BENTON'S COMMUNICATIONS-RELATED HEADLINES for TUESDAY, MARCH 29, 2011

Today: BTOP Summit http://benton.org/node/54061

AT&T|T-MOBILE
   Sprint Opposes Proposed AT&T Acquisition of T-Mobile USA
   Moody's says JPMorgan's $20 Billion Loan to AT&T for T-Mobile Deal "Credit Negative"
   Looks Like a Duopoly
   AT&T Outguns Sprint in Lobbying
   Lobbyists dial into debate on AT&T deal
   Black Caucus a player in AT&T|T-Mobile merger
   AT&T merger could swell ranks of Communications Workers of America
   AT&T Internet customers, your service contract is changing

MORE ON WIRELESS/SPECTRUM
   FCC network neutrality rules and efficiency
   AT&T admits to slowing down the Motorola Atrix and HTC Inspire
   Ham radio operators concerned about losing band
   What's Yours Is Mine: Using a Wireless Network You Don't Own

INTERNET/BROADBAND
   The Community Broadband Fight In North Carolina
   Co-op Tactics for Community Broadband
   Daily's Hierarchy Of Broadband Needs

OWNERSHIP
   eBay acquires GSI Commerce for $2.4 billion

TELEVISION/RADIO
   ICANN Requests Independence
   TV Station Groups Post Huge Gains
   How to Make TV Even Better
   NPR suspends search for senior news exec
   Dispute Over Time Warner Cable’s Streaming to iPad Bursts Into the Open
   FCC Source: Justice Undecided On Fox Profanity Appeal
   Time for a Sequel to AOL-Time Warner?
   Netflix and others are changing the way we pay for video

CHILDREN AND MEDIA
   President Obama: Tech in schools 'not a magic bullet'
   Digital literacy mortally wounded in budget battle
   Social Media and Kids

PRIVACY
   FTC Official: Cases Against Twitter, Chitika Provide Roadmap To Privacy Enforcement
   Data brokers and scrapers feast on freely divulged personal data

POLICYMAKERS
   Chairman Darrell Issa bloated Julius Genachowski's visits
   A well-tread path from DC to Silicon Valley
   Senate Commerce postpones cybersecurity hearing
   Facebook Prepares to Add Friends in Washington
   Tech Goliath Apple Has David Mindset in DC

STORIES FROM ABROAD
This headline is presented in partnership with:

   Europe and US converging on Internet privacy
   Australia's Broadband Law Passes Parliament
   Australian government guarantees pricing on NBN upgrades
   Australian Senate Passes Key Broadband Bill
   How wiring the developing world can help save the planet
   Sentech outlines new broadband plan
   Baidu Plans Anti-Piracy Steps for Online Library

MORE ONLINE
   Digital Spaces and the Future of Free Speech
   Global Networking Technologies Guilty of Defrauding E-rate Program

