December 2011

BENTON'S COMMUNICATIONS-RELATED HEADLINES for MONDAY, DECEMBER 5, 2011

M-Enabling Summit (FCC), The Impact of Search on Journalism (Media Access Project), and the President’s Council of Advisors on Science and Technology (regional meeting) on today’s agenda http://benton.org/calendar/2011-12-05/

VERIZON SPECTRUM DEAL
   Verizon Wireless Allies With Cable in $3.6 Billion Deal
   DC Reacts to Verizon Spectrum Sale
   Verizon to AT&T: Want more spectrum? Here’s how you get it. - analysis
   Spectrum Deal Helps Dish Shares [links to web]
   Verizon’s spectrum deal with cable is the end of broadband competition - analysis
   Even without AT&T-Mo, we still have no competition - analysis

MORE ON SPECTRUM
   Dropped Call? Blame the FCC - editorial

INTERNET/BROADBAND
   The New Digital Divide - op-ed
   The internet as a diversion and destination - research
   When Your ISP is One of Your Neighbors
   $6 Billion in ‘Cyber Week’ U.S. Online Spending Sets New Weekly Record - research

OWNERSHIP
   Broadcasters to Appeal Media Ownership Decision to Supreme Court
   Coalition Asks FCC to Focus on Diversity in Quadrennial Ownership Rule Review
   Department of Justice OKs Google’s Acquisition of Admeld
   Facebook buys Gowalla
   Apple Loses Bid For Preliminary Injunction On Samsung’s Galaxy Tab In US [links to web]
   The Android Patent War - editorial

KIDS AND MEDIA
   Screen Time Higher Than Ever for Children
   Markey, Barton Friend Zuckerberg
    Khan Academy: Online Learning, Personalized [links to web]

PRIVACY
   Five Solutions To The Privacy Problem: Why They Work And Why They Don’t - analysis [links to web]
   Rep. Markey calls for investigation of cellphone tracking software
   Why Both You And Carrier IQ Are Pawns In The Fight For Mobile Data - analysis
   Carrier IQ, Samsung, HTC named in class action suit
   Carrier IQ's own marketing claims undercut its defense
   Carrier IQ and Facebook pose the least of your privacy threats - analysis
   How to turn off Carrier IQ on your iPhone [links to web]
   Markey, Barton Friend Zuckerberg
   Facebook’s tactical retreat on privacy - analysis
   Privacy Lawsuit Against Amazon Dismissed [links to web]
   Privacy, schmivacy. I just can't get worked up over the latest freakouts over the misuse of our information. Sorry. - editorial [links to web]
   EU eyes big fines for privacy breaches

CONTENT
   Piracy legislation pits Hollywood against Silicon Valley
   Antipiracy bills for Internet go too far - editorial
   Software That Listens for Lies [links to web]
   Seeking to copy -- legally-- from Blu-ray discs and online media [links to web]

TELEVISION/RADIO
   At TV and Radio Outlets, Little-Known Trove of Kudos and Complaints
   Two Giant Radio Groups Form Daily-Deal Alliance
   Uncovering the Truth about Retransmission Value - editorial
   Xbox Live Challenges Cable Box
   Nielsen Corrects TV-Viewing Data [links to web]
   Anderson Cooper's Talk Show Is a News Program, FCC Rules [links to web]
   TV isn't broken, so why fix it? - analysis [links to web]
   NPR CEO Gary Knell Talks Public Funding, Diversity On First Day [links to web]

ELECTIONS AND MEDIA
   4 ways technology will impact politics in 2012 - analysis
   In Iowa, Covering a New Breed of Campaign

AGENDA
   Senate Commerce Slates Votes on FCC Nominees – Dec 8 [links to web]

STORIES FROM ABROAD
   EU eyes big fines for privacy breaches
   Brussels homes in on Google antitrust case
   Steering Telecom Italia With a Steady Hand [links to web]
   Syrian government reportedly bans use of Apple iPhone [links to web]
   In Europe, Tablets Replace TV Viewing But Smartphones Complement It [links to web]

MORE ONLINE
   How Social Media Is Changing Law Enforcement - analysis [links to web]

