March 21, 2011 (AT&T to Buy T-Mobile USA)
BENTON'S COMMUNICATIONS-RELATED HEADLINES for MONDAY, MARCH 21, 2011
CTIA Wireless 2011 and World Wide Mind kickstart this week http://benton.org/calendar/2011-03-20--P1W/
PUBLIC BROADCASTING
The NPR ‘emergency’
What the NPR fight is really about
Rep Amash cites unconstitutionality as reason for 'present' vote on NPR bill
Right Wing Hit Media 400: "Disabling Journalism to Destroy Progressive Thought"
See also: March Madness
INTERNET/BROADBAND
FCC National Broadband Plan One Year Later: Where Are We Now?
NC communities deemed unprofitable for broadband fight for right to build their own networks
NC Broadband Exemption would protect Fibrant
Adult content websites get .xxx domain
Rep Owens Introduces Bill to Facilitate Broadband Expansion
WIRELESS/SPECTRUM
AT&T to Buy T-Mobile USA for $39 Billion
AT&T/T-Mobile Deal Faces Antitrust Barriers
AT&T merger with T-Mobile doesn't look good for consumers
Consumer groups: AT&T + T-Mobile is 'unthinkable'
T-Mobile Deal Leaves Sprint’s Future Unclear
Concerns About Japan to Preoccupy Wireless Conference
Rush for wireless airwaves may drive risky deals
Architectural Framework for Public Safety Broadband Network
Study: Social Access Key To Smartphone Happiness
TELECOM
FCC OK for CenturyLink-Qwest Merger
OWNERSHIP
JPMorgan Stake in Tribune to Violate FCC Rule, Lawyer Claims
Facebook to buy mobile specialist Snaptu
CYBERSECURITY
Cyberattacks against federal networks were up 40 percent in 2010
CONTENT
A New Internet Privacy Law?
Top court to weigh privacy rights
Google experts weigh in on search bias, antitrust
Netflix, AT&T DSL caps, 4G, net neutrality, and more…a personal journey
Done Deal: Netflix To Develop Original TV Show, ‘House Of Cards’
HEALTH
Meaningful use could include steps toward PCAST exchange goals
Telehealth Is Trending
Bill would expand EHR program to more mental-health workers
POLICYMAKERS
Obama Nears Appointment Of Eric Schmidt As Commerce Secretary
Vice President Biden Announces New Communications Director
GOVERNMENT & COMMUNICATIONS
Google accuses China of disrupting Gmail
MORE ONLINE
Writers, Hollywood studios reach contract agreement
South Carolina county says goodbye paper, hello iPad2
PUBLIC BROADCASTING
NPR EMERGENCY
[SOURCE: Washington Post, AUTHOR: Dana Milbank]
[Commentary] The bipartisan Congressional Budget Office ran the numbers and calculated the impact the "emergency" defunding of National Public Radio measure would have on government spending: “No effect.” Five minutes after acting on this budgetary emergency, House Republicans voted to continue the war in Afghanistan -- which costs about $10 billion. Per month. They then flew home for a vacation. During the debate over Afghanistan, cost was no object. “War is expensive and it should not be measured in the cost of money,” said Rep. Ted Poe (R-Texas). But the 0.0001 percent of the budget going to NPR was a fiscal emergency. “It’s about saving taxpayer money,” proclaimed Rep. Marsha Blackburn (R-TN), the Republican floor leader. But this was undercut by freshman Rep. Rich Nugent (R-FL), who argued that “to compel a man to furnish contributions of money for the propagation of opinions which he disbelieves in is sinful and tyrannical.” Tyrannical? “We are not trying to harm NPR,” he added. “We are actually trying to liberate them from federal tax dollars.” Majority Leader Eric Cantor (R-VA), in his speech, complained that NPR’s “programming often veers far from what most Americans would like.” He said NPR was being targeted because it advocates “one ideology.” And everybody knows what ideology that is. It’s the ideology of Click and Clack, from Car Talk.
