August 1999

INTERNET
Small Internet Providers Survive Among the Giants (NYT)
The New World of Search Engines (SJM)
Conventional Retailers Use Web to Improve Service (CyberTimes)
Microsoft, Partner Aim to Cut Online Fees in Japan (WP)

PUBLISHING
Media: Newspaper Deal in San Francisco Revives Regulation Debate (NYT)
Book Industry Study Shows Sales Increased 4% Last Year (NYT)

MERGERS
AT&T-BT Venture Gets Security Review (WSJ)

WIRELESS
Satellites May Come to the Rescue for 911 (ChiTrib)
Laptops, Cell Phones Can Leak Secrets (USA)

INTERNET

SMALL INTERNET PROVIDERS SURVIVE AMONG THE GIANTS
Issue: ISPs
Despite predictions that the market for Internet service providers (ISPs)
would consolidate around America Online, Microsoft and telephone companies,
the industry remains diverse and still holds possibilities for competitors
-- even mon-and-Michael Cloran operations [I had to plug Chicago provider
Enteract.com] And the AOL business model isn't the only one with free access
popular in Europe and spreading to the US and other discounted plans offered
by hardware manufacturer/service provider teams. Although AOL remains #1 in
the market -- with 17 million subscribers and the closest competitors with
less than 2 million -- AOL's market share is not growing as it has in recent
years. Boardwatch Magazine reported growth of 36% in its directory of ISPs
in the US, Canada and the Caribbean. Of the 6,511 ISPs listed, 5,895 offer
local access numbers in fewer than 25 area codes -- only 616 offer regional
or national access.
[SOURCE: New York Times (C1), AUTHOR: Matt Richtel]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/16net.html)

THE NEW WORLD OF SEARCH ENGINES
Issue: Internet Content
It is increasingly likely that at least some of the results a search
conducted on one of the Internet's many search engines will be paid
advertisements. Companies like Lycoos and Yahoo are feeling increasing
pressure to gain revenue from the navigational services they provide. Some
analysts say that the quality of portals have suffered as a result of the
drive to turn profit. Jakob Nielsen, co-founder of the Nielsen Norman
Group, a company that studies the usability of technology, says that as
portals increasingly turn their attention to adding new features, "they have
been failing in their core mission of helping people find things." Many
users are annoyed by the large volume of commercial sites that are
generated by their searches. "When I look at the results of my searches, I
expect that the listings would come up strictly as a function of the
relevance to my search inquiry," says Gary Allen, a San Jose resident.
"There's an expectation that I'm going to get unbiased information. But
that isn't the case."
[SOURCE: San Jose Mercury News, AUTHOR: Monus Janah]
(http://www.mercurycenter.com/svtech/news/indepth/docs/search081699.htm)

CONVENTIONAL RETAILERS USE WEB TO IMPROVE SERVICE
Issue: E-Commerce
As some "brick-and-mortar" businesses live in fear of becoming casualties
of the e-commerce revolution, others are using the Internet itself to fight
the rising tide of cyber retail. "We've been dealing with a lot of
companies almost paralyzed with fear about the Internet," said Melissa
Bane, an E-commerce analyst with the Yankee Group, an Internet consulting
firm. Other companies, according to Bane, are using the Internet in their
stores to expand their customer base. Sears, Borders Books, and the Gap are
among major chains that have begun to install Internet kiosks in many of
their stores. The interactive technology allows consumers to access
detailed information about products and availability. "I am sure that 10
years from now, every major retail company will have an Internet-enabled
device in the store," said Rick Vanzura, president of Borders Online, who
is in charge of the company's effort to install Internet kiosks in each of
its 270 superstores.
[SOURCE: CyberTimes, AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/08/cyber/commerce/16commerce.html)

MICROSOFT, PARTNER AIM TO CUT ONLINE FEES IN JAPAN
Issue: Internet/ International
While Japanese may be crazy about the Internet, many are reluctant to log
on. With local phone charges around 9 cents for every three minutes,
surfing the Net can be an expensive habit. Many Japanese Internet experts
claim the recently announced joint venture between Microsoft and
Japan's big Internet investor Softbank, intended to circumvent Nippon
Telegraph and Telephone's near monopoly to offer lower-cost online access,
is a sign of Japan's rapidly changing Internet environment. Japan, however,
is still far behind the U.S., where people are more than twice as likely to
have Internet accounts. Some people think wireless technology may offer the
best hope for bringing Japan online. Almost 40% of all Japanese households
have cell phones. "There's a
tremendous potential for leapfrogging with these technologies," says
Merrill Lynch's Negi.
[SOURCE: Washington Post (A1), AUTHOR: Clay Chandler]
(http://www.washingtonpost.com/wp-srv/digest/daily/aug99/jnet16.htm)

PUBLISHING

MEDIA: NEWSPAPER DEAL IN SAN FRANCISCO REVIVES REGULATION DEBATE
Issue: Newspapers
The Newspaper Preservation Act of 1970 aimed to help struggling newspapers
around the country by allowing joint operating agreements (JOAs) which
allowed two newspapers to share costs -- like printing and distribution --
and revenues -- like advertising and circulation. In cities like San
Francisco, JOAs kept a second, weaker paper in business. In theory, the two
papers would continue to compete and they would be able to devote more of
their resources to content providing the community with two distinct
editorial voices. But with the sale of The San Francisco Chronicle to the
Hearst Corporation, owner of archrival San Francisco Examiner, some are
questioning how effective the law has been and how effective it is nearly 30
years after being written. Donna Patterson, a deputy assistant attorney
general in the Justice Department's antitrust division, said, "I guess
historically it's been a success," she said, "because it's preserved voices
longer than they would otherwise have been preserved." Barringer ends with:
The new media landscape and the growing competition for advertising dollars,
make it harder for a weak newspaper to survive, and make its survival less
urgent, [Michigan State Prof Stephen] Lacy believes. "I'm not sure I'd call
the Newspaper Preservation Act a failure," he said. "Just a non-success.
People back then did not realize that this would not make a difference in
the long run."
[SOURCE: New York Times (C12), AUTHOR: Felicity Barringer]
(http://www.nytimes.com/yr/mo/day/news/financial/media-column.html)

BOOK INDUSTRY STUDY SHOWS SALES INCREASED 4% LAST YEAR
Issue: Publishing
Book sales rose 4% last year and the Book Industry Study Group is predicting
that sales will rise 2% annually through 2003. "We don't see the total
market expanding in any dramatic shape for five years," said Albert Greco,
an associate professor of business at Fordham University who helped prepare
the projections. "If you say 10 years, it might be even more modest. I think
people are reading less, and I just don't see that we're going to turn the
corner and become a nation of readers." "We've seen a strong market since
last summer -- all publishing divisions, all formats, all categories," said
Peter Olson, the chief executive of Random House, the Bertelsmann AG unit
that is the largest trade publisher in the United States. Olson gave credit
for some of the strength to online retailers that now account for roughly 4
to 5 percent of the company's sales. "I think that the attention that
Amazon.com and Barnesandnoble.com have generated has increased interest in
books in general, and that has led to buying not just online, but in
stores," Olson said.
[SOURCE: New York Times (C1), AUTHOR: Doreen Carvajal]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/16book.html)