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AT&T|T-MOBILE

SPRINT OPPOSES MERGER
[SOURCE: Sprint, AUTHOR: Press release]
Sprint Nextel, the nation’s third largest wireless provider and a leader in advanced wireless broadband technologies, announced its opposition to AT&T’s proposed $39 billion takeover of T-Mobile USA. The transaction, which requires the approval of the Department of Justice and the Federal Communications Commission, and will likely spark a host of hearings in the U.S. Congress, would reverse nearly three decades of actions by the U.S. government and the courts that modernized and opened U.S. communications markets to competition. The wireless industry has sparked unprecedented levels of competition, innovation, job creation and investment for the American economy, all of which could be undone by this transaction.
AT&T and Verizon are already by far the largest wireless providers. If approved, the proposed acquisition would create a combined company that would be almost three times the size of Sprint in terms of wireless revenue and would entrench AT&T’s and Verizon’s duopoly control over the wireless market. The wireless industry moving forward would be dominated overwhelmingly by two vertically integrated companies with unprecedented control over the U.S. wireless post-paid market, as well as the availability and price of key inputs, such as backhaul and access needed by other wireless companies to compete.
“Sprint urges the United States government to block this anti-competitive acquisition,” said Vonya McCann, senior vice president, Government Affairs. “This transaction will harm consumers and harm competition at a time when this country can least afford it. As the first national carrier to roll out 4G services and handsets and the carrier that brought simple unlimited pricing to the marketplace, Sprint stands ready to compete in a truly dynamic marketplace. So on behalf of our customers, our industry and our country, Sprint will fight this attempt by AT&T to undo the progress of the past 25 years and create a new Ma Bell duopoly.”
Bill Barloon, Sprint's top congressional lobbyist, suggested Tea Party Republicans may bristle at the proposed mega-merger: "An important part of the Republican Party ran as anti-Wall Street, anti-large government, and anti-large corporation. They represent Main Street America and they know a lot of investment bankers are going to make money on this transaction. So, hopefully they will be receptive to our message."
In the wake of Sprint’s firm resistance Jim Cicconi, AT&T's chief of public affairs, told his competitor to mind its own business. “Rather than becoming distracted by challenging the business strategies of others," Cicconi, "we have always found that the most constructive course is to focus on our own strategies for serving our customers and building our business.”
benton.org/node/54140 | Sprint | The Hill
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AT&T'S RISKY LOAN
[SOURCE: Bloomberg, AUTHOR: Dawn Kopecki]
JPMorgan Chase & Co.’s decision to be the sole lender on a $20 billion loan to AT&T is a “credit negative” for the bank and may encourage other lenders to take on more risk, Moody’s Investors Service said. “JPM’s large AT&T commitment highlights how the risk profile of a capital markets business can change quickly,” analyst Sean Jones wrote in a research note. JPMorgan is the lone underwriter on the bridge loan to AT&T in its $39 billion bid for Deutsche Telekom AG’s U.S. wireless unit T-Mobile USA Inc. Moody’s called the deal a credit negative for JPMorgan’s corporate debt because it shows the bank’s willingness to finance riskier deals to win a spot as an adviser on the acquisition. Even by JPMorgan’s standards, the loan is big at 17 percent of the New York-based bank’s Tier 1 common equity as of Dec. 31, Moody’s said. It’s rare for a loan of that size to be concentrated at a single bank, according to Moody’s.
benton.org/node/54138 | Bloomberg | National Journal
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LOOKS LIKE A DUOPOLY
[SOURCE: New York Times, AUTHOR: Editorial staff]
[Commentary] AT&T and Verizon Wireless have emerged from a 15-year consolidation spree with almost two-thirds of American cellphone subscribers. Now AT&T wants to take this a step further. It is proposing to gobble up the No. 4 carrier, T-Mobile, in a $39 billion deal. The Department of Justice and the Federal Communications Commission must review the deal with much skepticism and block it if needed. As proposed, the acquisition would leave two companies with nearly 80 percent of the market and a weak third national carrier, Sprint, without the scale to compete effectively. In an industry where lack of spectrum imposes an enormous barrier to entry, cellular telephony in the United States could become an anticompetitive duopoly. This doesn't mean that AT&T’s proposed purchase of T-Mobile should be rejected. But the hurdle must be high: the FCC and the Department of Justice must ascertain that the arrangement does not reduce competition any further. In fact, for the acquisition to be deemed in the public interest, it should ideally lead to more competition. AT&T could be required to sell chunks of its network or divest swaths of spectrum. Regulators could impose conditions like mandatory data roaming on the AT&T network or a commitment to provide nondiscriminatory access to data from third parties on its wireless network. It is uncertain whether regulators could write conditions that would ensure strong enough rivals emerged to stand up as competitors to the two wireless giants. If they can't, they should not let the deal go through.
benton.org/node/54163 | New York Times
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AT&T OUTGUNS SPRINT
[SOURCE: Wall Street Journal, AUTHOR: Shayndi Raice]
As the regulatory battle begins over AT&T's proposed $39 billion purchase of T-Mobile USA, rival Sprint Nextel Corp. is at a big disadvantage to AT&T in a critical area: lobbying muscle. The company, the nation's No. 3 wireless operator by revenue, argues that the deal would stifle innovation and harm consumers by further entrenching a duopoly in which Verizon Wireless, the current market leader, and an expanded AT&T, now No. 2, would control most of the US wireless market. Sprint, however, spends just a fraction of what its competitors do on lobbying efforts. In 2010, the company devoted $2.5 million to lobbying, according to campaign contributions database OpenSecrets.org, compared with AT&T's $15.3 million. T-Mobile USA and its parent, Deutsche Telekom AG, spent $1.3 million and $3 million, respectively.
benton.org/node/54161 | Wall Street Journal
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AT&T'S LOBBYISTS
[SOURCE: Financial Times, AUTHOR: Matt Kennard]
Big corporate mergers usually pique the interest of a wide variety of interest groups, but eyebrows were raised when some of the first endorsements for AT&T’s acquisition of T-Mobile USA came from top black and Hispanic civil rights bodies, groups with little reason to take a position on the deal. Days after AT&T made its takeover bid, the Hispanic Federation and the National Association for the Advancement of Colored People, both heavily Democratic-leaning bodies focused on issues of racial equality, waded in to the debate, lauding the benefits for their members. It followed a glowing endorsement last Sunday, the day the deal was announced, from the influential Communication Workers of America union. “Today’s announcement of the acquisition of T-Mobile USA by AT&T is a victory for broadband proponents,” said Larry Cohen, president of the CWA. AT&T is the only major mobile phone operator to have a unionized workforce, so the CWA’s interest in the acquisition of a non-unionized company is clear. But there is no guarantee that T-Mobile USA staff will gain the same benefits as those enjoyed by AT&T workers, unless, analysts speculated, a deal had already been struck. What these swift endorsements reflect is the deep network of lobbying power that AT&T has built up over the past decade, as it developed a reputation as one of the slickest political operatives on Capitol Hill.
benton.org/node/54160 | Financial Times
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BLACK CAUCUS AND MERGER
[SOURCE: Chicago Sun-Times, AUTHOR: Laura Washington]
[Commentary] What do the Congressional Black Caucus and AT&T have in common? They share an “interest” in expanding broadband access and diminishing the nation’s digital divide. If the omnivorous AT&T wants to gobble up T-Mobile, it should include a little healthy altruism in its diet. Universal and cheap broadband would help. The nation’s inner cities suffer from countless festering maladies -- joblessness, troubled schools, wealth inequalities, just off the top. Securing digital connectivity among low-income and minority communities is a solvable problem. A 2009 study by the University of Illinois at Chicago and the University of Iowa found that 40 percent of all Chicagoans have little or no Internet access. Surveys showed that one in four Chicagoans are completely offline and another 15 percent have limited access. How about free Internet access for our kids? Enter the Congressional Black Caucus. Its 43 members represent urban and minority constituents in dire need of an economic lifeline across the digital divide. It can deploy its brand to provide cover for long-maligned corporate behemoths like AT&T. The caucus’ clout could be crucial to congressional approval. African-American political leadership is well-positioned to extract a pound of flesh in return for a helping hand. The merger partners want this one. Badly. They are eager to plow massive cash into winning congressional and government approval. This deal is a no-brainer for congressional Republicans, but a strange-bedfellow partnership between AT&T and black congressional leaders could help sway the U.S. Senate’s Democratic majority and build momentum for regulatory approval. It’s a historic opportunity for the CBC to reach out and touch the constituents it purports to serve. Free or reduced-rate Internet access can level the playing field for the digitally disadvantaged.
benton.org/node/54080 | Chicago Sun-Times
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AT&T DEAL COULD HELP CWA
[SOURCE: The Hill, AUTHOR: Sara Jerome]
If the merger of AT&T and T-Mobile is approved, T-Mobile USA's employees — who are not unionized — will become part of the Communications Workers of America (CWA). Stan Wylie, executive vice president at CWA Local 7800, near T-Mobile's hometown, said the merger may increase CWA's political clout. Thousands of local employees could become CWA members if the deal with AT&T is approved. "We know there are a lot of T-Mobile employees here who are looking forward to being represented, so we're looking forward to that," Wylie said.
benton.org/node/54136 | Hill, The
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AT&T CHANGES CONTRACTS
[SOURCE: Los Angeles Times, AUTHOR: David Lazarus]
All eyes might be on AT&T's pending acquisition of T-Mobile, but AT&T Internet customers shouldn't overlook some significant changes the company has just made to their service contract. Perhaps the most noteworthy addition is a new provision that allows AT&T to limit the online activities of heavy users. Customers who hog bandwidth by downloading high-definition movies or vast quantities of digital music slow the pipeline for everyone else, said AT&T spokesman John Britton. So now AT&T says it will impose caps on data use or limit a customer's download speed — or even impose additional fees — if they're slurping too much online soup. "People have a right to behave however they want online," Britton said. "But we have a right to manage the bandwidth so that everyone has a good experience. This is targeting the top 2% of people who use about 20% of the bandwidth." AT&T's contract changes include a few other eye-opening provisions. The company has inserted language allowing it to unilaterally upgrade a DSL user's service to U-verse. On the one hand, this is cool because U-verse is faster and more versatile than DSL. On the other, AT&T says U-verse would come with "applicable rates, terms and conditions, which may differ from your previous DSL service rates, terms and conditions." In other words, AT&T might charge you more for a level of service you never wanted or asked for. One other provision of note: AT&T's contract now stipulates that the company can cancel your service "if you engage in conduct that is threatening, abusive or harassing" to the company's workers, or for "frequent use of profane or vulgar language" when dealing with service reps.
benton.org/node/54134 | Los Angeles Times
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MORE ON WIRELESS/SPECTRUM

