November 2011

AT&T/T-MOBILE

AT&T/T-MOBILE APPLICATION WITHDRAWN
[SOURCE: Washington Post, AUTHOR: Cecilia Kang]
The Federal Communications Commission is expected to accept the withdrawal of AT&T and T-Mobile’s merger application, clearing the way for the companies to concentrate on their separate antitrust battle with the Justice Department. The companies hope to win their federal lawsuit against Justice and then reapply for their merger with the FCC. The agency is also expected to announce the release a report on its findings from its merger review — a move the companies have protested because the findings could influence the Justice Department’s separate lawsuit against the merger in the U.S. District Court of the District of Columbia. The wireless giants argue that to release the report would go against FCC protocol. Dick Wiley, AT&T’s outside attorney, called FCC Commissioner Mignon Clyburn, saying that the merger application has already been withdrawn and that any documents related to the agency’s review of the deal should remain sealed. “Releasing staff workproduct concerning a matter no longer before the Commission would be unprecedented,” Wiley said in an ex-parte filing with the FCC. “In this case, the workproduct is highly deliberative in nature as it is a draft for consideration by the Commissioners that, if finalized and approved, would merely provide the basis for issues to be considered by an Administrative Law Judge. This workproduct would in no way constitute official findings of the Commission.”
benton.org/node/106168 | Washington Post | The Hill | WSJ | Reuters | Public Knowledge | Free Press | Media Access Project | IDG | FCC Order | FCC staff report
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WITHDRAWAL BY RIGHT
[SOURCE: AT&T, AUTHOR: Jim Cicconi]
I read with interest Harold Feld’s blog and a related filing by Public Knowledge and the Media Access Project (MAP) on AT&T’s withdrawal of its merger application from the FCC. While Harold and his colleagues sometimes have interesting arguments to make, this isn’t one of those times.
Here are the facts:
On Wednesday, November 23, 2011, after learning that the FCC staff had prepared a hearing designation order which was to be circulated for a vote, AT&T and Deutsche Telecom, in accordance with the Commission’s rules and precedent, filed the appropriate forms at the FCC via its Universal Licensing and other systems to withdraw all applications pending before it. At the same time, the parties filed a letter to the Secretary stating that all pending applications were withdrawn effective immediately and were to be dismissed without prejudice per the Commission’s rules.
The parties’ ability to withdraw the applications by right could not be clearer. Section 1.934(a) of the Commission’s rules states that if “the applicant requests dismissal of its application without prejudice, the Commission will dismiss that application without prejudice” unless one of two conditions exists, neither of which is present here. The statement that the Commission “will” dismiss the application without prejudice leaves the Commission with no discretion. The mandatory language of Section 1.934, bolstered by the Commission’s position and the D.C. Circuit’s decision in Environmentel, make clear that the Applicants have an absolute right to withdraw their applications in this matter without prejudice to their ability to refile in the future should they elect to do so. Thus, there shouldn’t be much controversy around the withdrawal of our applications last Wednesday. Yet Public Knowledge and MAP, relying on their usual tortured reading of Commission rules, contend that the FCC should somehow proceed with its review. Unnamed sources at the Commission have also been suggesting that the FCC has discretion to deny or otherwise side-step our withdrawal to keep its review alive, at least long enough to issue its draft Hearing Designation Order (HDO).