benton.org/node/53342 | Washington Post
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NPR FIGHT
[SOURCE: Washington Post, AUTHOR: Chris Cillizza]
[Commentary] The bill to defund National Public Radio is almost certainly a loser. But, in politics , every fight — particularly a high profile one like this — amounts to an opportunity. And both sides are already hard at work trying to take advantage of the NPR kerfuffle. Republicans are using it to placate their wayward base while Democrats are trying to raise money from — you guessed it! — their base from the controversy. A look at polling on NPR reveals a deep partisan chasm with the base of the Democratic party largely supportive of it and the base of the Republican party, well, not. The Republican base has long detested NPR, believing it to be a liberal-aligned media outlet that is being funded (in part) by the government. Trying to get rid of it then — particularly in the wake of the controversy that led to the resignation of the organization’s president — kills two birds with one stone. It sends a very clear signal to the GOP political base that the establishment is on its side while simultaneously keeping a campaign promise to shrink the size of government. Democrats, too, welcome the NPR fight politically as it gives them a chance to stand with their own base — casting Republicans as extremists interested in pushing their political agenda at all costs — not to mention raise money. In politics, there are plenty of lose-lose propositions for the two parties. But, the fight over NPR’s funding mechanism is a rare occasion where both sides may wind up on the winning side. For Republicans, the fight energizes their base and unites the straying tea party element of the GOP behind the establishment. For Democrats, the debate is a fundraising boon not to mention a way to rally their somewhat listless base in advance of the 2012 election.
benton.org/node/53341 | Washington Post
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AMASH ON NPR BILL
[SOURCE: The Hill, AUTHOR: Pete Kasperowicz]
Freshman Rep. Justin Amash (R-MI) said he believes a bill aimed at blocking federal funds to National Public Radio is unconstitutional, which is why he voted "present." "The bill's treatment of NPR is arguably unconstitutional and definitely violates the rule of law," he said. "The bill is arguably unconstitutional because it likely is a bill of attainder. Article I, Section 9 of the Constitution prohibits Congress from passing bills of attainder. The idea behind the bill of attainder ban is that Congress shouldn't enact laws meant to punish particular persons or entities, because the proper way to punish a wrongdoer is after the accused has been given a chance to defend himself at trial in a court." Rep Amash has said he would vote "present" whenever he sees the legislation as unconstitutional, when not enough time has been allowed to consider a bill or when he has a personal conflict of interest related to a bill.
Rep Amash opposes taxpayer funding for NPR, but explained his opposition in a statement to Fox News by noting that the bill voted on would not save a dime of taxpayer money: "The federal government does not subsidize NPR directly. Instead, the government funds the Corporation for Public Broadcasting, a government entity, which has discretion to provide funding to whichever private radio producers it chooses. H R 1076 does not actually save taxpayer dollars; it merely blocks CPB from exercising its discretion to send funding to NPR. The funds CPB does not send to NPR under the bill are returned to CPB to be spent subsidizing other private radio producers. I offered an amendment in the Rules Committee to require that any funds not sent to NPR be redirected to pay down the deficit, but the amendment was ruled out of order. Therefore, public broadcasting will not see any reduction in federal funding even if this bill becomes law."
benton.org/node/53339 | Hill, The | Think Progress
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INTERNET/BROADBAND
NATIONAL BROADBAND PLAN
[SOURCE: PC Magazine, AUTHOR: Chloe Albanesius]
The national broadband plan is now a year old, and while you're probably more likely to toast St. Patrick than the Federal Communications Commission's 376-page plan, it's worth taking a look at how much (or how little) the commission has accomplished since March 2010. To be fair, the plan which was mandated by the 2009 stimulus bill outlines suggestions for providing the country with broadband service over the next 10 years, so no one expected everything to be in place by the end of this week. But you have to start somewhere, and the commission and supporting agencies have taken some steps when it comes spectrum allocation, broadband mapping, and public safety, among other things. Clearly, there's still a long way to go. While the broadband map showed that 68 percent of households in the U.S. have broadband access - up from 63.5 percent last year - work still need to be done to get to 100 percent. The topics addressed in the last year cover just a fraction of the broadband plan's nearly 400 pages of recommendations for the next nine years. The commission touched on everything from infrastructure and health IT to telecommuting and energy issues, so stay tuned for more rulemakings, committees, proposals, and hopefully, results.
