May 2016

Verizon reaches deal with unions for 4-year contract

Striking Verizon employees may be back to work the week of May 31 after the company and its unions reached an agreement in principle for a four-year contract. About 39,000 Verizon Communications Inc. landline and cable employees in nine Eastern states and Washington (DC) have been on strike since April. They had been working without a contract since August.

Labor Secretary Thomas Perez said that the agreement is being written and will be submitted for approval from union members of Communications Workers of America and International Brotherhood of Electrical Workers. "I expect that workers will be back on the job next week," Perez said. Details of the contract were not disclosed. CWA President Chris Shelton said in a statement that the agreement is "a victory for working families."

Ten senators ask FCC to delay box plan

A bipartisan group of 10 Sens asked the Federal Communications Commission in a letter to delay a plan to open up the market for television set-top boxes until its effect on small providers can be studied. The letter adds to a list of upper chamber lawmakers who have expressed concerns about the plan. “While we appreciate your commitment to protecting consumers, we urge you to delay the video navigation device proceedings until the FCC sufficiently studies the specific costs and impacts of the proposal on rural consumers and small providers,” said the lawmakers. “Small providers will not be able to afford the costs that could be associated with building a new architecture to comply with the proposed rule.”

The letter was dated May 26 and released by the American Cable Association, a lobbying group for small cable providers. The signatories include both Republican and Democratic Sens, including Sens Cory Gardner (R-CO) and Bob Casey Jr. (D-PA). Several are from states with large rural populations. They join Senate colleagues who have already criticized the proposal put forth by FCC Chairman Tom Wheeler.

Sen Leahy: FCC Must Clarify Set-Top Proposal

Count Senate Judiciary Committee Ranking Member Patrick Leahy (D-VT) among the fans of the Federal Communications Commission's set-top box proposal but only if it protects multichannel video programming distributors (MVPD, or pay-TV) content and contracts. Ranking Member Leahy sent a letter to FCC Chairman Tom Wheeler (there were no co-signers), saying he supported the need for competition, though he characterized the proposal as "beginning a discussion of how best to [spur meaningful set-top competition] in today's environment."

Ranking Member Leahy agreed that rules were needed. He said that the "patchwork of state privacy laws and Federal Trade Commission enforcement alone are not adequate" and that consumers want the option of "breaking free" of rental boxes, but he said that should not mean fewer rights for consumers and programmers. While the letter's overall tone was supportive, it also echoed concerns MVPDs have raised about protecting content or denying functions via the forced disaggregation. The senator told FCC chairman Tom Wheeler he thought the "unlock the box" proposal—the FCC's brand for the Notice of Proposed Rulemaking on third-party navigation devices—would "put forward meaningful opportunity to increase consumer choice" but also said it needed "important clarifications."

FCC Releases Relay Services for Deaf Blind Order

In this Order, the Federal Communications Commission extends the National Deaf-Blind Equipment Distribution Program (NDBEDP), as a pilot program, for one additional year, until June 30, 2017. The NDBEDP provides up to $10 million annually to support programs that distribute communications equipment to low-income individuals who are deaf-blind.

The NDBEDP has operated as a pilot program since July 2012 and is currently set to expire on June 30, 2016. Extending the pilot program for an additional year will enable the NDBEDP to continue providing communications equipment to low-income individuals who are deaf-blind without interruption while the Commission completes the proceeding that is underway to adopt rules to govern a permanent NDBEDP.

Secret Text in Senate Bill Would Give FBI Warrantless Access to E-mail Records

A provision snuck into the still-secret text of the Senate’s annual intelligence authorization would give the FBI the ability to demand individuals’ e-mail data and possibly web-surfing history from their service providers without a warrant and in complete secrecy. If passed, the change would expand the reach of the FBI’s already highly controversial national security letters.