benton.org/node/106177 | AT&T | Harold Feld
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AT&T’S 11TH-HOUR GAMBIT
[SOURCE: New York Times, AUTHOR: Andrew Ross Sorkin]
AT&T has been secretly working on an audacious 11th-hour deal to salvage its $39 billion acquisition of T-Mobile: AT&T is knee-deep in talks with Leap Wireless, a second-tier but growing wireless player, to sell it a big piece of T-Mobile’s customer accounts and some of its wireless spectrum. AT&T hopes such a deal would placate the Justice Department enough for it to drop its opposition to AT&T’s acquisition of T-Mobile or at least to strengthen AT&T’s hand if it goes to trial. The deal would make Leap the fourth-largest wireless carrier in the nation, but it would allow AT&T to retain enough of T-Mobile’s valuable wireless spectrum, which it says it badly needs to provide the kind of next-generation service that its customers expect. If the Leap deal sounds a bit like a Hail Mary pass, that is because it is. It is just as questionable as AT&T’s original deal to merge with T-Mobile. Even with creating a new No. 4 player, it does little to change the duopoly that would be created as a result of the deal, making AT&T and Verizon clear favorites, while leaving Sprint, Leap and MetroPCS far behind; in particular, Leap and MetroPCS would probably still be without enough spectrum or cash flow to be truly competitive.
benton.org/node/106167 | New York Times | National Journal
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AT&T COULD SHED T-MOBILE CUSTOMERS
[SOURCE: Bloomberg, AUTHOR: Scott Moritz, Sara Forden]
AT&T, under pressure from regulators over its bid for T-Mobile USA, may be willing to shed up to half of the target’s customers to close the deal and gain control of assets including wireless spectrum, analysts said. AT&T, the second-largest U.S. wireless operator, is weighing the sale of customers and spectrum to address Justice Department concerns that the acquisition of the fourth- largest operator will undercut competition. The company may propose total divestitures of as much as 40 percent of T-Mobile assets. AT&T could sell a higher percentage of T-Mobile’s customers and smaller share of other assets, said Roger Entner, founder of market research firm Recon Analytics LLC. Most important for AT&T is getting T-Mobile spectrum, or licenses to airwaves that provide more capacity for wireless traffic, he said. “It’s still a good deal even if they have to give up half the customers,” said Entner. “AT&T desperately needs spectrum in larger cities and would give it up elsewhere.” AT&T wants to work out an agreement with the Justice Department, which sued on Aug. 31 to block the deal. If the two sides can’t reach a compromise, they’re scheduled to go to trial in February.
benton.org/node/106166 | Bloomberg
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AT&T HITS WALL
[SOURCE: Politico, AUTHOR: Kim Hart, Elizabeth Wasserman, Mike Zapler]
The Obama Administration’s two-pronged attack on AT&T’s T-Mobile deal represents a sea change in antitrust enforcement that stands to have political and business ramifications far beyond dropped calls and deals for the hottest smartphone. Some antitrust experts say that the Administration’s opposition to the union of the nation’s second- and fourth-largest wireless carriers is a return to the pre-George W. Bush era, when the government was more likely to flex its legal muscle and block deals. The move could galvanize Republican members of Congress who want to curb the ability of the FCC to challenge mergers on the basis of what’s in the public interest. It also stands to send a message to the business world: there is such a thing as too big to prevail. “The message to corporations is, ‘You can’t do everything you want,’” said Harry First, an antitrust law professor at NYU School of Law. “Fifteen years ago, a merger like AT&T/T-Mobile wouldn’t have passed the laugh test. Since then it’s become less clear what the DOJ and FCC will or won’t allow. Doing this shows some seriousness about changing merger policy.” At the same time, First added, the government’s resistance to the deal “may say as much about AT&T’s legal advice in underestimating that things aren’t like they used to be.”
benton.org/node/106165 | Politico
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WHO WINS?
[SOURCE: GigaOm, AUTHOR: Kevin Fitchard]
So what happens in the aftermath of AT&T/T-Mobile? Every operator would have a different take depending on what side of the AT&T-Mo battle lines they stood and their relative position in the mobile market. Here’s Fitchard’s take on who would win and who would lose:
AT&T: It may seem obvious that AT&T loses if its blockbuster acquisition fails, but AT&T isn’t as bad off as it claims. AT&T wouldn’t be able to piece together the massive 20 MHz-by-20 MHz LTE juggernaut it hoped to gain with T-Mobile’s Advanced Wireless Service (AWS) spectrum, but it’s still fairly well off spectrum-wise. The most lasting damage from the merger fallout to AT&T may be in public perception.
