December 2014

Macmillan, Amazon Reach New Deal

Amazon and Macmillan have struck a new multiyear agreement covering the sale of print and digital books, according to a letter posted on one of Macmillan’s websites and signed by John Sargent, Macmillan’s chief executive.

The pact, which goes into effect Jan. 5, assures that Amazon will continue to sell and promote Macmillan titles without disruption during the ongoing holiday selling season. Under the new e-book contract, Macmillan will set the consumer prices of its digital titles. Macmillan, a unit of Germany’s Verlagsgruppe Georg von Holtzbrinck GmbH, owns such imprints as Farrar, Straus and Giroux, Henry Holt and Co., and St. Martin’s Press. Top-selling titles include “Killing Patton” by Bill O’Reilly and Martin Dugard, and the photo collection “Humans of New York” by Brandon Stanton.

FCC’s 17th Annual Report and Analysis of Competitive Market Conditions With Respect to Mobile Wireless

The Federal Communications Commission released its Seventeenth Mobile Wireless Competition Report, an analysis of commercial mobile radio services (CMRS) integrated into an analysis of all mobile wireless services, including not only voice, but also messaging and broadband.

Consistent with the FCC’s first seven Reports, and the Fourteenth and subsequent Reports, this Seventeenth Report does not reach an overall conclusion or formal finding regarding whether or not the CMRS marketplace is effectively competitive, but provides an analysis and description of the CMRS industry’s competitive metrics and trends. Given the complexity of the various inter-related segments and services within the mobile wireless ecosystem, the FCC refrains from providing any single conclusion because such an assessment would be incomplete and possibly misleading in light of the variations and complexities the commission observed. Rather, the report focuses on presenting the best data available on competition throughout this sector of the economy, both at the regional and national level, and highlighting several key trends in the mobile wireless industry.

FCC’s Wireless Telecommunications Bureau Issues Declaratory Ruling on Data Roaming

The Federal Communications Commission’s Wireless Telecommunications Bureau has granted a T-Mobile US petition for an expedited declaratory ruling in order to provide additional guidance on how to evaluate data roaming agreements under the standard set forth in Section 20.12(e) of the FCC’s rules.

This rule obligates facilities-based providers to offer data roaming arrangements to other such providers on “commercially reasonable terms and conditions.” Specifically, the petition requests guidance that, in evaluating data roaming disputes, the FCC will consider as potentially relevant whether proffered data roaming rates are substantially in excess of retail rates, international rates, and mobile virtual network operator (MVNO)/resale rates, as well as how proffered data roaming rates compare to domestic data roaming rates charged by other providers.

Additionally, the petition argues that:
(i) the presumption in the Data Roaming Order that the terms of an existing roaming agreement are commercially reasonable should be interpreted to apply only with respect to challenges to the terms of that agreement, and not to future agreements; and
(ii) the inclusion of the extent and nature of providers’ build-out as a relevant factor should not be interpreted to allow a host provider to deny roaming or charge commercially unreasonable rates for roaming in a particular area where the otherwise built-out requesting provider has not built out in that area.

Expansion of Online Public File Obligations To Cable and Satellite TV Operators and Broadcast and Satellite Radio Licensees

In this Notice of Proposed Rulemaking (“NPRM”), the Federal Communications Commission proposes to expand to cable operators, satellite TV (also referred to as “Direct Broadcast Satellite” or “DBS”) providers, broadcast radio licensees, and satellite radio (also referred to as “Satellite Digital Audio Radio Services” or “SDARS”) licensees the requirement that public inspection files be posted to the FCC’s online database.

In 2012, the FCC adopted online public file rules for broadcast television stations that required them to post public file documents to a central, FCC-hosted online database rather than maintaining the files locally at their main studios. The FCC’s goal was to modernize the procedures television broadcasters use to inform the public about how they are serving their communities, to make information concerning broadcast service more accessible to the public and, over time, to reduce the cost of broadcasters’ compliance. The FCC initiates this proceeding to extend its modernization effort to include the public file documents that cable operators, DBS providers, and broadcast and satellite radio licensees are required to maintain. While the FCC first included only television broadcasters in its public file database to “ease the initial implementation of the online public file,” television broadcasters have successfully transitioned to the online file over the past two years. Accordingly, the FCC now believes it is appropriate to commence the process of expanding the online file to other media entities in order to extend the benefits of improved public access to public inspection files and, ultimately, reduce the burden on these other entities of maintaining these files.

FCC Announces Deadline for Bidders Interested in Remaining Under Consideration for Rural Broadband Experiments Support to File Additional Information

The Federal Communications Commission established a process to enable the provisional selection of additional bidders for rural broadband experiments support in the event any of the current provisionally selected bidders defaults before the time the FCC’s Wireline Competition Bureau finalizes the list of census blocks that will be offered to the price cap carriers for Phase II of the Connect America Fund.