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VERIZON SPECTRUM DEAL

VERIZON’S SPECTRUM DEAL
[SOURCE: Bloomberg, AUTHOR: Alex Sherman]
Verizon Wireless, the largest U.S. mobile-phone carrier, struck an alliance with cable companies that will change how customers buy Internet, mobile and pay-TV services and present new challenges for rivals such as AT&T. Verizon Wireless will pay the group $3.6 billion for wireless spectrum: Comcast, the country’s largest cable provider, will receive $2.3 billion, while Time Warner Cable gets $1.1 billion and Bright House Networks LLC gets $189 million. The deal would allow Verizon to double-up on its LTE network – in some regions triple up – creating huge overhead for future mobile broadband growth. With that spectrum, Verizon can build what amounts to another LTE network parallel to its current 4G network at 700 MHZ. In areas where its current AWS holdings overlap with SpecrtumCo’s, Verizon will have a total of 60 MHz of spectrum, which would be enough to build mobile broadband networks with three times the capacity it has on LTE today. If it can get this deal by regulators, Verizon will seal its mobile broadband future for years to come.
Verizon Wireless and the cable companies will also market and sell each other’s services under the agreement. Verizon will offer cable-TV products in its retail stores and receive a percentage of revenue for every cable customer it signs up, while cable companies will receive fees for each wireless customer they sign up. “This is a strategic masterstroke for Verizon,” said Craig Moffett, an analyst at Sanford C. Bernstein & Co. The agreement will lead to “a complete reordering of the competitive universe as we know it today.” The partnership may make Verizon and cable operators more cooperative “frienemies,” said David Joyce, an analyst at Miller Tabak. “This might slow the competitive push from FiOS to drive down prices, which could help the cable companies,” said Joyce.
The partnership still needs approval from regulators. The Federal Communications Commission will “undertake a thorough, fair and fact-based review of the proposed transaction,” according to FCC spokesman Neil Grace. The FCC and Justice Department are likely to approve the deal, though they may require the sale of assets in certain markets, said Jeff Silva, senior policy director for telecommunications, media and technology at Medley Global Advisors LLC in Washington. “This deal is likely to eventually get approved with possible divestitures in any markets that the FCC and Justice Department find that Verizon would have excessive spectrum concentration,” he said. The companies said that they do not think federal regulators can review their marketing agreement. They noted that AT&T has a similar cross-promotional deal with satellite company DirecTV. But antitrust experts said that either Justice or the FCC could expand its review and question how the marketing partnership would affect consumer choice. “It’s fair to say this is going to get a hard and thorough review,” said the person familiar with the concerns of federal antitrust officials, who spoke on condition of anonymity because the review process is not publicly disclosed. “If not in the review, in an investigation.”
benton.org/node/106483 | Bloomberg | WashPost | Reuters | NYTimes | LATimes | Associated Press | The Hill | GigaOm |
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DC REACTS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Washington reaction varied to the news that cable operators were selling the spectrum they won at the Federal Communications Commission's Advanced Wireless Services auction in the 2006.
Mark Cooper of the Consumer Federation of America said it would be a good deal for Verizon and a bad deal for consumers. He said the deal would result in higher prices and less choices. "The auctioning of spectrum has totally failed to promote competition in wireless," he said. Cooper said it was ironic that the announced deal came a day after House Republicans voted to foreclose the development of unlicensed spectrum that would give the public alternatives to paying Verizon -- or AT&T -- for cellular service. "With this purchase, almost 75 percent of the spectrum auctioned in the last decade has ended up in the hands of the top two wireless firms (AT&T and Verizon) and 90 percent with the top four firms," said Cooper.
Public Knowledge saw some upside to the deal. "It is good news that Verizon is paying $3.6 billion to buy useful spectrum from the cable company consortium. Spectrum is better held in the hands of those who will use it, as opposed to those who don't," PK legal director Harold Feld said in a statement. "The transaction also shows how relatively cheaply more spectrum can be acquired by those who need it. The purchase price is about one-tenth of the amount AT&T wants to pay for T-Mobile to theoretically solve AT&T's spectrum shortage." But he shared with Cooper concerns about reducing competition, in the video as well as broadband space.
benton.org/node/106482 | Broadcasting&Cable
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VERIZON, AT&T AND SPECTRUM
[SOURCE: GigaOm, AUTHOR: Stacey Higginbotham]
Unlike AT&T, which is attempting to acquire T-Mobile for $39 billion and hitting roadblocks at the Federal Communications Commission and the Department of Justice, Verizon is likely to work a deal that gives it up to 20 MHz more of unused spectrum to deploy for LTE in all major U.S. markets. This is no small feat, as one of the suspected lures of T-Mobile’s AWS spectrum for AT&T was that it allowed AT&T to deploy an LTE network without having to worry about phasing out customers using its existing spectrum for 2G and 3G devices. Now Verizon stands to get pristine spectrum in the AWS band that it can combine with its 700 MHz airwaves it won at auction for LTE. The key for FCC approval lies in the fact that this spectrum is unused, according to sources in Washington DC. Because there are no customers on it right now, it’s an asset, and Verizon’s acquisition of it doesn’t affect actual customers or an existing market. Thus, a competitive market analysis like what the DoJ and the FCC evaluated in the AT&T and T-Mobile deal doesn’t make sense. Plus, coming immediately after the FCC all but quashed the AT&T attempt to purchase T-Mobile, while also releasing a report that essentially accused Ma Bell of lying, it’s unlikely to react so boldly a second time, especially as we head into an election year. When I asked the FCC for comment, a spokesman replied, “When the applications come before us, the FCC will undertake a thorough, fair and fact-based review of the proposed transaction.” The FCC, however, can evaluate the deal against its spectrum screen as opposed to looking at how the deal would affect individual markets. The FCC has the ability to evaluate transactions that allow one player to hold a large amount of megahertz in a given market, and Public Knowledge, a consumer lobbying group has called on the FCC to do exactly that.
benton.org/node/106481 | GigaOm
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END OF BROADBAND COMPETITION
[SOURCE: GigaOm, AUTHOR: Stacey Higginbotham]
The Verizon Wireless-cable companies spectrum deal signals the moment that the consumer benefits of the convergence of voice, video and data hit the wall. It’s a deal that’s great for Verizon, an acknowledgment of reality for the cable folks and a bummer for AT&T and consumers. The deal has a huge potential impact on wireless broadband competition. Verizon had hinted it might resell its FiOS TV service over-the-top to folks outside the FiOS service area. Since TV can be a collection of bits delivered over the Internet, the traditional cable packages could become obsolete if the content companies and channels could figure out ways to license their content in new ways. Given that Verizon has both a broadband and a pay TV business, it had one of the best chances to push such a radical change in the pay TV business model. But now that it has some mysterious “agreements” with the cable guys, it’s unlikely that Verizon would try to infringe on their content businesses with its own over-the-top offering. That’s a bummer for consumers who might prefer a Verizon package over one from their local cable provider, but it’s also indicative of Verizon ceding the wireline market to cable companies. Susan Crawford, an influential policy wonk and a professor at Cardozo Law School said: “This is the crystalline moment when the division of the marketplace becomes completely clear, even to people who haven’t been paying attention. VZ and ATT get wireless; cable gets wires; consumers are stuck. Wireless, like wired high-speed access already wholly dominated by the cable companies, is a natural monopoly service at this point, with incredibly high barriers to entry – so high that even current players, like T-Mo, are having trouble making it. Clearwire has nowhere to go at this point. So we have the worst of all worlds: no competition, and no regulatory oversight.”
benton.org/node/106479 | GigaOm
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NO COMPEITITION
[SOURCE: GigaOm, AUTHOR: Kevin Tofel]
[Commentary] With AT&T’s proposed deal to purchase T-Mobile now effectively dead, consumers have won, right? T-Mobile customers that enjoy lower rates have no cause to worry a new owner will raise their monthly bill. AT&T still has plenty of spectrum to roll out its LTE network, so most of the country will have speedy mobile broadband access. And existing T-Mobile subscribers won’t have to buy new phones that work on AT&T’s network. However, consumers are no better off than before. I realize that’s a bit of an obvious statement, but the end of the AT&T-Mo situation looks like a potential missed opportunity for consumers to benefit from more carrier competition. Let’s face it: We have four major networks in the U.S. providing voice and data — plus a number of smaller, regional carriers — but unlike most other consumers around the world, we can’t move our phones amongst these networks.
benton.org/node/106478 | GigaOm
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MORE ON SPECTRUM