T-Mobile: T-Mobile could come out of this smelling slightly sweeter than when it started. A failed acquisition means a big $3 billion payout for DT as well as the handover of $3 billion worth of spectrum to T-Mobile. That spectrum probably won’t be enough to launch a nationwide LTE network (if it were, AT&T wouldn’t need to buy T-Mobile’s spectrum,) but assuming AT&T does fork over some of its own AWS holdings, T-Mobile could build upon it to become a much stronger mobile broadband player.
Verizon: If the AT&T-Mo merger just disappeared, Verizon would be happy: no new regulations on the wireless industry, no definitive decision to deny the mega-merger, no harm, no foul.
Sprint: Sprint, of course, would celebrate the failure of AT&T-Mo, but ironically it might have actually benefited if the merger went through.
MetroPCS and Leap Wireless: They would miss out on their biggest opportunity to expand for some time. Any AT&T deal with the FCC or DOJ would have required massive divestitures of markets and spectrum, all of which Metro and Leap could have picked up to either expand their footprints or add capacity to their CDMA and LTE networks.
benton.org/node/106164 | GigaOm
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PRIVACY

FTC-FACEBOOK SETTLEMENT
[SOURCE: Federal Trade Commission, AUTHOR: Press release]
Facebook has agreed to settle Federal Trade Commission charges that it deceived consumers by telling them they could keep their information on Facebook private, and then repeatedly allowing it to be shared and made public. The proposed settlement requires Facebook to take several steps to make sure it lives up to its promises in the future, including giving consumers clear and prominent notice and obtaining consumers' express consent before their information is shared beyond the privacy settings they have established. The FTC's eight-count complaint against Facebook charges that the claims that Facebook made were unfair and deceptive, and violated federal law. The proposed settlement bars Facebook from making any further deceptive privacy claims, requires that the company get consumers' approval before it changes the way it shares their data, and requires that it obtain periodic assessments of its privacy practices by independent, third-party auditors for the next 20 years. Specifically, under the proposed settlement, Facebook is:
barred from making misrepresentations about the privacy or security of consumers' personal information;
required to obtain consumers' affirmative express consent before enacting changes that override their privacy preferences;
required to prevent anyone from accessing a user's material no more than 30 days after the user has deleted his or her account;
required to establish and maintain a comprehensive privacy program designed to address privacy risks associated with the development and management of new and existing products and services, and to protect the privacy and confidentiality of consumers' information; and
required, within 180 days, and every two years after that for the next 20 years, to obtain independent, third-party audits certifying that it has a privacy program in place that meets or exceeds the requirements of the FTC order, and to ensure that the privacy of consumers' information is protected.
The proposed order also contains standard record-keeping provisions to allow the FTC to monitor compliance with its order.
benton.org/node/106163 | Federal Trade Commission
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PHONE-TRACKING IN MALLS
[SOURCE: InfoWorld, AUTHOR: Ted Samson]
After a shopping binge at Macy's, is a mallgoer more likely to refuel at Cinnabon or Cold Stone Creamery -- or both? If the latter, will said customer then head to Brookstone to recover in a massaging chair, or will he make a beeline to the mall's first aid station? Malls and retailers had hoped to start gleaning information about shoppers' movement by discretely tracking them through their mobile devices -- but their plans are now on hold after a U.S. senator raised privacy concerns about the practice. The value of this technology is evident: Retailers can use that data to better understand shopping patterns, which in theory means they can make improvements based on their finding to enhance the customer experience while boosting sales. Inevitably, though, it raises the question as to whether this type of system represents an invasion of privacy or a potential security risk for mobile device users. Sen Charles Schumer raised the privacy flag after reports emerged last week about malls and retailers rolling out a tracking system from Path Intelligence, based in the United Kingdom. Two malls -- Promenade Temecula in southern California and Short Pump Town Center in Richmond, Va. -- had announced plans to test Path Intelligence's FootPath Technology system through the end of the year, whereas Home Depot and JC Penney were reportedly considering the system as well. According to The Register, the mall owners suspended deployment of FootPath after receiving letters from Schumer over the weekend.
