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May 2013

Weekly Digest

Glass Ceiling Shattered at FCC: The Clyburn Chairmanship Begins

On July 11, 1934, Eugene O. Sykes became the first chairman of the Federal Communications Commission. He held the post until March 8, 1935 when Anning S. Prall rose to be chair. Since then, each succeeding FCC chair has been a man – that is, until May 20, 2013, when Mignon Clyburn became the Acting Chairwoman of the commission.

May 31, 2013 (AG Holder Pledges Shifts on Media)

Sorry we're late this morning.

BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, MAY 31, 2013

A look at events on the June calendar http://benton.org/calendar/2013-06/


GOVERNMENT & COMMUNINICATIONS
   AG Holder Pledges Shifts on Media
   A Double-Trouble Scandal for Obama - editorial
   Shielding journalists, by law - editorial

OWNERSHIP
   Broadcasters: Impact of Cross-Ownership on Minority/Female Ownership 'Probably Negligible'
   Warren Buffett's newspaper group to buy The Roanoke Times [links to web]
   Chicago Sun-Times cuts entire photography staff [links to web]

WIRELESS/SPECTRUM
   Dish Makes a Play For Clearwire That May Stymie Sprint
   What’s Behind Dish’s Higher Bid for Clearwire? - analysis
   House panel to take up cellphone unlocking bill [links to web]
   NAB/CEA Urge FCC to Create Spectrum Coordination Task Force [links to web]
   US Cellular spectrum partner bewails absence of Band 12 in Apple's iPhone [links to web]

INTERNET/BROADBAND
   FCC Refutes Verizon Network Neutrality Argument
   The Industrial Internet: The next great economic revolution [links to web]
   Internet cafes in Ohio face ban [links to web]

CONTENT
   Hate Speech on Facebook - editorial
   YouTube runs a reform school for copyright violations [links to web]
   Netflix wants to spend up to 15 percent of its content cash on originals [links to web]

TELEVISION
   NAB Defends Joint Retransmission Negotiations [links to web]
   Fanhattan unveils radically different approach to cable boxes [links to web]

CYBERSECURITY
   Why cyberwarfare is the great equalizer - op-ed [links to web]
   The Human Side of Cyber Threats - op-ed [links to web]

ACCESSIBILITY
   National Federation of the Blind, MPAA join forces to back book treaty [links to web]

EMERGENCY COMMUNICATIONS
   Adding Insult to Injury for Sandy Victims: 911 Calls May Not Go Through on New Verizon Phone Service - analysis
   New York City’s 911 Operators Use Pen and Paper as Computers Fail [links to web]

POLICYMAKERS
   FCC Acting Chairwoman Mignon Clyburn Makes Staff Announcements - press release [links to web]
   Rand Paul Seeks Silicon Valley Funds [links to web]

STORIES FROM ABROAD
   Is Venezuela's opposition TV channel bowing to government pressure? [links to web]
   Telecom Italia agrees to separate fixed-line network [links to web]

MORE ONLINE
   Google's Eric Schmidt Invests in Obama's Big Data Brains [links to web]
   All Your Worst Fears About Google Glass Are Coming True, and It's All Your Fault - analysis [links to web]

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GOVERNMENT & COMMUNINICATIONS