NETWORK NEUTRALITY AND EFFICIENCY
[SOURCE: Financial Times, AUTHOR: Thomas Hazlett]
[Commentary] MetroPCS is the first Internet service provider to be hit with a network neutrality complaint. The complaint is in response to the ways the company deals with its own limitations:
First, the $40 per month price tag extends a fat discount. Unlimited everything can cost $120 on faster networks. Second, it has also deployed new 4G technology, offering both a $40 tier similar to the 2G product (no video streaming), but also a pumped up version with video streaming, VoIP and everything else – without data caps – for $60 a month. Of course, this network has far larger capacity and is much zippier (reliable at 700 kbps). PC World rated the full-blown 4G service “dirt cheap”. Third, to upgrade the cheaper-than-dirt 2G experience, MetroPCS got Google – owner of YouTube – to compress their videos for delivery over the older network. This allowed the mobile carrier to extend unlimited wildly popular YouTube content to its lowest tier subscribers. Busted! Favouring YouTube is said to violate neutrality. The business plan contains differences that “lack any engineering merit”, and the option for consumers to access more content for a higher price irrelevant. Free Press asks, “What if that $60 unlimited plan were $100? What about $600?” The carrier responds that its customers really like YouTube and that they have no financial interest in the matter by making their subscribers happier. The Federal Communications Commission has already erred. Innovators such as MetroPCS and Google should need no defence in supplying customers’ superior choices. Neither consumers nor the Internet are “protected” by rules hostile to co-operative efforts – even if money were to pass between firms – that expand outputs and lower prices. If the FCC is to take such ill-targeted attacks on competitive rivalry seriously, it will do far more to deter the open Internet than to preserve it.
benton.org/node/54149 | Financial Times
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AT&T SLOWED PHONES ON ITS NETWORK
[SOURCE: ars technica, AUTHOR: Casey Johnston]
AT&T has admitted that it clipped the wings of its 4G network and is the reason that two recently released phones, the Motorola Atrix 4G and the HTC Inspire 4G, have dismal upload speeds. Carrier reps have promised that AT&T will fix the problem with a software update to the phones in April after many complaints were made to the Better Business Bureau. AT&T's HSUPA network has been up and running for some time now, but when 4G phones began entering the market recently, customers were surprised to find their upload speeds were no faster than 300kbps.
benton.org/node/54158 | Ars Technica
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HAM RADIO AND SPECTRUM
[SOURCE: USAToday, AUTHOR: Didi Tang, Malia Rulon]
Ham radio enthusiasts nationwide are concerned about a bill in Congress that they say would limit their ability to help in disasters and emergencies. Rep. Pete King (R-NY), chairman of the Homeland Security Committee, introduced legislation last month to reallocate some radio frequencies now used by ham radio to first responders responsible for public safety. To offset lost revenue from that change, the bill includes a provision that would allow the 420-440 MHz frequencies currently provided free to amateur radio to be auctioned off. Those frequencies are used not just by hobbyists but also by hundreds of thousands of Amateur Radio Emergency Service volunteers and severe-weather spotters working with National Weather Service.
benton.org/node/54151 | USAToday
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CHILDREN AND MEDIA

