December 2011

Broadcasters Press Supreme Court to Overturn TV, Radio and Newspaper Ownership Rules

Tribune, Sinclair, Bonneville, The Scranton Times, Clear Channel, Morris Communications, and the Newspaper Association of America all joined with Fox (News Corp.) to challenge not only the Federal Communications Commission's media ownership rules, but the spectrum scarcity rationale for media ownership regulations in general. In their petition that the Supreme Court review, and overturn, the Third Circuit's decision upholding most of the FCC's media ownership rules, Fox and legal friends argue that the spectrum scarcity rationale underpinning the media ownership rules (and other regulations) should be overturned -- it stems from the Supreme Court's own decision in the Red Lion case, and that, in any case, the newspaper-broadcast cross-ownership restriction violates the First Amendment and Fifth Amendment because it singles out newspapers. "The time has come for the Court to intercede and restore the full protections of the First Amendment to broadcasters," said the petitioners. "[T]he scarcity doctrine expired long ago," they said, citing a revolution in media delivery since the early 1970s when Red Lion was decided.

In a separate filing, the National Association of Broadcasters (NAB) argues that rather than resulting in dangerous monopolies, allowing broadcasters to own multiple news organs helps them improve their financial health. That in turn gives them the flexibility to invest in higher quality reporting. “By harming local television stations all over the country, the duopoly rule also directly harms the public,” the petition reads. “When a station struggles financially or ceases to operate, it loses its ability to provide the news and public affairs programming on which members of the public rely. But placing stations under common ownership, resulting in an improvement in financial stability, leads to improved local programming – both in quality and in quantity – of the kind that is critical to viewers.” Furthermore, the petition says the Third Circuit’s decision conflicts with lower court opinions related to broadcast media ownership rules, and asks the court to intervene so it can clarify the regulations.

MetroPCS CFO Says AT&T’s T-Mobile USA Deal Likely to Fail

MetroPCS Communications Chief Financial Officer J. Braxton Carter said AT&T’s attempt to buy T-Mobile USA is likely to fail, signaling lack of confidence by a company AT&T had approached to help with the transaction.

AT&T, seeking regulatory approval for the deal, has been in discussions with MetroPCS to sell spectrum and customers as a way of propping up competition in the absence of T-Mobile. Discussing any scenarios to save the $39 billion deal is “almost kind of moot at this point given the intense opposition by the government,” Carter said. Companies involved need to move on to “plan B,” he said. The comments suggest the odds of AT&T completing the T- Mobile takeover may be decreasing and that AT&T may need to find another partner to buy some assets as part of the transaction.

Dutch Antitrust Investigators Visit KPN, T-Mobile, Vodafone

Royal KPN NV is among mobile-phone operators in the Netherlands visited by the NMa competition authority as part of an investigation into possible antitrust violations.

KPN, the largest Dutch phone company, said in a statement that its headquarters were raided today by the NMa as part of a probe into “concerted practice with regard to mobile telecommunications offerings on the Dutch consumer market,” and “division of independent sales channels.” It said five KPN employees are being questioned and the company is cooperating fully. T-Mobile is also cooperating fully with the investigation, spokesman Michael Vos said via phone, confirming a visit from the NMa this morning. “We are confident in the result,” he said, while declining to elaborate on the probe. Vodafone Group Plc confirmed in a statement that it had been visited by the competition authority.

Commissioner Michael Copps Announces His Departure from the FCC

Yesterday, I submitted to the President notice of my intention to resign my post as Commissioner effective January 1, 2012. Should the Senate confirm my successor prior to that date, or should the Senate adjourn sine die before January 1st, I would of course be leaving sooner.

It has been a privilege and honor to serve for more than ten years as a Commissioner. The FCC is an agency of true excellence and its decisions are integral to our country’s future. Ubiquitous, opportunity-creating broadband and a resource-rich media capable of informing our civic dialogue are critically-important components of our future success as a people, and I intend to keep speaking about these challenges as a private citizen in the years ahead.

It has been the highest honor to serve with my colleagues on the Commission. I thank them all for their dedication, collegiality and friendship. I also owe an enormous debt to the Commission staff. Their professionalism and dedication to the public interest stands as a model of government service.

Comcast: No plans for usage-based broadband pricing

Many cable operators are considering new pricing for broadband services that would link the amount of data their subscribers consume with the amount they pay. But Comcast isn’t one of them, according to executives.

