August 17, 2012 (Justice Department OKs Verizon-Cable Companies Spectrum Deal)
BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, AUGUST 17, 2012
Headlines is taking Mondays off in August; we will return TUESDAY, AUGUST 21, 2012
VERIZON-SPECTRUMCO DEAL
Justice Department Requires Changes to Verizon-Cable Company Transactions to Protect Consumers, Allows Procompetitive Spectrum Acquisitions to Go Forward - press release
FCC’s Genachowski: Commission Should Now Approve Verizon-SpectrumCo Deal - press release
Barack Obama, trustbuster?
Verizon/Cable Settlement with DOJ: A Closer Look - analysis
When Competition Is Cooked, Consumers Are Toast - op-ed
Keeping Verizon Wireless from being too cozy with cable - analysis
Critics Slam SpectrumCo Approval
Sen Franken: DOJ should have been tougher on Verizon
ELECTIONS AND MEDIA
Commission on Presidential Debates Asked to Add Debates Moderated by Journalists of Color
Ryan Pick Excites Foes of Tech Regulation
PBS CEO: Romney plans to cut funding ‘extremely disappointing’
Report: Congress broke social media rules in rush to discuss Ryan as VP [links to web]
Campaigns race to define Paul Ryan online [links to web]
Ad wars aim for stay-at-home moms [links to web]
Obama, Romney Won't Air Ads On 9/11 [links to web]
Fake followers newest ploy, accusation in politics [links to web]
Few Voters Are Truly Up for Grabs, Research Suggests [links to web]
JOURNALISM
Further Decline in Credibility Ratings for Most News Organizations - research
News Corp Announces New Ethics Oversight Structure [links to web]
NEWS FROM COURT
Patent Trial Turns to Damages [links to web]
Apple Lawyer to Frustrated Judge: Yes, We Need All These Witnesses, and No, I’m Not Smoking Crack [links to web]
Apple vs. Samsung Judge Encourages “Horse Trading” to Narrow Case [links to web]
Judge Koh: It’s Samsung’s Own Fault It Ran Out of Time [links to web]
As time ticks down, publishers and Authors Guild slam e-book settlement [links to web]
Illinois judge dismisses case challenging bloggers' right to protect anonymous tipsters [links to web]
TELEVISION
Apple, Microsoft, Google and the sad state of TV [links to web]
California Assembly approves state film, TV tax credit extension [links to web]
INTERNET/BROADBAND
Dish's Broadband Satellite Expansion Won't Solve the Rural Internet Problem [links to web]
WIRELESS/SPECTRUM
Your Life Is Fully Mobile [links to web]
PRIVACY
The End of Big Data [links to web]
POLICYMAKERS
Campaigning Aside, Team Plans a Romney Presidency [links to web]
GOVERNMENT & COMMUNICATIONS
Amazon e-Readers, Content Management, and Logistics [links to web]
What data does the public want? [links to web]
STORIES FROM ABROAD
These headlines presented in partnership with:
ITU seeks public input on the future of Internet regulation
Saudi Arabia objects to .gay, .wine and other proposed gTLDs [links to web]
Network upgrades boost average broadband speeds in the UK - press release [links to web]
UK’s Internet video regulator is here to stay [links to web]
Google faces investigation by India's antitrust agency [links to web]
Japan's Dimwitted Smartphones [links to web]
Born from Japan disasters, Line app sets sights on U.S., China [links to web]
New Zealand judge: FBI must release more evidence to Kim Dotcom [links to web]
The Case For Keeping Libraries Alive [links to web]
MORE ONLINE
The Whole Story: Media And The Daily Commute [links to web]
From Weeds and Bricks to Media Hub in Brooklyn [links to web]
VERIZON-SPECTRUMCO DEAL
DEPARMENT OF JUSTICE OKs VERIZON-SPECTRUMCO DEAL
[SOURCE: Department of Justice, AUTHOR: Press release]
The Department of Justice announced today that it will require Verizon and four of the nation’s largest cable companies—Comcast, Time Warner Cable, Bright House Networks and Cox Communications—to make changes to a series of agreements concerning both the sale of bundled wireless and wireline services, and the formation of a technology research joint venture. The department said that, if left unaltered, the agreements would have harmed competition by diminishing the companies’ incentive to compete, resulting in higher prices and lower quality for consumers. The announcement came after a closely coordinated investigation with the Federal Communications Commission (FCC), with additional assistance provided by the New York State Attorney General’s Office. The department also said that it would allow both Verizon’s proposed acquisitions of spectrum from the cable companies and T-Mobile USA’s contingent purchase of a significant portion of that spectrum from Verizon to go forward. The department said that the spectrum transactions facilitate active use of an important national resource and thereby promise substantial benefit to wireless consumers. The transactions remain subject to review by the FCC, which is expected to release a separate statement regarding the status of its review of the transactions.