MERGERS

AT&T-BT VENTURE GETS SECURITY REVIEW
Issue: Mergers/Alliances
AT&T and British Telecommunications (BT) are under intense scrutiny by the
Federal Bureau of Investigations and the Justice Department. Both federal
agencies were asked to comment on why they are investigating this deal
before its approval but both refused to comment. The AT&T/BT venture is
going to provide international companies with voice, video and data
services. In the past, the FBI and Justice department have looked into these
deals to make sure
the agencies can wiretap and to protect the privacy of U.S. citizens. AT&T
says everything is on track and the deal should go through in October.
[SOURCE: Wall Street Journal, B6, AUTHOR: Kathy Chen and Rebecca Blumenstein]
(http://interactive.wsj.com/articles/SB93475090510192539.htm)

WIRELESS

SATELLITES MAY COME TO THE RESCUE FOR 911
Issue: Wireless/Safety
You're in the middle of who-knows-where, in trouble, you call 911 on your
wireless phone and the public safety official says, "Where are you?" For
many of the 40,000 emergency phone calls placed by wireless users each year,
they just don't know. Global positioning satellite technology (GPS) may be
the long-term answer -- it can locate someone within 5 yards in the best
circumstances. But for the 70 million wireless phones in use, GPS is not an
answer in the near future. A look at the variety of technologies that could
serve today's (and yesterday's) phones and the tough choice the Federal
Communication Commission must make to sort them out.
[SOURCE: Chicago Tribune (Sec4, p.1), AUTHOR: Jon Van]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99081600
05,FF.html)

LAPTOPS, CELL PHONES CAN LEAK SECRETS
Issue: Security
The danger of leaking company and confidential information is increasing as
people use their cell phones and computers in places other than their homes
and offices. A survey by Hyatt found 71% of business travelers use voice
mail, 62% use laptops and 45% rely on cell phone while on the road. People
tend to be louder on a cell phone in public when making business deals --
not realizing their conversations are being overheard by many. Prime spots
to gather such secrets are airplanes' business sections, commuter trains
and trade shows.
[SOURCE: USA Today, 4B, AUTHOR: Stephanie Armour]
(http://www.usatoday.com)

--------------------------------------------------------------
Welcome back, Rachel. Thanks for the help, Purdy.

BROADBAND
Open Broadband Access (FCC)
How do AT&T, Excite( at )Home Fit Together? (SJM)
IBM Offers PC with High-Speed 'DSL' Internal Modem (SJM)

INTERNET
BET Plans Site for African Americans (WP)
Energizing the E-Political (WP)
Net Is Expected to Rival Radio in Ad Spending by 2004 (WSJ)
Sprint PCS to Offer Wireless Internet Service (ChiTrib)
How to Spend an Allowance Without Leaving Home (NYT)

MEDIA & SOCIETY
Diverse Is Better, Screen Actors Guild Ads Tell the Networks (WP)

INTELLECTUAL PROPERTY
Broadcast Consortium Threatens to Sue Makers of Personal Video
Recorders (WSJ)

ACCESS TO GOVERNMENT INFO
Moving ( at ) the Speed of Government (USA)

BROADBAND

OPEN BROADBAND ACCESS
Issue: Broadband
From News Release: Federal Communications Commission Chairman William E.
Kennard yesterday reiterated that the FCC shares the goal of consumers and
local governments -- an open Internet. In a letter to the FCC's Local and
State Government Advisory Committee, Kennard said, "We must pursue the goal
of open access in a manner that encourages investment in the deployment of
[broadband] networks." Kennard stated that the FCC's policy of encouraging
the marketplace to develop has "already produced impressive results across
the country," including:
Increased deployment of cable modem service by cable operators; Increased
rollout of DSL (digital subscriber line) services by local phone companies;
Declining charges for DSL service as competition intensifies; Increased
investments by companies exploring the potential of satellite and wireless
technologies as broadband sources
Kennard noted that although broadband is in its infancy, the FCC is taking
steps to ensure that there are many competitors in the Internet marketplace.
He said that more spectrum has been made available to wireless operators and
that it is easier for emerging competitive local phone companies to connect
into the existing network in order to provide high-speed access to the
Internet using DSL technology. Kennard said that the FCC is conducting a
series of "on-going broadband monitoring sessions" on the subject, with
participants including local government representatives, public interest
groups, investment analysts, cable and phone companies, ISPs, academics and
others. He said the FCC will be seeking further public comment on the issue
this Fall in connection with the study of advanced telecommunications
services conducted pursuant to section 706 of the Telecommunications Act of
1996. The Local and State Advisory Committee
(http://www.fcc.gov/statelocal/) met with FCC staff on July 23, 1999 to
discuss a series of topics, including the open cable issue.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Cable/News_Releases/1999/nrcb9014.html)

HOW DO AT&T, EXCITE( at )HOME FIT TOGETHER?
Issue: Broadband
"We've never been in the content business and we've said we don't want to be
in the content business. We're an access provider," said AT&T spokesman Mark
Siegel. "We want our customers to have all the content they want. We want
the Internet to be rich in content (but) our business is not to generate it
or aggregate it." This quote reveals a "philosophy gap" between AT&T and
Excite( at )Home. AT&T is a major (26%) shareholder in Excite( at )Home, which
concentrates on providing not only high-speed Internet service over cable
networks, but also aggregating content tailored for those fast connections,
such as video and audio clips to go along with news stories. "We think they
fit together quite naturally," said Excite( at )Home CEO Tom Jermoluk. "The
success of AOL I think proves the model. The difference between AOL's growth
rate and general ISPs...shows you that it really matters." With with
high-speed Internet connections like those to offered on AT&T's cable lines,
access and content will change. Traditional dial-up service providers like
AOL and other ISPs discourage customers from staying online around the
clock; Excite( at )Home attempts to keep its users online all the time.
High-speed services could also allow a three-dimensional view of a product
in an online store, for example. This fall, Excite( at )Home plans to unveil a
portal with content designed specifically for high-speed Internet service
consumers. Analysts say this kind of content will be an important source of
revenue for Excite( at )Home, with people paying transaction fees for content
delivered over the Web. And as more and more high-speed services become
available, it is content that will differentiate the various sites, said
Blaik Kirby of Boston-based strategic consulting firm Renaissance Worldwide.
[SOURCE: San Jose Mercury News, AUTHOR: Deborah Kong]
(http://www.sjmercury.com/svtech/news/indepth/docs/excite081299.htm)

