BROADBAND
Fight For Internet Access Creates Unusual Alliances (NYT)
Inside the Tangles of AT&T's Web Strategy (WSJ)
INTERNET
Alta Vista Offering Free Internet Access (USA)
Tricky Issue in Gambling Case (CyberTimes)
Saudi Women Find Freedom on Web (SJM)
TELEPHONY
Don't Let Baby Bells Shirt Rules (USA)
The Regulators (WP)
5-Cent Long-Distance Puts AT&T on the Spot (USA Today)
TELEVISION
Advertising That the Whole Family Can Enjoy (WP)
Time Warner, Advance Suspend Plans For TV Network
Targeted at Women (WSJ)
MAGAZINES
Disney Said to Be Selling Fairchild Publications (NYT)
FCC REFORM
FCC Offers 5-Year Restructuring Plan To Speed Up
Policy-Making Process (WSJ)
Chairman Kennard Delivers to Congress Draft Strategic Plan for
21st Century (FCC)
BROADBAND
FIGHT FOR INTERNET ACCESS CREATES UNUSUAL ALLIANCES
Issue: Broadband
"In a field where exaggeration is common, it is fair to say that this issue
is regarded as the most important public policy question in
telecommunications for the decade," said Andrew Jay Schwartzman, president
of Media Access Project, which promotes consumer rights and diversity on the
airwaves. "In the near term," Schwartzman said, "there's billions of dollars
in revenue at stake. Over the longer term, the outcome of this fight will
play a large role in determining who will be the dominant telecommunications
and Internet players for the next decade. As a consequence, the bedfellows
are stranger than strange." A look at the "open access" issue and the fight
to open up AT&T's cable networks to competitive ISPs. Labaton explores some
of those unusual alliances -- like the one between David Kendall and Bret
Kavanaugh, two lawyers that argued opposite sides of the impeachment of
President Clinton. Consumer advocates have joined the anti-AT&T side, but
are somewhat uncomfortable working with telephone companies they have
criticized in the past. Although fewer than 1 million homes have broadband
Internet access, that number is expected to grow to 10-16 million by 2002
with 60-85% using cable connections. [Next week's Digital Beat will explore
the open access issue]
[SOURCE: New York Times (A1), AUTHOR: Stephen Labaton]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/13internet.html)
INSIDE THE TANGLES OF AT&T'S WEB STRATEGY
Issue: Broadband
AT&T is spending $120 billion to buy cable TV systems, in large part to
offer speedy Web service to customers in the U.S. But it faces several
predicaments that have the company in high-stakes, unresolved talks with
some of the Web's biggest players: Just what is going to pop up on the
computer screen at the other end of those cable lines? Some have suggested
AT&T offer a link to AOL, the nation's biggest Internet service, with 18
million subscribers -- but AT&T has a complex relationship with the Internet
service provider Excite( at )Home. When AT&T bought the cable giant TCI last
March, it inherited a big minority stake in the Excite( at )Home. It also
inherited a contract making Excite( at )Home the exclusive online service for
AT&T's cable customers through 2002. In discussing the board structure with
respect to all of the companies involved in decision making processes,
Excite( at )Home President George Bell said, "We are made up of companies with
competing and cooperative relationships, so it is going to be a much harder
job to deal with all the issues facing us." Under the terms of Excite( at )Home's
agreements with its cable partners, AT&T can't cut side deals with other
Internet players such as AOL or Yahoo -- only Excite( at )Home can make those
deals. AOL wants to control customers' accounts -- handling billing and
service. AT&T at some point might consider a deal to give AOL access to its
cable lines -- but the company wants those customers to remain AT&T
customers. If tensions become too great and cable companies lose interest in
Excite( at )Home, the service will lose to the big phone companies pushing a
rival technology called digital subscriber lines or DSL.
[SOURCE: Wall Street Journal, B1, AUTHOR: Rebecca Blumenstein, Leslie
Cauley and Kara Swisher]
(http://interactive.wsj.com/articles/SB934495250507391754.htm)
INTERNET
ALTA VISTA OFFERING FREE INTERNET ACCESS
Issue: Internet Access
AltaVista became the first major site to offer free Internet access in the
United States with an announcement yesterday. The company hopes to make up
the lost subscription revenue by getting advertisers to ante up more. Even
AOL, which offers free access in Europe, has no plans to do so in the U.S.,
says spokeswoman Tricia Primrose. Consumers who use AltaVista's service will
be required to start surfing the Web from its home page. Users also will
have a constant ad in the corner of their computers. The company will not
sell the information consumers give up when they register, but it will
deliver ads based on the places that the consumer shops, says AltaVista
spokesman David Emmanuel. It is not clear whether other small companies that
offer free Internet access -- such as start-ups FreePC and NetZero -- can
make up the money they spend to acquire a customer with the advertisements.
