June 2014

Is Bitcoin a joke? People thought that about the internet too.

A Q&A with Marc Andreessen, venture capitalist.

Bitcoin has enjoyed a meteoric rise. The value of one unit of the cryptocurrency has soared from $13 at the beginning of 2013 to $600. Investors have poured millions of dollars into Bitcoin-based startups. Yet Bitcoin still faces widespread skepticism. The payment system's many critics argue that it doesn't have any compelling advantages over the conventional financial system. And they say Bitcoin is hampered by security concerns, extremely volatility, and unsavory ties to the criminal underworld.

These criticisms give Andreessen a sense of deja vu. In 1994, he was an early adopter of another technology that was widely dismissed as an impractical fad: the Internet. He describes the "massive wall of negativity" he encountered when, as the co-founder of the browser company Netscape, he tried to convince major American companies to take the internet seriously.

Andreessen believes that Bitcoin has the same kind of disruptive potential that the internet had two decades ago. “Bitcoin could basically reconstruct the financial industry in an untrusted peer-to-peer environment. This is why all the technologists look at it and get excited,” Andreessen said.

High court rejects Google appeal in snooping case

Google must face a class action lawsuit alleging the Internet giant violated federal wiretap law when its Street View vehicles collected data from private Wi-Fi networks.

The US Supreme Court said that it would not consider Google's challenge to the class action lawsuit. The federal Wiretap Act bans the interception of electronic communications.

Google had argued that it was not illegal to collect radio communications or any "form of electronic communication readily accessible to the general public."

But a San Francisco federal judge and the 9th US Circuit Court of Appeals did not agree and refused to dismiss the class action. The class action was filed on behalf of individuals whose information was collected from unsecured Wi-Fi networks when Google's Street View cars rode past unsuspecting households.

Protecting the Internet from political agendas: Takeaways from the ICANN meeting

[Commentary] The recent Internet Corporation for Assigned Names and Numbers (ICANN) meeting in London highlighted two issues that appear unrelated on the surface but link current concerns about how to manage Internet Governance going forward.

One is the transition of the Internet Assigned Numbers Authority (IANA) stewardship away from the US Government, and the second is the Government Advisory Committee’s multi-meeting, dragged out discussion on .wine/.vin new Top Level Domains (TLDs).

We need to know that the European Commission and its government colleagues understand this is a technical coordinating organization. If governments are willing to bring an issue from outside of the technical functions of the Internet into ICANN, how do we trust them to keep the IANA function purely technical and to stay away from the temptation to use it as a political lever?

If France wants to protect its geographic indicators on wine labels, for instance, it needs to continue negotiations with its global partners in the world of trade agreements, not technical Internet functions. The temptation to settle a commercial trade issue through Internet Governance will be just the beginning of mass political misappropriation of the largest economic tool that we have seen in this century -- the Internet.

[Tews is Chief Policy Officer at 463 Communication]

Aereo Ruling May Set Stage For Defining Distributors

Broadcasters were breathing a big sigh of relief after the Supreme Court ruled 6-3 that Aereo was indeed providing a public performance of their work without compensation.

Their underlying challenge in the lower courts remains, and Aereo founder Chet Kanojia vowed to keep fighting.

But even though the Supreme Court reversal of the Second Circuit’s denial of an injunction against Aereo does not technically settle those lower court cases, it effectively does, with language that makes it clear what Aereo is and isn’t. What it is, says the court, is like a cable operator or other multichannel video programming distributor, and not simply a cool technology to access free stuff.

That could give the Federal Communications Commission some direction in its proceeding on how to define an over-the-top video service provider, and could also send the decision’s critics to Congress for help clarifying its impact on other technologies, as the court pointed out.

Why the Aereo Shutdown Will Be a Disaster for Broadcast TV

[Commentary] When I finally heard that the Supreme Court had shut down the groundbreaking digital video system, I was amazed by how universally joyful TV broadcasters and distributors were about the ruling and ensuing shutdown.