The proposed settlement forbids Verizon Wireless from selling cable company products in FiOS areas and removes contractual restrictions on Verizon Wireless’s ability to sell FiOS, ensuring that Verizon’s incentives to compete aggressively against the cable companies remain unchanged. In addition, under the proposed settlement, Verizon Wireless’s ability to resell the cable companies’ services to customers in areas where Verizon sells DSL Internet service ends in December of 2016 (subject to potential renewal at the department’s sole discretion), thereby preserving Verizon’s incentives to reconsider its decision to stop building out its FiOS network and otherwise innovate in its DSL territory. Finally, the proposed settlement limits the duration of the technology joint venture and other features of the agreements, ensuring that the agreements will not dampen the companies’ incentives to compete against one another going forward.
The proposed settlement also requires the commercial agreements to be amended so that:
Verizon retains the ability to sell bundles of services that include DSL, Verizon Wireless and the video services of a direct broadcast satellite company (i.e., DirecTV or Dish Network);
After five years, the cable companies are no longer barred from selling the wireless services of Verizon Wireless’s competitors, and may partner with other wireless providers;
The cable companies can elect to resell Verizon Wireless services using their own brand at any time as provided for under the amended agreements; and
Upon dissolution of the technology joint venture, all members receive a non-exclusive license to all the joint venture’s technology, and each may then choose to sublicense to other competitors.
The settlement also forbids any form of collusion and restricts the exchange of competitively sensitive information. Verizon and the cable companies would also be required to provide regular reports to the department to ensure that the collaboration does not harm competition going forward.
benton.org/node/132340 | Department of Justice | AP | Bloomberg | Washington Post | The Hill | GigaOm | CNNMoney | NYTimes | ars technica
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FCC CHAIRMAN GENACHOWSKI STATEMENT
[SOURCE: Federal Communications Commission, AUTHOR: FCC Chairman Julius Genachowski]
A rigorous review by the Federal Communications Commission and Department of Justice staffs revealed that the deal as proposed by Verizon Wireless and the cable company owners of SpectrumCo posed serious concerns, including in the wired and wireless broadband and video marketplaces. In response to the agencies’ objections, the parties have made a number of binding pro-competitive commitments and will also make fundamental changes to their agreements. Because of these substantial undertakings and in light of the Consent Decree the companies executed with the Justice Department today, I believe the Commission should now approve this transaction, and I will be circulating a draft order to my colleagues that would do so.
Specifically, Verizon Wireless has undertaken an unprecedented divestiture of spectrum to one of its competitors, T-Mobile, and has committed to accelerate the build-out of its new spectrum and enhance its roaming obligations. In addition, the companies’ commercial agreements will be modified to, among other things, preserve Verizon's incentives to build out FiOS, increase wireless competition, and ensure that the proposed IP venture is pro-consumer and that its products cannot be used in anti-competitive ways.
Approval of the substantially modified transaction will promote the public interest and benefit consumers in several ways. By advancing U.S. leadership in 4G LTE deployment, the transaction marks another step in our effort to promote the U.S. innovation economy and make state-of-the-art broadband available to more people in more places. The transaction will preserve incentives for deployment and spur innovation while guarding against anti-competitive conduct. And vitally, it will put approximately 20 megahertz of prime spectrum—spectrum that has gone unused for too long—quickly to work across the country, benefiting consumers and the marketplace.