Lisa Allen of Forrester Research said she's skeptical about the service:
"The revenue potential doesn't seem to be clear." But AltaVista's Charles
Rashall says that with 38 million monthly users, the company is confident it
can make enough on free access.
[SOURCE: USA Today, 1B, AUTHOR: Janet Kornblum]
(http://www.usatoday.com/life/cyber/tech/ctf842.htm)
See Also:
ALTA VISTA OFFERS FREE DIAL-UP INTERNET ACCESS
[SOURCE: San Jose Mercury, AUTHOR: Reuters]
(http://www.sjmercury.com/svtech/news/breaking/merc/docs/001961.htm)
ALTAVISTA UNVEILS FREE NET SERVICE THAT TARGETS ADS TO USERS' TASTES
[SOURCE: Wall Street Journal, AUTHOR: Interactive Journal News Roundup]
(http://interactive.wsj.com/articles/SB934473246829326966.htm)
TRICKY ISSUE IN GAMBLING CASE
Issue: E-Commerce
Justice Charles Edward Ramos of the New York State Supreme Court ruled that
operators of an Internet gambling casino based in Antigua violated New York
State and federal anti-gambling laws. Regardless of where the computer
server is located, an online gambling site creates a virtual casino within
a local user's computer terminal which can be penalized by local and
national laws which prohibit the promotion of gambling. This ruling could
also impact other forms of electronic commerce. Jack Goldsmith, a law
professor at the University of Chicago says it raises the question of how
far a Web site should go to protect itself. "What kind of precautions do
content providers need to take to avoid liability [in a state and from
unauthorized users or buyers] and make business flourish?" If a Web site,
for example, makes a good faith effort to screen out unauthorized users,
then local law should not apply to its actions, says Goldsmith. It will up
to the courts now to follow-up with Ramos' ruling, however, and decide.
[SOURCE: New York Times (CyberTimes), AUTHOR: Calr S. Kaplan]
(http://www.nytimes.com/library/tech/99/08/cyber/cyberlaw/13law.html)
SAUDI WOMEN FIND FREEDOM ON WEB
Issue: International
In January, the government of Saudi Arabia decided to allow local Internet
service providers to operate. Now there are an estimated 65,000 subscribers,
and the number is expected to nearly double by the end of this year.
Although there are no figures available on how many women subscribe are with
all the providers, one provider, AwalNet, offers a special branch for women
surfers -- a novel addition to the "ladies only" banks, schools and shops
that abound here, Sami reports. "It whetted my appetite to keep up with the
world," said Salwa Al-Qunaibet, a census bureau computer operator. "It gives
you more confidence when you can keep up with the world ... in knowledge, in
culture. Why should we miss out?"
[SOURCE: San Jose Mercury, AUTHOR: Mariam Sami, Associated Press]
(http://www.sjmercury.com/svtech/news/breaking/ap/docs/751101l.htm)
TELEPHONY
DON'T LET BABY BELLS SHIRT RULES
Issue: Regulation
[Editorial] Baby Bells still provide
97% of the local residential phone service in the US and the companies have
found a
way around the stipulations of the Telecommunications Act, which would have
spurred more local phone competition and more choices for consumers. Baby
Bells are not bridging the digital
divide as they are toting in their latest ad campaign with former
politicians. "Three bills already are in the hopper for long-distance data
transmission. And last week federal regulators eased restrictions on some
services" Baby Bells have just skirted their way around any legislation and
they are only working to upgrade the metropolitan lines that will make the
most money. "Before they get new freedoms, they need to allow consumers more
choices."
[SOURCE: USA Today, A14, AUTHOR: USAToday Editorial Staff]
(Article from 8/11/99 at http://www.usatoday.com)
THE REGULATORS
Issue: Telephony
Gone are the days when callers could pay for long-distance calls solely on
a per-minute basis. Long-distance charges now get tacked onto bills as
minimum usage fees, even for people who don't or barely use the service,
and the Federal Communications Commission Chairman William E. Kennard is
concerned. "I intend to
look very carefully at whether consumers who make very few calls even at
these historically low per-minute prices are disadvantaged by the flat
charges that long-distance companies choose to put on their bills" The
long-distance fees vary depending on the long-distance service provider
(AT&T, Spring, etc) for various reasons. The FCC said it will explore
whether "regulatory intervention" is needed. Some commissioners, though,
oppose questioning how these companies charge their customers.