benton.org/node/53327 | PC Magazine
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NC BROADBAND BILL UPDATE
[SOURCE: Associated Press, AUTHOR: ]
North Carolina lawmakers aiming to stop cities from building their own broadband networks decided to allow public comments the next time they consider the latest effort by telecom companies to keep local governments out of the business. The House Finance Committee will hear from the public March 23 as it reviews legislation that would sharply restrict the chances for municipalities to step in when cable and phone companies decide not to build high-speed Internet systems in lightly populated areas. Opponents say telecom companies aren't extending super-fast Internet at reasonable prices, and that keeps smaller communities behind in the wired world of commerce. "They don't want to provide these services in a lot of areas because it's expensive, and they don't want municipalities to offer these services. That's an unlevel playing field for our citizens," said Rep. Deborah Ross (D). Legislation unveiled March 17 was changed to ease the rules for communities in which at least half the households have no access to high-speed Internet except through a satellite provider. Another change ensures the new rules don't affect the municipal networks already established in Wilson, Salisbury, Morganton and Iredell County, which have borrowed to build their systems.
benton.org/node/53338 | Associated Press
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WIRELESS/SPECTRUM
AT&T T-MOBILE DEAL
[SOURCE: New York Times, AUTHOR: Andrew Ross Sorkin, Michael de la Merced, Jenna Wortham]
AT&T has agreed to buy T-Mobile USA from Deutsche Telekom for $39 billion, in a deal that would create the largest wireless carrier in the nation and would reshape the industry.
The transaction, one of the largest since the onset of the financial crisis, is expected to start a fierce battle in Washington as regulators scrutinize the effect of the deal on competition and consumers. The deal would leave just three major cellular companies in the country: AT&T, Verizon and the much smaller Sprint Nextel.
Some critics denounced the merger within hours of its announcement, saying it would most likely lead to higher prices. T-Mobile had offered some of the lowest rates in the country, keeping pressure on competitors. While AT&T is expected to honor current contracts, T-Mobile customers may have to pay higher rates once those contracts expire. Still, AT&T pointed to a recent report from the federal Government Accountability Office that said cellular subscription costs fell 50 percent from 1999 and 2009, a period in which the industry has consolidated.
AT&T customers, though, could benefit in one notable area: service. Both AT&T and T-Mobile operate on the same technology, known as GSM, so the combination should provide better coverage. That has been a sore point for AT&T, which has been ridiculed over dropped calls and slow data services, especially on the Apple iPhone.
The acquisition would give AT&T additional leverage against its main rival, Verizon. The newly combined company, bringing together AT&T’s 95.5 million wireless subscribers with T-Mobile’s 33.7 million customers, would account for roughly 42 percent of all wireless subscribers in the United States. Verizon has around 31 percent, said Charles Golvin, a telecommunications analyst at Forrester Research. T-Mobile customers would have the option to buy an iPhone, helping AT&T combat the migration of the popular device to Verizon.
The deal would also provide significant cost savings, roughly $3 billion a year for the new company. Those savings, however, could have a huge effect on both the local and national economy, from real estate to media. The combined company is expected to close hundreds of retail outlets in areas where they overlap, as well as eliminate overlapping back office, technical and call center staff. It may also drastically reduce advertising spending. Last year, AT&T and T-Mobile spent a combined $2.7 billion on advertising, according to Kantar Media.
