March 2012

Conservative Group Asks Congress Not to Scrap Retransmission in Regulation Reform Bills

The American Conservative Union has asked Congress to oppose portions of House and Senate deregulatory bills that would scrap retransmission consent.

ACU, whose board includes Grover Norquist and former Hewlett-Packer CEO Carly Fiorina, said that the retrans marketplace is functioning and that "stripping away" compensation for use of the broadcast signal the government would "be tipping the scales heavily to the side of the pay-TV companies." "Despite what you might hear, under the present system there is no epidemic of service interruptions that adversely affect consumers and cause them to miss widely-viewed events like the Super Bowl," said the group. "In fact this is a marketplace in which over 99 percent of negotiations are settled with no service interruptions."

Senator Jim DeMint (R-SC) last December introduced the Next Generation Television Marketplace Act in Senate. The sweeping and unlikely-to-pass legislation would throw out the retrans regime and local ownership rules. Rep. Steve Scalise (R-LA) introduced a House version of the bill.

Congress eyes mobile payment apps

It’s already a social network, an inbox and a gaming console — and, for a small but growing number of smartphone owners, their beloved device is becoming a mobile wallet, too. But the neophyte market for apps and other tools that allow consumers to swipe their phones instead of their credit or debit cards at the register is compelling some policymakers to revisit privacy, security and banking rules written in a seemingly more analog time.

“We are, I think, on a precipice of some fundamental change in the way money is exchanged between consumers and businesses,” said Rep. Shelley Moore Capito (R-WV) during the House Financial Services Committee consumer credit panel’s hearing on The Future of Money last week. “There’s a lot for Congress, banks, regulators, retailers and customers to learn. Most importantly, we want to make sure these payments are safe and secure.” Policymakers have questions about jurisdiction — such as which agency should be chiefly in charge — and fears that laws meant to shield consumers from unwanted marketing may need an upgrade in the dawning age of mobile payments. Those debates only add to the larger difficulty of devising ways to protect a consumer’s 16-digit card number and expiration date, not to mention the privacy of all the other personal data encapsulated in a smartphone.

Congressional scrutiny is expected to continue: The Senate banking committee on March 29 will hold the latest in its series of planned sessions on the mobile payments issue, and it plans to call witnesses from the Federal Reserve system to discuss information security and financial disclosure issues.

GOP faces digital divide

President Barack Obama and his Democratic allies have opened up a big advantage over Republicans when it comes to high-tech voter targeting. And this year conservatives are making an ambitious push to change that ahead of the 2012 election.

The Republican National Committee and the Koch brothers are spending millions on dueling voter file projects and a tea party group is set to unveil a new voter database platform March 29. Yet, even as Republican and conservative groups are poised to spend millions ahead of Election Day on new efforts to catch up to Democratic data and technology to target likely voters, some conservatives say there might not be enough time to have an impact. One of the biggest challenges for the GOP this year, they fear, could be that when it comes to mobilizing volunteers, donors and voters, they are sitting on the wrong side of a digital divide.

Nearly 1 Billion Smart Connected Devices Shipped in 2011 with Shipments Expected to Double by 2016

The universe of smart connected devices, including PCs, media tablets, and smartphones, saw shipments of more than 916 million units and revenues surpassing $489 billion dollars in 2011.

These numbers reflect the combined total from IDC's Worldwide Quarterly PC Tracker, Mobile Phone Tracker, and Media Tablet Tracker. Looking ahead, unit shipments for smart connected devices should top 1.1 billion worldwide in 2012. By 2016, IDC predicts shipments will reach 1.84 billion units, more than double the 2011 figure, as consumers and business of all shapes and sizes around the world are showing a nearly insatiable appetite for smart connected devices. This works out to a compound annual growth rate (CAGR) of 15.4% for the five-year forecast period

Bringing Up an E-Reader

Books on iPads and some e-readers like the Nook Color or the Kindle Fire are fun. They include music, animation and other interactive elements that make reading a book feel like playing a video game.

In “Pete the Cat: I Love My White Shoes,” an e-book for children ages 3 to 7, they can change the color of Pete’s shoes by touching them, sing along to music with the lyrics that roll along the page, listen to a narrator or record their voices as they read aloud. But is it better than a book? It may take a generation to ever know for sure, and even 10 or 20 years from now it will be debated as the effects of television or video games are still discussed today.

Former FCC Commissioner Copps Joins Public Knowledge Board

Public Knowledge President and CEO Gigi B. Sohn announced today that former Federal Communications Commission (FCC) Commissioner Michael Copps has joined the Public Knowledge Board of Directors.

“We are honored and thrilled that such a prominent defender of the public interest as Commissioner Copps has become a member of our Board,” Sohn said. “We look forward to working closely with him and to learning from him.”

In addition to adding Copps, the PK Board also selected officers. Kathleen Wallman, president of Wallman Consulting LL, will be the Board chair. Kevin Werbach, founder of Supernova Group, will be treasurer. Leah Belsky, vice president of Strategic Development and Assoc. GC, Kaltura, will be the Board secretary. Other members of the Board are: Susan Crawford, visiting professor at Harvard Law School; Maureen Colleton Corbett, president and founder of the Glen Echo Group; Brewster Kahle, director and co-founder of the Internet Archive; Andrew McLaughlin, vice president of Tumblr; Michael Petricone, senior vice president of the Consumer Electronics Association, and Sohn.