[SOURCE: Washington Post (), AUTHOR: Lisa de Moraes]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/13/026l-081399-idx.html)
5-CENT LONG DISTANCE PUTS AT&T ON THE SPOT
Issue: Telephony
"We're not worried. MCI WorldCom is playing a one-dimensional game and this
is now a three-dimensional industry," said AT&T spokesman Mark Siegel.
Sprint and WorldCom announced plans to offer 5-cents-a-minute long-distance
calling plans to compete with AT&T's 10-cents-a-minute. Though some believe
AT&T is overpriced in this regard, the company has been trying to distance
itself from price-based marketing strategies and is building
on its bundling strategy offering discounts to customers who heavily use its
long-distance, wireless, calling card and other services. But some believe
AT&T might have to match Sprint and WorldCom's offer and face
not-so-positive results. "This is going to be a really interesting test for
AT&T," analyst Lisa Pierce of Giga Information said. "If they come out with
a me-too, 5-cents-a-minute calling plan, they are going to seriously
compromise their bundling strategy." In the meanwhile, AT&T studies its
competitors moves.
[SOURCE: USA Today, 2B, AUTHOR: Steve Rosenbush]
(http://www.usatoday.com/news/comment/ncguest.htm)
TELEVISION
ADVERTISING THAT THE WHOLE FAMILY CAN ENJOY
Issue: Media & Society
A group of advertisers called the Family Friendly Programming Forum has a
plan to curb all the sex and violence on television. The goals of the group
are: 1) to encourage more shows for family viewing in the 8-to-10pm block
of prime time, 2) announce an awards ceremony to recognize excellence in
family-friendly programming, 3) give the fledgling WB network some money to
pay for the writing of "family-friendly" scripts and 4) announce
scholarships to teach aspiring writers how to craft family-friendly
programming. According to the fine print in the forum's Web site, the
advertisers are not completely restricted from producing their "edgier"
content but can rest easy in publicly pronouncing their appetite for
family-friendly fare.
[SOURCE: Washington Post (C7), AUTHOR: Lisa de Moraes]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/13/098l-081399-idx.html)
TIME WARNER, ADVANCE SUSPEND PLANS FOR TV NETWORK TARGETED AT WOMEN
Issue: Television
Time Warner announced in June it would create a network targeted at women,
as well as a Web site, with Advance Publications' Conde Nast unit,
publishers of Vogue, Glamour and Mademoiselle. A similar women-oriented
cable network has long been in the works by Oxygen Media. But Time Warner
and Advance Publications have suspended plans for the women's network just
two months after announcing an ambitious strategy to combine their cable
assets and women's content. The network would have competed with Lifetime
cable network, which is a joint venture between Walt Disney and Hearst and
Oxygen. Chairman and Chief Executive Gerald Levin and Vice Chairman Ted
Turner of Time Warner believe that the expense associated with the channel
couldn't be justified because they need funding for other channels such as
one with cartoon material and one for entertainment of the southeastern
part of the U.S., which are in the works at present. TBS, the
cable-programming unit of Time Warner, said it "decided that it is not in
the company's best interest or in the best interests of our affiliates to
actively pursue the creation of the women's network at this time. We are
putting development of the network on hold." Time Warner and Advance's
decision will be a relief to Lifetime and Oxygen Media, which would have
had to fight it out in the increasingly crowded women's television market.
[SOURCE: Wall Street Journal, B8, AUTHOR: Martin Peers]
(http://interactive.wsj.com/articles/SB934499526290479530.htm)
MAGAZINES
DISNEY SAID TO BE SELLING FAIRCHILD PUBLICATIONS
Issue: Magazines
Walt Disney may be selling its magazine division to focus on its studio and
theme park divisions. Fairchild Publications includes W, Women's Wear Daily,
Los Angeles and Jane magazines. Bidders include Conde Nast and Hearst -- and
the price appears to be at least $650 million. Disney has been under
pressure from Wall Street to revive its core business and sell off
nonstrategic assets.