IBM OFFERS PC WITH HIGH-SPEED 'DSL' INTERNAL MODEM
Issue: InfoTech
In the latest step toward the U.S. moving Internet connections over to
broadband, IBM announced it will build personal computers with built-in
digital modems, which will boost the price of those computers by about $100.
IBM's move represents the first broad rollout of an internal digital modem.
This internal digital modem will make it easier to hook up to your local DSL
technology provider because right now the telephone company has to splice
your telephone wire outside your home as well as hook another external modem
up. This would provide one less step, less hardware and less cost for DSL
installation. DSL connections are 50 to 100 times faster than a standard
telephone connection.
[SOURCE: San Jose Mercury, AUTHOR: Associated Press]
(http://www.sjmercury.com/svtech/news/breaking/merc/docs/075317.htm)

INTERNET

BET PLANS SITE FOR AFRICAN AMERICANS
Issue: Minorities
BET Holdings Inc. will announce plans today to launch BET.com, a Web site
that will offer electronic mail, instant messaging, news, entertainment,
shopping and other services targeted at African Americans. "We have come
together to ensure that African American consumers are not left out of the
economy," said BET Chairman Robert L. Johnson. Amid growing concern that a
digital divide exists between white, high-income Americans and minority
groups, some believe Web sites geared towards women or minority groups can
succeed on the Internet. "Communities are what the Web is all about," says
Gary Arlen, an Internet analyst. BET.com is banking on its name,
Black Entertainment Television, and its history working with television,
cable and print to make this model a success. It also has the financial
backing of Microsoft, USA Networks Inc, Liberty Media Group and News
America Digital Publishing owned by Rupert Murdoch's News Corp. Analysts
say the biggest challenge, however, will be getting minority homes online.
[SOURCE: Washington Post (E1), AUTHOR: Shannon Henry]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/12/186l-081299-idx.html)
See Also
THE BATTLE TO USHER BLACKS ONTO THE WEB
[SOURCE: Wall Street Journal (B1), AUTHOR: Kara Swisher]
(http://interactive.wsj.com/articles/SB93440894663591020.htm)
COMPANIES BACK NEW WEB SITE AIMED AT BLACKS
[SOURCE: New York Times (C5), AUTHOR: Saul Hansell]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/12bet.html)

ENERGIZING THE E-POLITICAL
Issue: Internet & Politics
A new occupation is emerging: the cyber-lobbyist. The Communications and
Policy Technology Network (CAPTN, www.captn.org), a coalition of 70
Washington-area groups, is made up of techies who want to know how campaigns
work and policy experts looking for new ways to spread the word online.
Cyber-lobbing is a new occupation not just a strategy, say Daniel Bennett
and Pam Fielding who run Internet lobbying group e-Advocates and plan to
release _The Net Effect: How Cyber-Advocacy is Changing the Political
Landscape_ next month.The release of Kenneth Starr's report last September
gave people an expectation that they should be able to get political
documents online, fast. More and more people feel comfortable using email
and doing research online. And the 2000 election will attract more people to
the Internet. Issues under consideration at CAPTN include 1) how to convince
members of Congress that e-mail is just as good as snail mail, 2) how to
figure out what exactly constitutes an online signature and
3) how to best target Internet constituents on certain issues.
[SOURCE: Washington Post (E1), AUTHOR: Shannon Henry]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/12/199l-081299-idx.html)

NET IS EXPECTED TO RIVAL RADIO IN AD SPENDING BY 2004
Issue: Advertising/Old vs New Media
Forrester Research, a technology research firm, is releasing a study this
week that says spending for Internet advertising will more than triple in
the next four years -- with the Internet rivaling radio by 2004 as the
fourth-largest advertising medium in the country. The report estimates that
Internet advertising will make up more than 8% of advertisers' total
marketing efforts by 2004, accounting for about $22 billion in spending in
the U.S. The Forrester report is based on interviews with 50 companies, most
of which have a significant Web presence and including companies such as AOL
and Yahoo. Forrester found that marketing executives expect their Internet
spending to jump past the Yellow Pages and magazines by 2004. That would
leave it trailing only television, newspapers and direct mail in popularity
for advertising spending. The one way that the advertising dollars will
significantly change is that most companies will not pay the flat rate for
ads on Web pages as the majority do now -- instead they will go with the
number of people who click on the ad. This could significantly change
advertising structure and monies within the industry over the next few years.
[SOURCE: Wall Street Journal, B12, AUTHOR: Yochi Dreazen]
(http://interactive.wsj.com/articles/SB934413726207205057.htm)

SPRINT PCS TO OFFER WIRELESS INTERNET SERVICE
Issue: Wireless/Internet
A popular service in Europe and Asia, wireless Internet connections through
cell phones, will be rolled out in the US next month by Sprint. Van reports,
the Sprint service, which will be available for as little as a $10 monthly
fee added to existing wireless voice service, will enable customers to look
at data from popular Internet Web pages directly on their phone's screen. It
will also let them plug a laptop computer into their phone to obtain a
wireless connection to the Internet and to obtain selected information sent
regularly to their phone in the form of short messages. John Garcia, Sprint
senior vp for sales and distribution, says that research shows that a
majority of people who use the Internet also use wireless phones and vice
versa. "We've bundled things customers already use in a way that makes it
easier and simpler for them to use," Garcia said. "We're not trying to sell
a killer application, but rather to build on existing applications." A new,
top-of-the-line phone for the service, with an oversized screen, will sell
for $400, but others designed to send and receive data sell for as little as
$100.
[SOURCE: Chicago Tribune (Sec 3, p.3), AUTHOR: Jon Van]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99081203
63,FF.html)
See Also:
SPRINT PCS PLANS WIRELESS DATA NET, LINKING CELL PHONES, ACCESS TO INTERNET
[SOURCE: Wall Street Journal, B8, AUTHOR: Nicole Harris]
(http://www.wsj.com)

HOW TO SPEND AN ALLOWANCE WITHOUT LEAVING HOME
Issue: Ecommerce
Jupiter Communications predicts that by 2002, children ages 5 to 18 will
spend $1.3 billion online. So, companies like J. Crew, Toys R Us, Kaybee Toy
and Hobby Stores and Barnes & Noble are rushing to introduce Web sites
designed to encourage children to buy from online retailers. "This is a
natural evolution, because today's kids are sophisticated and already are
comfortable using the Internet for other things," said Anya Sacharow, an
analyst at Jupiter Communications, the Internet research firm. "The main
thing that was stopping them from buying online was that they didn't have
their own credit cards." Psychologists and financial planners question
whether it is a good idea to make it easier for kids to spend. "Parents
feel guilty about their children, and they try to make it up to them by
buying things," said Carol Seefeldt, a professor at the University of
Maryland's Institute for Child Studies. "I see a lot of parents who do not
want their children to ever delay gratification, but that's the wrong
approach. Saving and investing gives kids an important sense of self-control
over their lives. We want to teach them to take care of themselves rather
than to expect people to take care of them." See also Learning to Budget and
Spend on the Web
(http://www.nytimes.com/library/tech/99/08/circuits/articles/12ssho.html)
[and chalk one up for the Consumer Nation].
[SOURCE: New York Times (D1), AUTHOR: Michelle Slatalla]
(http://www.nytimes.com/library/tech/99/08/circuits/articles/12shop.html)
See Also:
WHAT CAN MAKE A MARKETER BROOD? TARGETING TEENS
[SOURCE: Chicago Tribune (Sec 3, p.1), AUTHOR: Susan Chandler]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99081203
53,FF.html)