Too bad they weren’t in Anaheim with me, because despite Aereo’s now-illegal Rube Goldberg-esque transmission technology, it offered a distinctive and revolutionary way for broadcast TV to remain relevant to younger viewers.

Unfortunately, most TV execs probably never had a chance to actually use Aereo. And that’s too bad, because the well-designed service delivered a unique and compelling way for traditional TV -- still mostly watched on TVs -- to build an audience among digital natives.

Now that the Aereo experiment is over, network executives will be newly emboldened to continue to circle the wagons and mostly keep doing business in the same old way -- via traditional distributors and to the dumb devices that, when millennials do watch, they usually mostly ignore in favor of their favorite screens in their hands (disparagingly called the “second screen” by the traditional TV industry). Unfortunately, they will continue to see their audience decline -- and revenue along with it.

The broadcast upfronts just concluded, and even though there was a slight increase in the rates charged to reach each viewer, overall revenue is likely to be down across most of the English-language broadcasters, due to declining viewership.

[“Cord Cutter” works as Senior Digital Exec for a major programming company]

CEO Brian Roberts bulks up Comcast for the future

Brian Roberts, chairman and chief executive of Comcast, is looking to fortify his company for an increasingly competitive era. He believes that the $45-billion takeover of Time Warner Cable will help do that, particularly as major technology companies -- including Google, Apple and Amazon -- try to crowd into America's living rooms to control the TV-watching experience.

He still needs the blessing of federal regulators, who are expected to decide soon. If they approve, Comcast would be a dominant provider of cable TV and Internet service -- an increasingly vital connection for tens of millions of families -- along the nation's East and West coasts. It would gain 7 million subscribers and claim two major pieces on the chessboard, Los Angeles and New York, an audacious move even for a company known for its daring bets.

Comcast would command the major population centers: New York, Los Angeles, Chicago, Boston, Philadelphia, Washington, Atlanta, Dallas, Seattle and San Francisco. In Los Angeles, Comcast would become the sole cable TV operator, with reach into nearly 1.8 million homes. The deal would complete Comcast's transformation into a national company from a regional cable operator, all of it done without having to dig trenches and extend its fiber lines through every state.

"Something closer to world domination" was how veteran cable analyst Craig Moffett described Comcast's ambitions.

Election Spending To Hit $8.3B, Says Borrell

Political advertising is expected to reach $8.3 billion in 2014, according to a new report from Borrell Associates.

Borrell says that two thirds of that money will be spent between July 1 and Election Day and that the bulk continues to go towards traditional media, rather than digital outlets.

Borrell says that candidates and political organizations will spend $37 per voter in 2014, up 9% from the last mid-term election. It expects spending to jump to $51 per voter in 2016, up 21% from the previous presidential election year in 2012.

Surge In 2016 Online Political Ad Spend Seen

Total online political ad spending is projected to soar to almost a billion dollars in 2016 US political races that are expected to generate more than $12 billion for all contests -- almost $51 for every qualified voter -- according to a report from Borrell Associates.

Digital media still would account for less than 8% of all political advertising, the report says, but the way political advertising money is spent will change dramatically in 2016, affecting every level of spending -- from very local to presidential runs.

Cable and online are the only media choices projected to gain share in political ad spending in 2014, the report says.

Rootstrikers.org Effort Seeks More Political File Info

Political activist site Rootstrikers.org is seeking signatures on a petition to require the source of political ads to identify themselves in the Federal Communications Commission's political files.

That comes as the commission prepares on July 1 to require all stations to upload their political files to an online database, as the top stations in the top 50 markets have had to do.

"Disclosure of political ads offers our only glimpse into $300 million of secret money that floods our elections. But major TV executives refuse to obey the law," Rootstrikers wrote. "Others give misleading information on a loophole-ridden form created by industry lobbyists!"

Time To Finally Embrace News Collaboration

Speakers at the recent Investigative Reporters & Editors conference say that 76% of local broadcasters partner with other news outlets, and it behooves TV reporters to maximize the potential -- and benefits -- of those collaborations, whether they like it or not.

And the same goes for collaborating with their own digital teams. There should no longer be a division between on-air and digital departments.

Benton

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