benton.org/node/106138 | InfoWorld
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POLICYMAKERS

NOMINATION HEARING PREVIEW
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Jessica Rosenworcel, nominated by President Barack Obama to be a commissioner at the Federal Communications Commission, will tell the Senate Commerce Committee that her approach to the job will be a strong commitment to public service and a little regulatory "humility" in the face of technological change, guided by the core consumer- and competition-protection values of the Communications Act.
benton.org/node/106161 | Broadcasting&Cable
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FCC REFORM

FCC REFORM AND THE USF ORDER
[SOURCE: House of Representatives Commerce Committee, AUTHOR: Press release]
As the House Commerce Committee prepares to vote on legislation to increase transparency and accountability at the Federal Communications Commission, Committee Chairman Fred Upton (R-MI) and Communications and Technology Subcommittee Chairman Greg Walden (R-OR) expressed concern regarding the lack of transparency surrounding the FCC’s recent universal service proceedings. The chairmen requested the FCC outline what changes were made to the universal service item between the time it was considered and the time it was adopted. They request responses to a list of requests by Dec. 12, including copy of the item as it existed when it was adopted on Oct. 27, what changes, if any, were made, and an explanation of how the sunshine rules applied to the order between the time of a seven-page executive summary released Oct. 27 and the 759-page order was released Nov. 18, including any ex parte communications.
benton.org/node/106153 | House of Representatives Commerce Committee | B&C
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FCC REFORM BILL
[SOURCE: Tales of the Sausage Factory, AUTHOR: Harold Feld]
[Commentary] You haven’t seen a lot of industry lobbying to support the FCC Reform Legislation pushed by House Republicans on the Energy & Commerce Committee. One would think that a bill which requires the FCC to spend three years building up to adopting a rule, imposes all kinds of new burdens on the FCC before adopting a rule so that rulemaking will be even more burdensome and less likely to occur, and generally tries to limit the FCC from regulating or imposing conditions on media and telecom mergers would generate loud applause from industry players supposedly chaffing under the terrible yoke of the FCC. But we haven’t, and we won’t. Oh, Republicans may lean on industry trade associations for some perfunctory applause and ritual chanting about “the burdens of job killing regulation” blah blah Amen. But their heart won’t be in it. This may surprise those who think that the proposed Republican FCC Reform Bill is an industry fantasy crafted by high-paid industry lobbyists and pushed by their wholly owned subsidiaries. The bill contains everything industry always claims to want, so where the heck is the industry cheerleading squad? Why haven’t they shown up to cheer its passage with any enthusiasm? Why aren’t industry lobbyists busy writing op eds about how this wonderful FCC reform bill will make your cell phone bills cheaper, bring us better broadband, and give you free cable? And why are Republicans so determined to push it if no one in industry really wants it?
benton.org/node/106152 | Tales of the Sausage Factory
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FCC CONSIDERS NEW PROCEDURAL REQUIREMENTS
[SOURCE: Federal Communications Commission, AUTHOR: Public Notice]
The Federal Communications Commission seeks comment on additional procedures to improve transparency and efficiency in FCC proceedings. In particular, the FCC seeks comment on whether it should require commenters to file materials they cite in pleadings submitted in rulemaking proceedings, so that those materials are more easily accessible to all interested parties. In particular, the FCC seeks comment on requiring parties to submit full copies of any materials cited in their pleadings or ex parte submissions. Such a requirement may be viable under the Commission’s current electronic filing processes, when it would not previously have been feasible. Further, it could help to ensure that the record timely and unambiguously includes those materials that parties to our proceedings believe to be germane and informative.
