July 27, 2005

Large telephone companies gather today to ask -- what's in it for us in the
re-write of the nation's telecom laws. For upcoming media policy events,
see http://www.benton.org/calendar.htm

POLICYMAKERS
Bush's High-Tech Report Card
FCC Chief Pushes for Easing Rules on DSL Broadband
Broadband Consumer Choice Act
Rumors Suggest Meece, Tate as FCC Commissioners
Martin at NARUC
FCC May Consolidate Oversight Of Wireless Issues

CONTENT
Paid Product Placement Surges in Magazines, Newspapers, Other Media
Broadcasters, News Directors Defend Use of Video News Releases
Playola
FCC May Consolidate Oversight of Wireless Issues
The FAIR Ratings Act
Hillary vs. the Xbox: Game over

CABLE
Commercial Broadcasters Want a Free Ride at Everyone Else's Expense
McSlarrow Rips Bells' Hill Tactics
Comcast Mulls Sports Network to Rival ESPN
Telling the FCC about Comcast/TimeWarner/Adelphia

TELEPHONY
Lifeline Across America
Internet Phone Providers Given More Time on 911

QUICKLY -- What's the Matter with Indymedia?; Embracing the Future; Visit
the Past; Lawyers' Delight: Old Web Material Doesn't Disappear

POLICYMAKERS

BUSH'S HIGH-TECH REPORT CARD
Six months into his second term, some executives in Silicon Valley question
whether President Bush and key members of his administration really do "get
it" when it comes to high tech. They complain -- usually privately -- about
a lack of accomplishment on some major policy issues and a broader lack of
focus on what they consider a unique sector of the U.S. economy.
Increasingly, high-tech executives are turning to Congress to try to
address their needs. The Administration is criticized on a number of
industry priorities: 1) Failing to take more aggressive steps to expand
access to high-speed Internet services, allowing the United States to fall
from fourth in the world in broadband penetration in 2001 to 12th last
year, according to one leading gauge; 2) Not putting more money into basic
federal research at the National Science Foundation for engineering and
physics in the face of increased foreign competition; and most
disheartening to even strong Bush supporters, 3) new regulatory accounting
rules for stock options that many Silicon Valley companies adamantly oppose.
[SOURCE: Mercury News, AUTHOR: Jim Puzzanghera]
http://www.siliconvalley.com/mld/siliconvalley/12217418.htm

FCC CHIEF PUSHES FOR EASING RULES ON DSL BROADBAND
FCC Chairman Kevin Martin said he has circulated a proposal that would
treat digital subscriber line (DSL) broadband as an information service. If
approved, that would exempt it from most traditional telephone rules, such
as requirements to lease network access to competitors. Chairman Martin
said he has already "shared with my colleagues" a proposal that will give
telephone carriers the same regulatory framework as other providers. He
added, "The lack of regulatory parity between telecoms and cable is
inhibiting broadband growth."
[SOURCE: Reuters]
http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID...

BROADBAND CONSUMER CHOICE ACT
There's a buzz in Washington as Sen. Ensign (R-NV) said he will introduce a
comprehensive telecom bill, "Broadband Consumer Choice Act of 2005," today
that will include provisions on video franchising plus other elements
designed to boost competition within the industry. The bill is expected to
eliminate franchises for all local video
competitors -- in addition to "rewriting outdated telecom laws" (which is
the exact phrasing that can send shivers down the spines of public interest
advocates).
[SOURCE: Communications Daily]
(Not available online)

RUMORS SUGGEST MEECE, TATE AS FCC COMMISSIONERS
More DC telecom buzz... President Bush may name his nominees for two open
FCC seats by the end of this week. There are two rumored front runners: 1)
Mike Meece, a special assistant to the President and deputy director of
public liaison with a specialty in telecom and media issues. He was deputy
chief of staff to then-Commerce Sec Donald Evans. In his current role,
Meece represents the President on business issues in his area of expertise.
He deals closely with a variety of companies and business groups, speaking
and appearing at conferences. 2) Deborah Taylor was appointed in July 2002
to a 6-year term as director of the Tennessee Regulatory Authority. In
2003, then-FCC Chairman Michael Powell named her to the FCC's federal-state
joint conference on advanced telecom services. In 2005, she became Chairman
of NARUC's Washington Action Committee. She also serves on NARUC's
triennial review implementation task force and the consumer affairs and gas
committees. But don't ink there names in as FCC commissioners... there's
more names on a short list that includes Washington consultant Janice
Obuchowski, Richard Russell, associate dir. with the White House Office of
Science and Technology Policy (OSTP) and Suzie Terrell, a lawyer based in
New Orleans.
[SOURCE: Communications Daily, AUTHOR: Anne Veigle]
(Not available online)
See Taylor Tate's bio at:
http://www.state.tn.us/tra/tate/tatefullbio.htm
* FCC Vacancies Have Bevy Of Contenders
http://www.njtelecomupdate.com/lenya/telco/live/tb-QSRB1122409192514.html
* White House aide said to be top FCC contender
http://today.reuters.com/news/newsArticle.aspx?type=politicsNews&storyID...