AG HOLDER PLEDGES SHIFT
[SOURCE: Wall Street Journal, AUTHOR: Devlin Barrett]
Attorney General Eric Holder told news editors in a private meeting that he is committed to changing Justice Department guidelines on investigations involving journalists, in the wake of recent controversies over the seizure of reporters' phone and email records. AG Holder and aides said they were open to changing the guidelines the department uses to broaden the circle of officials who have to agree that subpoenas are justified as a last resort. The officials also said they were open to annual reviews with news organizations, according to a Wall Street Journal editor who attended the meeting. Those in attendance at the meeting included editors from The Wall Street Journal, the Washington Post, the New York Daily News, Politico and the New Yorker. The Justice officials said further discussions would be held with other editors, reporters, media attorneys and academics. AG Holder and the other Justice officials told the editors they were committed to protecting the role journalists play in reporting on the government. The department's guidelines haven't been revised in more than two decades, and the officials said they needed to be updated to deal with significant changes in news gathering that have occurred in that time. AG Holder and his aides also said the administration would throw its weight behind an effort to pass a federal media shield law, though such legislation would likely have little impact on the two cases at the center of the current controversy.
benton.org/node/152886 | Wall Street Journal
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DOUBLE-TROUBLE SCANDAL
[SOURCE: Wall Street Journal, AUTHOR: Kimberley Strassel]
[Commentary] The facts of the Department of Justice’s press intrusions are clear and uncontested. We know Justice has seized records of reporters, that Attorney General Eric Holder himself signed onto a warrant that suggested a journalist was a "co-conspirator" in a national-security leak. We also know that government has violated its own guidelines on probing journalists. So this is a scandal that can't be ignored or dismissed as a Republican witch hunt. Moreover, it is a scandal that has, for once, outraged two groups that President Barack Obama deeply depends on for his political success: the press and liberal activists. Since the AP story broke, the Beltway media have been doing a passable impression of a credible Fourth Estate. White House press secretary Jay Carney's daily briefings now resemble "Survivor" episodes, with journalists firing off questions, rejecting answers, and even rolling their eyes at responses. The White House's evasiveness on the press scandal has suddenly got the press corps wondering what else this administration isn't being straight on. Will it last? That may depend on how many more revelations about press intrusions come to light. But the notable thing is that President Obama has lost the media's loyalty at this critical moment of his presidency, as other scandals over the IRS and Benghazi continue to swirl. The left and the press have always been with President Obama when it really mattered, and that may well remain the case. The particular significance of Justice's press scandal is that it has deprived Mr. Obama of support at a time when he is vulnerable on so much else. Who knows what will come of that?
benton.org/node/152885 | Wall Street Journal
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SHIELDING JOURNALISTS
[SOURCE: Los Angeles Times, AUTHOR: Editorial staff]
[Commentary] After a firestorm of criticism, the Obama administration is suggesting that it will make amends for its aggressive pursuit of journalists suspected of receiving leaks of classified information. But airy affirmations of the importance of a free press and vague promises of a new look at Justice Department regulations aren't enough. The administration needs to commit itself in specific terms to stronger protections for news gathering that will be embodied in a federal statute. Previous administrations have recognized that the 1st Amendment contemplates a division of labor in which government may seek to keep information secret while the press sets out to uncover secrets in its efforts to keep the public informed about the actions of its leaders. In its zeal to plug leaks of classified information, the Obama administration upended that traditional understanding. It must show by deeds as well as words that it recognizes where it went wrong.
benton.org/node/152884 | Los Angeles Times
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OWNERSHIP

MMTC STUDY
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
In a study submitted to the Federal Communications Commission, the Minority Media and Telecommunications Council and BIA/Kelsey conclude that it appears that “cross-media interests' impact on minority and women broadcast ownership is not sufficiently material to be a material justification for tightening or retaining the [cross-ownership] rules.” "The results of this study, while not dispositive, do provide evidence that the impact of cross-media ownership on minority and women broadcast ownership is probably negligible," said BIA/Kelsey. One reason they were not dispositive was that the survey was based on only 14 respondents (representing 31 stations) in markets with grandfathered cross-ownership combos and with stations owned by minorities and/or women. BIA/Kelsey conceded more responses would have been preferable, but argued that it was never meant to be a comprehensive, random sample survey of all cross-media combos in markets with minority and women owners. It said the answers it did get were "sufficiently compelling and unambiguous" to support its conclusion of, essentially, no harm, no foul. But there were caveats. MMTC President David Honig pointed out in a letter to the FCC that there was one market in which all the respondents mentioned cross-media interests as having a competitive impact. That came in a medium market with a combination of the only daily newspaper, a full-power TV station and radio stations. A second caveat was that the study only looked at the impact of cross-ownership on diverse ownership.
"MMTC based its conclusions on an opinion survey of existing media owners," said Free Press Policy Director Matt Wood. "This qualitative approach might have yielded some interesting anecdotes, but it's not a substitute for real analysis of likely outcomes from the disastrous rule changes pushed by former [FCC] Chairman [Julius] Genachowski. We'll review the survey, and take part if and when the FCC seeks comment on it. But there's nothing surprising about the fact that MMTC -- a group on the record as supporting more media consolidation -- would design and produce a survey claiming that no harm results from consolidation."
benton.org/node/152873 | Broadcasting&Cable | TVNewsCheck
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WIRELESS/SPECTRUM