What would be the benefits and burdens of such a new procedural requirement in rulemaking proceedings? Should any such rule distinguish among types of documents cited? For example, should data be treated differently from other forms of information and should economic analysis be treated differently from a law review article, court decision, or other government publication? Should ease of access to the cited information matter? If so, how should ease of access be determined? Are there some circumstances in which materials could not practically be placed in the record, such as when third parties do not permit copying (e.g., daily newsletters), the material is very bulky, or the material is in the form of a database? Would parties need to place an entire document in the record or would an excerpt suffice? Should the inclusion of an Internet address (URL) where the document can be viewed be deemed sufficient to satisfy the filing requirement for that document? Might this proposal diminish the quality of the comments received by the Commission, for instance if the additional burden of providing supporting materials outweighs their perceived value to the commenter? Would this proposal impose an undue paperwork burden on filers? Should the proposal be adopted in additional, or different, categories of proceedings?
benton.org/node/106160 | Federal Communications Commission
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WIRELESS/SPECTRUM

JOBS ACT
[SOURCE: House of Representatives Commerce Committee, AUTHOR: Press release]
House Communications and Technology Subcommittee Chairman Greg Walden (R-OR) unveiled the Jumpstarting Opportunity with Broadband Spectrum (JOBS) Act of 2011. The JOBS Act will advance wireless broadband service, spur billions of dollars in private investment, create thousands of jobs, help bring interoperable broadband communications to public safety officials, and reduce the deficit by approximately $15 billion. The legislation is the culmination of five hearings and extensive bipartisan negotiations to use voluntary incentive auctions to make more efficient and effective use of the public’s airwaves and support establishment of a nationwide, interoperable, broadband public safety network.
The legislation authorizes incentive auctions, creating the contiguous, 20-MHz block of spectrum public safety officials say they need for broadband by reallocating the 700 MHz D Block and providing for the return of 700 MHz narrowband spectrum, making up to $6.5 billion in grants available for the construction of an interoperable public safety network, and creating a governance structure for construction and operation of the network. The legislation also addresses the relocation of federal government incumbents to make additional spectrum available for commercial services. Following the experiences of the AWS-1 band (1710-1755 MHz), the legislation adopts changes to the Commercial Spectrum Enhancement Act to streamline the existing relocation process, including providing NTIA with funding for spectrum planning prior to relocation auctions, permitting incremental updates to government systems through the relocation process, improving processes for the creation of relocation plans, and improving accountability.
benton.org/node/106156 | House of Representatives Commerce Committee | The Hill | B&C
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NEW SPECTRUM BILL
[SOURCE: House of Representatives Commerce Committee]
Rep. Henry A. Waxman (D-CA), Ranking Member of the House Commerce Committee, Rep. Anna G. Eshoo (D-CA), Ranking Member of the Communications and Technology Subcommittee, and other Democratic members of the Committee announced plans to introduce legislation that would create a nationwide, interoperable public safety broadband network. The “Wireless Innovation and Public Safety Act of 2011” would also provide the Federal Communications Commission with incentive auction authority to efficiently and responsibly repurpose broadcast spectrum for commercial broadband purposes and unlicensed innovation. The legislation reallocates the D Block spectrum for public safety use. In addition, it promotes efficient spectrum use by enabling sharing of public safety network spectrum and infrastructure to facilitate interoperability among agencies responding to emergencies and promote public/private partnerships to speed network deployment. The legislation would establish a private, non-profit entity, the Public Safety Broadband Corporation, as the national governance vehicle for ensuring fiscal responsibility and accountability. The legislation also directs the Commission to identify and auction approximately 250 MHz of spectrum to be made available for commercial mobile broadband. Proceeds from the auctions will be deposited into the Public Safety Trust Fund. The legislation also provides the FCC with the flexibility to preserve unlicensed spectrum in the TV band. Unlicensed spectrum in the TV band will enable innovators and entrepreneurs to develop applications and services like, super Wi-Fi hotspots, which will drive new economic opportunity and job creation. The legislation also gives the FCC incentive auction authority to compensate licensees for voluntary relinquishment of their spectrum usage rights.