Recap -- Cybersecurity: Threats to Communications Networks and Public-Sector Responses

The House Subcommittee on Communications and Technology held a hearing to examine threats to America’s communications networks, what the public sector is doing to address those threats, how it is working with the private sector, and what role the federal government should play in securing communications networks. The Subcommittee heard from witnesses representing the Federal Communications Commission, the National Telecommunications and Information Administration, the Department of Homeland Security, Carnegie Mellon’s Computer Emergency Readiness Team, and Sandia Laboratories.

In general, Republicans said the government should encourage voluntary industry standards and not insert itself in a way that would reduce private industry's flexibility in responding to threats.

Democrats on the panel gave a shout-out to those ISP efforts, but suggested that the government also needed a way to ensure accountability to those voluntary standards. Rep. Henry Waxman (D-CA) made the strongest case for stronger government involvement. He suggested that reliance solely on voluntary efforts might not be sufficient, say, dealing with a company that was less diligent in its best practices and caused a cyber-breach to critical infrastructure. He said that if industry wants exemptions from antitrust and other consumer laws in order to share info with the government -- it does -- then it should be willing to be held accountable for not abusing that freedom.

James Barnett, chief of the FCC's Public Safety and Homeland Security Bureau, said he supports giving the government new regulatory powers to protect against cyber attacks. He endorsed the regulatory provisions of the Cybersecurity Act, a bill authored by Sens. Joe Lieberman (I-CT) and Susan Collins (R-Maine). The legislation would give the Homeland Security Department the power to require that critical systems, such as electrical grids, meet minimum cybersecurity standards. Barnet also said that ensuring cybersecurity doesn't mean giving up privacy or undermining Internet freedom. "Sacrificing privacy or Internet openness for security is a false choice," Barnett said. "We must insist on having all three, and we strongly believe that this is achievable."

Subcommittee Chairman Greg Walden characterized some of the testimony as disturbing, then even more disturbing as witnesses talked about the threats. They included an attack on the Department of Commerce's Economic Development Administration that took the network down for several weeks and counting. It also included this sobering assessment from Bob Hutchinson, of Sandia National Laboratories, a government-funded national research lab: "The most important lesson I have learned in my career is that computer systems can never be fully trusted, can never be proven free of compromise, so we must focus on finding ways to conduct business, even critical business, on machines that are presumed to be infected," he said.

Arbitron Agrees to Improve How It Counts Minority Radio Listeners

Arbitron, the largest radio ratings service, has settled a lawsuit in California over how it measures minority audiences, agreeing to pay $400,000 and to abide by certain research methods in tracking black and Latino radio listeners.

The agreement settles a suit filed last week by the attorney general of California, who was joined by the city attorneys of San Francisco and Los Angeles. The suit contended that Arbitron undercounted minority audiences in how it recruited people to use its Portable People Meter, an electronic device that it introduced in 2008 to measure radio listening habits. Arbitron agreed in the settlement to reach listeners by address and make other steps to represent minority groups. It will also pay $150,000 each to the State of California and the City of Los Angeles, and $100,000 to the City and County of San Francisco.

Apple spurs touch-screen technology growth

The fervor over iPhones, iPads and other tablets and smartphones has stoked the market for all that makes people want to get their hands on them. With shipments of touch-screen displays booming, the market for touch-controller integrated circuits has nearly tripled during the past five years and is projected to continue growing, according to IHS iSuppli.

If demand continues to grow at this rate, shipments are projected to reach 2.4 billion units in 2015, up from 865 million two years ago, IHS reports. Guess who's to thank for their booming popularity? “Apple almost single-handedly ignited the market for touch in 2007 when it introduced the iPhone, which featured a multi-touch screen based on a projected capacitive touch technology," said Randy Lawson, principal analyst for display and consumer electronics at IHS. "Since the appearance of the iPhone, many other smartphone manufacturers have jumped on the bandwagon by deploying sophisticated touch sensors for their products.”

Dodgers sale could mean bigger cable bills

While former Lakers great Magic Johnson may be leading the group shelling out a record $2 billion to buy the storied baseball franchise, in the end consumers may pick up much of the tab because their cable bills likely will be going up, up, up!

The $2 billion price tag tops by more than $1.1 billion what the Chicago Cubs were sold for three years ago and $1.5 billion more than what Frank McCourt paid for the Dodgers in 2004. When the Dodgers, which filed for bankruptcy last year, were first put up for sale, most baseball watchers thought McCourt would be hard pressed to get $1 billion, much less twice that. Even Mark Cuban, the outspoken owner of the Dallas Mavericks basketball team who's not shy about opening his wallet, thought that the Dodgers weren't worth $1 billion. But Johnson's group, whose big backer is Mark Walter, chief executive officer of financial services firm Guggenheim Partners, which will be the Dodgers controlling owner, was willing to pay so much because it figures it can make that money back in television revenue. It's not a crazy bet. Sports rights fees have skyrocketed lately.

Currently, Fox's regional cable network Prime Ticket carries the bulk of Dodger games at a price tag of roughly $38 million per season. The Dodgers also have a broadcast deal with CBS' KCAL-TV, which carries 50 games. Those will likely go away because the team can get more money from cable than broadcast. Fox's contract with the Dodgers runs through the 2013 season and the network has exclusive rights to renegotiate a new agreement through November of this year. After that, Time Warner Cable, which is launching a regional sports channel here later this year, can jump in the fray and try to grab TV rights to the Dodgers. But while Time Warner Cable and Fox Sports will likely be willing to pay more than double and perhaps even triple what the Dodgers are currently getting, that still may not be enough given the price tag. Another scenario is that the Dodgers will look to create their own cable sports channel, as the Yankees have with YES. That way the team can keep not only subscriber fees from cable and satellite companies, but also advertising revenue.