DISH-CLEARWIRE
[SOURCE: Wall Street Journal, AUTHOR: Thomas Gryta, Shalini Ramachandran, Anton Troianovski]
Dish Network launched a tender for shares of Clearwire, throwing a wrench into a planned purchase of the broadband company by Sprint Nextel. The last-minute move complicates a three-way merger aimed at turning Sprint into a stronger competitor in the U.S. wireless market. Sprint, which agreed to buy the roughly 50% of Clearwire it doesn't already own, also agreed to be bought for $20 billion by SoftBank of Japan. Clearwire delayed its shareholder vote as a result of the bid until June 13, while Sprint's shareholders will vote on the deal with SoftBank on June 12. While Dish stands little chance of taking over Clearwire given Sprint's big shareholdings, it could in theory win enough of a minority stake to create unwanted headaches for Sprint and SoftBank as they try to knit the companies together.
benton.org/node/152883 | Wall Street Journal
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DISH-CLEARWIRE
[SOURCE: telecompetitor, AUTHOR: Joan Engebretson]
Is Clearwire a diamond in the rough, making it the real prize? Or is Dish just trying to mess with Sprint? Perhaps if Dish’s offer gains strong interest from Clearwire, Dish can use it as a bargaining chip in its efforts to obtain Sprint. Dish’s motivation could be a combination of those two factors. Dish knew when it made its initial offers for Clearwire and Sprint that it faced a huge struggle to obtain either company, as Sprint has many contractual locks on Clearwire — just as Softbank has on Sprint. So it’s not surprising that Dish is trying a wide range of tactics to gain the additional spectrum and expertise it needs — and perhaps those tactics include upping its Clearwire bid as a negotiation ploy with Sprint. But although Clearwire initially may not seem like much of a prize, it has huge spectrum holdings. And even though that spectrum in some markets currently supports WiMax, a technology that didn’t gain much traction in the U.S., concerns such as those are becoming less and less important nowadays. As bandwidth demand continues to climb and with few new sources of spectrum likely to become available any time soon, it’s important not to underestimate the value of Clearwire’s spectrum holdings – even if some of that spectrum would have to be repurposed.
benton.org/node/152864 | telecompetitor
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INTERNET/BROADBAND

NET NEUTRALITY ARGUMENTS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The Federal Communications Commission told the U.S. Court of Appeals for the D.C. Circuit May 30 that a court decision Verizon presented to the circuit recently to buttress its challenge of network neutrality rules is not on point. In a January filing to the court, the FCC said that Verizon and other broadband providers "do not engage in speech; they transport the speech of others, as a messenger delivers documents containing speech." It drew the distinction between that and "cable systems, newspapers and other curated media," saying that broadband providers "do not exercise editorial discretion." In a filing with the court last week, attorneys for Verizon pointed to National Association of Manufacturers [NAM], et al. v. National Labor Relations Board [NLRB], decided by the D.C. Circuit May 7, to argue that the FCC was wrong. In that decision, the court pointed to what it said were "some firmly established principles of free speech law," including the fact that "the dissemination of messages others have created is entitled to the same level of protection as the 'creation' of messages." In its response, the FCC said that Open Internet rules do not resemble the regulation in the NLRB case, which was a requirement that employers post notices of collective bargaining rights. "The notice was written by the government, with a list of required statements in a specified format," said the FCC, which the court concluded was compelled speech "like a compulsory flag salute or the mandatory display of a license-plate motto." "The Open Internet rules do not resemble that regulation," the FCC said. "Broadband providers need not convey any specific message, let alone a government-designated one. Providers must only refrain from blocking access to web sites of their customers' choice. Indeed, because Internet access service serves principally as a conduit for Internet content, broadband providers are not speakers at all... The Open Internet rules thus affect only the conduct of Internet service providers, not their speech."
benton.org/node/152881 | Broadcasting&Cable
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CONTENT

HATE SPEECH ON FACEBOOK
[SOURCE: New York Times, AUTHOR: Editorial staff]
[Commentary] Facebook belatedly moved to further restrict hate speech that glorified violence against women after an organized social media campaign caused some companies like Nissan, the automaker, to withhold advertising from the site. The companies said they acted after they became aware that their ads might have appeared next to the offensive content. It was only after advocacy groups like Women, Action & the Media and The Everyday Sexism Project mounted a campaign, sending 5,000 e-mails to Facebook advertisers and coordinating petitions signed by more than 200,000 people, that the company reacted publicly. The company’s slow response may be indicative of a deeper problem in technology and Internet-based companies — most of them are primarily run by men. Facebook is, of course, a notable exception in that its chief operating officer is Sheryl Sandberg, who recently wrote the book “Lean In: Women, Work, and the Will to Lead.” This episode shows that sexism is a deeply entrenched problem that society has to battle collectively because individual voices far too often go unheeded.
benton.org/node/152879 | New York Times
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EMERGENCY COMMUNICATIONS