The original cosponsors of the “Wireless Innovation and Public Safety Act of 2011” are Rep. Henry A. Waxman, Rep. Anna G. Eshoo, Rep. Edward J. Markey, Rep. Mike Doyle, Rep. Doris Matsui, Rep. Donna M. Christensen, Rep. Frank Pallone, Jr., Rep. Diana DeGette, Rep. Eliot Engel, and Rep. Jan Schakowsky.
Groups in support of the legislation include the Public Safety Alliance, the National Governors Association, the National League of Cities, the U.S. Conference of Mayors, the National Association of Counties, the International City/County Management Association, Consumer Federation of America, Consumer’s Union, Public Knowledge, the New America Foundation, Free Press, Media Access Project, and the National Emergency Number Association.
benton.org/node/106155 | House of Representatives Commerce Committee | AdWeek | The Hill
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TELEVISION

REVERSE COMPENSATION
[SOURCE: Deadline New York, AUTHOR: David Lieberman]
Station groups including Belo, Gray Television, LIN Media, NexStar Broadcasting, and Sinclair Broadcast face a big problem after next year’s elections when the cash from political ads evaporates: Their revenues and cash flow could plummet as they’re forced to turn as much as half of the money they collect from cable and satellite retransmission consent agreements over to ABC, CBS, Fox, and NBC, according to a report from Moody’s Investors Service. The debt rating firm warned that the networks, by virtue of their popular prime time shows — and growing ability to distribute shows over the Web — “have the upper hand” over local station owners. And they’re using that to demand growing payments, known as “reverse compensation.”
benton.org/node/106150 | Deadline New York
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OWNERSHIP

FACEBOOK IPO
[SOURCE: Wall Street Journal, AUTHOR: Shayndi Raice]
Apparently, Facebook is inching closer to an initial public offering that it hopes will value the company at more than $100 billion.
The social networking firm is now targeting a time frame of April to June 2012 for an initial public offering. The company is exploring raising $10 billion in its IPO—what would be one of the largest offerings ever—in a deal that might assign Facebook a $100 billion valuation, a number greater than twice that of such stalwarts as Hewlett-Packard and 3M. The company now appears poised to go ahead with a deal. But it will likely come to market at a time when investors are beginning to question the value of some newer Internet businesses.
benton.org/node/106146 | Wall Street Journal
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$100 BILLION QUESTION FOR FACEBOOK INVESTORS
[SOURCE: Wall Street Journal, AUTHOR: Rolfe Winkler]
As initial valuations go, $100 billion is a big number to ask. But at least Facebook has a business model to buy into. Investors will want to see the financial statements before deciding to jump into the social network's initial public offering, penciled in for next year. And when the figures emerge, perhaps as soon as December, investors are likely to see a more robust business model than they have come to expect from recent Internet IPOs. Facebook will have $4.3 billion of world-wide revenue this year, eMarketer estimates, up from $2 billion last year. Meanwhile, it seems reasonable to estimate that Facebook's operating-profit margins will settle somewhere near Google's, which run about 50%. If Facebook grows its revenue 60% next year to roughly $7 billion—and can generate 50% operating profit—then after tax, it should have earnings of perhaps $2.3 billion. At $100 billion, the valuation would certainly seem steep at over 40 times earnings. Google trades at roughly 15 times next year's earnings. However, Facebook is a younger company growing more quickly. That warrants a premium. And even at 40 times, it would be far cheaper than Amazon. The online retailer is in an entirely different business, of course, yet its stock fetches 90 times next year's earnings.