BLAME THE FCC
[SOURCE: Wall Street Journal, AUTHOR: L Gordon Crovitz]
[Commentary] In the bad old days, AT&T was the all-powerful monopolist, but remember that it took two to suppress competition: AT&T plus a government agency dedicated to micromanaging the phone industry. Bipartisan deregulation by the Carter and Reagan administrations broke up Ma Bell in 1982 and brought the free market to telecommunications. How soon we forget the risks of overregulation: Last week, the Federal Communications Commission flexed the same muscle it once used to quash market forces in the phone industry to quash market forces in the wireless industry. Today's AT&T, a spinoff from the original, needs more spectrum to catch up with market leader Verizon, also a Ma Bell descendant, to support iPhones, Androids and other devices that feature video and sophisticated apps. It wants to buy T-Mobile, a division of a German company, which doesn't have the resources to compete in the United States on its own. But the FCC decided to apply antitrust theory from the industrial era and claims to know better than wireless companies how they should operate their businesses. We live in an era when innovation in technology requires more regulatory humility. If a company wants to serve consumers better by risking its capital to buy spectrum through an acquisition, it should be allowed to proceed. Company executives can then be blamed if they either underinvest or overinvest in spectrum. FCC lawyers should stick to writing briefs. So long as regulators apply rules for mature industries to new technologies, we will have problems such as spectrum scarcity and industries kept artificially inefficient. Until regulators change their ways, blame a meddling FCC when calls get dropped on your mobile phone.
benton.org/node/106496 | Wall Street Journal
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INTERNET/BROADBAND

THE NEW DIGITAL DIVIDE
[SOURCE: New York Times, AUTHOR: Susan Crawford]
[Commentary] Increasingly, we are a country in which only the urban and suburban well-off have truly high-speed Internet access, while the rest — the poor and the working class — either cannot afford access or use restricted wireless access as their only connection to the Internet. As our jobs, entertainment, politics and even health care move online, millions are at risk of being left behind. While we still talk about “the” Internet, we increasingly have two separate access marketplaces: high-speed wired and second-class wireless. High-speed access is a superhighway for those who can afford it, while racial minorities and poorer and rural Americans must make do with a bike path. The new digital divide raises important questions about social equity in an information-driven world. But it is also a matter of protecting our economic future. Thirty years from now, African-Americans and Latinos, who are at the greatest risk of being left behind in the Internet revolution, will be more than half of our work force. If we want to be competitive in the global economy, we need to make sure every American has truly high-speed wired access to the Internet for a reasonable cost.
[Crawford is a professor at the Benjamin N. Cardozo School of Law and a former special assistant to President Obama for science, technology and innovation policy.]
benton.org/node/106476 | New York Times
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PEOPLE ONLINE FOR FUN
[SOURCE: Pew Research Center's Internet & American Life Project, AUTHOR: Lee Raine]
Americans are increasingly going online just for fun and to pass the time, particularly young adults under 30. On any given day, 53% of all the young adults ages 18-29 go online for no particular reason except to have fun or to pass the time. Many of them go online in purposeful ways, as well. But the results of a survey by the Pew Research Center’s Internet & American Life Project show that young adults’ use of the internet can at times be simply for the diversion it presents. Indeed, 81% of all young adults in this age cohort report they have used the internet for this reason at least occasionally. These results come in the larger context that internet users of all ages are much more likely now than in the past to say they go online for no particular reason other than to pass the time or have fun. Some 58% of all adults (or 74% of all online adults) say they use the internet this way. And a third of all adults (34%) say they used the internet that way “yesterday” – or the day before Pew Internet reached them for the survey. Both figures are higher than in 2009 when we last asked this question and vastly higher than in the middle of the last decade.
benton.org/node/106463 | Pew Research Center's Internet & American Life Project | Associated Press
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DC ACCESS
[SOURCE: PCWorld, AUTHOR: Phil Shapiro]
[Commentary] When in the course of human events it becomes necessary for consumers to declare their independence from large telcos, it's reassuring to know that wireless Internet service providers (WISP) are one possible option. Wireless ISP's (WISP) are usually located in rural areas not served by any other Internet service, but some urban WISP's have gained a foothold. One of these is DC Access, LLC (www.dcaccess.net) which serves sections of the Capitol Hill and Adams Morgan neighborhoods in the District of Columbia. DC Access provides a “fixed wireless” Internet service. You'll pay about the same as you would for Internet service from the big telcos (Verizon, Comcast, and so on), but you'll be treated a whole lot better when you call for support. Any small business that doesn't provide outstanding customer service is a small business on its way to being a former small business.
benton.org/node/106490 | PCWorld
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HOLIDAY SPENDING ONLINE
[SOURCE: comScore, AUTHOR: ]
comScore reported holiday season retail e-commerce spending for the first 32 days of the November – December 2011 holiday season. For the holiday season-to-date, $18.7 billion has been spent online, marking a 15-percent increase versus the corresponding days last year. The most recent week saw three individual days eclipse $1 billion in spending, led by Cyber Monday, which became the heaviest online spending day on record at $1.25 billion. Tuesday, November 29 reached $1.12 billion, while Wednesday, November 30 reached $1.03 billion. These three billion dollar spending days currently rank as three of the four heaviest online spending days in history (with Cyber Monday 2010 being the other).
benton.org/node/106489 | comScore
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OWNERSHIP