MARTIN AT NARUC
FCC Chairman Kevin Martin spoke at the summer meeting of the National
Association of Regulatory Utility Commissioners on Tuesday. He said an
effective federal-state partnership in implementing public policy may mean
giving states more decision-making power. "The states have a larger role to
play than just being an enforcer," Chairman Martin said. "The FCC could
give states more flexibility to implement policy," as was done successfully
in some states with numbering administration. "But we in government must
ensure that the regulatory environment we create doesn't get in the way of
market forces. And our blueprints for change should also allow new
technologies to flourish." Martin, in his first address to NARUC since
becoming the FCC's head, said intermodal competition and new technologies
are eroding legacy universal service and intercarrier compensation regimes,
while regulatory uncertainties are slowing broadband deployment. Addressing
these breakdowns, he said, will require flexible federal and state policies
that are technology-neutral and apply evenly to all providers of particular
services. To reform universal service support, Martin said he still likes
the idea of basing universal service contributions on phone numbers, not
revenues, because this method is easy to administer and is within existing
FCC authority. He said it would apply to any service that uses phone
numbers, regardless of technology, would be easy for carriers and consumers
to understand, and would promote number conservation.
[SOURCE: Communications Daily]
(Not available online)

FCC MAY CONSOLIDATE OVERSIGHT OF WIRELESS ISSUES
Telecommunications industry officials are reacting favorably to reports
about a tentative reorganization of the FCC contemplated by agency Chairman
Kevin Martin. He is contemplating abolishing the Wireless
Telecommunications Bureau and splitting its functions into the existing
Wireline Competition Bureau and a new spectrum bureau or office. Martin
also is contemplating the creation of a homeland security division or
bureau that would centralize the functions pertaining to emergency
responders, whether through wireless or wire-based communications.
[SOURCE: Technology Daily, AUTHOR: Drew Clark]
http://www.njtelecomupdate.com/lenya/telco/live/tb-ZGEW1122408903073.html

CONTENT

PAID PRODUCT PLACEMENT SURGES IN MAGAZINES, NEWSPAPERS, OTHER MEDIA
A new report to be released today shows product placement is a much bigger
deal that has influenced virtually all forms of media, even supposedly
sacrosanct print outlets such as newspapers and magazines where paid
placements are that fastest growing segment of the business. Although
highly controversial, the total value of product placements in magazines is
on pace to grow 17.5 percent in 2005 to $160.9 million, and product
placements in newspapers is projected to rise 16.9 percent to $65.0
million, estimates PQ Media. While TV and films account for 90 percent of
all product placements, PQ estimates other media account for 18.1 percent,
or $384.9 million. The report reveals that product placement is influencing
every segments of media, including print, videogames, online, books and
even radio and recorded music. In fact, just about the only medium not
tracked in the report is outdoor and place-based media, which appear to
offer the ultimate panacea for the main factors driving product placement
deals: clutter, media multitasking and ad-skipping.
[SOURCE: Media Post, AUTHOR: Joe Mandese]
http://publications.mediapost.com/index.cfm?fuseaction=Articles.showArti...