benton.org/node/53417 | New York Times | WSJ | WSJ - Stephenson's bet | WSJ - Rethink possible | WashPost | FT | AP | SJ Merc | National Journal
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ANTITRUST CONCERNS
[SOURCE: Wall Street Journal, AUTHOR: Spencer Ante, Amy Schatz]
AT&T's proposed acquisition of T-Mobile comes with one giant question mark: Will the U.S. government approve an acquisition that most experts thought was unthinkable until recently? Technology, finance and policy experts say the combination of the second and fourth largest providers of U.S wireless service by revenue will face a rocky path to approval and at a minimum require large divestitures. But AT&T has plotted its strategy carefully, even structuring its announcement in large part around the arguments it will need to win to convince regulators to allow the deal. The gamble is a big one for Chief Executive Randall Stephenson, whose company will have to turn over $3 billion and valuable spectrum to T-Mobile USA if it can't complete the deal. The acquisition needs approval from the Federal Communications Commission, which has to sign off on the transfer of T-Mobile's spectrum licenses to AT&T. It is also certain to face a thorough investigation by the Justice Department, according to people familiar with the matter. The merger is likely to be of particular concern to antitrust enforcers because the industry's two dominant companies -- Verizon Wireless, a joint venture of Vodafone Group PLC and Verizon Communications Inc., and AT&T -- are already so far ahead of anyone else, with more than 90 million subscribers each, raising the specter of an effective duopoly in mobile telephony. AT&T, however, is pushing for the industry to be looked at market by market -- essentially city by city -- where it argues the industry is for the most part fiercely competitive and has become more so recently with the rise of low-cost carriers and newer providers of fourth generation wireless services.
benton.org/node/53415 | Wall Street Journal | Bloomberg
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NOT A GOOD DEAL FOR CONSUMERS
[SOURCE: Los Angeles Times, AUTHOR: David Lazarus]
[Commentary] When the Bell telephone system — aka AT&T — was broken up in 1984, consumers were told this would be a good thing because it would increase competition. When the U.S. telecommunications market was deregulated in 1996, consumers were told this would be a good thing because it would increase competition. And now AT&T is planning to merge with T-Mobile, the latest in a string of acquisitions that effectively restores Ma Bell to her former girth yet allows the company to operate in a looser regulatory environment. Consumers might wonder if they've been played. "There's no way this latest merger can be good for consumers," said Sally Greenberg, executive director of the National Consumers League. "This places a lot of power in the hands of only a few companies." The reality, however, is that the most competitive segment of the telecom market — wireless service — will now have one fewer player, and we are a big step closer to a marketplace controlled by only two companies, AT&T and Verizon.
benton.org/node/53413 | Los Angeles Times
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UNTHINKABLE
[SOURCE: The Hill, AUTHOR: Sara Jerome]
There is no ambiguity about how consumer groups will view the proposed merger of T-Mobile USA and AT&T: "Unthinkable," said Public Knowledge President Gigi Sohn. "We think that US regulators should take a page out of Reed Hundt's playbook and declare this merger 'unthinkable' (as he did when it was rumored that AT&T would merge w. SBC in 1987)," Sohn said. "The proposed merger shows how desperately the US.. needs both strong network neutrality rules and competition policy that requires dominant broadband providers to make their networks available to competitors," she said.
benton.org/node/53412 | Hill, The | Public Knowledge | Free Press
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RUSH FOR AIRWAVES
[SOURCE: Reuters, AUTHOR: Sinead Carew]
In the telecommunication industry's land grab for wireless airwaves, investors better brace for US deals that are bewildering -- or worse. To stay competitive with powerhouses Verizon Wireless and AT&T Inc, smaller and mid-sized telephone companies are badly in need of more wireless airwaves to handle the rising Web traffic demands of smartphones and tablet computers. That may leave operators little choice but to consider partnerships and full-fledged mergers. "If you don't have enough spectrum, how are you going to compete? You've got to force M&A ahead of that," said one telecom banker who asked not to be named due to lack of authorization to speak publicly on the topic. For now, most of the chatter surrounds Sprint Nextel, the No. 3 U.S. mobile service, and its smaller rival, T-Mobile USA. Both are looking at ways to beef up their networks. There is no easy answer, analysts say, with all of their possible moves full of drawbacks.
