April 2013

Is News Corp. really going to yank Fox off the airwaves in response to Aereo? Snap consensus judgment from the various corners of the TV Industrial Complex: No way. At least, not anytime soon.

It’s possible that over time, if broadcasters do think that Aereo or Aereo-like technology really threatens the fees they get from pay TV operators for their over-the-air programming, they’ll move more of it to cable networks. And, in fact, programmers have already started moving lots of high-profile sporting events from free TV to pay TV. Near-term, however, people seem to think that both practical and legal restrictions — for instance, deals that Fox and CBS have with the NFL for football broadcast rights — would prevent this from happening. More practically, there isn’t any reason to do so, since only a handful of people are actually using Aereo to get broadcast TV for free.

All that said, Wall Street seems to like the idea. Bernstein analyst Todd Juenger gamed out a scenario where all four broadcasters moved from over-the-air to pay networks, and concluded that it wouldn’t be a terrible idea, at least financially. By Juenger’s thinking, the lost “retransmission fees” and advertising dollars the broadcasters would lose from over-the-air programming would be replaced by even higher “affiliate fees” and advertising dollars they could get on cable.

The U.S.-China Business Council objected to a law that restricts parts of the federal government from purchasing technology equipment produced by entities associated with the Chinese government.

Lawmakers created the restrictions last month in a six-month stopgap bill to fund the federal government, arguing they were needed to protect national security. But John Frisbie, the president of the China-focused business group, said the new rules are misguided, and urged House and Senate leaders to ensure the provision is kept out of future appropriations bills. "The national security of the United States is critical, but it must not be used as a means of protectionism," Frisbie wrote in a letter to leaders. "Imposing a country-specific risk assessment creates a false sense of security if the goal is to improve our nation's cybersecurity." Frisbie encouraged lawmakers to work with American tech companies on ensuring the security of their supply chains. The U.S.-China Business Council represents more than 200 American companies from a range of industries that do business with China, including Google, Oracle and Best Buy.

The Expanding Opportunities for Broadcasters Coalition met with Federal Communications Commission officials and left still concerned that the FCC would discourage broadcaster participation in the auction by holding to a plan to pay larger broadcasters more than smaller ones.

Such differential pricing according to size or audience, the coalition has said, is not relevant to the price of a station's spectrum. It says only two factors should be considered: 1) the effect of the station's spectrum on the subsequent repacking of other stations after the reverse auction portion of the incentive auction, and 2) the market price as determined by the competitive bids by broadcasters to give up spectrum. According to coalition executive director Preston Padden in a letter to the FCC, he is concerned by comments from Wireless Bureau chief Ruth Milkman and others at the meeting that they "expressed a desire to retain the flexibility to pay more to 'big' stations and less to 'small' stations.”

Padden said that if by 'big' that the FCC might have to pay more for a station that had a big effect on repacking of other stations, that was understandable, but if that still mean according to size or audience, population covered, or enterprise value, then that would be "picking winners and losers" and suggested the FCC might wind up the ultimate loser by reducing the amount of spectrum it was able to reclaim and was already "driving away from the auction the very stations most likely to otherwise consider surrendering their spectrum."

Google Fiber will come to Austin, Texas, making it the second city to get the search giant’s gigabit network. And people in Austin may be saying, “We won’t have to deal with Time Warner Cable anymore.”

You may be wondering why you, in particular, need a gig. The answer is that today you don’t. I spend all day thinking and writing about broadband and even I have no idea what I would do with a symmetrical gigabit network inside my home. But we’ve gone far beyond the idea that the internet is just a fad. It’s the underpinning of the information economy. Right now our content is digital, and while next generation video standards like 4K will require 25 Mbps connections, the real reason you need a gig isn’t about video. The internet today transfers digital bits, but it’s rapidly moving to the place where it will transfer physical atoms. Thus, it won’t be about information, but about physical goods. Things like Uber or same-day delivery are examples of this. You tell the internet what you want and it delivers it for you in real-time or at least that day. If you consider 3D printers and the evolution of on-demand manufacturing then the internet could bring you physical goods directly. You want a bracelet you see online? If you have a 3D printer, the company will send the file to your Makerbot and it will print it.