BROADCASTERS APPEAL MEDIA OWNERSHIP RULES DECISION
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The National Association of Broadcasters plans on Dec. 5 to ask the Supreme Court to overturn the Third Circuit's decision that leaves most of the Federal Communications Commission's media ownership limits in place. Apparently, News Corp. will also challenge the rules. There are expected to be a number of petitions filed. The Third Circuit Court of Appeals in July upheld the FCC's 2008 decision not to loosen the TV duopoly, radio ownership or TV-radio crossownership rules and vacated and remanded its loosening of the broadcast/newspaper crossownership rule for failure to meet notice and comment requirements.
benton.org/node/106471 | Broadcasting&Cable
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DIVERSITY AND MEDIA OWNERSHIP RULES
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The Leadership Conference on Civil and Human Rights has written the Federal Communications Commission to ask that it focus on diversity in its quadrennial media ownership rules review. In its letter, the conference (a coalition of 200-plus diversity groups) said that the FCC currently has "no meaningful policies to address racial and gender inequities in media ownership" and has "ignored the impact of its media ownership rules on those inequities." It pointed to the Third Circuit remand the court's admonition that the FCC was "punting yet again" on diversity. "As media consolidation grows, people of color and women become less significant players in the media ecosystem. The Commission must acknowledge that fact and take action to remedy it," the coalition said. Groups also signing on to the letter included the Communications Workers of America, National Urban League, NAACP, NOW and the UCC Office of Communication.
In addition, on Dec 1, more than 50 groups representing a wide range of women’s, media and social justice organizations, including Free Press, sent a letter to the FCC urging the agency to make diversity issues a priority in its upcoming review.
benton.org/node/106470 | Broadcasting&Cable | Free Press
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JUSTICE OKs GOOGLE-ADMELD
[SOURCE: Department of Justice, AUTHOR: Press release]
The Department of Justice’s Antitrust Division closed its investigation into the proposed acquisition of Admeld, an online display advertising service provider, by Google. After a thorough review of the evidence, the division concluded that the transaction is not likely to substantially lessen competition in the sale of display advertising. Although the Antitrust Division concluded that this particular transaction was unlikely to cause consumer harm, the division will continue to be vigilant in the enforcement of the antitrust laws to protect competition in display and other forms of online advertising. The division’s investigation focused on the potential effect of the proposed transaction on competition in the display advertising industry. Both Google and Admeld provide services and technology to web publishers that facilitate the sale of those publishers’ display advertising space. Google is a diversified software company whose offerings for publishers include an advertising exchange, an advertising network and an ad server. Admeld operates a supply-side platform (SSP) that helps publishers optimize the yield from their display advertising inventory. The investigation determined that web publishers often rely on multiple display advertising platforms and can move business among them in response to changes in price or the quality of ad placements. This use of multiple display advertising platforms, commonly called “multi-homing,” lessens the risk that the market will tip to a single dominant platform. In addition, there have been recent SSP and advertising exchange entrants in the display advertising industry. These were significant considerations in the division’s decision to close the investigation.
benton.org/node/106477 | Department of Justice | Bloomberg | NYTimes | WashPost | Associated Press | The Hill
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FACEBOOK-GOWALLA
[SOURCE: CNNMoney, AUTHOR: Laurie Segall]
Apparently, Facebook has acquired location sharing service Gowalla for an undisclosed sum. Launched in 2009, Austin-based Gowalla went head-to-head with direct rival Foursquare -- and lost. Badly trailing Foursquare in user adoption, Gowalla recently shifted directions, recasting itself as a travel guide. The site had raised around $10 million over the years from backers including the Founders Fund, Greylock Partners and a collection of angel investors.
benton.org/node/106449 | CNNMoney
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ANDROID PATENTS
[SOURCE: Wall Street Journal, AUTHOR: Editorial staff]
[Commentary] How's this for an unhappy holiday surprise: An obscure federal agency could soon ban imports of popular smart phones that use Android software. On Dec 6 the International Trade Commission (ITC) is scheduled to decide if Taiwan-based, Android smart-phone supplier HTC Corp. violated four Apple patents, such as touch-screen technology. The ITC has only one possible remedy under the law: to ban any product that infringes on intellectual property for the life of the patent. Given that the average smart phone uses more than 200,000 patents, one adverse finding could result in a ban on millions of phone imports. Blame for this potential debacle belongs to the 1930 Smoot-Hawley tariff act, believe it or not, which gave the ITC the power to resolve foreign breaches of U.S. patents. Companies now source and manufacture goods all over the world. So ITC patent cases have become popular as a weapon of protectionist mass destruction against competitors. There are 66 of these "Section 337" patent claims pending, up from 33 in 2006. The commission must by law consider the public interest and it could reject Apple's complaint on that basis. If the ITC proceeds with an exclusion order, President Obama has 60 days to overrule it, but such intervention is rare. Reagan was the last to do so. The larger absurdity is a law that could do great economic harm to one of the few U.S. industries that is growing rapidly. The ITC's role in patent law is an accident of history that is now being exploited for anticompetitive purposes and that Congress needs to correct. If the ITC blocks Android imports, President Obama will have ample cause to intervene.
benton.org/node/106495 | Wall Street Journal
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KIDS AND MEDIA