benton.org/node/106176 | Wall Street Journal
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INTERNET/BROADBAND

FCC USF REFORM
[SOURCE: GigaOm, AUTHOR: Stacey Higginbotham]
The Federal Communications Commission’s $4.5 billion plan to upgrade for the 21st Century the funding program that provides telephone service to rural areas will soon become law, as universal service fund reform hits the Federal Register. As policy-making goes, this more-than-700-page regulation detailing the reform was much-needed and has taken years, but once the FCC decided to buckle down and address the problem in the last few months, the lobbying was over in a relative flash. This compared with the two-year saga that was getting network neutrality from a proposed rule to final rule with legal teeth. Savvy politicos see the USF reform’s speed as a case of necessity, because the issue was complicated and created uncertainty for many telcos and communications providers. The FCC did kickstart the issue two years ago, but only over the summer did it start focusing deeply on it. So the industry and the FCC got together to push the process through in record time with attention for the issue coming mostly from political and industry insiders fighting over their slice of the pie. Most portions of the reform, which swaps the FCC’s rural funding model from old-school copper and voice to backing broadband and IP, will go into effect on Dec. 29 after the Commission voted to approve the order back in October. While this is a necessary step in moving the nation from the analog infrastructure to something equipped to meet the digital age, there are aspects of the rules where political compromise has cost the tech world and rural consumers while still sending payment to the big telcos.
benton.org/node/106178 | GigaOm
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CONTENT

CHANEL CASE
[SOURCE: ars technica, AUTHOR: Nate Anderson]
After a series of one-sided hearings, luxury goods maker Chanel has won recent court orders against hundreds of websites trafficking in counterfeit luxury goods. A federal judge in Nevada has agreed that Chanel can seize the domain names in question and transfer them all to US-based registrar GoDaddy. The judge also ordered "all Internet search engines" and "all social media websites"—explicitly naming Facebook, Twitter, Google+, Bing, Yahoo, and Google—to "de-index" the domain names and to remove them from any search results.
The case has been a remarkable one. Concerned about counterfeiting, Chanel has filed a joint suit in Nevada against nearly 700 domain names that appear to have nothing in common. When Chanel finds more names, it simply uses the same case and files new requests for more seizures. (A recent November 14 order went after an additional 228 sites; none had a chance to contest the request until after it was approved and the names had been seized.)
How were the sites investigated? For the most recent batch of names, Chanel hired a Nevada investigator to order from three of the 228 sites in question. When the orders arrived, they were reviewed by a Chanel official and declared counterfeit. The other 225 sites were seized based on a Chanel anti-counterfeiting specialist browsing the Web. That was good enough for Judge Kent Dawson to order the names seized and transferred to GoDaddy, where they would all redirect to a page serving notice of the seizure. In addition, a total ban on search engine indexing was ordered, one which neither Bing nor Google appears to have complied with yet.
benton.org/node/106172 | Ars Technica
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PATRIOT ACT AND CLOUD COMPUTING
[SOURCE: Politico, AUTHOR: David Saleh Rauf]
Cloud computing is a gold mine for the U.S. tech industry, but American firms are encountering resistance from an unexpected enemy overseas: the PATRIOT Act. The Sept. 11-era law was supposed to help the intelligence community gather data on suspected terrorists. But competitors overseas are using it as a way to discourage foreign countries from signing on with U.S. cloud computing providers like Google and Microsoft: Put your data on a U.S.-based cloud, they warn, and you may just put it in the hands of the U.S. government. “The PATRIOT Act has come to be a kind of label for this set of concerns,” said Ambassador Philip Verveer, U.S. coordinator for International Communications and Information Policy at the State Department. “We think, to some extent, it’s taking advantage of a misperception, and we’d like to clear up that misperception.”
benton.org/node/106171 | Politico
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STORIES FROM ABROAD

CHINA BANS ADS IN TV DRAMAS
[SOURCE: Wall Street Journal, AUTHOR: Laurie Burkitt]
China's regulators will ban advertising during television dramas, dealing a blow to marketers who have ramped up ad spending to reach the nation's growing consumer class. The State Administration of Radio, Film, and Television issued new rules restricting commercials from interrupting TV dramas, allowing them to air only back-to-back between programs. It said the new restrictions, which will go into effect at the beginning of next year, are intended to spur broadcasters to show more cultural programming, helping them to uphold a "public service." While the ban could cheer couch potatoes, experts say pushing commercials to the end of dramas will ultimately hurt marketers. Earlier this month, both foreign and domestic companies paid a record 14.26 billion yuan, or about $2.25 billion, for the rights to advertise next year on the country's largest network, China Central Television. Volkswagen AG, for example, pledged $45.6 million in the auction, according to Chinese advertising agency Charm Communications.