MEDIA & SOCIETY

DIVERSE IS BETTER, SCREEN ACTORS GUILD ADS TELL THE NETWORKS
Issue: Media & Society
"You have a demand. We have a supply," reads an ad run by The Screen Actors
Guild in Los Angeles to convince entertainment industry execs that diverse
casting is the right thing to do and makes good business sense. Guild
President Richard Masur said the SAG wants to "challenge" the myth that
there aren't enough qualified performers among groups that are
underrepresented on television and to tell them that diversity can improve
their bottom line. The first ad ran in the Hollywood Reporter, the next ad
will run Aug. 31 in the Daily Variety. Both magazines target entertainment
executives.
[SOURCE: Washington Post (C7), AUTHOR: Lisa de Moraes]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/12/173l-081299-idx.html)

INTELLECTUAL PROPERTY

BROADCAST CONSORTIUM THREATENS TO SUE MAKERS OF PERSONAL VIDEO RECORDERS
Issue: Intellectual Property
The Advanced Television Copyright Coalition (ATCC), a consortium of media
companies including CBS, Time Warner, Walt Disney, News Corp and Discovery
Communications, will announce that start-up companies, such as TiVo and
Replay Networks of California, must be subject to negotiations similar to
the way studios license shows to networks or cable channels grant carriage
to local cable systems. The broadcasting companies are threatening to sue
makers of personal video recorders (PRVs) unless the manufacturers agree to
obtain license agreements for use of the networks' programming. Personal
video recorders are advanced videocassette recorders that use digital
technology to store TV programming on a hard-disk drive that can store up
to 14 hours of content. TiVo and Replay Networks make PVRs that allow users to
customize their TV viewing by recording only the shows they want to watch
-- but unlike traditional VCRs, PVRs easily allow viewers to instantly
rewind and fast forward the shows they watch, thereby enabling users to
skip commercials. The concern among the network owners is that the PVR
records shows off live television, organizes them according to the viewer's
preferences, and also has the ability to substitute the network's
commercials for their own. The ATCC is worried that the PVR could radically
alter the habits of viewers once they achieve sufficient penetration by
essentially empowering viewers to set their own program schedules and how
they want to watch TV. That, in turn, could further drive down audience
levels for the networks, which already have lost large numbers of viewers in
recent years as more channels and alternative media outlets have joined the
competition.
[SOURCE: Wall Street Journal, B10, AUTHOR: John Lippman]
(http://interactive.wsj.com/articles/SB934415502283259272.htm)

ACCESS TO GOVERNMENT INFO

MOVING ( at ) THE SPEED OF GOVERNMENT
Issue: Internet
[Op-ed] "Armed with electronic "smart cards," citizens of Spain are tapping
into
their unemployment and disability benefits through the Internet. In
Belgium, small companies are registering for business licenses online. On
the other side of the globe, Singaporeans access electronic government
services ranging from getting a marriage license to applying for
citizenship, while would-be college students are required to apply to
college on the Web." Stephen J. Rohleder and Martin I. Cole go on to
emphasize that "government in the United States continues to move at, well,
the speed of government." "By harnessing the Web, government can deliver
better services without raising taxes, because electronic government is
cheaper," they write. "The U.S. Commerce Department, for
example, is planning for electronic applications for export licenses. Dade
County, Florida -- home of the nation's fourth-largest traffic court system
-- schedules cases and delivers documents electronically to attorneys and
judges. Missouri's courts are being networked to allow citizens to monitor
cases via the Internet. An electronic job network in Ohio is helping match
job seekers and employers." But in the end Rohleder and Cole emphasize that
the U.S. government must follow the business world to wipe out bureaucracy.
[SOURCE: USA Today, 13A, AUTHOR: (Stephen J. Rohleder is a managing partner
of Andersen Consulting America's Federal Government Practice and Martin I.
Cole is managing partner of the firm's America's State and Local Government
Practive.)]
(http://www.usatoday.com/news/comment/ncguest.htm)

--------------------------------------------------------------

MEDIA & SOCIETY
The Y2K Social Disease (NYT)
Wireless Revolution Turning U.S. Into Nation of Phone-ies (Trib)
One Minority Has Managed to Find a Place on Television and
in Film (ChiTrib)

E-COMMERCE
Capital Dispatch: Internet Tax Panel Gets Down to Work (CyberTimes)
Japan's Fujitsu Looks to America Online as Model in Attempt to
Become a Leader in E-Commerce (WSJ)
Old Line Consulting Firms Become the Internet Mavericks (Cyber)
Buying Stamps Can Now Mean Just a Trip to the Computer (NYT)

INTERNET
Capital Dispatch: The Week Ahead (CyberTimes)
Capital Dispatch: Anti-Cybersquatting Bill Clears Senate (CyberTimes)
Qwest to Combine Internet Access, Long Distance (WSJ)
Medical Web Sites Can Steer You Wrong (WP)
Advertising: Siren Calls Sought for Conde Nast's Web of Sites (NYT)

ACCESS TO GOVERNMENT INFO
Capital Dispatch: Groups Identify Ten "Most Wanted" Documents
(CyberTimes)

BUDGET ISSUES
Capital Dispatch: Republicans Backtrack on Research Tax Credit
(CyberTimes)

LEGAL ISSUES
Ticketmaster Sues Again Over Links (CyberTimes)
Times Co. and Amazon Settle a Legal Dispute (NYT)
Telecom Venture of Siemens and Citic Skirts Chinese Ban With
Unusual Step (WSJ)

SECURITY
Capital Dispatch: Task Force to Study Net Crime (CyberTimes)

MEDIA & SOCIETY

THE Y2K SOCIAL DISEASE
Issue: Lifestyles!
Friedman writes that he has the story of the century because it is the story
of the *next* 100 years: overconnectedness. This is the real Y2K virus for
developed countries. It is the anxiety that is going to be produced when
telecommunications combines with the "Evernet" -- the technology that will
soon allow people to get on line from their watches, their cars, their
toasters or their Walkmans -- so that everyone will be able to be connected
all the time, everywhere. The Internet is shrinking both time and distance
which is great for business, but it's socially claustrophobic. When was the
last time someone said, 'Let me sleep on that'? Like computer servers, we're
always on now. What happens when we're always connected is that the boundary
between work and play disappears. He concludes: There's no such thing as
"quality time" with your kids. There's only quantity time, and that's what
overconnectedness threatens to destroy -- if we let it. So please, don't
call me. I'll call you -- at the office.
[SOURCE: New York Times (A19), AUTHOR: Thomas Friedman]
(http://www.nytimes.com/library/opinion/friedman/081099frie.html)