SCREEN TIME AND KIDS
[SOURCE: New York Times, AUTHOR: Tamar Lewin]
Despite the American Academy of Pediatrics’ longstanding recommendations to the contrary, children under 8 are spending more time than ever in front of screens. A new study documents for the first time an emerging “app gap” in which affluent children are likely to use mobile educational games while those in low-income families are the most likely to have televisions in their bedrooms. The study, by Common Sense Media, a San Francisco nonprofit group, is the first of its kind since apps became widespread, and the first to look at screen time from birth. It found that almost half the families with incomes above $75,000 had downloaded apps specifically for their young children, compared with one in eight of the families earning less than $30,000. More than a third of those low-income parents said they did not know what an “app” — short for application — was. The study found that fully half of children under 8 had access to a mobile device like a smartphone, a video iPod, or an iPad or other tablet. Of course, television is still the elephant in the children’s media room, accounting for the largest share of their screen time: about half of children under 2 watch TV or DVDs on a typical day, according to the study, and those who do spend an average of almost two hours in front of the screen. Among all children under 2, the average is 53 minutes a day of television or DVDs — more than twice the 23 minutes a day the survey found children are read to. And almost a third of children under 2 have televisions in their bedrooms, a substantial increase from 2005, when the Kaiser Foundation found that 19 percent of children ages 6 months to 23 months had them. In families with annual incomes under $30,000, the new study found, 64 percent of children under 8 had televisions in their rooms, compared with 20 percent in families with incomes above $75,000. Computers are common as well: about 12 percent of children 2 to 4 use them every day, and 24 percent at least once a week, the study found; among those 5 to 8, 22 percent use a computer daily, 46 percent more than once a week. On average, the children who use computers started doing so at age 3 ½. The report found that despite more than a decade of warnings from the American Academy of Pediatrics that screen time offers no benefits for children under 2, “only 14 percent of the parents surveyed said their doctor had ever discussed media use with them,” said Vicky Rideout, its author.
benton.org/node/106475 | New York Times
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PRIVACY