BROADCASTERS, NEWS DIRECTORS DEFEND USE OF VIDEO NEWS RELEASES
In comments filed at the FCC, the National Association of Broadcasters
argued that more regulation of video news releases (VNRs) is not warranted
and could raise constitutional concerns. Use of VNRs does not violates
Commission rules on sponsorship identification, the NAB said. Those rules
require that when payment is received
by or promised to a broadcast licensee for airing material, the station
must disclose that fact at the time of airing and identify who made the
payment. But the Center for Media Democracy and Free Press called for
further disclosure of sources of material aired, including a frame-by-frame
visual notification of sources. The Radio-Television News Directors
Association countered saying such a requirement would burden broadcasters
and cable operators. The added requirements also would violate First
Amendment rights by dictating how VNRs are used. "In our democratic
society, it is axiomatic that decisions concerning how to contextualize a
story, inform the audience, or otherwise present news programming be left
to journalists, not dictated by the government" RTNDA said.
[SOURCE: Communications Daily]
(Not available online)

PLAYOLA
[Commentary] Perhaps the question is this: If you were a disc jockey or a
radio station manager, would the chance to play blackjack with Celine Dion
in Las Vegas induce you to put her single "I Drove All Night" on the air
more often? No one supposes that radio playlists are the results of pure
popularity or artistic merit -- not since the payola scandals of the late
1950's and early 60's. The radio map has changed entirely since then. It
has seen the near-demise of local stations, the rise of powerful national
networks like Clear Channel, the splintering of audiences and the
appearance of satellite radio. The radio spectrum at the moment includes
everything from ironclad rotations for mass markets to an untested merger
of radio and the Internet called podcasting. To the extent that they offer
payola, record companies will offer it only to the largest of these
outlets. As Eliot Spitzer, New York's attorney general, continues his
investigation, he would do well to look at those who are doing the taking
as well as those who are doing the bribing.
[SOURCE: New York Times, AUTHOR: Editorial Staff]
http://www.nytimes.com/2005/07/27/opinion/27wed4.html
(requires registration)
* Clear Channel Vows "Swift And Appropriate Disciplinary Action"
http://www.fmqb.com/Article.asp?id=103257

THE FAIR RATINGS ACT
There's a Senate Commerce Committee hearing this afternoon on the
"Fairness, Accuracy, Inclusivity, and Responsiveness in Ratings Act of
2005." Opponents are lining up against the legislation (see links below).
You can watch the hearing by checking out
http://commerce.senate.gov/hearings/witnesslist.cfm?id=1592 and you can
find the text of the bill on Thomas
http://frwebgate.access.gpo.gov/cgi-bin/getdoc.cgi?dbname=109_cong_bills...
[SOURCE: Senate Commerce Committee]
* More Groups Rip Burns Bill
http://www.multichannel.com/article/CA629555.html?display=Breaking+News
* More Groups Cry Foul Over FAIR Act
http://www.broadcastingcable.com/article/CA629510?display=Breaking+News&...
(free access for Benton's Headlines subscribers)
* Association of National Advertisers Opposes Ratings Bill
http://www.broadcastingcable.com/article/CA629494?display=Breaking+News&...
(free access for Benton's Headlines subscribers)
* Collins: No Minorities at MRC Hearing?
http://www.multichannel.com/article/CA629376.html?display=Breaking+News
* Collins Dismayed At "Colorless" Witness List
http://www.broadcastingcable.com/article/CA629354?display=Breaking+News&...
(free access for Benton's Headlines subscribers)
* CBS Exec Pushes Strong MRC
http://www.broadcastingcable.com/article/CA629562?display=Breaking+News&...
(free access for Benton's Headlines subscribers)

HILLARY VS THE XBOX: GAME OVER
[Commentary] The author of "Everything Bad Is Good For You: How Today's
Popular Culture Is Actually Making Us Smarter" suggests that Sen Hillary
Clinton's proposed $90-million study on the effects of video games on
children be expanded to include another game whose nonstop violence and
hostility has captured the attention of millions of kids -- a game that
instills aggressive thoughts in the minds of its players, some of whom have
gone on to commit real-world acts of violence and sexual assault after
playing: high school football. In defense of video games Johnson writes,
"The great secret of today's video games that has been lost in the moral
panic over "Grand Theft Auto" is how difficult the games have become. That
difficulty is not merely a question of hand-eye coordination; most of
today's games force kids to learn complex rule systems, master challenging
new interfaces, follow dozens of shifting variables in real time and
prioritize between multiple objectives. In short, precisely the sorts of
skills that they're going to need in the digital workplace of tomorrow."
[SOURCE: Los Angeles Times, AUTHOR: Steven Johnson]
http://www.latimes.com/news/printedition/opinion/la-oe-johnson27jul27,1,...
(requires registration)