VOICE LINK AND 911
[SOURCE: Public Knowledge, AUTHOR: Jodie Griffin]
[Commentary] Months after Hurricane Sandy damaged Verizon’s traditional copper phone network in Fire Island, NY, Verizon has made it clear that it does not intend to repair its infrastructure in the recovering community. Instead, Verizon has announced plans to replace its wireline service in Fire Island and other hurricane-ravaged communities with an untested fixed wireless service called Voice Link. Verizon has been eager to tell subscribers that Voice Link offers “the same 911 support” and “many of the same voice features and functions” as their old landline phones did. In New Jersey, Verizon even sent around a mailer saying “Our technicians connect Voice Link into the telephone lines in your home, allowing you to use your home telephones to make and receive calls just like you did before.” But Verizon’s frequent public pronouncements that its Voice Link service is basically the same as its former copper network service is belied by a filing the New York Public Service Commission required Verizon to submit last week. In that filing, Verizon revealed that Voice Link service will be significantly limited compared to the wireline service Fire Island residents were used to.
benton.org/node/152865 | Public Knowledge
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AG Holder Pledges Shifts on Media

Attorney General Eric Holder told news editors in a private meeting that he is committed to changing Justice Department guidelines on investigations involving journalists, in the wake of recent controversies over the seizure of reporters' phone and email records.

AG Holder and aides said they were open to changing the guidelines the department uses to broaden the circle of officials who have to agree that subpoenas are justified as a last resort. The officials also said they were open to annual reviews with news organizations, according to a Wall Street Journal editor who attended the meeting. Those in attendance at the meeting included editors from The Wall Street Journal, the Washington Post, the New York Daily News, Politico and the New Yorker. The Justice officials said further discussions would be held with other editors, reporters, media attorneys and academics. AG Holder and the other Justice officials told the editors they were committed to protecting the role journalists play in reporting on the government. The department's guidelines haven't been revised in more than two decades, and the officials said they needed to be updated to deal with significant changes in news gathering that have occurred in that time. AG Holder and his aides also said the administration would throw its weight behind an effort to pass a federal media shield law, though such legislation would likely have little impact on the two cases at the center of the current controversy.

A Double-Trouble Scandal for Obama

[Commentary] The facts of the Department of Justice’s press intrusions are clear and uncontested. We know Justice has seized records of reporters, that Attorney General Eric Holder himself signed onto a warrant that suggested a journalist was a "co-conspirator" in a national-security leak. We also know that government has violated its own guidelines on probing journalists. So this is a scandal that can't be ignored or dismissed as a Republican witch hunt.

Moreover, it is a scandal that has, for once, outraged two groups that President Barack Obama deeply depends on for his political success: the press and liberal activists. Since the AP story broke, the Beltway media have been doing a passable impression of a credible Fourth Estate. White House press secretary Jay Carney's daily briefings now resemble "Survivor" episodes, with journalists firing off questions, rejecting answers, and even rolling their eyes at responses. The White House's evasiveness on the press scandal has suddenly got the press corps wondering what else this administration isn't being straight on. Will it last? That may depend on how many more revelations about press intrusions come to light. But the notable thing is that President Obama has lost the media's loyalty at this critical moment of his presidency, as other scandals over the IRS and Benghazi continue to swirl. The left and the press have always been with President Obama when it really mattered, and that may well remain the case. The particular significance of Justice's press scandal is that it has deprived Mr. Obama of support at a time when he is vulnerable on so much else. Who knows what will come of that?

Shielding journalists, by law

[Commentary] After a firestorm of criticism, the Obama administration is suggesting that it will make amends for its aggressive pursuit of journalists suspected of receiving leaks of classified information. But airy affirmations of the importance of a free press and vague promises of a new look at Justice Department regulations aren't enough.

The administration needs to commit itself in specific terms to stronger protections for news gathering that will be embodied in a federal statute. Previous administrations have recognized that the 1st Amendment contemplates a division of labor in which government may seek to keep information secret while the press sets out to uncover secrets in its efforts to keep the public informed about the actions of its leaders. In its zeal to plug leaks of classified information, the Obama administration upended that traditional understanding. It must show by deeds as well as words that it recognizes where it went wrong.

Dish Makes a Play For Clearwire That May Stymie Sprint

Dish Network launched a tender for shares of Clearwire, throwing a wrench into a planned purchase of the broadband company by Sprint Nextel.

The last-minute move complicates a three-way merger aimed at turning Sprint into a stronger competitor in the U.S. wireless market. Sprint, which agreed to buy the roughly 50% of Clearwire it doesn't already own, also agreed to be bought for $20 billion by SoftBank of Japan. Clearwire delayed its shareholder vote as a result of the bid until June 13, while Sprint's shareholders will vote on the deal with SoftBank on June 12. While Dish stands little chance of taking over Clearwire given Sprint's big shareholdings, it could in theory win enough of a minority stake to create unwanted headaches for Sprint and SoftBank as they try to knit the companies together.