MARKEY ASKS FOR CARRIER IQ INVESTIGATION
[SOURCE: The Hill, AUTHOR: Brendan Sasso]
Rep. Ed Markey (D-MA) urged the Federal Trade Commission to investigate reports that Carrier IQ software tracks nearly everything that consumers do on their smartphones. "This software raises a number of privacy concerns for Android, Blackberry and Nokia phones," Rep Markey wrote in a letter to FTC Chairman Jon Leibowitz. "Consumers neither have knowledge of this data collection, nor what Carrier IQ intends to do with information." The lawmaker said the FTC has the authority to investigate whether the software amounts to an "unfair or deceptive" trade practice.
benton.org/node/106457 | Hill, The | B&C
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WE ARE PAWNS IN MOBILE DATA FIGHT
[SOURCE: paidContent.org, AUTHOR: Tom Krazit]
There is no question that we love our mobile devices. There’s also no question that we are paranoid about how much of ourselves we pour into the most personal computers ever created, which is why that even if some of the initial concerns were overblown, this week’s flap over the Carrier IQ software shows that the mobile industry still hasn’t learned its lessons about honesty, disclosure, and respect for its users and that those users still don’t understand that their mobile experience is controlled by data-hungry corporations.
There is only one way to operate a mobile business in a paranoid age: full and complete disclosure written in plain language as to what data is being collected along with clear options for how to control the data your customers share. Installing clandestine software on devices that rarely leave one’s person is simply not a long-term strategy for building trust, especially for a carrier like Sprint that needs every customer it can get. (Verizon gleefully pointed out this week that it has never used Carrier IQ, and people expect this sort of underhanded thing from AT&T.) It’s not hard to feel like a pawn of big business in the 21st century. Mobile computers have the potential to unlock so much human potential by giving us access to the world’s information nearly anywhere we go, but more and more people are starting to wonder about the cost of having access to that information. After all, you don’t really own a smartphone in the U.S.: you’re essentially leasing a subsided device based on the promise that you’ll pay back the acquisition cost over a two-year period. One day component costs will come down to the point where someone can make money selling a capable low-cost smartphone that doesn’t require a two-year contract and a data-mining operation to make money. Those days are not here yet. And if you’re not paying for it, you’re the product. It’s a little scary to imagine what the modern-day Internet would be like had we all been forced to buy subsidized PCs from Internet service providers.
benton.org/node/106456 | paidContent.org
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CLASS ACTION SUIT
[SOURCE: VentureBeat.com, AUTHOR: Chikodi Chima]
Two new victims have been sucked into the growing CarrierIQ click tracking scandal. Handset manufacturers Samsung and HTC have been named in a class action suit along with CarrierIQ, alleging that the company is in violation of federal wiretapping guidelines for illegally intercepting communications from people’s phones. The lawsuit was filed in federal court in Chicago seeking hundreds of millions of dollars in damages on behalf of all U.S. residents who own handsets running the software. Erin Janek owns an HTC phone and is the plaintiff in the suit, which alleges that her data was being surreptitiously monitored when it was not publicly available. The suit further claims that she did not grant authorization to CarrierIQ, or HTC to access her information.
benton.org/node/106455 | VentureBeat.com | Connected Planet | ComputerWorld
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CARRIER IQ MARKETING
[SOURCE: ComputerWorld, AUTHOR: Jaikumar Vijayan]
An increasingly besieged Carrier IQ insisted that its software is designed only to help wireless carriers diagnose operational problems on networks and mobile devices. But its own marketing material for one of the products raises doubts about that claim. The IQ Insight Experience Manager is one in a suite of five similar products sold by CIQ. An online datasheet describes it as customer experience profiling software that gives carriers detailed views of how consumers interact with their phones at "any level of granularity from the entire population, to comparative groups, down to individual users, all at the touch of a button." The datasheet explains how the software can give carriers a "precise view" of customer interaction -- even when the phone is not communicating with the network. Users of Carrier IQ's Insight Experience Manager can capture a "vast array" of data, including screen transitions, button presses, and service interactions, according to the material. Carriers can "task" phones dynamically over the air to optimize data selection. That data can be updated in real-time and aggregated in the company's Mobile Service Intelligence Platform. In the datasheet, CIQ describes Insight Experience Manager as revenue-boosting technology that carriers can use to "view application and device feature usage, such as camera, music, messaging, browser, and TV." It also describes how the product can help carriers identify how users respond to mobile advertising. That description appears to be at odds with the company's depictions of its products.
benton.org/node/106454 | ComputerWorld
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THE LEAST OF YOUR PRIVACY THREATS
[SOURCE: InfoWorld, AUTHOR: Galen Gruman]
Technologies such as Carrier IQ, GM's continued tracking of OnStar customers who had cancelled service, and the tracking software used by some malls over the Thanksgiving holidays are relatively benign compared to what people are not talking about: software and devices that not only monitor individuals but feed that data to insurers and others who could use it to determine rates, deny coverage, and otherwise control people's behavior. Big Brother-type technology used to monitor specific individuals and shape their behavior through penalties and rewards. If the government were doing this, we'd have people in the streets, but in the hands of private companies, these seductive methods convince people to naively agree to being controlled.
benton.org/node/106453 | InfoWorld
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REPS FRIEND ZUCKERBERG
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Reps Ed Markey (D-MA) and Joe Barton (R-TX), co-chairs of the Congressional Privacy Caucus, have asked Facebook CEO Mark Zuckerberg to attend a Dec. 14 briefing on teens and online privacy. "It is our hope that the briefing will be an open, frank and educational discussion about the tools needed to ensure online privacy safeguards for children and teens. We want to give Facebook an opportunity to discuss its policies for protecting the privacy of children and teens now and in the future. We look forward to an informational and engaging discussion with Facebook," said Reps. Markey and Barton. They asked for an answer by Dec. 12 and said they were looking for him or "a designee" to show up.
benton.org/node/106461 | Broadcasting&Cable
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FACEBOOK’S PRIVACY RETREAT
[SOURCE: GigaOm, AUTHOR: Paul Sweeting]
At first glance, Facebook appears to have conceded quite a lot of ground to the Federal Trade Commission in the agreement it negotiated with the agency over its handling of user data. Among other things, the social network will now be required to obtain users’ affirmative express consent before making changes to the platform that override the user’s privacy settings. It will be barred from making false representations about the privacy and security of user data; it must establish and maintain a comprehensive privacy program; and, perhaps most significant, it must submit to an independent privacy audit every two years for the next 20 years. Taken together, the new measures have the potential to constrain significantly Facebook’s ability to provide marketers with the sort of fine-grained ad-targeting data that could support premium ad prices, as well as the social network’s strategy of making content and information sharing by its users as seamless and friction-free as possible. In reality, Facebook had little choice but to cut a deal with the FTC. But the deal it cut could end up paying dividends in the future. Apart from the every-two-year privacy audits, Facebook in all probability did not agree to implement any procedures it wasn’t already going to face significant pressure to implement — not from any U.S. authority but instead from the European Union.
benton.org/node/106460 | GigaOm
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CONTENT

SILICON VALLEY VS HOLLYWOOD
[SOURCE: Los Angeles Times, AUTHOR: Richard Verrier, Jim Puzzanghera]
Film director Penelope Spheeris and Internet entrepreneur Gabriel Weinberg represent opposite camps in a congressional fight that divides California's two most glamorous and energetic industries: Hollywood and Silicon Valley. On one side are old-media entertainment companies such as Warner Bros. and 20th Century Fox, which accuse the search companies of acting as fences for private property by collecting advertising revenue from the sites where pirates lurk. On the other are new-media giants such as Google, Yahoo, EBay and Facebook, which say the proposed legislation threatens free speech and will jeopardize the technological stability of the World Wide Web "This is truly an epic battle between two huge interests that are both very, very important to our national economy," said Rep. Anna G. Eshoo (D-Menlo Park), who represents Silicon Valley. The pending bills in the House and Senate would give the Justice Department power to seek court orders requiring U.S. search engines and Internet sites to block access to foreign websites hawking pirated material. Private companies such as Paramount Pictures and Sony Music Entertainment would also be able to seek court orders preventing such sites from receiving ads and payments services from the US. The fight is curiously nonpartisan, with conservative Republicans and liberal Democrats teamed on both sides of the issue. Some of the split is based on which industry is more dominant in a lawmaker's region. Many Southern California representatives back Hollywood's position, and most Northern California members side with the Internet companies. But political philosophy also plays a role, leading anti-big-government conservatives to join with liberal civil libertarians in opposition to giving Washington what they fear would be broad censorship power over websites.
benton.org/node/106494 | Los Angeles Times
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BILLS GO TO FAR
[SOURCE: San Francisco Chronicle, AUTHOR: Editorial staff]
[Commentary] Hollywood, drugmakers and video-game designers have lived uneasily with the dark side of the Internet for years. Bootleg websites - think back to Napster and Canadian cut-rate pharmacies - offer copyrighted goods for free or next to nothing. Profits, investments and artistic achievement are lost in this hustle. But fixing this problem fairly is a challenge. Who is to blame for the abuses? And what damage do new controls pose for a free-wheeling online world, where innovation can also be destructive? The latest example is a pair of antipiracy bills in Congress pushed by major copyright holders such as the motion picture and recording industries plus pharmaceutical firms. On the other side is most of name-brand Silicon Valley, making the issue a battle between Big Content and Big Tech. The measures, which could be considered by year's end, would oblige online services to tightly patrol their websites for links to rogue sites, chiefly overseas. If they fail to do so, these services, such as Google, Yahoo or Facebook, could face fines and extended legal trouble from the U.S. Department of Justice. Credit card firms that handle the money may also feel the heat. The law goes beyond the sensible and sound. It targets services that don't just offer unauthorized copyright materials but also "facilitate" such sales. That fateful word, critics say, opens a Pandora's box of possible targets that may only incidentally be involved in the disputed commerce.
benton.org/node/106492 | San Francisco Chronicle
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TELEVISION/RADIO