CABLE

COMMERCIAL BROADCASTERS WANT A FREE RIDE AT EVERYONE ELSE'S EXPENSE
NCTA released a new paper Tuesday for anyone making weekend reading plans.
It serves as a rebuttal to National Association of Broadcaster claims about
must carry. 1) NAB asserts that the burden imposed on a cable system's
capacity by a multicast must carry rule is no more than that already
required under current law. 2) NAB alleges that cable operators are
"stripping" additional multicast programming services from the signals
carried on their systems, thus "depriving millions of Americans one of
the key benefits of the DTV transition." 3) NAB alleges that if
broadcasters are unable to obtain cable carriage for their multicast
signals, consumers will be penalized and deprived of local over-the-air
programming options. Conversely, they argue: if broadcasters receive the
assurance of carriage and fully develop their multicast services, consumers
will have another incentive to purchase DTV sets which will, in turn,
accelerate the transition. 4) NAB asserts that multicasting will enhance
viewers' programming options and encourage broadcasters to create
innovative new local content. 5) NAB asserts that consumers who have
digital TVs will receive little more "from their cable company than a
signal that has been turned back into analog format."
NCTA claims that both multicast and dual must carry are likely to be found
unconstitutional. The group concludes: "If Congress decides that the analog
spectrum needs to be returned before most television viewers are equipped
to receive digital signals, it can ensure that the transition to DTV
continues without unnecessary disruptions or additional costs. Cable
operators should be given the flexibility to carry down-converted signals
in lieu of digital signals and should retain the discretion to carry both
the down-converted and digital versions of those signals. Moreover, forcing
cable to carry multiple streams of duplicative broadcast programming,
regardless of its value to consumers, is not in the public interest and
will not speed the transition to digital television. Congress should reject
the broadcasters' attempts to insert multicast must carry provisions in
pending DTV legislation."
[SOURCE: National Cable & Telecommunications Association]
http://www.ncta.com/press/press.cfm?PRid=614&showArticles=ok

MCSLARROW RIPS BELLS' HILL TACTICS
Bad Bells. Bad, bad, bad. Complaining that telephone companies are
"cherry-picking to their hearts' content," National Cable &
Telecommunications Association President Kyle McSlarrow argued that telcos
looking to obtain cable franchises in order to compete with cable operators
should have to adhere to the same rules that govern cable operators. "The
question is: What are the rules of the road? Are the rules going to be what
cable has lived under for years, or are we just going to turn on a dime and
provide a different set of rules for different players?" McSlarrow
rhetorically asked. He went on to say that the Bells don't typically play
by anyone else's rules and they aren't asking for cable-like rules on
Capitol Hill, adding, "These are tough competitors. They're going to change
the rules if they don't like them. They're going to squash competitors."
[SOURCE: Multichannel News, AUTHOR: Steve Donohue]
http://www.multichannel.com/article/CA629511.html?display=Breaking+News
(requires subscription)

COMCAST MULLS SPORTS NETWORK TO RIVAL ESPN
Cable-television giant Comcast Corp. failed last year in an attempt to buy
Walt Disney Co. and its ever-burgeoning ESPN sports network. Now, the
Philadelphia-based company is exploring the possibility of mounting a
challenge to ESPN, the undisputed leader in TV sports programming. People
familiar with the company's plans say Comcast is interested in recasting
its quirky and low-rated Outdoor Life Network. While best known for its
coverage of Lance Armstrong's annual victory at the Tour de France, it is
also the home of professional bull riding, bear hunting and competitive
barbeque. But transforming the network to an ESPN-style contender would
require a major team sport, and people with knowledge of Comcast's plans
say the company is in serious negotiations with the National Football
League and National Hockey League, and also has its eye on Nascar auto
racing. ESPN already carries the NFL, as well as Major League Baseball, the
National Basketball Association, and virtually every other major college
and professional sport. The channel generates about $1 billion in cash flow
for parent Disney, according to industry research firm Kagan World Media.
Besides ESPN, there are five sister cable channels, a magazine and a
restaurant chain. Comcast does have significant resources. It is the
nation's biggest cable operator with more than 21 million subscribers, and
it posted revenue of $20.3 billion last year. Comcast already owns four
regional sports channels and it has a majority ownership of the
Philadelphia Flyers of the NHL and Philadelphia 76ers of the NBA.
[SOURCE: Wall Street Journal, AUTHOR: Joe Flint joe.flint( at )wsj.com and
Stefan Fatsis stefan.fatsis( at )wsj.com]
http://online.wsj.com/article/0,,SB112243020602197021,00.html?mod=todays...
(requires subscription)