I look forward to working with my colleagues toward a final Commission vote in the near future.
benton.org/node/132338 | Federal Communications Commission
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OBAMA THE TRUSTBUSTER?
[SOURCE: Politico, AUTHOR: Elizabeth Wasserman, Jonathan Allen]
President Barack Obama borrowed a tool from Teddy Roosevelt to prevent American companies from gouging consumers: a big stick. Just ask Apple, Google, AT&T, Visa, MasterCard and H&R Block. And now you can add Verizon to the list. Obama’s Justice Department said it would approve the company’s plan to buy nearly $4 billion in wireless airwaves from other cable companies — but only with strict limits the department says are needed to protect consumers. Candidate Obama vowed in the last election to make up for what he called “lax enforcement” by the George W. Bush administration on antitrust. And Obama’s supporters say he has amassed a record on trust-busting that reflects a difference between his view of government's relationship with big business and that of his 2012 rival, Republican Mitt Romney.
benton.org/node/132379 | Politico
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A CLOSER LOOK
[SOURCE: Public Knowledge, AUTHOR: Jodie Griffin]
[Commentary] The Department of Justice (DOJ) announced that it will allow, with conditions, Verizon, Comcast, and other cable companies to cross-market each other’s products and establish a Joint Operating Entity to develop and control new technology. The DOJ's proposed settlement includes many conditions that attempt to alleviate some of the harms of this deal. Although the conditions still won't be as effective as blocking the deals in their entirety, the DOJ and Federal Communications Commission do deserve credit for trying to fix some of the harms from the deal and for rightfully asserting their authority over the transactions to begin with.
Joint Marketing Agreements Allowed in Part: The DOJ settlement places significant limitations on proposed joint marketing agreements. Verizon Wireless will not be allowed to market for the cable companies (or permit another company to do so) within the "FiOS Footprint." This includes any area where Verizon has built out FiOS or is legally bound to do so, where Verizon has a non-statewide franchise authorizing Verizon to build out FiOS, or where Verizon has delivered notice of an intention to build out FiOS under a statewide franchise agreement. Starting in December 2016, Verizon Wireless similarly won't be allowed to market for the cable companies within its DSL service territory outside of the FiOS footprint, nor will Verizon Wireless be able to prohibit the cable companies from selling another wireless service.
The Joint Operating Entity Survives, But Limited: The DOJ conditions specify that the proposed joint operating entity (JOE) can continue to exist but the companies must leave the JOE by December 2016 unless they receive written advance permission from the government. A term limit, while better than an unlimited JOE, still gives the companies the ability and incentive to share information and stifle competition from third parties.
Ongoing Monitoring: The DOJ settlement also requires the companies to keep records of all of their communications with each other and submit to the DOJ reports detailing how they are complying with the settlement conditions. The reports will specifically include information on sales made through the joint marketing agreements, Verizon Wireless's sales of Verizon wireline services, Verizon's FiOS and DSL buildout, and the JOE's activities. Regarding the JOE, Verizon Wireless must detail the JOE's technology and products, pending patent applications, and intellectual property agreements entered into by the JOE.
benton.org/node/132354 | Public Knowledge | Department of Justice
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COMPETITION COOKED, CONSUMERS TOAST
[SOURCE: Wired, AUTHOR: Susan Crawford]
[Commentary] Federal Communications Commission and Department of Justice approval of the Verizon/SpectrumCo deal is inevitable. Some conditions around the edges will be imposed, as in the Comcast/NBCU merger of 2011, but they won’t grapple with the fundamental problem. It’s as if we’ve allowed electricity transmission companies to dictate what brands of appliances can plug into the grid, who gets service, what people pay for it, what kinds of toast are permitted, and what uses of electricity are preferred. Non-affiliated information flows will be roughed up by discriminatory application of usage caps, technical speed-bumps, and many other mob-like techniques. Meanwhile, Americans are paying more than people in many other countries for services that aren’t as good, even as inequality in communications leaves more people behind every day. Fully 80% of Fortune 500 companies require online applications for jobs, but a third of Americans don’t have high-speed access at home.
