INTERNET
Internet Tax plan Likely to Deadlock (USA)
Media Giants' Net Change (USA)Dot-Com Ads Surpass $1 Billion (SJM)
Read All About It! Internet Not Killing Newspapers (SJM)
E-COMMERCE
Stanford Creates E-Commerce Center (NYT)
TELEPHONY
MCI's Fine Art of Fine Print (WP)
U.S. Hires Stephen Axinn to Review the MCI WorldCom-Sprint Merger
(WSJ)
INTERNET
INTERNET TAX PLAN LIKELY TO DEADLOCK
Issue: Internet/Regulation
The Clinton administration's decision to oppose plans for making the
Internet a tax-free zone is expected to block the Advisory Commission on
Electronic Commerce from recommending that goods bought online be exempt
from sales taxes. The commission is composed of 19 business, government and
consumer representatives and will be meeting for its third session today and
Wednesday in San Francisco. The panel faces a deadline of April 21 to report
to Congress. The Clinton administrations' refusal to back plans to make the
Internet tax-free is the first of its kind. The Clinton administration,
which has three members on the commission, voiced deep concerns Friday about
making online purchases tax-free, making it nearly impossible for the
panel's
chairman, Virginia Governor James Gilmore, to gain the necessary two-thirds
majority for a ban on Internet sales taxes. The panel appears equally
unlikely to endorse a National Governors' Association plan that would
establish a voluntary system for online merchants to collect sales taxes.
The most likely scenario would be an endorsement of one of three less
controversial positions: banning taxes on Internet access, opposing
international tariffs on electronic commerce and eliminating the existing 3%
federal tax on telephone service.
[SOURCE: USA Today (2A), AUTHOR: Richard Wolf]
(http://www.usatoday.com/usatonline/19991214/1750374s.htm)
MEDIA GIANTS' NET CHANGE
Issue: Internet/Media
This time last year, executives assured analysts that their companies had
Web ventures even though most were ancillary businesses put in place to
capture any lucrative overflow if the Internet became a profitable media
force. Last week at the PaineWebber Annual Media Conference however,
companies such as Time Warner, Walt Disney's Go.com, Seagram, News Corp.,
Viacom and USA Networks had a different message. Not only are they deeply
integrating the Internet into their businesses they are integrated it into
almost everything they do. What accounts for the change? Internet companies
have given large businesses in the physical world the financial freedom to
rush into the new world by advertising on established media. But executives
are not spending heavily in new media just because they have a lot of cash.
They see the investments as safe, expecting them to eventually become
profitable. Some say that the marketing firepower of existing media, plus
their strong balance sheets, will make it impractical for upstarts to take
the Internet from these large companies by storm. USA Networks CEO Barry
Diller also sees an end coming to the Internet's frontier days. "If we do
our work well,'' he says, ''in a couple of years the barriers to entry for
those who want to enter the local (information and e-commerce) world will be
high."
[SOURCE: USA Today (3B), AUTHOR: David Leiberman]
(http://www.usatoday.com/usatonline/19991214/1750337s.htm)
DOT-COM ADS SURPASS $1 BILLION
Issue: Advertising
Internet companies are boosting their advertising in traditional media. For
the first time ever, ad buying by Net firms surpassed $1 billion, said
Competitive Media Reporting a research company that tracks ad spending. The
report said dot-com companies spent $1.37 billion on advertising in
traditional media in the January-September period, up from $349.1 million a
year ago. First was network television at $278.3 million, magazines were
second at $265.2 million. Those figures represented an increase of more than
fourfold for network TV and a near tripling for magazines compared with a
year ago. The rest include Cable TV at $202 million, local television at
$166.9 million, local radio at $154.6 million, national newspapers at $148.7
million, other newspapers got $69.4 million, network radio got $43.1
million, outdoor media had $24.6 million and Sunday magazines attracted
nearly $7 million from dot.com advertising. The online broker E*Trade was
the biggest dot-com advertising spender at nearly $89 million for the first
nine months of the year.
[SOURCE: San Jose Mercury, AUTHOR: Skip Wollenberg - Associated Press]
(http://www.sjmercury.com/svtech/news/breaking/ap/docs/1184641l.htm)
READ ALL ABOUT IT! INTERNET NOT KILLING NEWSPAPERS
Issue: Old Media vs. New Media
Monday, a report published by the Newspaper Association of America called
"Synergize for Success" showed that more people actually read newspapers
online than buy the ink-stained version. It showed that among all adults,
57% read a daily newspaper and 67% read a Sunday newspaper -- but the
numbers rise for adults who call up newspapers online, with 67% reading
dailies and 78% checking out Sunday editions. The poll of 3,693 people age
18 or over, showed that even though more and more are reading newspapers
online, Americans are not abandoning the traditional form. Only 15% said
they read a printed newspaper less frequently since going online and 8% said
they use it more. A majority, 74%, said there has been no change in their
printed newspaper reading habits since they began reading online.
[SOURCE: San Jose Mercury, AUTHOR: Steve James - Reuters]
(http://www.sjmercury.com/svtech/news/breaking/internet/docs/1184884l.htm)
E-COMMERCE
STANFORD CREATES E-COMMERCE CENTER
Issue: E-Commerce
Stanford University has received $20 million from several companies to open
a Center for Electronic Business and Commerce at Stanford Graduate School of
Business. Business school dean Robert Joss said the new center will develop
research and education initiatives needed to understand the impact of
information and communication technologies on firms, industries, and
markets. "The impact of electronic commerce on all aspects of business will
be profound," Joss said. Stanford Business School is among a small number of
leading business schools that have a course on electronic business as part
of its core curriculum.
[SOURCE: New York Times, AUTHOR: Associated Press]
(http://www.nytimes.com/library/tech/99/12/biztech/articles/14stanford-ecomm
erce.html)
MCI'S FINE ART OF FINE PRINT
Issue: Telephony
Some business customers are disturbed to discover that their only option in
resolving a billing dispute with MCI Worldcom over $10,000 is through
private mediation. Many clients are unaware of this rule until they have a
problem, because MCI has buried the arbitration requirements in a truly
obscure document--its tariff filing at the Federal Communications
Commission. "There needs to be something more than [tariff filing] to let
the consumer know they're waiving the right to jury trial," said lawyer Alan
Kaplinsky. Companies are also concerned about MCI's private agreement with
JAMS/Endispute, the arbitration firm that has settled all of its cases since
1994. "JAMS, as a for-profit entity, depends upon MCI's business and has a
strong vested interest in keeping MCI happy," said a complaint on the
matter, filed with the FTC by Innkeepers' Telemanagement & Equipment (ITEC).
[SOURCE: Washington Post (E1), AUTHOR: Caroline E. Mayer]
(http://washingtonpost.com/wp-srv/business/feed/a54475-1999dec14.htm)
U.S. HIRES STEPHEN AXINN TO REVIEW THE MCI WORLDCOM-SPRINT MERGER
Issue: Merger
Justice Department hired a well-known Wall Street antitrust lawyer, Stephen
Axinn, to review the merger between MCI Worldcom and Sprint. A Justice
Department official confirmed Axinn had been hired as a consultant, saying
the move "reflects the importance of the matter, but should not be viewed as
suggesting that we are leaning one way or another on the merits of the
merger." The Justice Department's review of the deal, which could take six
months or more, will focus on the companies' Internet data-transmission
service and on dominance of residential long-distance. Approval of the deal
could come only with divestitures that address any Justice Department
antitrust concerns.
[SOURCE: Wall Street Journal, AUTHOR: John R. Wilke]
(http://interactive.wsj.com/articles/SB945140016472123445.htm)
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