TELLING THE FCC ABOUT COMCAST/TIME WARNER/ADELPHIA
Free Press has created an easy, online system for filing comments in the
Comcast/TimeWarner/Adelphia proceeding at the FCC. Just visit the URL below.
[SOURCE: Free Press]
http://www.freepress.net/fcc/comment.php?d=92-264

TELEPHONY

LIFELINE ACROSS AMERICA
The Federal Communications Commission (FCC) and the National Association of
Regulatory Commissioners (NARUC) have joined hands to launch "Lifeline
Across America," a nationwide program to draw more low-income consumers
into federal and state Lifeline and Link-up programs. These programs
provide for discounts to low income households for both the initial
installation of phone service (Link-Up) and monthly phone bills (Lifeline.)
The "Lifeline Across America" initiative includes: 1) A Best Practices
Working Group that will develop guidelines to help carriers target
consumers who are eligible for participation in the Lifeline and Link-up
programs. The working group is comprised of representatives from the FCC
and NARUC, and will include input from state and local government entities,
industry, tribes and consumer groups; 2) Joint Outreach Materials in
English and Spanish that will be distributed and available to targeted
audiences, including: consumer-friendly fact sheets, an eligibility
checklist, as well as other publications and marketing materials; 3) FCC
and NARUC Web Site Enhancements that will highlight the Lifeline and
Link-up programs and provide information in a consumer-friendly and
informative manner; and 4) Train-the-Trainer Program to educate state and
local government stakeholders about Lifeline and Link-up eligibility
requirements and procedures. Such program may be web-based to maximize
cost efficiencies. The FCC and NARUC will partner with relevant state and
local government entities, industry, tribes and consumer groups to
facilitate the training effort.
[SOURCE: Federal Communications Commission]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-260129A1.doc

INTERNET PHONE PROVIDERS GIVEN MORE TIME ON 911
Concerned by several high-profile incidents where people had difficulty
reaching emergency dispatchers, the Federal Communications Commission had
asked Internet telephone companies to obtain customer acknowledgments of
the limitations of the service by July 29. But to accommodate carrier
complaints that they could not meet that deadline, the FCC issued a notice
on Tuesday giving them until Aug. 10 to file a report detailing their
efforts to get such acknowledgments .
[SOURCE: Reuters, AUTHOR: Jeremy Pelofsky]
http://today.reuters.com/news/newsArticle.aspx?type=internetNews&storyID...
* FCC Public Notice
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-05-2085A1.doc

QUICKLY

WHAT'S THE MATTER WITH INDYMEDIA?
[Commentary] Conceived initially to allow everybody to 'be the media,'
Indymedia is plagued by everything from fascist messages to paralyzing
ideology to good old fashioned laziness.
[SOURCE: AlterNet, AUTHOR: Jennifer Whitney]
http://www.alternet.org/mediaculture/23741/

EMBRACE THE FUTURE
What does the newspaper industry need to do to survive? Simplify rate cards
to make it easier for businesses to advertise; invest in technology that
can deliver information to consumers in new ways; give consumers the power
to decide what information is of value to them; expand market share in
addition to protecting existing turf; and innovate, innovate, innovate.
Thoughts from the Newspaper Association of America's Future of Newspapers
Conference
[SOURCE: Presstime, AUTHOR: Jeff Lemberg]
http://www.naa.org/Presstime/PTArtPage.cfm?AID=7119

LAWYERS' DELIGHT: OLD WEB MATERIAL DOESN'T DISAPPEAR
The Web, seemingly one of the most ephemeral of media, is instead starting
to leave permanent records. Through the Wayback Machine, and similar
services offered by companies such as Google Inc., it's now easy to
retrieve all kinds of online material, from defunct Web pages to old
versions of sites. While these databases have caught on among historians
and scholars, they are proving particularly enticing for lawyers. At some
law firms, litigators now ask researchers, "can you do a Wayback on that?"
The archives are most attractive to specialists in intellectual-property
law -- in particular, areas such as domain-name battles.
[SOURCE: Wall Street Journal, AUTHOR: David Kesmodel david.kesmodel( at )wsj.com]
http://online.wsj.com/article/0,,SB112242983960797010,00.html?mod=todays...
(requires subscription)
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Way to go, Mad Dog! 3,001 and counting....
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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. While the summaries are
factually accurate, their often informal tone does not always represent the
tone of the original articles. Headlines are compiled by Kevin Taglang
(headlines( at )benton.org) -- we welcome your comments.
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