WIRELESS REVOLUTION TURNING U.S. INTO NATION OF PHONE-IES
Issue: Lifestyles!/Wireless
A look at some people who are just not connected through one cell phone, but
multiple phones. As the country converts to a cell phone nation, just about
anyone will be seven, 10 or a dozen (international long distance) digits
away from the rest of the world, said Northwestern University sociologist
Bernard Beck. "Anyone will be able to find you," said Beck, an expert on
popular culture. "You can run, but you cannot hide because the cell phone
goes with you. And then the notion will emerge that if you leave it behind,
you will be blamed for not taking it with you." Driven by falling prices,
cell phone penetration and use keeps climbing. "Unlike the Internet, cell
phone users are spread across all demographic groups," said Gerald Celente,
director of Trends Research Institute. At least 25 Americans sign up for
cell phone service every minute -- or about 37,000 a day, according to
Cellular Telecommunications Industry Association figures. About 80 million
Americans own or use cell phones, up from 69 million last year, the
Washington-based trade group said. Four years from now that number will
double, according to industry estimates. We always had to go to `it'--the
phone that is," said Tom Wheeler, president of the Cellular
Telecommunications Industry Association. "It interrupted dinner or you had
to go to a phone booth. The phone now comes to us. Not only is that personal
freedom, it is an empowerment of our potential and how we use communication."
[SOURCE: Chicago Tribune (p.1), AUTHOR: Patrick Cole]
(http://chicagotribune.com/news/printedition/article/0,2669,SAV-9908100295,F
F.html)

ONE MINORITY HAS MANAGED TO FIND A PLACE ON TELEVISION AND IN FILM
Issue: Media & Society
As the television industry is criticized for a lack of racial minorities on
the screen, gay characters seem to be finding a niche in both TV and movies.
Bryan Caldwell, co-senior vice president of marketing for Fine Line
Features, says "We're not going after the Guns & Ammo crowd, but there's no
question this film delivers on many, many levels. Upscale, educated
consumers have come to terms with the fact that there are alternative
lifestyles, and they've become more open-minded. With the growth of
independent films, it's not just about gay cinema anymore, it's about
intelligent, character-driven movies."
[SOURCE: Chicago Tribune (Sec 5, p.1), AUTHOR: Gary Dretzka]
(http://chicagotribune.com/leisure/tempo/printedition/article/0,2669,SAV-990
8100021,FF.html)

E-COMMERCE

CAPITAL DISPATCH:
INTERNET TAX PANEL GETS DOWN TO WORK
Issue: Ecommerce
The group charged with recommending tax policy for the Internet agreed on a
five-point agenda for its next meeting to be held in New York Sept. 14 and
15: 1) whether U.S. lawmakers should remove legal roadblocks preventing
localities from taxing goods sold over the Internet or by catalog, 2) to
explore whether online and offline taxes should be the same, 3) whether to
impose new taxes on Internet access and 4) how international taxing schemes
will come into play. The group will hear witnesses and hopes to have a final
report ready by March.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

JAPAN'S FUJITSU LOOKS TO AMERICA ONLINE AS MODEL IN ATTEMPT TO BECOME A
LEADER IN E-COMMERCE
Issue: International
Fujitsu is the No.1 computer company in Japan and IBM is the No.1
computer manufacturer in the world. Both companies have focused in recent
years on computer services -- helping customers use technology rather than
merely selling them a box. But Fujitsu decided to take a different strategy
and took full ownership of Japan's largest online service provider, Nifty
Serve, in March of 1999. Since then, Fujitsu has unveiled a series of
e-commerce deals in banking, securities and online shopping -- comparing
itself now with AOL. "What we're aiming for is a portal service
like AOL in America," says Yuji Hirose, who heads Fujitsu's software and
services division. Banking is one of the services Fujitsu hopes will
attract the new users to "nifty." In July, Fujitsu and Sakura Bank
announced a joint venture to start Japan's first Internet-only bank. The
bank, in which Sakura will hold a 90% stake and Fujitsu 10%, will try to
lure customers by offering higher interest rates and lower fees, according
to Mr. Hirose. To save money, the Internet bank won't have any branches.
Some analysts believe Fujitsu will have a difficult time with the
transition from production to service -- as the company's estimate of 3.5
million nifty users is overblown because it includes customers who haven't
paid their bills in years and never use the service. Roger Boisvert, the
president of rival Internet provider Global OnLine Japan, says he was still
able to access his Nifty Serve account as of a year ago even though he had
stopped paying his bill seven years earlier.
[SOURCE: Wall Street Journal, A18, AUTHOR: Peter Landers]
(http://interactive.wsj.com/articles/SB934224153798186107.htm)

OLD LINE CONSULTING FIRMS BECOME THE INTERNET MAVERICKS
Issue: E-commerce
Andersen Consultants and other consulting companies are happy to
charge $700 an hour to help people make their Web sites happen. Other firms
like Ernst & Young, A.T. Kearney and PricewaterhouseCoopers are also
turning into self-appointed Internet gurus and going after the same
customers around the world. The companies' Web sites compete for the most
imaginative packaging of guidelines for success in e-commerce. These
consultant models are working because corporations may be unwilling to
confront the electronic world. Most executives cannot imagine entrusting an
innovative but unproven startup with their future -- so they turn to big
consulting companies, which they have known for years as reliable auditors
or software integrators. Andersen Consulting is also putting serious energy
into human language technology and "v-commerce," or voice-driven commerce.
[SOURCE: New York Times (CyberTimes), AUTHOR: Bruno Giussani]
(http://www.nytimes.com/library/tech/99/08/cyber/eurobytes/10eurobytes.html)

BUYING STAMPS CAN NOW MEAN JUST A TRIP TO THE COMPUTER
Issue: Ecommerce
PC Postage, available nationwide, is the first new way to buy US postage
since the introduction of the postage meter in 1920. The E-Stamp Corp and
Stamps.com have been approved to sell their products nationally over the
Internet. Customers will use credit cards to pay for postage and will then
be able to print out a special bar code on envelopes. "Life just became a
little bit easier for those who mail," Pam Gibert, a Postal Service vice
president, said. "With PC Postage you can purchase and print postage 24
hours a day, 7 days a week."
[SOURCE: New York Times (A13), AUTHOR: Melody Petersen]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/10post.html)
See Also:
Digital stamps get Postal Service OK
[SOURCE: San Jose Mercury, AUTHOR: Deborah Claymon]
(http://www.sjmercury.com/svtech/news/indepth/docs/postal081099.htm)
U.S. Postal Service Unveils PlanFor Firms to Sell Stamps Online
[SOURCE: Wall Street Journal, A4, AUTHOR:Glenn Burkins]
(http://interactive.wsj.com/articles/SB934213775652415189.htm)

INTERNET

CAPITAL DISPATCH:
THE WEEK AHEAD
Issue: Internet/Domain Names
On Thursday, the Internet Corporation for Assigned Names and Numbers
(ICANN) will hold a meeting to vote on a proposal to amend its bylaws.
ICANN will look at limiting its representation in one of its membership
groups -- the Domain Name Supporting Organization -- to just one person per
company. Network Solutions, which has nominated three people, prompted the
move.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

