July 2013

Another Week, Another Wireless Deal – Part II

[Commentary] Last Friday, perhaps while you were reading our piece Introducing the New Sprint, AT&T announced that it will acquire Leap Wireless, and its Cricket brands, for $1.2 billion. And we can’t shake the irony that when we first introduced SoftBank’s plan to acquire a majority stake of Sprint it came on the heels of the news that T-Mobile and MetroPCS would combine. And, of course, this new AT&T-Leap deal is AT&T’s first sizable acquisition since the Justice Department squelched the company’s $39 billion deal to buy the fourth-largest U.S. wireless carrier, T-Mobile USA, in 2011. (Not that we want to call AT&T’s $780 million dollar purchase of Alltel wireless “puny.”) What’s going on in wireless?

FCC Signals It Would Like Swift Resolution of CBS/TWC Dispute

According to a Federal Communications Commission spokesman, the commission is actively following the retransmission consent dispute between CBS and Time Warner Cable and is looking for a consumer-friendly result, which the spokesman suggests means a deal. "The Commission is continuing to monitor the situation," said the spokesman. "We urge the respective parties involved to do what is in the best interests of consumers and viewers, and to reach a retransmission consent agreement as quickly as possible."

CBS Has a Weapon It Won’t Use in Its Time Warner Cable Fight

CBS is telling its viewers that if it goes dark in Time Warner Cable markets like New York and Los Angeles, they should go get a subscription with another pay-TV company. But here we should note one option CBS isn’t promoting: Using an old-fashioned antenna to get the network’s shows, over the air, without paying anyone for them.

That’s perfectly legal, of course, and lots of people still watch their TV that way. But presumably CBS doesn’t want to play up the notion that you can watch their shows for free — because it is trying to get pay-TV distributors to pay them a bunch of money in “retransmission fees” for those same shows. So if you’re not going to watch “Big Bang Theory” on Time Warner Cable this summer, CBS would much rather you watch it via another pay-TV company. And it’s just possible that if it comes down to watching it for free versus not watching it at all, the company would rather you just tuned out.

Colorado Legislature Wants EAGLE-Net Info

EAGLE-Net Alliance continues to come under scrutiny over its government grant to provide broadband to anchor institutions and allegations it is overbuilding existing service. The Colorado State General Assembly's Legislative Audit Committee has formally asked EAGLE-Net Alliance to provide records for the committee's review and to agree to send a representative to an Aug. 27 meeting with the committee. A letter from both Democratic and Republican members of the Committee asked for the records by Aug. 15 and suggested EAGLE-Net has been hard to pin down on a date for a meeting.

Padden: 120 MHz Is Readily Recoverable If FCC Gets Auction Right

The Federal Communications Commission’s biggest challenge is to ensure that broadcasters can make enough out of an incentive auction to want to give up spectrum. If the commission doesn't get that part right, the current debate over band plans and what wireless carriers can bid for spectrum will be moot. That is the message from Expanding Opportunities for Broadcasters Coalition executive director Preston Padden, according to a copy of his prepared testimony for an auction oversight hearing in the House Communications Subcommittee slated for July 23.

According to Padden, his coalition comprises 70-plus stations willing to offer up spectrum under the right conditions -- under the auction rules, those bidders do not have to identify themselves. Padden argues that with sufficient incentive, the FCC can reach in initial target of 120 MHz of spectrum. Without it, "the auction will fail at its inception and there will be no need to debate other issues such as band plans and wireless carrier eligibility," he says. Padden says the FCC should not try to limit the payout to broadcasters -- by "scoring" stations based on population coverage or other factors. He also warns the FCC that broadcasters need more information about the auction design.

Rural Legislators Seek FCC Protection of LPTV, Translators

Fifty-seven members of Congress representing "rural and mountainous" areas of the country have written Acting Federal Communications Commission Chairwoman Mignon Clyburn saying the FCC needs to tell them how the upcoming incentive spectrum auctions are going to impact those who rely on low-power TV stations and translators. And they want an answer "before the FCC proceeds with any plans that could adversely affect our constituents in rural America."

The signatories, which included the chair and ranking member of the House Agriculture Committee, were almost evenly divided between Republicans and Democrats, but united in their concern for rural constituents, who rely on translators -- which extend TV station signals to hard-to-reach areas, and low-power stations that provide niche service to rural areas.