benton.org/node/132352 | Wired
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KEEPING VERIZON AND CABLE COZY
[SOURCE: Los Angeles Times, AUTHOR: David Lazarus]
[Commentary] The Department of Justice says Verizon can go ahead with its $3.6-billion purchase of wireless spectrum from the cable industry, but not without some tweaks to help protect consumers from telecom behemoths becoming too cozy. Specifically, the DOJ said that it's placing limits on sales of cable services at Verizon Wireless stores — a move that had appeared to relegate Verizon's own TV and Internet offerings to the back burner and make the market less competitive. I'm not a told-you-so kind of guy, but this is exactly what I warned of in a column last month questioning how this deal worked in consumers' best interest, not to mention how downplaying the company's own services was good for Verizon shareholders. William Petersen, general counsel of Verizon Wireless, said good times are ahead for consumers. "We now believe the consumer benefits of the transaction will be promptly realized, and look forward to the conclusion of the FCC review so that we can move forward with meeting the unprecedented consumer demand" for wireless and broadband services, he said. Cable providers, of course, are thrilled. They now are a few billion dollars richer and have a new sales channel in Verizon Wireless stores. Perhaps such blatantly anti-competitive behavior was to be expected. Consolidation has been the norm in the telecom industry for years.
benton.org/node/132421 | Los Angeles Times
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CRITICS SLAM DOJ DECISION
[SOURCE: Multichannel News, AUTHOR: Mike Farrell]
While the cable industry was patting itself on the back after receiving federal antitrust approval of its $3.9 billion wireless spectrum sale to Verizon Wireless, some public policy groups criticized the deal -- and the conditions agreed to by both parties -- as not serving consumer interests. In a statement, Public Knowledge president and CEO Gigi Sohn said the agreement conceded that U.S. broadband competition policy has failed. At Free Press, Policy Adviser Joel Kelsey was most concerned that the deal did little to temper an emerging monopoly environment for broadband service. The Consumer Federation of America took a similar tack, with Director of Research Mark Cooper calling the approval a sign that the "the primary pillar on which the Telecommunications Act of 1996 stood -- intramodal and intermodal competition between broadband platforms -- has collapsed in a short 16 years. And for the Communications Workers of America, the union that is currently in a labor dispute with Verizon Wireless, the objection centered around jobs.
benton.org/node/132350 | Multichannel News | Comcast | Public Knowledge | Free Press | Communications Workers of America | National Journal | GigaOm
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CONGRESSIONAL REACTION
[SOURCE: The Hill, AUTHOR: Brendan Sasso]
Sen. Al Franken (D-MN) criticized the Obama administration for not imposing tougher conditions on Verizon's $3.6 billion deal with the nation's largest cable companies. Sen Franken argued the conditions won't do enough to protect competition for broadband Internet service. “Most consumers, and especially those in rural areas in Minnesota and elsewhere, have few or no options for high-speed broadband service, which is one of the reasons I was so concerned about this deal," said Sen Franken, who serves on the Judiciary Committee's subpanel on antitrust issues. "Without meaningful competition for broadband, the cable companies will be able to charge whatever they want—and drive consumers to purchase expensive bundles of services they don’t want or need in order to get Internet service. The Department of Justice has addressed some of the worst parts of this transaction, but I don’t think it has gone far enough." Sen Franken urged the FCC to "stand up for consumers and address the lack of competition for high-speed broadband before it votes to approve this deal.”
benton.org/node/132349 | Hill, The
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ELECTIONS AND MEDIA
REQUEST FOR ADDITIONAL DEBATES
[SOURCE: Joint Center for Political and Economic Studies, AUTHOR: Ralph Everett]
The Joint Center for Political and Economic Studies sent a letter to Janet Brown, the Executive Director of the Commission on Presidential Debates, with concerns that the commission did not select any journalists of color to moderate any of the presidential debates being broadcast this year. The Joint Center asked the commission to schedule additional presidential debates moderated by journalists with large audiences of African-Americans, Latinos, Asian-Americans, Native Americans and other people of color.
http://benton.org/sites/benton.org/files/presidential_debates_j__brown_l...