benton.org/node/53391 | Reuters
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PUBLIC SAFETY BROADBAND NETWORK
[SOURCE: Federal Communications Commission, AUTHOR: Behzad Ghaffari]
On Jan 25th, 2011, the Federal Communications Commission adopted Long Term Evolution (LTE) as the common air interface for the nationwide interoperable broadband network for public safety in the 700 MHz band. This order also adopted a set of LTE interfaces to ensure interoperability and roaming. To this end, this item set a minimum level of requirements to establish the technology and standards on which a nationwide interoperable broadband network is to be developed. This was a significant step but certainly not the last one towards nationwide interoperability. Considerable work remains in establishing and adopting rules to ensure nationwide interoperability for this network.
In the same item, the FCC also issued a notice of proposed rulemaking that addresses a host of issues related to achieving nationwide interoperability. This includes questions about an architectural framework for the network. When we talk about architecture, it may sound like we are building a house; but in our case, this architectural framework will provide a view of the final network build out, a roadmap to signify the evolution steps for network, and the capabilities offered to users.
While this notice does not dictate network architecture, it does set the stage for ways to achieve an architectural framework by inquiring about guiding principles. Using the same house building analogy, we may not want to mandate exactly what the house should look like, but we may want in principle to ensure that it is built on one acre of land, with a kitchen, a family room, a dining room, a living room, 4 bedrooms, 2 bathrooms, and a basement. There will be many different ways to design a house with these characteristics, but they are all principally built based on this given data. We proposed some guiding principles for the construction of this nationwide broadband network in the notice and sought comment on many open issues. We look forward to reviewing the input on this very important issue, for what may be the very foundation of the public safety broadband network.
benton.org/node/53384 | Federal Communications Commission
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TELECOM
FCC CONDITIONALLY APPROVES CENTURYLINK/QWEST MERGER
[SOURCE: Federal Communications Commission, AUTHOR: ]
The Federal Communications Commission approved the merger of CenturyLink and Qwest Communications International. The merger will create the third largest traditional phone service provider in the nation, behind AT&T and Verizon. The FCC imposed protections against the risk of harm to competition and ensured the merged entity will live up to its commitments to significantly expand its network and launch a major broadband adoption program for low-income consumers. The transaction is expected to close soon after the companies have obtained their final state approval. Based on the companies' agreement to certain conditions, the FCC found that the potential public interest benefits of the merger are likely to outweigh the potential harms.
Binding and enforceable conditions include:
Broadband adoption program for low-income consumers
Launch major broadband adoption program focused on connecting the millions of low-income consumers in the combined company's 37-state territory.
Offer qualifying households broadband starting at less than $10 per month and a computer for less than $150, and keep the window open for five years for qualifying consumers to sign up.
Make a significant annual commitment to marketing, outreach, and digital literacy training, and include detailed reporting on outcomes and an independent analysis of the program's effectiveness.
Broadband deployment
Significantly increase the capacity of the Qwest network, bringing broadband with actual download speeds of at least 4 Megabits per second (Mbps) to at least 4 million more homes and businesses, and at least 20,000 more anchor institutions, such as schools, libraries, and community centers.
Significantly increase availability of higher-speed broadband: The company will more than double the number of homes and businesses that can get 12 Mbps broadband, and more than triple the number that can get 40 Mbps broadband.
Advancing Universal Service Fund reform
Phase down three forms of support designed for smaller companies, which the company currently receives from the federal Universal Service Fund.
Protection against potential transaction-related harms
No increase in enterprise service prices for 7 years in a few dozen buildings where the companies currently compete (Minneapolis (MN), and Olympia (WA)).
Safeguards for smooth transition of operations support systems, to protect wholesale customers.
Ensuring the merger does not harm interconnection agreements with competing phone carriers.