PUBLIC FILES
[SOURCE: New York Times, AUTHOR: Meredith Hoffman]
There is no indication that New York television stations do anything with public complaints, other than what they have done for decades: put them in their “public files,” a little-known but rich trove of teeth-gnashing, hand-wringing and sometimes heartfelt correspondence that all television and radio outlets must maintain and make available for viewing, under federal law. Besides the letters, the public file includes nuts-and-bolts information about each station, including descriptions of its programs and Federal Communications Commission license, and information on political advertisement spending. In 2009 at Channel 2, for example, Mayor Michael R. Bloomberg outspent his challenger, Comptroller William C. Thompson Jr., $5,597,060 to $471,460. At some stations the files fill multiple binders, or several stacks of cabinets. The idea, perhaps quaint in the era of cable television and the Internet, is to make the stations, which broadcast over the public’s airwaves, answerable to the public. And in the spirit of accountability, the stations are required to make the files available to anyone who walks in the door and requests them during normal business hours. But not every station does so. Within the next year, the FCC hopes, stations will start to post their public files online, on a website the FCC would run. Some outlets, though not all, already post a portion of their files on their own websites. The online files would show thousands of New Yorkers at their most brutal, enthusiastic and loving — after all, what better way to vent, or gush, than to an anonymous official at a television or radio station?
benton.org/node/106499 | New York Times
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CLEAR CHANNEL-CUMULUS
[SOURCE: New York Times, AUTHOR: Ben Sisario]
Two of the fastest-growing trends in media have been daily-deal Web sites and the aggregation of entertainment content online. Now the two biggest radio companies have formed an alliance to compete on both fronts. Clear Channel Communications, which owns about 850 stations, will announce that it will run ads for SweetJack, the daily-deals program owned by Cumulus Media. In turn, Cumulus, the second-biggest operator with 570 stations, will become part of iHeartRadio, Clear Channel’s streaming app and all-purpose online radio brand. The deal will help Cumulus quickly expand its nascent discount service to hundreds of cities and compete with the dominant daily-deal players, Groupon and LivingSocial. SweetJack, which sells promotions to local merchants and advertises the deals on the air and online, opened in April, shortly after Cumulus agreed to pay $2.5 billion to acquire the Citadel Broadcasting Corporation. Cumulus has introduced SweetJack in 16 cities and signed up one million users, the company said. By teaming with Clear Channel, Cumulus plans to take the service to 120 markets by the end of next year. SweetJack will have its own sales forces in local markets, and the companies plan to share profits from the service. Clear Channel also stands to significantly expand iHeartRadio, which collects streams from 800 of its stations along with programming from broadcasters like Univision and the New York public radio station WNYC. It also offers a Pandora-like personalized music service; the company said the app had been downloaded 44 million times by users.
benton.org/node/106497 | New York Times
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RETRANSMISSION VALUE
[SOURCE: TVNewsCheck, AUTHOR: Harry Jessell]
[Commentary] SNL Kagan has supplied some ammo for stations to take into their next retransmission negotiations with cable and satellite operators. It's a report showing growth of the cash flow margins of cable networks, and it's the retrans equivalent of the Predator drone. What it shows is just how fat cable networks have become. According to its research, more than 30 networks have margins of 50% or more topped by Nickelodeon, with a 64.6% margin and the Food Network at 60.5%. Next in line: NBCU's CNBC World and CNBC at 59.9% each; Viacom’s VH1 Classic at 59.3%; Discovery Communications’ TLC at 58.7%; The Disney Channel at 57.7%; Scripps’ HGTV at 57.1%; the Discovery Channel at 57%; and AMC Network's AMC at 55.4%. The average margin of all cable networks in 2010 was 41%, which SNL researchers found "amazing, given the fact that there are a number of networks with negative cash flow margins and emerging networks with low margins in the mix. "In addition, sports networks typically have lower cash flow margins than general entertainment and other genres," the reports says. "ESPN, for instance, which makes up almost 15% of industry revenue, has a cash flow margin of just 25.3%." And the gilded gated community of cable's super rich is expanding. By 2015, the number of 50%-margin-plus networks will nearly double to 58, the report says. And there will be another 61 with margins between 40% and 50% and 32 in the 30%-40% range. So, when your local cable operator gags on your asking $1 per sub per month (which is the least you should be getting) and says he can't afford anything close to that, show him the SNL Kagan report and point out that it isn't your neighborhood broadcasters who are getting rich off of his subscribers, but those remote cable networks that, by the way, only have a fraction of the audience that you have. The reason that the cable networks can post such margins despite their paltry ratings is because cable and satellite operators mindlessly pay them programming fees that have no relation to the audiences they are delivering.
benton.org/node/106468 | TVNewsCheck
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XBOX UPGRADE
[SOURCE: New York Times, AUTHOR: Nick Wingfield, Brian Stelter]
The old-fashioned cable television set-top box — long the hub of living-room entertainment for most people — is about to become less relevant. Beginning on Dec 6 and continuing through the month, Microsoft will give a face-lift to its Xbox Live online entertainment service that will allow subscribers to watch a wide array of mainstream television programming from the Xbox 360 console. In addition, rather than fumbling with traditional remote controls and the primitive program guides of cable boxes, Xbox Live users will be able to search for shows using voice commands and hand gestures, if they also have the popular Kinect peripheral for the Xbox. Later this month, Microsoft will begin adding dozens of other sources of programming to the service, including Verizon FiOS, Comcast’s Xfinity and HBO. On Dec 6, the few online video services that have been on Xbox Live for some time, including Netflix and Hulu Plus, will be able to be retrieved using voice searching and other methods. Microsoft’s deal with cable and content providers stops short of making it possible for people to ditch their traditional pay-television packages; people will still need to pay the cable providers to get channels through the Xbox. They will also have to pay the roughly $60 a year Microsoft typically charges for a premier membership to Xbox Live. And the Xbox won’t be a true substitute for everything viewers can get through their cable boxes because content rights will have to be negotiated for some shows before they can be watched through the console. But the agreement is nonetheless significant because there are more than 35 million worldwide subscribers to Xbox Live, making the Xbox one of the most common Internet-connected boxes in living rooms. And it is part of a growing effort by media companies to bring some 21st-century pizazz to the experience of navigating and watching television, a medium that is largely watched using traditional remote controls and set-top boxes that have changed little in the past 10 years.
benton.org/node/106487 | New York Times | FT
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ELECTIONS AND MEDIA