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RYAN PICK EXCITES FOES OF TECH REGULATION
[SOURCE: National Journal, AUTHOR: Juliana Gruenwald]
Rep. Paul Ryan (R-WI) is best known as a budget wonk, and doesn’t have a major profile on technology issues. Still, his pick by Mitt Romney to join the Republican presidential ticket has energized a group of libertarian-leaning experts on tech policy who look past Ryan’s lack of issue-area expertise and focus on the free-market philosophy they believe drives his plan to flatten the tax code and shrink government. The bigger perspective here, said Berin Szoka, president of the think tank TechFreedom, is that “ultimately this debate about Medicare and Medicaid and Social Security and entitlements is really a debate about the future level of taxation.” The reality is, he said, “the tech sector is likely to bear a significant portion of the future tax burden.”
benton.org/node/132372 | National Journal
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PROPOSED PUBLIC BROADCASTING CUTS
[SOURCE: Washington Post, AUTHOR: Lisa de Moraes]
PBS CEO Paula Kerger finds recent comments by GOP presidential hopeful Mitt Romney about cutting the programming service’s federal funding as “extremely disappointing” given the “value the American people place on public broadcasting and the outstanding return on investment the system delivers.” This week, GOP presidential hopeful Mitt Romney joined the ranks of Republicans unimpressed by PBS’s 58 Primetime Emmy Awards nominations who have vowed to slash its federal funding. Romney told Fortune magazine he’s a fan of PBS, but federal funding of same would get cut off during his administration. Joining PBS in Romney’s tumbril are Amtrak, the National Endowment for the Arts, and the National Endowment for the Humanities.
benton.org/node/132424 | Washington Post
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JOURNALISM
NEWS ORG CREDIBILITY
[SOURCE: Pew Research Center for the People & the Press, AUTHOR: ]
For the second time in a decade, the believability ratings for major news organizations have suffered broad-based declines. In the new survey, positive believability ratings have fallen significantly for nine of 13 news organizations tested. This follows a similar downturn in positive believability ratings that occurred between 2002 and 2004. The falloff in credibility affects news organizations in most sectors: national newspapers, such as the New York Times and USA Today, all three cable news outlets, as well as the broadcast TV networks and National Public Radio. Across all 13 news organizations included in the survey, the average positive believability rating (3 or 4 on a 4-point scale) is 56%. In 2010, the average positive rating was 62%. A decade ago, the average rating for the news organizations tested was 71%. Since 2002, every news outlet’s believability rating has suffered a double-digit drop, except for local daily newspapers and local TV news. The New York Times was not included in this survey until 2004, but its believability rating has fallen by 13 points since then.
benton.org/node/132378 | Pew Research Center for the People & the Press
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STORIES FROM ABROAD
These headlines presented in partnership with:
ITU SEEKS PUBLIC INPUT
[SOURCE: IDG News Service, AUTHOR: Loek Essers]
The United Nations' International Telecommunication Union (ITU) has called for a public consultation on a draft document ahead of a December meeting to finalize a new treaty for regulation of the Internet. The ITU published on its website the draft version of the document that will be discussed during the upcoming World Conference on International Telecommunications (WCIT) in Dubai. People can express their views and opinions on the content of the draft document or any other matter related to WCIT. The conference in Dubai is a global conference that will aim to sign a treaty to define the general principles for the provision and operation of international telecommunications networks around the world, the ITU said. The consultation will remain open until Nov. 3 and the inputs will be made available to all member states, ITU said.
benton.org/node/132388 | IDG News Service | AP
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