Maintenance of wholesale service quality.
benton.org/node/53386 | Federal Communications Commission | B&C | The Hill | Associated Press | National Journal | Chairman Genachowski | Commissioner Copps | Commissioner McDowell | Commissioner Clyburn | Commissioner Baker
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CYBERSECURITY
CYBERSECURITY REPORT
[SOURCE: nextgov, AUTHOR: Aliya Sternstein]
The number of attacks against federal networks increased nearly 40 percent last year, while the number of incidents targeting U.S. computers overall was down roughly 1 percent for the same period, according to a new White House report to Congress on federal computer security. "Malicious code through multiple means," such as phishing and viruses, "continues to be the most widely used attack approach," Office of Management and Budget officials wrote. Phishing scams lure victims with fake e-mails apparently from legitimate organizations, such as banks, that instruct them to submit sensitive information, including passwords, on phony websites. In fiscal 2010, federal agencies reported 41,776 cyber incidents vs. 30,000 attacks in 2009, the year the Conficker worm installed malicious software on millions of home, business and government computers. To deal with the growing cyber threat, information technology managers gradually are changing the way they monitor security by installing scanners that automatically detect abnormalities in real time, noted the latest report on agencies' compliance with safeguards codified under the 2002 Federal Information Security Management Act. OMB submitted the annual report to Congress on Feb. 28 and published it online this month.
benton.org/node/53333 | nextgov | read the White House report | The Hill
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CONTENT
A NEW INTERNET PRIVACY LAW?
[SOURCE: New York Times, AUTHOR: Editorial staff]
[Commentary] Considering how much information we entrust to the Internet every day, it is hard to believe there is no general law to protect people’s privacy online. Companies harvest data about people as they surf the Net, assemble it into detailed profiles and sell it to advertisers or others without ever asking permission. So it is good to see a groundswell of support emerging for minimum standards of privacy, online and off. This week, the Obama administration called for legislation to protect consumers’ privacy. In the Senate, John Kerry is trying to draft a privacy bill of rights with the across-the-aisle support of John McCain. It is crucial that lawmakers get this right. There is strong pressure from the advertising industry to water down rules aimed at limiting the data companies can collect and what they can do with it. Privacy protections are long overdue. We hope the swell of support will lead to significant legislation.
benton.org/node/53406 | New York Times
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POLICYMAKERS
SCHMIDT FOR COMMERCE SECRETARY?
[SOURCE: Business Insider, AUTHOR: John Ellis]
The word in Washington is that President Barack Obama is close to naming departing CEO Eric Schmidt as the nation's next Secretary of Commerce.
Schmidt picked up an important vote of confidence earlier this week when former Reagan Administration Commerce Department counsel Clyde Prestowitz essentially endorsed Schmidt for the job. That didn't happen by accident and it's a strong signal that the GOP DC establishment will support a Schmidt appointment. Such support would almost certainly insure a smooth confirmation process. A final decision is expected within the next two weeks. The outgoing Commerce Secretary, former Washington Governor Gary Locke, was nominated by President Obama to serve as the US Ambassador to China. Schmidt is scheduled to step down from his position as CEO of Google on April 4.
benton.org/node/53373 | Business Insider | Washington Post
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GOVERNMENT & COMMUNICATIONS
GMAIL IN CHINA
[SOURCE: Financial Times, AUTHOR: Richard Waters, Kathrin Hille]
Google has accused the Chinese authorities of disrupting its e-mail service inside the country, adding a new twist to the stand-off over censorship that has bedeviled the US company’s attempts to push into the world’s most populous Internet market. The claim by the Internet giant followed weeks of sporadic problems encountered by Internet users in mainland China as the government tightened its censorship measures in light of an anonymous online call for a “Jasmine Revolution” in China. “This is a government blockage carefully designed to look like the problem is with Gmail,” a Google spokesperson said. The problems that have been reported to take different forms, making it difficult to trace a pattern in the precise nature of the faults, the types of Gmail user affected, or the length of the time the issues have been experienced. Some users, for instance, have said they periodically fail to send, search or load e-mail, even though they can access their accounts, which gives the impression that the fault lies with Google. In other instances, users in China have been unable to log into Gmail or even access the Gmail site.
benton.org/node/53407 | Financial Times
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