TECH AND THE 2012 ELECTIONS
[SOURCE: GigaOm, AUTHOR: Michael Wolf]
Just how will technology be part of the story in the 2012 election? Here are four possible ways:
Expect all the major candidates to make mobile a big part of their fundraising and messaging efforts throughout the year.
With more politicians tweeting and at greater frequency, there’s no doubt Twitter could play a big role in 2012, and in possibly unforeseen and unwanted ways.
It is savvy use of analytics by a candidate to sift through the mountains of data made available through social, mobile and other types of profiling and behavioral data could give them a significant advantage over their opponent.
How will the use of Internet political activism take shape in 2012? It’s impossible to predict at this point, other than to say there’s a high likelihood that new and existing groups will likely try to make their voices heard in new and unforeseen ways, making this new frontier of Internet activism perhaps the biggest x-factor of all in next year’s Presidential election.
benton.org/node/106452 | GigaOm
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JOURNALISTS AND THE 2012 CAMPAIGN
[SOURCE: Columbia Journalism Review, AUTHOR: Andrew Duffelmeyer]
The rise of social media and the increasing prominence of cable news is making coverage of the 2012 presidential primary different than any cycle before it—and the changes present journalists with a new set of challenges while also offering some fresh opportunities, veteran reporters in the Hawkeye State say. Republican candidates this year seem to be waging a “national campaign,” relying more on media outlets with broad reach and less on on-the-ground campaigning in early primary states like Iowa. In prior cycles, local journalists effectively had the campaigns to themselves for a period, and candidates often appeared at town hall-style gatherings, where they fielded tough questions from voters. This year, national attention and wider campaigning has kicked in at an earlier point in the cycle -- in part because many of the campaigns officially “launched” unusually late -- and candidate appearances are more likely to consist of simple stump speeches.
benton.org/node/106451 | Columbia Journalism Review
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STORIES FROM ABROAD
   EU eyes big fines for privacy breaches
   Brussels homes in on Google antitrust case
   Steering Telecom Italia With a Steady Hand [links to web]

EU AND PRIVACY BREACHES
[SOURCE: Financial Times, AUTHOR: Stanley Pignal]
Businesses breaching European Union privacy rules will face fines of up to 5 per cent of their global turnover under sweeping proposals to be unveiled next month.
In the first significant update of data protection legislation since 1995, companies found to have mishandled any personal data they hold – be it of their customers, suppliers or their own employees – will face the highest levels of fines, which could extend to billions of euros for large multinationals. The measures are being finalized within the European Commission. They will have to be approved by national governments, some of which – especially Germany – will be reluctant to lose oversight on privacy matters to Brussels. The process is likely to take at least two years, with another two before the measures come into effect. The proposals would bolster significantly the EU’s powers on combating data protection breaches, such as when companies sell customer data to third parties without authorization or fail to adequately protect information held by social networks and “cloud computing” services. Companies would have 24 hours to notify data protection authorities and the effected parties in cases where private data are compromised
benton.org/node/106486 | Financial Times
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BRUSSELS AND GOOGLE
[SOURCE: Financial Times, AUTHOR: Alex Barker, Richard Waters]
The European Commission is homing in on a list of concerns about Google’s business practices that could form the basis of an antitrust complaint against the US internet search group. The narrowing of the investigation to issues red flagged by Brussels marks a turning point in an inquiry that has been running for almost two years. However, the commission has yet to decide whether to bring a formal complaint against the company or lay out its concerns in detail, said people familiar with the situation. News that the European case has moved into a more advanced phase comes just days before Eric Schmidt, Google’s chairman, is due to meet Joaquín Almunia, the European competition commissioner.
benton.org/node/106485 | Financial Times
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