CAPITAL DISPATCH:
ANTI-CYBERSQUATTING BILL CLEARS SENATE
Issue: Legislation/Internet
Last week, the Senate passed a cybersquatting bill -- which has not yet
cleared the House -- that would impose fines of up to $100,000 per Internet
name on anyone who registers a domain name in "bad faith" by hoping to
profit from association with a trademark owned by someone else. Some say
the bill will give big companies an edge over small companies. Big
companies say they are tired of having to pay large amounts for a domain
name with their registered trademark. The Clinton Administration says it
opposes the measure. Meanwhile, the House Commerce Committee cleared two
bills to create a national framework to recognize digital signatures and to
extend copyright protection to electronic databases.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

QWEST TO COMBINE INTERNET ACCESS, LONG DISTANCE
Issue: Internet/Long Distance
Qwest Communications is expected to announce today an offer for unlimited
Internet access and 250 minutes of long-distance calling for $24.95/month.
This comes one day after MCI announced its five cents a minute long
distance plan. AT&T did not immediately match MCIWorldCom's offer. The
company stressed that its future is in selling bundles of services. "They
are just focused on price and long distance, but we think the industry is
well past that," an AT&T spokesman said. (That would be why Qwest is coming
out of the gates for bundling services.) Paul Wright, an analyst with
Loomis Sales in Boston, said long-distance companies might be gearing up
their best plans in anticipation of the entry of regional Bell operating
companies into the long-distance market. "This really is the beginning of
the war in a real way," Mr. Wright said.
[SOURCE: Wall Street Journal, B6, AUTHOR: Rebecca Blumenstein]
(http://interactive.wsj.com/articles/SB934240023639236010.htm)

MEDICAL WEB SITES CAN STEER YOU WRONG
Issue: Online Health
A team of researchers from the University of Michigan reviewed 400 Web
sites for information on a rare cancer, Erwing sarcoma, to find that 6% of
the sites contained erroneous information and many more were misleading.
One of the most basic statistics --the survival rate for people with this
form of cancer-- varied from 5% to 85%. The high rate could influence
people to refuse therapy in light of such a dismal prognosis or influence
people to undergo treatment with an organization that lists a lower
mortality rate. The report addressed the notion that patients today have
instant access to an overwhelming amount of information, some of it of
dubious validity. "I think the Internet is a really positive development,"
said J. Sybil Biermann, an orthopedic surgeon who led the study, but there
are perils in the lack of peer review and the promulgation of bad
information. When patients come in to discuss information with their
doctor, Biermann recommended doctors ask patients if they got the
information from the Internet. Then doctors can assess a patient's level of
understanding about the health matter being addressed, dispel
misinformation and provide guidance and support.
[SOURCE: Washington Post (Z7), AUTHOR: Sandra G. Boodman]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/10/008l-081099-idx.html)

ADVERTISING: SIREN CALLS SOUGHT FOR CONDE NAST'S WEB OF SITES
Issue: Advertising
Conde Nast will pend more than $20 million to increase traffic to Conde
Net's Web sites. Conde Nast owns familiar magazines like Architectural
Digest, Bon Appetit, Conde Nast Traveler, Details, GQ, Glamour, Gourmet,
Mademoiselle, The New Yorker, Self and Vanity Fair. "The plethora of
dot-coms makes it hard to establish a brand," said Sarah Chubb, director for
Conde Net in New York. "We know who it is we want, but it's harder to get
them because of all that's out there. The idea is to communicate the
richness of the content to those who have not seen it before, and even to
those who have not been online before." The campaign will include television
and radio commercials, newspaper and magazine ads, postcards and posters.
[SOURCE: New York Times (C7), AUTHOR: Stuart Elliott]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/10conde-ad-colum
n.html)

ACCESS TO GOVERNMENT INFO

CAPITAL DISPATCH:
GROUPS IDENTIFY TEN 'MOST WANTED' DOCUMENTS
Issue: Access to Government Information
The Center for Democracy and Technology and OMB Watch issued a list of the
"Ten Most Wanted" documents they want the government to place on the
Internet. Among these was the Congressional Research Service's reports on
public policy issues. Sen. John McCain (R-AZ) has filed a bill to make the
reports available to everyone on the Web. "Taxpayers have footed the bill
for these documents, and they have a right to see them," said Sen McCain.
Hundreds of reporters, librarians and researchers responded to a public
call for the "Ten Most Wanted" documents which also included Supreme Court
decisions, the Environmental Protection Agency's Pesticide Safety Database
and Congressional hearings.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

BUDGET ISSUES

CAPITAL DISPATCH:
REPUBLICANS BACKTRACK ON RESEARCH TAX CREDIT
Issue: Budget Issues
The latest tax bill the Republicans sent the President last week contained
only a five-year extension of the Research and Development tax credit
destined to serve the technology industry. Thirty top high-tech leaders
determined that a permanent extension of the credit was the best way to
maintain U.S. leadership in cutting-edge technology. President Clinton has
never opposed the R&D but has problems with larger issues surrounding the
proposed tax cuts. Democrats expressed surprise that the Republicans tax
legislation package was not able to find a permanent extension of the R&D
credit, as they have been touting themselves high-tech friendly.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

LEGAL ISSUES

TICKETMASTER SUES OVER LINKS
Issue: Legal Issues
Ticketmaster Online-City Search Inc. filed a suit last month against
Tickets.com Inc. saying it featured links that went deep into
Ticketmaster's own site, bypassing introductory pages and advertising.
Ticketmaster also said Tickets.com plagiarized editorial material and
misled customers about ticket availability at venues affiliated with
Ticketmaster. W. Thomas Gimple, president and chief executive of Ticket.com
said deep linking presents "a service to consumers and venues, and brings
customers to Ticketmaster. So we're a little puzzled about this."
Tickets.com bills itself as a clearinghouse that directs visitors of its
Web site to ticketing agents including Ticketmaster. In 1997, Ticketmaster
sued Microsoft's Sidewalk site for deep linking. Microsoft eventually conceded.
[SOURCE: New York Times (CyberTimes), AUTHOR: Bob Tedeschi]
(http://www.nytimes.com/library/tech/99/08/cyber/articles/10tickets.html)

TIMES CO. AND AMAZON SETTLE A LEGAL DISPUTE
Issue: Legal Issues
Amazon and the New York Times have settled a dispute over the use NYTimes
best seller list by the online bookseller. Amazon agreed to list the
best-selling books in alphabetical order, post the lists after publication
in the newspaper and include disclaimers that the NYTimes was not affiliated
with Amazon. In turn, Amazon has agreed to continue providing weekly sales
data to the newspaper. "They didn't threaten to withhold their data, but it
was very clear to us that their data is of benefit to us," said Nancy
Nielsen, a spokeswoman for the Times Company. "So when we made the
settlement, it was written going forward that this was a quid pro quo." "The
bottom line is that this is an agreement that benefits the book-reading
public," said Bill Curry, a spokesman for Amazon. "You have a widely
recognized list of best sellers on line so that people can readily know that
these books are available at Amazon.com. And from The Times's perspective,
the integrity of the best-seller list" will be maintained "because it will
include sales data from the biggest seller of online books."
[SOURCE: New York Times (C7), AUTHOR: Doreen Carvajal]
(http://www.nytimes.com/library/tech/99/08/biztech/articles/10times.html)
See Also:
AMAZON.COM, NEW YORK TIMES SETTLE DISPUTE OVER BESTSELLERS
(http://interactive.wsj.com/articles/SB934210800893903188.htm)