SOCIAL MEDIA AND KIDS: SOME BENEFITS, SOME WORRIES
[SOURCE: American Academy of Pediatrics, AUTHOR: Press release]
Pediatricians are adding another topic to their list of questions for visits with school-aged and adolescent patients: Are you on Facebook? Recognizing the increasing importance of all types of media in their young patients’ lives, pediatricians often hear from parents who are concerned about their children’s engagement with social media. To help address the many effects -- both positive and negative -- that social media use has on youth and families, the American Academy of Pediatrics (AAP) has issued a new clinical report, “The Impact of Social Media Use on Children, Adolescents and Families” in the April issue of Pediatrics (published online March 28). The report offers background on the latest research in this area, and recommendations on how pediatricians, parents and youth can successfully navigate this new mode of communication.
“For some teens and tweens, social media is the primary way they interact socially, rather than at the mall or a friend’s house,” said Gwenn O’Keeffe, MD, FAAP, co-author of the clinical report. “A large part of this generation’s social and emotional development is occurring while on the Internet and on cell phones. Parents need to understand these technologies so they can relate to their children’s online world ­ and comfortably parent in that world.”
The new AAP guidelines include recommendations for pediatricians to help families navigate the social media landscape, including:
Advise parents to talk to children and adolescents about their online use and the specific issues that today’s online kids face, such as cyberbullying, sexting, and difficulty managing their time.
Advise parents to work on their own “participation gap” in their homes by becoming better educated about the many technologies their children are using.
Discuss with families the need for a family online-use plan, with an emphasis on citizenship and healthy behavior.
Discuss with parents the importance of supervising online activities via active participation and communication, not just via monitoring software.
benton.org/node/54078 | American Academy of Pediatrics
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PRIVACY