benton.org/node/106132 | Wall Street Journal
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UK’S SUPER-CONNECTED CITIES
[SOURCE: Financial Times, AUTHOR: Maija Palmer]
The chancellor has pledged an additional £100m fund to help create 10 “super-connected” cities across the UK, which will have broadband speeds of 80 to 100 megabits a second. London, Cardiff, Belfast and Edinburgh will be among the 10, with the remaining six to be decided through a competition. They will be announced in the 2012 Budget.
George Osborne said broadband was among the 500 infrastructure projects that the government will pursue in the next 10 years. “It means creating new superfast digital networks for companies across our country. These do not exist today. See what countries like China or Brazil are building, and you’ll also see why we risk falling behind the rest of the world,” Osborne said. “Our great cities are at the heart of our regional economies. And we will help bring world-leading, superfast broadband and WiFi connections to 10 of them – including the capitals of all four nations.” It is understood the money will go towards filling in so-called ‘not-spots’, or areas of cities that have poor broadband or WiFi coverage. The spending was part of a plan by the chancellor to bring superfast broadband to 90 per cent of homes and extending mobile coverage to 99 per cent of families.
benton.org/node/106131 | Financial Times
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EU DATA PROTECTION
[SOURCE: Associated Press, AUTHOR: ]
The European Union wants to create one "level playing field" when it comes to data protection, and plans to update laws that have been around long before Facebook and other social networking sites even existed. EU Justice Commissioner Viviane Reding said that social networks must become more open about how they operate. Under her proposals, businesses — including Internet service providers — would have additional responsibilities such as having to inform users of what data about them is being collected, for what purpose, and how it is stored.
benton.org/node/106130 | Associated Press
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SAMSUNG DEFEATS APPLE BAN
[SOURCE: Bloomberg, AUTHOR: Joe Schneider]
Samsung, the world’s biggest smartphone maker, won a battle in its global patent war with Apple as an Australian appeals court overturned a ban on the sale of its tablet rivaling the iPad. Samsung can begin sales of its Galaxy Tab 10.1 in the country starting Dec. 2, a federal appeals judge ruled. A three-member appeal panel unanimously said that a lower-court judge earlier made a mistake in granting Apple’s request for a ban. Apple must file an emergency appeal against this verdict in the Canberra-based High Court, the nation’s apex legal body, to extend the ban. The Australian dispute is part of a battle between the companies on at least four continents that began in April, when Apple sued Samsung in the U.S. and accused it of “slavishly” copying the designs of iPhones and iPads.
benton.org/node/106170 | Bloomberg | Los Angeles Times | Financial Times
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HACKING IN UK
[SOURCE: New York Times, AUTHOR: Sarah Lyall]
Paul McMullan, a former deputy features editor at Rupert Murdoch’s now-defunct News of the World tabloid, admitted that he and his colleagues hacked into people’s phones and paid police officers for tips. He confessed to lurking in unmarked vans outside people’s houses, stealing confidential documents, rifling through celebrity garbage cans and pretending that he was not a journalist pursuing a story but “Brad the teenage rent boy,” propositioning a priest. McMullan said at the Leveson Inquiry, which is investigating media ethics in Britain the wake of the summer’s phone hacking scandal that The News of the World’s underlings were encouraged by their circulation-obsessed bosses to use any means necessary to get material. “We did all these things for our editors, for Rebekah Brooks and for Andy Coulson,” Mr. McMullan said, referring to two former News of the World editors who, he said, “should have had the strength of conviction to say, ‘Yes, sometimes you have to stray into black or gray illegal areas.’” He added: “They should have been the heroes of journalism, but they aren’t. They are the scum of journalism for trying to drop me and my colleagues in it.”
benton.org/node/106169 | New York Times
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