The FBI is currently allowed to get certain types of information with National Security Letters (NSLs) — most commonly, information about the name, address, and call data associated with a phone number or details about a bank account. Since a 2008 Justice Department legal opinion, the FBI has not been allowed to use NSLs to demand “electronic communication transactional records,” such as e-mail subject lines and other metadata, or URLs visited. The spy bill passed the Senate Intelligence Committee on May 24, with the provision in it. The lone no vote came from Sen Ron Wyden (D-OR), who wrote in a statement that one of the bill’s provisions “would allow any FBI field office to demand e-mail records without a court order, a major expansion of federal surveillance powers.” Sen Wyden did not disclose exactly what the provision would allow, but his spokesperson suggested it might go beyond e-mail records to things like web-surfing histories and other information about online behavior. “Senator Wyden is concerned it could be read that way,” Keith Chu said. It’s unclear how or when the provision was added, although Committee Chairman Richard Burr (R-NC) and Sen Tom Cotton (R-AR) have both offered bills in the past that would address what the FBI calls a gap and privacy advocates consider a serious threat to civil liberties.

Post-Merger, Charter Has the Scale to Start Thinking Beyond the Cord

A quixotic endeavor? Not to Rutledge. The Charter chairman and CEO, regarded as one of the cable biz’s top operational minds, has pledged to hire 20,000 employees post-merger to boost customer service, on top of the new company’s workforce of nearly 90,000. “We intend to continually improve the way we do business in order to be the very best at what we do,” he said after the three-way merger closed last week, following a year of regulatory reviews. He’s not all talk. Since taking the helm in 2012, Rutledge has upped Charter’s customer-satisfaction ratings on the American Customer Satisfaction Index, as TW Cable’s already bottom-of-the-barrel scores have drifted lower in each of the past four years. Charter held steady at 4.3 million residential cable TV subscribers at the end of 2015, flat for the year — but a win given that the pay-TV industry overall shrank by 385,000 subscribers (down 0.4%), according to Leichtman Research Group.

Rutledge’s initial focus will be the massive undertaking of integrating the three companies’ sales, billing, and technology teams and systems, which he has acknowledged will be a “tremendously complex” two-year process. For example, Charter will now have 11 regional operating divisions, up from four. But the potentially new-and-improved Charter may soon have to think outside the box. The company — along with its pay-TV peers and rivals — must face the increasing prospect of cord-cutting amid a groundswell of new broadband-video services. Analysts expect Charter, now that it has the muscle to negotiate more flexible programming deals, to break the unwritten rule of the cable fraternity and launch a nationwide internet-TV service. Dish Network has done that with Sling TV; AT&T is gearing up to take DirecTV over-the-top later in 2016; and Hulu has pegged a 2017 launch for a live TV package.

Facebook and the Republicans — Give Conflict a Chance

[Commentary] The recent flare-up between Facebook and conservatives will likely soon be forgotten. Facebook handled it brilliantly, comforting its critics through an open dialogue. Still, I wish Facebook had responded to inquiries from conservatives and government officials like Sen John Thune (R-SD), with the words Donald Trump used about the disclosure of his tax forms: “none of your damn business.” I concede that answer would have created a short-term PR nightmare. But in three ways it would have improved the groundwork for our country’s inevitable debate on the government’s role in regulating the political implications of large databases.

[Blair Levin is a Non-Resident Fellow at the Brookings Institute Metropolitan Policy Project.]

Newspapers escalate their fight against ad blockers

The newspaper industry is upping its tactics in the fight against ad-blockers. The Newspaper Association of America, the industry association representing 2,000 newspapers (including the Washington Post), filed a federal complaint against the ad-blocking industry on May 26, alleging that software companies which enable users to block ads are misleading the public. The complaint asks the Federal Trade Commission, the government agency that oversees trade practices, to investigate ad blockers that offer “paid whitelisting,” – a service which charges advertisers to bypass ad-blocking software – along with services that substitute ad blockers’ own advertising for blocked ads or get around publishers’ subscription pages.