TELECOM VENTURE OF SIEMENS AND CITIC SKIRTS CHINESE BAN WITH UNUSUAL STEP
Issue: International
Chinese law bars foreign ownership of telecom ventures. But the company Xin
De Telecom International Ventures has found a way around that law. It is a
joint venture between Siemens of Germany and China International Trade and
Investment (Citic). What the company does to get around the Chinese law is
act as a leasing agent. They have provided $180 million to China's second
largest telephone operator, China Unicom -- so they can lease mobile-phone
equipment from Siemens and expand into Chinese cities. The partnership is
"legal" in the sense that both companies are "Chinese" companies. China has
been trying to resolve issues of foreign investing and this has hobbled
their effort to join the World trade Organization, the global body that
sets up trading rules.
[SOURCE: Wall Street Journal, A19, AUTHOR: Ian Johnson]
(http://www.wsj.com)

SECURITY

CAPITAL DISPATCH:
TASK FORCE TO STUDY NET CRIME
Issue: Security
Attorney General Janet Reno will head a special task force designed to look
at unlawful uses of the global Internet network. Under observation will be
such issues as the illegal sale of guns, explosives, controlled substances
and prescription drugs online as well as fraud and child pornography. The
group was created by an executive order of the President to determine
whether to push for self-regulation and to identify areas where regulation
gaps exist. Besides Reno, the panel will include the director of the
Federal Bureau of Investigation, the director of the Bureau of Alcohol,
Tobacco and Firearms and the administrator of the Dug Enforcement
Administration.
[SOURCE: New York Times (CyberTimes), AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/08/cyber/capital/10capital.html)

--------------------------------------------------------------

BROADCAST OWNERSHIP RULES
F.C.C. Will Permit Owning 2 Stations In Big TV Markets (NYT)

MEDIA & SOCIETY
Parental (Not Expert) Guidance Suggested (WSJ)

INTERNET
Students Learn Business Skills, Help Small Entrepreneurs (SJM)
Web Opens Hard-To-Reach Market to Advertisers (USA)
Hacker Vandalizes Security Site (SJM)
Filters Debated in Michigan (CyberTimes)
Is Linking Legal? (CyberTimes)
Wireless Way to Web (ChiTrib)

MERGERS
Deutsche Telekom To Buy One2one For $11.1 Billion (WSJ)
AT&T, British Telecom to Buy Stake In Canada Wireless
Firm Rogers Cantel (WSJ)

LEGISLATION
House Votes, 217-210, to Approve Spending Bill Totaling
$37.7 Billion (WSJ)
Committee Markup (House)

FCC OPEN MEETING
FCC Seeks to Promote Universal Service in Tribal Lands and
Other Insular Areas (FCC)
FCC to Explore Ways to Extend Terrestrial and Satellite
Wireless Services to Individuals Living on Tribal Lands (FCC)
FCC Adopts Pricing Flexibility and Other Access Charge Reforms (FCC)
FCC Revises Local Television Ownership Rules (FCC)
FCC Revises Rules for Calculating Audience Under National
Television Ownership Rule (FCC)
FCC Amends Broadcast and Cable/MDS Ownership Attribution Rules (FCC)

BROADCAST OWNERSHIP RULES

F.C.C. WILL PERMIT OWNING 2 STATIONS IN BIG TV MARKETS
Issue: Broadcast Ownership
"The race is on," read one memo to top corporate officers at a broadcast
network. The Federal Communications Commission voted yesterday to relax
television station ownership rules -- allowing a single company or network
to own two TV stations in the same market. Carter writes, Networks and other
big station companies want to own more than one station in a market because
it increases their presence in areas that are becoming increasingly crowded
with other viewing options, like cable and satellite channels. It also
allows them to save money on programming and personnel costs and gives them
another outlet for shows they own. "For the economic model, it's great to
own two stations in one market," said Paul Sweeney of Salomon Smith Barney.
"I think we are going to start seeing a lot of big-ticket deals." Andrew Jay
Schwartzman, the president of the Media Access Project, a Washington-based
public interest firm, said that while he had hoped for more in the way of
insuring diversity in station ownership, the FCC deserved to be praised for
succeeding in the most important area of closing loopholes in stations
ownership restrictions that had rendered the existing rules unfair. "Now if
you run it, you own it," Schwartzman said. "It had become like the Wild
West. People who played by the rules were being penalized. I think overall
[FCC Chairman] Bill Kennard did a good job under severe political pressure."
[The FCC was busy yesterday -- see summaries of other decisions below]
[SOURCE: New York Times (A1), AUTHOR: Bill Carter]
(http://www.nytimes.com/yr/mo/day/news/financial/tv-station-ownership.html)
See Also:
RULES ON TV STATIONS LOOSENED
[SOURCE: Chicago Tribune (Sec 3, p.1), AUTHOR: Tim Jones]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99080602
11,FF.html)
FCC OPENS UP BIG TV MARKETS
[SOURCE: Washington Post (E3), AUTHOR: John Schwartz]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/06/094l-080699-idx.html)
FCC Relaxes Its Rules on TV-Station Ownership
[SOURCE: Wall Street Journal, A3, AUTHOR: Kathy Chen and Martin Peers]
(http://www.wsj.com)

MEDIA & SOCIETY

PARENTAL (NOT EXPERT) GUIDANCE SUGGESTED
Issue: Media & Society
Theodore Dalrymple is critical of the latest suggestions by the American
Academy of Pediatrics. The Academy said that children under two should not
watch television and that parents (and doctors) should take a greater
interest in what children watch. He states that his disdain for television
is pretty apparent. Dalrymple says if he could, he'd make children watch the
farming news everyday for two years so that they would develop a hatred for
TV. "How life should be lived is not a technical question to be decided by
committees of experts... The reason that parents should take an interest in
the activities -- or perhaps I should call them the passivities -- of their
children is because they are responsible for the moral welfare and growth of
their children. This inescapable responsibility is antecedent to any
research-based recommendations of expert committees, however eminent their
members, and cannot be abrogated... If there are indeed parents who, because
of the Academy's recommendations, start to take an interest in what their
young children watch on television, I can only say that such parents appall
me only a little less than those who continue to take no interest whatever.
I hesitate to use the word abuse in these times in which everyone thirsts to
be a victim, but to leave children to the mercies of a television screen is
abusive, and it requires no pediatricians to tell us so."
[SOURCE: Wall Street Journal, A10, AUTHOR: (Theodore Dalrymple is the pen
name of Anthony Daniels, a British physician and contributing editor of
City Journal.)]
(http://www.wsj.com)