Specifically, all bidders in the rural broadband experiments that wish to remain in consideration for rural broadband experiments support must file their most recent three consecutive years of audited financial statements, including balance sheets, net income, and cash flow, as well as a description of the technology and system design that would be used to deliver voice and broadband service meeting the requisite speeds to all locations in the funded census blocks, including a network diagram, which must be certified by a professional engineer.

This information must be filed with the FCC in WC Docket No. 14-259 by 7p.m. EST on Tuesday, January 6, 2015.

Joint Statement of Commissioner Ajit Pai and Michael O'Rielly on the Abandonment of Consensus-Based Decision-Making at the FCC

Commissioner Pai: “The Chairman’s Office directed the Wireless Telecommunications Bureau to release today two major items. The first abdicates the annual responsibility Congress gave the Commission -- not the Bureau -- to make an assessment of the state of competition in the wireless industry. The second grants a T-Mobile petition that asked the Commission -- not the Bureau -- to regulate cellular data roaming rates by providing guidance on what the Commission meant in its 2011 data roaming order. FCC decisions issued on the Bureau level cut the Commissioners out of the decision-making process entirely. This is not how democracy works. And it’s not how the FCC in particular has ever worked.”

Commissioner O’Rielly: “In my time at the Commission so far, I have shown myself to be willing to vote quickly on items before me (although not everyone may always like how I cast my vote, especially if rushed). But on these and a number of other items, the full Commission has not been given any opportunity to consider and vote on -- quickly or otherwise -- the merits. I strongly object to the continued effort to delegate decision-making authority to the bureaus. I didn’t just go through the confirmation process in order to have bureaus and advisory committees make decisions that should be made by Commissioners. Both of these items should be brought before and debated by the Commission. These are not trivial items and, like all Commission decisions, would benefit from my colleagues’ input. I am especially concerned that today’s action will set precedent that will be used again and again.”

Dems to FCC: 'Time for action' on Web reclassification

A group of 36 Democrats are increasing their calls for the Federal Communications Commission to reclassify broadband Internet as a public utility. The lawmakers, including 12 senators and 24 House members, sent a letter to FCC Chairman Tom Wheeler urging the commission to adopt rules recently endorsed by President Barack Obama to enforce network neutrality, the view that all Internet traffic should be treated equally. They called for broadband Internet to be reclassified as a telecommunications service under Title II of the Telecommunications Act. But the lawmakers asked the commission to use "forbearance" to prevent some of the regulations from applying. Sen Ed Markey (D-MA) and Rep Anna Eshoo (D-CA) spearheaded the letter.

White House Promotes Title II Via Social Media

The White House is featuring network neutrality prominently on its home page, including the video President Barack Obama made promoting Title II, the same plan expanded upon in a statement on virtual White House letterhead, and a request to spread the word via social media. "President Obama is asking the FCC to keep the Internet open and free. Help spread the word -- share his plan with your friends and followers," says the White House, then directing readers to use the featured "Facebook" and Twitter" buttons.

Making the Internet a utility -- what's the worst that could happen?

[Commentary] There seems to be nothing the broadband industry fears more than Title II of the Communications Act. One big requirement Title II could bring is regulation of rates charged by Internet providers, either imposing a uniform limit on what all providers can charge or forcing each one to get permission for price increases and justify them based upon the amount they invest in their networks.

The Federal Communications Commission could also enforce “local loop unbundling”, but the National Cable and Telecommunications Association is confident the FCC won’t enforce that. "I think the thing that worries people the most is probably rate regulation,” said Steve Morris, NCTA's associate general counsel. More likely than rate regulation, though, is regulation of the interconnection deals Internet service providers strike with other large network operators such as Level 3 and Cogent and online content providers such as Netflix. “There’s no one who provides Internet access who said, ‘you know, I would invest more under Title II, this would help me introduce new services,’” Morris said. “It’s clear we’re talking about levels of bad and there’s no upside…For what consumers are getting today, they’re not going to get anything better under Title II, but it will get worse because their prices are going to go up, our cost of providing it is going to go up, our incentive to invest in it is going to go down. Let’s leave with that thought.”

Verizon: Interconnection is Not Net Neutrality Issue

Verizon told the Federal Communications Commission that it needs to keep the issue of interconnection and traffic exchange among networks separate from the open Internet proceedings and that, in any event, it cannot apply Title II regulations to interconnection, as some have proposed.

Verizon points out, as have others, that the FCC itself has historically deemed those interconnection agreements distinct from network neutrality. It also says those agreements are "quintessentially private carriage agreements and cannot be regulated as common carriage." Verizon says that net neutrality remains a last-mile issue, and that interconnection agreements are individualized responses to the business models of some content providers, like Netflix, which "have consumed an increasingly large share of Internet traffic." Verizon told the FCC that regulating interconnection agreements, "would only cripple this flexible, market-based dynamic that has played a key role in the explosive growth of the Internet."

Benton

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