[SOURCE: New York Times (C1), AUTHOR: Alex Kuczynski]
(http://www.nytimes.com/yr/mo/day/news/financial/disney-mags.html)
FCC REFORM
FCC OFFERS 5-YEAR RESTRUCTURING PLAN TO SPEED UP POLICY-MAKING PROCESS
Issue: FCC Reform
Federal Communications Commission Chairman William Kennard has proposed a
five year plan to drastically alter the policy making process at the FCC.
Chairman Kennard wants to eliminate the existing industry bureaus, such as
mass media and wireless, and move to bureaus structured around tasks. The
bureaus he has proposed are enforcement, consumer information, licensing,
competition/policy and international. This plan is aimed at addressing
convergence. The FCC plan would effectively take all of the enforcement
people from the industry bureaus and put them all together to deal with
enforcement issues. The FCC has been under intense scrutiny by Congress for
being too slow in processing applications and new rules. Ken Johnson, a
spokesman for Representative Billy Tauzin (R-LA), Chairman of the House
Telecommunications Subcommittee, said, "Clearly it's a step in the right
direction." Chairman Kennard's plan needs congressional approval.
[SOURCE: Wall Street Journal, A6, AUTHOR: Kathy Chen]
(http://www.wsj.com)
CHAIRMAN KENNARD DELIVERS TO CONGRESS DRAFT STRATEGIC PLAN FOR 21ST CENTURY
Issue: FCC Reform
From News Release: FCC Chairman William E. Kennard delivered to Congress a
draft strategic plan for the future, entitled "A New FCC for the 21st
Century." "With this plan," Chairman Kennard noted, "the FCC is meeting the
challenge of reinventing itself to keep pace with the rapidly changing
communications industry landscape. We've developed a well-thought-out plan
that reflects input from consumer groups, industry, state and local
governments, the academic community, and FCC employees. It will allow the
FCC to enter the next century able to respond fully and quickly to emerging
technologies and the inexorable movement from regulation to competition. The
Commission looks forward to a constructive dialogue with Congress and a
continuing dialogue with all our stakeholders to ensure that this plan is
inclusive, and addresses the needs of the American people." The plan
envisions that in five years U.S. communications markets will be
characterized predominantly by vigorous competition that will greatly reduce
the need for direct regulation. The FCC as we know it today will be very
different both in structure and mission. As a result, the FCC must wisely
manage the transition from an industry regulator to a market facilitator.
The plan notes that the advent of Internet-based and other new
technology-driven communications services will erode the traditional
regulatory distinctions between different sectors of the communications
industry. The FCC's primary goals, however, of promoting competition in
communications, protecting consumers, and supporting access for every
American to existing and advanced telecommunications services will continue
unabated. What will change is the means and mix of resources necessary to
achieve these goals in an environment marked by greater competition and
convergence of technology and industry sectors. In this new environment, the
FCC must refocus its efforts from managing monopolies to addressing issues
that will not be solved by the market. To do this, it must: (1) create a
model agency for the Digital Age; (2) promote competition in all
communications markets; (3) promote opportunities for all Americans to
benefit from the communications revolution; and (4) manage the
electromagnetic spectrum (the nation's airwaves) in the public interest.
Throughout the plan, the FCC focuses in particular on consumer protection
and enforcement to ensure that consumers are empowered and treated fairly as
they navigate the new world of communications. For each of these goals, the
plan establishes specific objectives and policy initiatives. To assess
whether the FCC is on track in achieving these goals, there are specific
performance measurements to be achieved within five years on key dimensions
such as industry outcomes, consumer benefits, and Commission output. The
plan also notes where statutory changes may be necessary to achieve the
goals and includes a summary of those proposals. The plan recognizes that it
is necessary to restructure the way the FCC is organized to reflect changes
in the regulatory landscape. In addition, the FCC must streamline its
licensing activities, accelerate the decisionmaking process, and allow the
public faster and easier access to information through increased automation
and efficiency. The FCC must become a "one-stop, digital shop" where
form-filing and document-location is easy and instantaneous. This draft
plan was developed in consultation with the senior management of the
Commission. In addition, four forums were convened to get input from FCC
stakeholders -- industry, consumers, state and local governments, academia,
and FCC employees. It will continue to be refined after further discussion
with these stakeholders and with Congress. The plan is available on the
Internet at http://www.fcc.gov/21st_century/. Paper copies are available
from ITS, the FCC's duplicating contractor, at (202) 857-3800.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Miscellaneous/News_Releases/1999/nrmc9059.html)
--------------------------------------------------------------
This is the last day for Headliner Debbie Becht; thanks for the great work,
Debbie, and best of luck in school.
...and we are outta here.