile broadband service in rural America. NetAmerica members are using the pilot network to develop, test and refine operating methodologies prior to turn-up of commercial service. Pilot users have experienced downlink data speeds of up to 28 Mbps and uplink data speeds of up to 13 Mbps. Pilot users are trialing fixed and mobile data services in the 4G LTE network. Initially, they are using PC dongles to test high-speed mobility throughout the network with the ability later to also trial a customer premise device in their home or business. The results of the pilot and lessons learned are being shared with all NetAmerica members.
benton.org/node/99026 | NetAmerica Alliance
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SAN FRANCISCO CELL PHONE LAW
[SOURCE: ars technica, AUTHOR: Eric Bangeman]
Even the watered-down version couldn't pass muster. San Francisco's ordinance requiring retail outlets to inform consumers about the (alleged) effects of cellphone radiation has been blocked by a federal judge. Upon passage, San Francisco's ordinance was challenged by industry trade group CTIA-The Wireless Association, which claimed the ordinance's requirement that retailers post messages about cell phone safety violated the First Amendment. San Francisco initially agreed to amend the ordinance after the CTIA filed suit, and made some changes, but they weren't enough. Judge William Alsup found that the ordinance failed the sniff test on both scientific and First Amendment grounds. "Whether or not cell phones cause cancer is a debatable question and, at this point in history, is a matter of opinion, not fact. San Francisco has its opinion. The industry has the opposite opinion," wrote Judge Alsup. The fact-sheet required by the ordinance is "misleading and must be corrected," notes the judge. "Although each factoid in isolation may have an anchor in some article somewhere, the overall message of the fact-sheet (and the poster, for that matter) is misleading by omission in two important ways. The overall impression left is that cell phones are dangerous and that they have somehow escaped the regulatory process."
benton.org/node/99061 | Ars Technica
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RIM AND SURVEILLANCE IN INDIA
[SOURCE: Wall Street Journal, AUTHOR: Amol Sharma]
Research In Motion Ltd. has set up a facility in Mumbai to help the Indian government carry out lawful surveillance of its BlackBerry services, but the move hasn't fully satisfied India's appetite for access to messages on the popular smartphones. Last year, India threatened to shut down BlackBerry encrypted email and instant messaging services because it couldn't wiretap them. The government put the onus on RIM to come up with solutions. Several government-set deadlines have passed and, though India still isn't happy with its surveillance capabilities, it is no longer threatening to shut down the service. RIM partly assuaged India by setting up the small Mumbai facility earlier this year to handle surveillance requests from India. India can submit the name of a suspect its investigators want to wiretap, and RIM will return decoded messages for that individual, as long as it is satisfied the request has legal authorization. The Mumbai facility handles lawful intercept requests for consumer services including the BlackBerry Messenger chat service, these people say. India saw the move as a positive step, but would prefer an arrangement where it has the ability to decode messages itself, so that it can conduct surveillance without disclosing the names of suspects to RIM.
benton.org/node/99062 | Wall Street Journal
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ENERGY

ILLINOIS SMART GRID
[SOURCE: Chicago Tribune, AUTHOR: Julie Wernau]
No more meter readers. No more calling the electric utility when the lights go out. And when a big storm does knock out power, those outages will be less widespread and shorter in duration. That's the brighter future promised for Illinois consumers served by utilities ComEd and Ameren after state legislators on Wednesday overrode Gov. Pat Quinn's veto and passed into law smart grid legislation. While sounding unequivocally positive, the legislation raised the ire of the governor and other critics because it also overhauls a century-old regulatory process for setting electricity rates and reduces oversight by the Illinois Commerce Commission. Electricity rates currently are hashed out every few years in an 11-month-long court-like proceeding. Under the new law, rates will be based on a formula that sets the return on equity the utilities will receive. Utilities also will come before the ICC every year seeking rate hikes rather than every few years, reducing the lag time between when a new rate is approved and when the rate goes into effect. That change will provide the utilities with additional millions of dollars each year. The $3.2 billion statewide smart grid build-out will begin next year. ComEd said it will likely take 10 years to complete its portion, and its 5.4 million customers will be charged an additional $3 per month to pay for the infrastructure during that time period; Ameren customers will be charged an additional $3.40 a year.
benton.org/node/99022 | Chicago Tribune
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RADIO
   Clear Channel Cuts DJ’s Across the Country

CLEAR CHANNEL FIRES DJs
[SOURCE: New York Times, AUTHOR: Brian Stelter]
Clear Channel Communications, the largest radio station operator in the United States, dismissed dozens of local DJ’s this week, affecting small stations from Syracuse to Spokane and raising fresh concerns about the homogenization of radio programming. Clear Channel Radio, which operates about 850 stations in the United States and employs 12,000 people, declined to say how many employees were dismissed, but some of the D.J.’s said they believed that the number was in the hundreds. The company said the layoffs were not made to cut costs but were part of a revamping of its about 600 regional radio stations. (Its 250 other stations are in large markets like New York and Los Angeles.) “We’ve completely rethought our regional market strategy and reinvented our operations in those markets in a way that will let us compete on a new level — and succeed using all of Clear Channel’s resources, scale and talent,” a company spokeswoman, Wendy Goldberg, said. To some in the radio business, the layoffs signaled the continuation of a several-years-old strategy that replaces locally produced programming with less costly nationally syndicated shows. Media reform groups have long assailed Clear Channel’s consolidation.
benton.org/node/99066 | New York Times
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Clear Channel Cuts DJ’s Across the Country

Clear Channel Communications, the largest radio station operator in the United States, dismissed dozens of local DJ’s this week, affecting small stations from Syracuse to Spokane and raising fresh concerns about the homogenization of radio programming.

