OWNERSHIP/MERGERS
Prometheus Radio Project v. FCC Oral Argument Report
Big Three Will Run World's Media, Says Murdoch
Comcast's Bid for Disney Ripples Through a Linked Industry
Cingular, Vodafone Show Their Cards to AT&T
Cellphone Merger Cure
ACCESSIBILITY
A New Cellphone Nods to the Needs of the Disabled
Censor 'Scooby-Doo'? Words Fail
BROADCASTING
Telecom Subcommittee Approves Indecency Bill
Public Telecommunications Facilities Program
TELEPHONY/BROADBAND
FCC Open Meeting Summary
Communications-related Headlines is a free online news summary service
provided by the Benton Foundation (www.benton.org). Posted Monday through
Friday, this service provides updates on important industry developments,
policy issues, and other related news events. Headlines are compiled by
Kevin Taglang (ktaglang( at )etpost.net) -- we welcome your comments.
OWNERSHIP/MERGERS
PROMETHEUS RADIO PROJECT V. FCC ORAL ARGUMENT REPORT
The Media Access Project has made available a report on the oral arguments
on the FCC's media ownership rules. Highlights of the oral arguments
include: 1) The court is very concerned that the diversity index is flawed
-- one judge characterized the diversity index as making "hypothetical"
assumptions when the FCC could have instead relied upon real market data.
The FCC included in the index TV stations that do not offer local news. 2)
One judge quoted the brief of United Church of Christ saying that while the
number of stations has increased, the number of owners decreased, and
challenged Clear Channel's lawyer's argument that a single owner owning
several radio stations could offer more diversity. 3) Public interest
lawyers showed that the FCC got its duty expressly backward as between
protecting competition and diversity. The law and facts show that rules to
protect competition are not enough to protect diversity: more restrictive
rules are needed to protect diversity than competition. 4) Lawyers showed
that the FCC failed to consider whether the UHF discount should be lowered.
5) The judges seemed to believe the FCC retains some ability to continue to
regulate in the public interest despite recent legislative changes in the
Telecommunications Act of 1996.
See the full report at the URL below.
[SOURCE: Media Access Project]
http://www.mediaaccess.org/MAPOralArg02-12-04.pdf
BIG THREE WILL RUN WORLD'S MEDIA, MURDOCH SAYS
"In three years the media scene will have at least three very big
competitive companies in Comcast, News and Time Warner, and several very
good and well-run smaller companies such as (US satellite pay-TV group)
DISH and (US cable group) Cox," said News Corp's Rupert Murdoch after
releasing the company's half-year results on Wednesday night. Comcast's
move is seen as a strong vindication of Mr Murdoch's strategy to build News
into a global content and distribution company. But Mr Murdoch did not
believe News would be disadvantaged by the might of the Comcast-Disney
group if that deal was approved. "We will have just as much ability to
pressure them as them us," he said.
[SOURCE: The Australian, AUTHOR: Jane Schulze and Geoff Elliott]
http://www.theaustralian.news.com.au/common/story_page/0,5744,8663759%25...
COMCAST'S BID FOR DISNEY RIPPLES THROUGH A LINKED INDUSTRY
What's the reaction of investment bankers to the Comcast bid for Disney?
They are suggesting that Time Warner make its own bid for Disney and
telling Viacom to make a run for satellite service EchoStar. Big media
companies are feeling pressure to get bigger, especially given the News
Corporation's acquisition two months ago of control of the satellite
service DirecTV. A company can't just be big in content or distribution; to
remain a player, it seems, a company needs to have both. But that trend may
mean less variety in new programming or make it harder for newcomers to
break into the business. "In a world where you have Warner Brothers, Turner
and AOL and Time Warner Cable and a WB Network in the control of one
company, and in a world where there is a DirecTV and a Fox and Fox Studio
and the Fox Cable networks," said Larry Gerbrandt, chief content officer of
the research company Kagan Media World, "Comcast can make a strong case
that this just gets them back to a level playing field. With some
relatively small exceptions, they have been pretty much at the mercy of the
content owners, the studios and the network owners without any means of
really effectively addressing their single largest expense, which is
programming costs." Fears of consolidation come not only from public
interest advocates. "These people essentially only accommodate each other;
there is no way in any more," said InterActiveCorp's Barry Diller of the
media giants.
[SOURCE: New York Times, AUTHOR: David Kirkpatrick]
http://www.nytimes.com/2004/02/13/business/media/13MEDI.html?pagewanted=all
(requires registration)
In a related article, the Wall Street Journal reports that if the deal goes
through, Comcast will have the power to decide when Disney's movies and TV
shows are released on cable services such as video on demand, threatening
to upend long-established ways of Hollywood.
http://online.wsj.com/article/0,,SB107663719354229166,00.html?mod=techno...
