June 2014

Sprint CEO talks consolidation, corporate responsibility

Sprint CEO Dan Hesse won't comment on speculation his company is preparing to merge with T-Mobile, but he will say that having a third large US mobile company that could rival the size of AT&T and Verizon would be a good thing.

Speculation has been swirling that Sprint, the third largest US wireless carrier, would acquire T-Mobile in a blockbuster deal valued anywhere from $31 billion to $50 billion.

If Sprint were to make such a move, one of the biggest roadblocks would the reluctance of US, regulators to let the US mobile market shrink from four major players to three. "I can't talk specifically about any particular potential merger, but I do think that the US wireless industry would be healthier and consumers would be better off with three strong competitors vs. basically a duopoly, which is what you have today," Hesse told USA TODAY. Hesse said a third competitor would drive prices down and might also motivate AT&T and Verizon to innovate more.

He added that a third major competitor might be able to build networks in rural and suburban US communities that are currently only serviced by AT&T and Verizon. "If you combined, let's say, Sprint and T-Mobile together, there would be enough customers to build a third network," he said.

The “Internet of things” could be great, but first we need a platform to support it

The “Internet of things” refers to the idea of turning everyday objects around us into responsive data devices. It’s one of the hottest ideas in tech right now -- even if we’re totally lacking the resources we need to support it.

For Tamara Budec, an executive with data services provider Digital Realty, the building of the physical layer for the Internet of things has barely begun, and moving forward will require constructing new clusters of data centers and also and freeing up more wireless spectrum.

There are also questions of how to build in global security and privacy controls, according to Jai Menon, VP and chief research officer at Dell Research. The challenge is especially daunting, Menon said, given the sheer scale of data that can now be collected. He pointed out that capturing all the information points generated by New York City’s taxi fleet would produce an unmanageable 26 exabytes a year.

Menon also noted that building an infrastructure for the Internet of things will involve constructing not only physical plant, but next-generation analytic tools that are not just predictive, but prescriptive too -- for instance, sensors that would not just predict a storm tomorrow, but also be capable of sending emergency responders to meet it.

Mobile video watching up 532 percent in two years, study says

Smartphones and tablets are playing a key role in the consumption of online videos, a new study from video technology company Ooyala shows. During the first quarter of 2014, 21 percent of all online video-plays around the world were completed through mobile devices or tablets, Ooyala reported.

In the first quarter of 2012, that figure was at 3.4 percent. It jumped to 9 percent in the first quarter of 2013. The massive growth in online video consumption via mobile devices has changed the paradigm in content availability. Since 2012, mobile and tablet video viewership is up 532 percent.

The data is an important consideration for broadcasters. Over the last couple of years, several companies, including most notably Microsoft with its Xbox One, have been promoting the benefits of multiscreen viewing.

Microsoft in particular believes that there's an opportunity for broadcasters to share relevant content to viewers on their mobile devices as they're viewing something on their televisions. Other companies are eyeing the ways in which tablets and smartphones can be integrated into the viewing experience, though no single firm has established itself as the leader in the multiscreen space.

Ooyala CEO Jay Fulcher said companies need to think about multiscreen viewing to "build a fundamentally better video business."

How New York could put a stop to Comcast’s merger with Time Warner Cable

Comcast's bid to win over regulators for its proposed merger with Time Warner Cable has mostly focused on Washington, where the cable company has testified before Congress, met with officials and given millions of dollars in political donations. But now, Comcast is devoting its attention to regulators a little farther north of the nation's capital. And wooing these folks will be no less important to the merger's outcome.

Since recent changes in the state's cable franchise laws, New York has vowed to take a close look at the Comcast-Time Warner Cable merger. In May, Gov Andrew Cuomo (D-NY) pledged a "hands-on review" of the proposal, and afterwards, the state public service commission (PSC) will hold the last of three hearings to consider the acquisition. If Comcast fails to convince state regulators that buying up Time Warner Cable (TWC) would benefit consumers, the PSC has the power to block the merger from happening within the state, says Brad Ramsay, the top lawyer for the National Association of Regulatory Utility Commissioners.

"They can't stop the entire merger, but they can stop the part that involves facilities in the state of New York," Ramsay said in an interview. "Would that require [Comcast] to go back to the drawing board? Well, if it's central to the synergies in this merger, sure."

How important is it that Comcast get New York's blessing? Look at it this way: Comcast has a fraction of the customers in New York that TWC has -- 23,000 versus more than 2.5 million. Considering that the entire merger nationwide would give Comcast control over 30 million subscribers, New Yorkers alone would account for nearly 10 percent of merger company's total customer base.

T-Mobile Uses Data Caps to Manipulate Competition Online, Undermine Net Neutrality

[Commentary] T-Mobile’s announcement that they will exempt a handful of music streaming services from their data cap is but the latest example of ISPs using data caps to undermine network neutrality.