USDA Announces Funding to Improve Rural Broadband in Texas, Iowa, and North Dakota

Rural Utilities Service (RUS) Administrator John Padalino announced funding for three rural telecommunications companies that will expand and improve broadband service in rural Texas, North Dakota and Iowa. USDA remains focused on carrying out its mission, despite a time of significant budget uncertainty.

This broadband funding announcement will improve Internet services for 37,000 homes and businesses. It will provide more than $30.5 million to install fiber infrastructure upgrades to the existing networks to improve telecommunications services in these three states. USDA funding is contingent upon the recipient meeting the terms of the loan agreement.

Ganado Telephone Company, Inc., in Ganado, Texas, will receive a $6,575,000 loan to complete a Fiber-to-the-Premises (FTTP) system in the town of Ganado, replace outdated copper components within the system and make other system improvements. The fiber transmission upgrades will provide customers with increased Internet data speed.
Keystone-Farmers Cooperative Telephone Company, in Keystone, Iowa, will receive a $7,648,000 loan to upgrade its outside plant and network infrastructure to Fiber-to-the-Premises architecture, and make other system improvements. FTTP capability will provide Keystone customers with voice, multi-media and high-speed data services. The project is expected to stimulate economic development and create job opportunities in this rural, predominantly agricultural area.
SRT Communications, Inc., of Minot, N.D., will receive a $16,283,000 loan to upgrade its Fiber-to-the-Premises infrastructure to deliver higher-value services and enhanced broadband capability to its customers in the service area. SRT is North Dakota’s largest telephone cooperative, serving 26 exchanges in the Drift Prairie region.

Federal Health IT Strategic Plan – Progress Report

The Department of Health’s Office of the National Coordinator for Health Information Technology (ONC) released a report describing the progress made on the Federal Health IT Strategic Plan.

The report details: grant programs, innovation challenges, certification, standards, and regulatory policy. All of these were developed through public and private collaboration to promote certified electronic health record (EHR) adoption and other health IT use and facilitate health information exchange. When the current Federal Health IT Strategic Plan was issued in 2011, we noted it was an ambitious effort that needed to inspire trust while serving as a guide to wider adoption and meaningful use of health technology by the nation’s health care providers.

The Plan, building on efforts to expand EHR adoption and the use of health IT, set five goals for how health IT would create an infrastructure that supports the nation’s vision of better health, better care, and lower costs:

Achieve Adoption and Information Exchange through Meaningful Use of Health IT;
Improve Care, Improve Population health, and Reduce health Care Costs through the Use of Health IT;
Inspire Confidence and Trust in Health IT;
Empower Individuals with Health IT to Improve their Health and the Health Care System; and
Achieve Rapid Learning and Technological Advancement.

In Major Ruling, Court Orders New York Times Reporter to Testify

In a major decision about press freedoms, a divided federal appeals court ruled that James Risen, an author and a reporter for The New York Times, must testify in the criminal trial of a former Central Intelligence Agency official charged with providing him with classified information.

Two members of a three-judge panel for the United States Court of Appeals for the Fourth Circuit, in Richmond (VA) — the court whose decisions cover the Pentagon and the C.I.A. — ruled that the First Amendment provides no protection to reporters who receive unauthorized leaks from being forced to testify against the people suspected of leaking to them. “Clearly, Risen’s direct, firsthand account of the criminal conduct indicted by the grand jury cannot be obtained by alternative means, as Risen is without dispute the only witness who can offer this critical testimony,” wrote Chief Judge William Byrd Traxler Jr., who was joined by Judge Albert Diaz. Risen has vowed to appeal any loss at the appeals court to the Supreme Court, and to go to prison rather than testify about his sources.

Oh, Canada: Verizon Wireless Eyes Possible Northward Expansion

Verizon Communications CFO Fran Shammo indicated that the carrier is conducting an “exploratory exercise” to see if an expansion into Canada makes sense.

“If you look at the population of Canada, about 70 percent of that population is between Toronto and Quebec. That’s adjacent to the Verizon Wireless properties,” Shammo said. “Again, if you look at the spectrum auction, it mirrors up exactly with what we launched here in the United States on the 700MHz [frequency].” Shammo did note that regulatory and other issues could pose challenges to such a move.

Benton

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