November 2012

Electronic privacy deserves a bipartisan upgrade

[Commentary] Today, if the police want to come into your house and take your personal letters, they need a warrant. If they want to read those same letters saved on Google or Yahoo they don’t. The Fourth Amendment has eroded online.

Americans for Tax Reform and the American Civil Liberties Union are members of the Digital Due Process Coalition, a wide-ranging group of privacy advocates, think tanks and businesses, like Microsoft, Google, Apple, AT&T, that often disagree on different issues. However, we can agree on consistent privacy protection for digital documents. We agree that the Electronic Communications Privacy Act (ECPA), though forward-thinking in 1986, has become outdated as we head in to 2013. On Nov 29, the Senate Judiciary Committee will reexamine an amendment to H.R. 2471 put forth by Sen. Patrick Leahy (D-Vt.) that requires a warrant to collect data from a technology companies and individuals. This is the kind of measure all committee members should be able to support without reservation. We believe email and information stored in the cloud should have the same legal protection as letters or information held by an individual in their home. This is clear, consistent, reasonable privacy protection for the digital age. It is our hope and expectation that all committee members will oppose any weakening amendments and vote to report the bill with Senator Leahy’s warrant for content standards intact.

West Virginia Broadband Consultant earns $732K

West Virginia spent $512,000 in federal stimulus funds last year to pay a consultant who's helping to manage the state's high-speed Internet expansion project while living in Colorado.

The state is on pace to spend another $329,000 for the consultant's services this year. The state didn't start paying the Denver-based consultant, Perry Rios, through a contract with Verizon until February 2011, even though the state Office of Technology approved Rios' contract in July 2010. He began work on the statewide broadband project two months later. The state has paid $196 an hour for Rios' services, or $731,770 through the end of last month. Rios isn't the only high-dollar consultant hired through Verizon.

Study Finds Rise in Texting Even as Revenue Drops

Cellphone texting has grown considerably — but not texting in the traditional sense. Instead of sending traditional text messages, cellphone owners are shifting toward Internet-based messaging services, like Apple’s iMessage, Facebook messaging and WhatsApp, says Chetan Sharma, an independent mobile analyst. These services are popular because they don’t charge per text; they are gradually redefining what we think of as text messaging.

Want to See Why You Can’t Get HBO or Showtime Without Paying for Cable? Watch This Ad.

“Hey, stupid TV companies!” the Internet says, over and over. “Stop making us sign up for pay TV to see your shows!” “Not gonna happen,” comes the response from the TV guys, over and over. “Not anytime soon, at least.”

That’s particularly true for premium pay channels like HBO and Showtime, which make almost all their money from subscription sales, and rely heavily on pay-TV providers to handle their marketing, as well as all of their customer service, billing, etc. Yes, there are a bunch of people who would pay to watch episodes of “Game of Thrones,” but don’t want to get HBO. And there also a bunch of people who say they would be happy to subscribe to HBO, but not pay for cable. But HBO and Showtime executives figure that the upside of pleasing those people doesn’t outweigh the downside of angering the cable, telco and satellite guys, who give them a ton of dough.

iPhone 5 Costs May Be Eating Apple’s Gross Margins

How much longer can Apple maintain the high margins it has long commanded for devices like the iPhone? Not much longer, says Pacific Crest analyst Andy Hargreaves, who believes the company’s gross profit per device has risen as high as it will ever go.

Hargreaves says the cost of goods sold for an iPhone 5 is higher than expected — about $370 — and he figures that will trim Apple’s overall gross margin for the December quarter to 38.8 percent from 40 percent. “Apple’s gross profit per unit has likely peaked,” Hargreaves theorized in a research note to clients. “Declining gross profit dollars per iPhone and volume sales of iPad are driving lower gross profit per unit of Apple product sold.” That may well be the case. In the third quarter of 2012, Apple’s gross profit per unit declined for the first time since the iPhone was introduced. And Hargreaves believes it will probably decline further through the end of fiscal 2013. With that in mind, he trimmed his target on the company to $645 from $670.

Doctors Abroad Report Mixed Results for Health IT

Health IT fails to consistently provide primary care physicians with timely information about patients or information on physician performance, a recent survey of doctors in 10 industrialized nations found. Even so, physicians say they’re seeing more progress in health IT than in some other health care areas, according to the survey, which was published online in the November issue of Health Affairs journal.