See also
WashPost: Will it Work?
http://www.washingtonpost.com/wp-dyn/articles/A37887-2004Feb12.html
CINGULAR, VODAFONE SHOW THEIR CARDS TO AT&T
Expect to see news by the end of the day that Cingular Wireless and
Vodafone have made official bids for AT&T Wireless. There is a 5pm deadline
for bids today and the board will consider offers this weekend. They are
currently six national U.S. wireless carriers, but price and marketing wars
have eroded profits. ''Cingular is by far the most likely buyer here, with
a straightforward deal, for a whole variety of reasons,'' said a Goldman
Sachs report out Thursday. Goldman cited Cingular's ability to generate
greater ''synergies,'' such as cost cuts, for the best investor returns.
[SOURCE: USAToday, AUTHOR:Andrew Backover]
http://www.usatoday.com/usatonline/20040213/5924807s.htm
CELLPHONE MERGER CURE
When cellphone prices drop because of competition, the historical cure has
been to merge with another company and losing a competitor. But that remedy
may not work any longer because of challenges from new technologies and a
rush of new entrants into the market. Mergers would likely have to shrink
the field of providers in half before they lead to higher prices and less
competitive behavior. One reason is that the big carriers sell their
services wholesale to resellers -- like Virgin -- who then retail to
targeted markets. Another factor is the growing popularity of Wi-Fi to
route calls over the Internet -- and avoid conventional cellphone networks
altogether.
[SOURCE: Wall Street Journal, AUTHOR: Jesse Drucker jesse.drucker( at )wsj.com ]
http://online.wsj.com/article/0,,SB107662632127528809,00.html?mod=home%5...
(requires subscription)
ACCESSIBILITY
A NEW CELLPHONE NODS TO THE NEEDS OF THE DISABLED
A complaint filed at the FCC against Verizon Wireless and cellphone maker
Audiovox has lead to the Toshiba VM4050 which can talk to users. In a
recorded voice, the phone tells a user, for example, that the battery is
low or the phone is in roaming mode. "This is certainly a significant step
forward," said Darren Burton, a technology associate for the American
Foundation for the Blind who is testing the phone. He said he most
appreciated the voiced reports on battery level, signal status, roaming,
new voice-mail messages and missed calls. But he said it still had "a way
to go'' in making other features equally accessible, like the phone's
menus, e-mail in-box, text messaging and Internet browser. Section 255 of
the Telecommunications Act of 1996 requires telephone makers and service
providers to make their products and services accessible to people with
disabilities. "We were hoping that Section 255 would be the impetus" for
improvements to cellphones, Dr. Bonnie O'Day said. "Unfortunately, we had
little compliance up until last year." See more at the URL below?
[SOURCE: New York Times (2/12), AUTHOR: Lisa Gurnsey]
http://www.nytimes.com/2004/02/12/technology/circuits/12phon.html
CENSOR 'SCOOBY-DOO'? WORDS FAIL
Department of Education grants for closed-captioning will be denied for
some 200 programs the Bush Administration has deemed inappropriate for the
funding, deciding that the shows don't fit the required definition of
"educational, news or informational" programming. "They've suddenly
narrowed down the definition of those three kinds of programming without
public input," says Kelby Brick, director of the NAD's law and advocacy
center. "Basically, the department wants to limit captioning to puritan
shows. The department wants to ensure that deaf and hard-of-hearing
individuals are not exposed to any non-puritan programming. Never mind that
the rest of the country is allowed to be exposed." (CBS is finding out that
that may not be true.) The Department of Education is refusing to reveal
the names of the panel members whose opinions determined the caption grants
and also won't disclose the new guidelines. By every appearance, the
government has changed its definition of what constitutes a caption-worthy
program. But it's keeping the new rules secret, Moffet writes in his
editorial. "They apparently used a panel of five individuals and then made
the censorship decisions based on the individuals' recommendations," Mr.
Brick says. "We have found the identity of one of the panelists. This
individual tells us that he never knew he was on such a panel and that his
views would be used for censorship. No panel was convened. The five
panelists were contacted individually and separately."
[SOURCE: Palm Beach Post (2/8), AUTHOR: Dan Moffett]
http://www.palmbeachpost.com/opinion/content/auto/epaper/editions/sunday...