FTC PRIVACY ENFORCEMENT
[SOURCE: MediaPost, AUTHOR: Wendy Davis]
The Federal Trade Commission seems to have stepped up its privacy enforcement efforts lately, but hasn't yet taken action regarding mobile privacy. But that could potentially change. The FTC's Maneesha Mithal, director of the division of privacy and identity presentation, told attendees at a Fordham Law event today that, even though the agency lacks jurisdiction over common carriers, it can take enforcement actions against app developers that engage in deceptive practices. What kinds of privacy practices would the FTC consider deceptive? Mithal said two recent cases offered insight. First, the FTC is concerned when companies don't keep users' data secure -- as happened when Twitter security glitches resulted in hackers gaining access to some users' names, passwords and private messages. The agency recently finalized a settlement with Twitter stemming from that data breach. Secondly, she says, failing to live up to promises in privacy policies can trigger FTC action. The agency recently settled with ad network Chitika for telling users they could click on a link to opt out of online behavioral targeting, but then setting those opt-outs to expire after only 10 days. Beyond that, while the FTC would like to see mobile app developers take privacy-friendly steps -- like shedding information as soon as it's no longer needed, and notifying cell phone users about data collection -- the agency doesn't appear to have the authority to force the issue.
benton.org/node/54087 | MediaPost
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POLICYMAKERS

ISSA VS GENACHOWSKI
[SOURCE: Politico, AUTHOR: Brooks Boliek]
Democrats on the House oversight committee accused the panel’s chairman of inflating the number of White House visits made by Federal Communications Commission Chairman Julius Genachowski to suggest the Obama Administration meddled in the development of network neutrality policy. According to the latest Democratic analysis of the meetings, Chairman Genachowski made only 34 visits to the White House between January 2009 and November 2010. That’s far shy of the 81 visits Oversight and Government Reform Chairman Darrell Issa (R-CA). Democratic staffers accused Issa of headline hunting. "He's sniffing into network neutrality because it is a hot-button issue," said one Democratic staffer. "This has almost become a pattern where they shoot off at the hip. It's become a pattern, and it's problematic and creating a distraction."
benton.org/node/54130 | Politico
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STORIES FROM ABROAD
This headline is presented in partnership with:

EUROPE AND US CONVERGING ON INTERNET PRIVACY
[SOURCE: Reuters, AUTHOR: Eva Dou]
For years the United States and Europe, with around 700 million Internet users between them, have diverged in their approach to policing the Web. But the two sides are converging in their Web privacy positions, partly through intensive meetings in recent months between regulators from Washington and Brussels. There are still many specifics to be worked out -- final legislative proposals are not expected from the European Union until later this year and the United States in June or July -- but officials are confident about steadily narrowing the gap.
benton.org/node/54111 | Reuters
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AUSTRALIA'S BROADBAND LAW PASSES PARLIAMENT
[SOURCE: Wall Street Journal, AUTHOR: Ray Brindal]
Australia's parliament has agreed on legislation that sets out the regulatory framework for the National Broadband Network, Minister for Broadband, Communications and the Digital Economy Stephen Conroy said. The legislation passed the House of Representatives on March 28, and included some amendments accepted by the Senate on March 25. "The bills set out a clear regulatory framework to provide that NBN Co. will operate on a wholesale-only, open and equivalent-access basis, delivering long-term benefits for competition and consumers," said Minister Conroy. Passage of the bills further underpins the government's policy to deliver structural reform of the telecommunications industry to promote sustainable retail-level competition, and fair pricing of wholesale services for all Australians, he said.
benton.org/node/54118 | Wall Street Journal
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