U.S. doctors in particular said the health care system needs “fundamental change,” with a majority reporting they spend a great deal of time dealing with insurance hassles that force some patients to go without care. Researchers surveyed primary care physicians in Australia, Canada, France, Germany, the Netherlands, New Zealand, Norway, Switzerland, the United Kingdom and the United States earlier this year for the report, which follows a similar survey conducted in 2009. The survey found near-universal use of electronic medical records in Australia, the Netherlands, New Zealand, Norway and the U.K. Two-thirds or more of physicians in the U.S., France and Germany report using electronic records, with significant growth reported in the U.S. and Canada in the last three years.

Hello Health raises $11.5 Million to help doctors go paper-free

For all the high-tech equipment doctors use in their practices, when it comes to communicating with patients, far too many physicians are woefully old-school, relying on fax machines and telephones for sharing tests results and releasing medical records. But New York-based Hello Health is one company trying to change that with an electronic health records (EHR) platform that helps doctors and patients make the shift to digital. The company announced that it had raised $11.5 million from First Generation Capital, which follows a $10 million round raised last year. As more doctors move their patients’ health information online – incentivized by the federal government – Hello Health says it offers physicians a platform that is not only free, but helps them earn additional revenue.

Tom Ricks to Fox News: The network operates 'as a wing of the Republican Party'

During an interview on Fox News, author Tom Ricks blasted the network as "operating as a wing of the Republican Party” and accused it of hyping the Benghazi attack for political purposes.

The Spectrum Crunch that Never Really Was

Part of the problem is simply hoarding: some companies have rights to more than they need, at times because business models didn’t pan out. For example, Clearwire, of Bellevue, Washington, held spectrum rights that it did not use, leading Sprint Nextel to buy a big stake in the company this year to expand its own network. Indeed, companies are keen to gobble up spectrum where they can. AT&T said its proposed merger with T-Mobile was needed to merge the two companies’ spectrum resources. There’s a great deal of idle government-controlled spectrum, too. Furthermore, there are plenty of ways that existing spectrum can be used more efficiently to address the crunch sometimes felt by end users. At ball games or concerts, for instance, you’ll often find milk-carton-sized Wi-Fi receivers tucked away in the rafters. Those receivers, operating on unlicensed spectrum, already handle 60 percent of all data traffic on AT&T’s network (your phone can send data on both Wi-Fi and cellular frequencies but will opportunistically choose Wi-Fi). The boxes mop up traffic from choke points like stadiums and train stations and send it directly to fiber backhaul, putting no demand whatsoever on the cellular network. The rise of Wi-Fi shows how working flexibly with existing spectrum can deal with the problem of capacity crunch.

Obama’s Moment

[Commentary] Chattanooga Mayor Ron Littlefield says city elders looked themselves in the eyes 15 years ago and realized that “we were a dilapidated city going the way of the Rust Belt.” But, by coming together to make the city an attractive place to live and getting both parties to agree to invest in a fiber-to-every-home-and-business network in a 600-square-mile area, Chattanooga replaced its belching smokestacks with an Amazon fulfillment center, major health care and insurance companies and a beehive of tech start-ups that all thrive on big data and super-high-speed Internet.

“We’ve gone from being a slowly declining and deflating urban balloon, to one of the fastest-growing cities in Tennessee,” said Mayor Littlefield. The fiber network now attracts companies that “like to see more and more of their employees able to work some of the time at home, which saves on office space and parking,” the mayor said. How fast is that Chattanooga choo-choo? The majority of Chattanooga homes and businesses get 50 megabits per second, some 100 megabits, a few 250 and those with big needs opt for a full gigabit per second, explained Harold DePriest, the chief executive of EPB, the city’s electric power and telecom provider, which built and operates the network. “The average around the country is 4.5 megabits per second.” So average Internet speed in Chattanooga is 10 times the national average. That doesn’t just mean faster downloads. The fiber grid means 150,000 Chattanooga homes now have smart electric meters to track their energy consumption in real time. More important, said DePriest, on July 5, Chattanooga got hit with an unusual storm that knocked out power to 80,000 homes. Thanks to intelligent power switching on the fiber network, he said, “42,000 homes had their electricity restored in ... 2 seconds.” Old days: 17 hours.

That network was fully completed thanks to $111 million in stimulus money. Imagine that we get a grand bargain in Washington that also includes a stimulus of just $20 billion to bring the 200 biggest urban areas in America up to Chattanooga’s standard. You’d see a “melt-up” in the U.S. economy. We are so close to doing something big and smart. Somebody needs to tell the Congress.

Benton

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