At the UBS Global Media and Communications Conference, Comcast Cable president Neil Smit and CFO Michael Angelakis implied that such plans probably wouldn’t be good for the company’s growing broadband business. While the cable industry has suffered from subscriber losses on the video side, it’s seeing increased growth in broadband subscription revenues. That growth is due in part to more consumers coming online, but also to a greater number of subscribers opting for higher-speed data plans. Comcast hopes to upsell subscribers on higher-speed plans. It recently rolled out 100 Mbps broadband services throughout its entire footprint, and is pushing its 25 Mbps Blast!, Extreme 50 and Extreme 105 broadband services with a holiday promotion that offers new subscribers a free wireless gateway.

While Comcast doesn’t plan to institute usage-based pricing, it does have a broadband cap of 250 GB per month, which the company instituted in 2008. Since then, broadband usage has exploded, especially with the growth of streaming video, but Comcast hasn’t increased its cap. The company claims most customers are still well below their limits, with the median usage being around 6 GB to 8 GB per month. Still, with growing demand for video and other high-bandwidth services, more family members using more devices, and more of Comcast’s customers taking higher-speed plans, it seems more customers are going to bump up against those caps unless the company increases them soon.

Federal Cybersecurity R&D Strategic Plan Released

The White House Office of Science and Technology Policy released Trustworthy Cyberspace: Strategic Plan for the Federal Cybersecurity Research and Development Program, a road map to ensuring long-term reliability and trustworthiness of the digital communications network that is increasingly at the heart of American economic growth and global competitiveness.

As a research and development strategy, this plan defines four strategic thrusts:

Inducing Change – using game-changing themes to understand the root causes of existing cybersecurity deficiencies with the goal of disrupting the status quo;
Developing Scientific Foundations – minimizing future cybersecurity problems by developing the science of security;
Maximizing Research Impact – catalyzing coordination, collaboration, and integration of research activities across Federal agencies for maximum effectiveness; and
Accelerating Transition to Practice – expediting improvements in cyberspace from research findings through focused transition programs.

Fate Of Netflix-Facebook Integration In Hands Of Congress--Right Now!

Bipartisan bill H.R. 2471 would create a way for people to expressly allow companies like Netflix or Facebook to share their video rental history on the web. And it's scheduled for a floor vote.

If passed, it would correct a frustrating situation outlined by Netflix CEO Reed Hastings in September, when he joined Mark Zuckerberg on stage at the f8 developer conference to make a surprise announcement: Netflix's domestic subscribers would not be able to integrate their accounts to share films and TV shows on Facebook's open graph. Forty-four of the 45 countries where Netflix is available--in Latin America, Canada--have access to the new Facebook integration that lets them share their movie watching choices. But in the U.S., an antiquated 1988 bill called the Video Privacy Protection Act forbids the disclosure of one's video rental information--even if the renter is okay with the disclosure. So domestic subscribers of Netflix would have to wait. Seems like an easy fix--today's legislation adds a sentence-length amendment to the original law. However, the legislation, which has supporters and co-sponsors from both sides of the aisle, is facing detractors, namely one sources say is Rep. Mel Watt (D-NC).

As Email Wheezes Toward The Grave, We Contemplate A DNR

[Commentary] It sounds kind of crazy (or crazy awesome)--a company banning email for all its employees. But this is no item from News of the Weird. Far from it. The company that banned email is Europe's largest IT company, one with 75,000 employees and $13 billion in annual revenue, which operates in 13 countries. The company, Atos, is the official IT shop for the Olympic games. Atos CEO Thierry Breton explained that "email is no longer the appropriate communication tool," and that the "zero email" policy would be phased in over the next 18 months. Breton says he hasn't sent an email in the past three years, and that Facebook, text, and the phone will replace email for his company, as they prepare for a new wave of usage and behavior.

By 2014, the technology research group Gartner predicts social networking services will replace email as the principal method of interpersonal communications for 20% of business users. So, is email dead? Can we do something to change it? And should we?

The Rise of Developeronomics

[Commentary] The one absolutely solid place to store your capital today — if you know how to do it – is in software developers’ wallets. If the world survives looming financial apocalypse dangers at all, this is the one investment that will weather the storms. It doesn’t matter whether you are an individual or a corporation, or what corner of the world you inhabit. You need to find a way to invest in software developers.

AT&T rated lowest (again) in our annual satisfaction survey

In the newest satisfaction survey of Consumer Reports online subscribers, a provider called Consumer Cellular topped the Ratings—and AT&T found itself at the bottom of the Ratings for the second year in a row.

Of the four major U.S. national cell-phone standard service providers, Verizon again scored the highest in this year’s Ratings, followed closely by Sprint. Survey respondents gave very good scores to Verizon for texting and data service satisfaction, as well for staff knowledge. T-Mobile was below Verizon and Sprint but continued to rate significantly better than the higher-priced AT&T.

Benton

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