T-Mobile now joins Comcast, AT&T, and AT&T again as an ISP that uses data caps as a pretext to manipulate how its users experience the Internet. Unlike other carriers, T-Mobile does not have a data cap with overage penalties. Instead, when users hit their cap they find their connection slowed significantly.

While this type of throttling is probably preferable to huge overage fees, it still exerts a strong influence on what types of services T-Mobile subscribers use online. This influence is strengthened enormously when certain apps or certain content is exempted from the cap -- a practice known as “zero rating.”

This type of gatekeeping interference by ISPs is exactly what net neutrality rules should be designed to prevent. Furthermore, T-Mobile’s announcement once again calls into question the purpose of data caps at all.

NABOB On Nexstar-Marshall Deal: Yes, But

The National Association of Black Owned Broadcasters has asked the Federal Communications Commission to approve joint sales agreement waivers that would clear the way for Nexstar Broadcasting Group’s $58.5 million proposed sale of three Fox affiliates to minority-owned Marshall Broadcasting Group.

But in its June 18 filing at the FCC, NABOB also said the agency should require Nexstar and the newly formed MBG to answer additional questions about their proposed deal. Also, according to the filing, NABOB wants the FCC to subject approval of the deal to annual reporting requirements.

Among the additional questions that NABOB wants answered are whether the parties have a plan in place for the brokered stations to develop their own sales forces during the terms of the JSAs, and how payments to the brokering stations will affect the brokered stations.

“The Video Marketplace: A Modern Viewpoint”

I want to discuss the incredible vitality of today’s video marketplace and how the FCC needs to modernize its rules to reflect current realities.

Digitization and the Internet have driven a proliferation of new platforms for consumers, especially in the last decade.

To win subscribers, video providers are seeking to offer more types of content in order to differentiate themselves in the marketplace. And programming production and distribution businesses have started converging to meet the growing demand for high quality original programming.

To realize the full benefits of this dynamism, the FCC should acknowledge the fierce competition that exists and it should get rid of regulations that no longer make sense.

I will make the analogy that the FCC is poised at this pivotal moment just like the proverbial ostrich. This bird is known for being stubborn and sticking its head in the sand. Instead of speeding forward to recognize the marketplace realities, I worry the FCC is desperately clinging to existing rules that were written prior to the digital revolution, prior to Wi-Fi, and prior to the Internet.

Sources: July FCC Vote Expected On IP Clip Captioning

Broadcasters and cable operators may be battling over retransmission consent, but they are on the same side when it comes to closed captioning online clips of shows originally aired on TV.

The buzz around the commission is that the chairman is planning to circulate an item for a vote at the July 11 open meeting requiring broadcasters and cable operators to caption clips as well as long-form online versions of their shows.

In a joint filing, the National Association of Broadcasters and the National Cable & Telecommunications Association told the Federal Communications Commission they didn't think the FCC had the authority to regulate the captioning of online clips, but that if the FCC does, it should not make them responsible for those clips on third-party sites, including network web sites. NAB said the requirement would limit the number of clips that can be used and said a 24-hour deadline would be more reasonable.

It also said there were journalistic reasons why an uncaptioned version of a clip would be retained on a site along with a captioned version. NCTA urged the FCC to allow voluntary efforts to continue rather than imposing the clip mandate. It also urged the FCC to recognize the difficulty of captioning time-sensitive clips and its support for a 24-hour turnaround time.

Internet Tax Freedom Act Gets Bipartisan Push

Legislators from both parties and both houses of Congress are calling on House Leadership to bring the Permanent Internet Tax Freedom Act (ITFA) to the floor for a vote, and Senate leaders to pass a bill as well.

That came in a letter from the co-chairs of the Congressional Internet Caucus, ranking House Communications Subcommittee member Rep Anna Eshoo (D-CA) and House Judiciary Committee chairman Bob Goodlatte (R-VA), and Senate Judiciary chair Sen Patrick Leahy (D-VT) and Commerce Committee ranking member Sen John Thune (R-SD).

The bill, spearheaded by Rep Goodlatte, passed out of the House Judiciary Committee on a vote of 30 to 4. The moratorium expires in November if not renewed, and soon House and Senate members will be returning to the home front to get re-elected so the need for speed is an issue.

Justices limit patents on software technology

The Supreme Court has limited patent protection for "computer-implemented" inventions, including a range of software and data-processing systems, in a closely watched business case that attracted the attention of dozens of tech giants.

The justices ruled unanimously against an Australian company that sought exclusive intellectual property rights for INVENTCO, a computerized system for creating and exchanging financial instruments such as derivatives. The court concluded the idea would "add nothing of substance to the underlying abstract idea," since that idea had been longstanding, and merely programmed for use on a computer.

"Merely requiring generic computer implementation fails to transform that abstract idea into a patent-eligible invention," said Justice Clarence Thomas. Federal law says, "Whoever invents or discovers any new and useful process, machine, manufacture, or composition of matter, or any new and useful improvement thereof, may obtain a patent." But there are exceptions, including, "laws of nature, natural phenomena, and abstract ideas."

Benton

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