Clear Channel Radio, which operates about 850 stations in the United States and employs 12,000 people, declined to say how many employees were dismissed, but some of the D.J.’s said they believed that the number was in the hundreds. The company said the layoffs were not made to cut costs but were part of a revamping of its about 600 regional radio stations. (Its 250 other stations are in large markets like New York and Los Angeles.) “We’ve completely rethought our regional market strategy and reinvented our operations in those markets in a way that will let us compete on a new level — and succeed using all of Clear Channel’s resources, scale and talent,” a company spokeswoman, Wendy Goldberg, said. To some in the radio business, the layoffs signaled the continuation of a several-years-old strategy that replaces locally produced programming with less costly nationally syndicated shows. Media reform groups have long assailed Clear Channel’s consolidation.

In U-Turn, H-P Will Hold On to PCs

Meg Whitman wants Hewlett-Packard Co. to sell personal computers after all, a dramatic about-face by the H-P chief executive only five weeks into the latest chapter of her sweeping career.

Whitman said Thursday that H-P will keep its $40.7 billion PC division, backing away from its prior plan -- endorsed 69 days ago by Whitman and other H-P directors -- to explore splitting the . H-P said a new evaluation had found the move was simply too costly. "H-P objectively evaluated the strategic, financial and operational impact of spinning off" the PC business, said Whitman, who assumed the CEO post after she and other directors dumped her predecessor, Leo Apotheker, last month. Keeping the business "is right for customers and partners, right for shareholders and right for employees," she said. The turnabout marks something of a fresh start for H-P and Whitman herself, who made a failed bid to become California governor, after a lucrative and at times controversial 10-year tenure as CEO of online retailer eBay Inc.

Ultimately, H-P decided the cost of dumping the business was just too high. For starters, H-P saves money procuring server parts, thanks to its scale in the PC business. Also, it would have proved very expensive to build a new brand and new corporate structure for the spun-out unit, not to mention the lost opportunity to increase sales by bundling lots of hardware together for customers. Yet if H-P ever was going to escape the low-margin PC business, now would seem to have been an opportune moment. H-P's market share is still tops, with 18% of global PC shipments by volume in the third quarter, according to IDC. Yet its share is actually down a bit from two years ago, as Asian rivals Lenovo and ASUS have grown quickly. At about 6%, H-P may have achieved peak operating-profit margins for the business. And growth for PCs has been sluggish, thanks in part to the popularity of mobile devices like Apple's iPad.

Samsung's Smartphone Sales Surpass Apple's

Samsung in the July-to-September period surpassed Apple Inc. as the leading seller of smartphones by shipping around 28 million, about four times the number it achieved a year earlier, in a rapid transformation of its biggest business by sales.

Apple said earlier this month it shipped around 17 million smartphones in the same period. Samsung in the period also closed in on Nokia Corp. as the world's largest seller of all cellphones. Samsung's telecom division, which accounted for 36% of revenue, provided more than half of the firm's operating profit and experienced its best profit margin since 2004. Smartphones provided about 31% of the division's revenue and more than 80% of its operating profit, analysts estimate. According to market research firm Strategy Analytics, global smartphone shipments in the third quarter grew 44% from a year earlier to reach a record 117 million units. It said Samsung's share of the smartphone market rose to 23.8% during the quarter from 9.3%, while Apple's market share fell to 14.6% from 17.4%. Nokia Corp. saw its share fall sharply to 14.4% from 32.7%.

RIM Facility Helps India in Surveillance Efforts

Research In Motion Ltd. has set up a facility in Mumbai to help the Indian government carry out lawful surveillance of its BlackBerry services, but the move hasn't fully satisfied India's appetite for access to messages on the popular smartphones.

Last year, India threatened to shut down BlackBerry encrypted email and instant messaging services because it couldn't wiretap them. The government put the onus on RIM to come up with solutions. Several government-set deadlines have passed and, though India still isn't happy with its surveillance capabilities, it is no longer threatening to shut down the service. RIM partly assuaged India by setting up the small Mumbai facility earlier this year to handle surveillance requests from India. India can submit the name of a suspect its investigators want to wiretap, and RIM will return decoded messages for that individual, as long as it is satisfied the request has legal authorization. The Mumbai facility handles lawful intercept requests for consumer services including the BlackBerry Messenger chat service, these people say. India saw the move as a positive step, but would prefer an arrangement where it has the ability to decode messages itself, so that it can conduct surveillance without disclosing the names of suspects to RIM.