BROADCASTING
TELECOM SUBCOMMITTEE APPROVES INDECENCY BILL
The House Telecommunications Subcommittee unanimously approved H. R. 3717
on Thursday, a bill that would increase the maximum fines ten-fold for
broadcast indecency. A number of amendments to the bill were introduced but
then removed as they are fine tuned or combined. Amendments would make
networks liable for indecent programming, make indecency an automatic
trigger for a license revocation hearing and bring violence under the FCC's
indecency purview as well. Expect to hear more about the bill after the
President's day break. Subcommittee Chairman Fred Upton hopes to send the
bill to President Bush in March.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA381263?display=Breaking+News
PUBLIC TELECOMMUNICATIONS FACILITIES PROGRAM
The Fiscal Year 2004 grant round of the Public Telecommunications
Facilities Program was published February 11. Public broadcast stations,
non-profit organizations organized for educational or cultural purposes,
state and local governments and Indian tribes are eligible for funds for
the planning and construction of public telecommunications facilities in
order to: 1) extend delivery of services to as many citizens as possible by
the most cost-effective means, including use of broadcast and non-broadcast
technologies; 2) increase public telecommunications services and facilities
available to, operated by, and controlled by minorities and women; and 3)
strengthen the capability of existing public TV and radio stations to
provide public telecommunications services to the public. About 100 grants
will be made; $19.75 million is available. Completed applications must be
received at the Public Telecommunications Facilities Program office no
later than 6:00 p.m., EST, on Wednesday, March 31, 2004.
[SOURCE: NTIA]
http://www.ntia.doc.gov/ptfp/attachments/FFO_Notice_04.htm
TELEPHONY/BROADBAND
FCC OPEN MEETING SUMMARY
The FCC held an open meeting and began a number of new rulemaking
procedures on Thursday Here are some highlights.
1) Internet Telephony (VoIP)
"IP networks cost much less to build and operate We will not dumb down the
genius of the Web to match the limited vision of a regulator," said FCC
Chairman Michael Powell as the Commission began a major proceeding to
examine opportunities that allow consumers greater choices created by voice
services provided over the Internet. It is also designed to provide a
measure of regulatory stability to the communications marketplace and to
further promote the development of these Internet-based services. The
Notice of Proposed Rulemaking (Notice) adopted today assumes not only that
Internet services should continue to be subject to minimal regulation, but
also that mechanisms to implement important social objectives, such as
public safety, emergency 911, law enforcement access, consumer protections
and disability access, may change as communications migrate to
Internet-enabled services. The Notice asks broad questions covering a wide
range of services and applications to differentiate between Internet
services and traditional telephony services and to distinguish among
different classes of Internet services. Specifically, the Notice asks
which regulatory requirements - for example, those relating to E911,
disability accessibility, access charges, and universal service - should be
extended to different types of Internet services. "Some of these goals may
well be achieved without heavy-handed regulation, but I am willing to
support targeted governmental mandates where necessary," said FCC
Commissioner Kathleen Abernathy. The Notice also asks questions on the
legal and regulatory framework for each type of Internet service and the
relevant jurisdictional considerations for each category.
Analysts do not expect many decisions by the FCC on the broader issues
until after the presidential election and any decision could be challenged
in court, as is often the case with telecommunications regulations
2) Separately, the FCC also adopted a Declaratory Ruling stating that
pulver.com's Free World Dialup (FWD) offering should remain free of
unnecessary regulation
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243869A1.doc
3) FCC Proposes Rules for Broadband Over Power Lines to Promote Broadband
Service to Underserved Areas and Increase Competition
The FCC proposed changes to certain technical rules that will foster
broadband deployment using the significantly untapped capabilities of the
nation's power grid, while safeguarding existing services against harmful
interference. The Part 15 rule changes, proposed in a Notice of Proposed
Rulemaking (Notice), set forth procedures to measure the radiofrequency
(RF) energy emitted by equipment used to provide broadband service over
power lines and establish particularized interference mitigation
requirements. By facilitating access to broadband over power lines (BPL),
the Commission takes a step toward increasing the availability of broadband
in rural and underserved areas because power lines reach virtually every
home and community in the country. In areas in which consumers already
have broadband access, BPL enhances competition by providing another
broadband alternative. These proposed changes will also facilitate the
ability of electric utilities to dynamically manage the power grid itself,
increasing network reliability.
[SOURCE: FCC]
http://www.fcc.gov
There's a lot of coverage of the FCC decisions; here are some links you may
want to check out.
Reuters: FCC Wades Into World of Internet Calls
http://www.reuters.com/newsArticle.jhtml;jsessionid=XQC2BRJUAZPVYCRBAE0C...
News.com: FCC: 'Pure' VoIP not a phone service
http://news.com.com/2100-7352_3-5158105.html?tag=nefd_top
LA Times: FCC Opens Study of Net Telephony
http://www.latimes.com/business/printedition/la-fi-fcc13feb13,1,6421628....
NY Times: F.C.C. Begins Rewriting Rules on Delivery of the Internet
http://www.nytimes.com/2004/02/13/technology/13net.html
Mercury News: FCC to take up Internet phone regulations
http://www.mercurynews.com/mld/mercurynews/business/technology/7935817.htm
USAToday: Few rules proposed for Internet calls
http://www.usatoday.com/usatonline/moneyindex12.htm
WashPost: FCC Considers Regulating Internet-Based Phone Calls
http://www.washingtonpost.com/wp-dyn/articles/A37745-2004Feb12.html
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...and we are outta here. Have a wonderful weekend. We'll be back on
Tuesday; enjoy the holiday.
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