House panel to take up cellphone unlocking bill

The House Judiciary Committee will hold a hearing June 6 to consider legislation that would legalize cellphone unlocking, which allows consumers to switch carriers.

The hearing, which will be held by the subcommittee on Courts, Intellectual Property and the Internet, will consider the Unlocking Consumer Choice and Wireless Competition Act, which is sponsored by full committee Chairman Bob Goodlatte (R-VA). The subcommittee has yet to announce the witnesses. Because of a Library of Congress decision last year, customers must obtain their carriers' permission to legally unlock their phones even after they have completed their contract. Goodlatte's bill, which is co-sponsored by subcommittee Chairman Howard Coble (R-NC) and ranking member Mel Watt (D-NC), would overturn the library's decision but would not amend the underlying copyright law. Senate Judiciary Committee Chairman Patrick Leahy (D-VT) has introduced companion legislation in the upper chamber. Reps. Zoe Lofgren (D-CA), Thomas Massie (R-KY), Anna Eshoo (D-CA) and Jared Polis (D-CO) have sponsored a more aggressive bill that would amend the Digital Millennium Copyright Act to permanently legalize cellphone unlocking.

FCC Refutes Verizon Network Neutrality Argument

The Federal Communications Commission told the U.S. Court of Appeals for the D.C. Circuit May 30 that a court decision Verizon presented to the circuit recently to buttress its challenge of network neutrality rules is not on point.

In a January filing to the court, the FCC said that Verizon and other broadband providers "do not engage in speech; they transport the speech of others, as a messenger delivers documents containing speech." It drew the distinction between that and "cable systems, newspapers and other curated media," saying that broadband providers "do not exercise editorial discretion." In a filing with the court last week, attorneys for Verizon pointed to National Association of Manufacturers [NAM], et al. v. National Labor Relations Board [NLRB], decided by the D.C. Circuit May 7, to argue that the FCC was wrong. In that decision, the court pointed to what it said were "some firmly established principles of free speech law," including the fact that "the dissemination of messages others have created is entitled to the same level of protection as the 'creation' of messages." In its response, the FCC said that Open Internet rules do not resemble the regulation in the NLRB case, which was a requirement that employers post notices of collective bargaining rights. "The notice was written by the government, with a list of required statements in a specified format," said the FCC, which the court concluded was compelled speech "like a compulsory flag salute or the mandatory display of a license-plate motto."

"The Open Internet rules do not resemble that regulation," the FCC said. "Broadband providers need not convey any specific message, let alone a government-designated one. Providers must only refrain from blocking access to web sites of their customers' choice. Indeed, because Internet access service serves principally as a conduit for Internet content, broadband providers are not speakers at all... The Open Internet rules thus affect only the conduct of Internet service providers, not their speech."

NAB/CEA Urge FCC to Create Spectrum Coordination Task Force

The incentive auctions continue to breed unusual alliances.

First there was the National Association of Broadcasters and wireless companies teaming on a band plan, and now the National Association of Broadcasters and the Consumer Electronics Association, which have battled over the relative value of spectrum in the hands of broadcasters and those wireless companies, have joined to ask the Federal Communications Commission to create a working group on international coordination.

The US will have to coordinate the repacking of TV stations after the auction with Canada and Mexico to avoid border interference issues. Broadcasters have been pushing the commission to resolve those issues before the auctions. "We are pleased that the Commission has recently reached out to Canada to begin this [coordination] process," they wrote in a letter to acting FCC Chair Mignon Clyburn. "We believe that the Commission can go one step further, however, and immediately create a joint working group consisting of public and private officials to expedite this critical process."

Hate Speech on Facebook

[Commentary] Facebook belatedly moved to further restrict hate speech that glorified violence against women after an organized social media campaign caused some companies like Nissan, the automaker, to withhold advertising from the site. The companies said they acted after they became aware that their ads might have appeared next to the offensive content.

It was only after advocacy groups like Women, Action & the Media and The Everyday Sexism Project mounted a campaign, sending 5,000 e-mails to Facebook advertisers and coordinating petitions signed by more than 200,000 people, that the company reacted publicly. The company’s slow response may be indicative of a deeper problem in technology and Internet-based companies — most of them are primarily run by men. Facebook is, of course, a notable exception in that its chief operating officer is Sheryl Sandberg, who recently wrote the book “Lean In: Women, Work, and the Will to Lead.” This episode shows that sexism is a deeply entrenched problem that society has to battle collectively because individual voices far too often go unheeded.

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