INTERNET

STUDENTS LEARN BUSINESS SKILLS, HELP SMALL ENTREPRENEURS
Issue: E-Commerce/EdTech
Virtualis, a Silicon Valley company, is teaching high school students what
they need to know to be successful in e-commerce -- everything from the art
of Web design to the art of a handshake. The San Jose Chamber of Commerce
and Virtualis have developed a program to train a select group of students,
who will then help local small businesses get online. "This is a great
opportunity for them to talk to adults and solve adult problems," said
Dennis Barbata, the school's technology coordinator. "We have to put the
tools in the hands of students so they can compete in the 21st century."
[SOURCE: San Jose Mercury News, AUTHOR: K. Oanh Ha]
(http://www.mercurycenter.com/svtech/news/indepth/docs/eagle080699.htm)

WEB OPENS HARD-TO-REACH MARKET TO ADVERTISERS
Issue: E-commerce
Web advertisers have realized they can get a much more defined audience by
advertising on the Web versus TV or radio. NetNoir serves 2.9 million black
households and, according to Forrester Research, Blacks are adopting the
Internet the faster than the rest of the population. Wall Street has taken
note of the Hispanic American population at 2.9 million, an on-line
community that is more penetrated than Caucasians on the Web. However, one
of the groups being left out of the Web advertising market are gays and
lesbians. "The fact that the group faces not-so-subtle forms of
discrimination makes them more cohesive and more likely to interact in an
on-line community," says David Alschuler, an analyst with the Aberdeen
Group. The Web can be more efficient than print because gays and lesbians
might not be out of the closet and feel they cannot read specific
publications in public. Still, finding mainstream advertisers for a gay
lifestyle Web site can be tricky -- especially since some sites feature
direct links to adult content. Advertisers do not look kindly on such content.
[SOURCE: USA Today (12B), AUTHOR: Greg Farrell]
(http://usatoday.com/)

HACKER VANDALIZES SECURITY SITE
Issue: Security
AntiOnline in Beaver (PA), a popular site specializing in news about
hackers and security, was hacked itself on Thursday. A hacker was able to
discover, and tamper with, hidden code on one of the site's pages. The
problems were fix in about an hour, but the attack raised concerns
about the vulnerability of the organizations that people depend on to
learn about protecting their own sites. "There is no absolute security,"
said James Adams, chief executive officer of Infrastructure Defense Inc.,
which works to protect companies against hackers. "All you can do is try to
keep ahead of the game. For anybody to claim they're totally secure, it's
not true."
[SOURCE: San Jose Mercury News, AUTHOR: Ted Bridis (Associated Press)]
(http://www.mercurycenter.com/svtech/news/breaking/ap/docs/727614l.htm)

FILTERS DEBATED IN MICHIGAN
Issue: Filtering
The only public library in Georgetown Township (MI) has placed filters on
all its computer terminals except one where it charges patrons $100 to have
an unrestricted view of the Internet. Though free-speech activists say this
violates the First Amendment rights of adults, Township Supervisor, Henry
Hilbrand says there is no violation under the new Michigan State law on
public filtering. He says the law is ambiguously worded and that the
library's interpretation is just. There has also been widespread local
support: "We were flooded with calls from people in the community who are
saying 'Finally someone stood up for what's right' and 'I'm glad they
declared war on Internet porn," said Sheryl VanderWagen, director of the
library. The American Civil Liberties Union (ACLU) of Michigan said the $100
fee was "outrageous" and said they would look into the filtering policy.
[SOURCE: New York Times (CyberTimes), AUTHOR: Pamela Mendels]
(http://www.nytimes.com/library/tech/99/08/cyber/articles/06michigan.html)

IS LINKING LEGAL?
Issue: Internet
The law on linking is currently "up in the air," especially in regards to
"deep links." Deep links can point specifically at a Web page or content in
a site, sometimes bypassing any identification or advertisements on the
site. Though there are no court opinions in the U.S. that directly address
this subject, says Jeffrey R. Kuester, a lawyer with Thomas, Kayden,
Horstemeyer & Risley in Atlanta, some lawyers believe that "deep linking"
should be limited -- others do not. "I don't think an intellectual property
owner should be able to stop most deep links," said Carl Opperdahl, a
cyberlaw expert at Oppendahl & Larson, a law firm in Frisco (CO). "The
eventual goal of the Web is for everything to be linked to everything else.
If someone says, 'You can't link to my page,' well, they are missing the
point of the Web." Emily Madoff, an intellectual property lawyer at Wolff
Popper in New York says that property owners who create content should have
a right to determine how surfers experience their Web sites. In particular,
she said, if an owner's home page or another page laden with ads is
bypassed by a deep link, then the linked-to Web site owner will soon be out
of business. What to do? One lawyer says, ask for permission to deep link.
[SOURCE: New York Times (CyberTimes), AUTHOR: Carl S. Kaplan]
(http://www.nytimes.com/library/tech/99/08/cyber/cyberlaw/06law.html)

WIRELESS WAY TO WEB
Issue: Wireless/Internet Access
"You don't have to sell anybody now on the idea that a cell phone is useful
for their business...But we're not yet to that point with wireless data,"
says Dan Croft of American Mobile Satellite Corp. The next generation of
cell phone will come fully equipped to receive information from the Web or
prepackaged information services. "Most people today think of the Web as a
destination, but that will change as people begin to see it as an engine to
fulfill transactions," said Mike Ozburn, vice president and general manager
of Nextel Online. "A wireless customer planning a business trip may enter
his destination information and get back options for plane and hotel
reservations to confirm with the click of a button. This will be available
anytime, anywhere without booting up, dialing in or any other nonsense." "We
in the wireless world see the Internet as the pipe that lets us gain entry
wherever we need to go," said Croft.
[SOURCE: Chicago Tribune (Sec3, p.1), AUTHOR: Jon Van]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99080602
16,FF.html)

MERGERS

DEUTSCHE TELEKOM TO BUY ONE2ONE FOR $11.1 BILLION
Issue: Mergers
The German Telecom giant, Deutsche Telekom, has agreed to acquire One2One,
from Cable & Wireless and MediaOne. Many European companies were attracted
to One2One because of the huge cellular demand in Britain. Deutsche Telekom
is hoping to exploit synergies between T-Mobile, its existing cellular
subsidiary, and On2One. After acquiring One2One, Deutsche Telekom will have
some 12 million mobile subscribers in the European cellular communications
market. Deutsche Telekom is also likely to find it much easier to acquire
one of the soon-to-be offered licenses for the next generation of
mobile-phone service in Britain.
[SOURCE: Wall Street Journal, AUTHOR: Wall Street Journal Staff]
(http://interactive.wsj.com/articles/SB933920025528981057.htm)

AT&T, BRITISH TELECOM TO BUY STAKE IN CANADA WIRELESS FIRM ROGERS CANTEL
Issue: Merger
AT&T and British Telecommunications (BT) invested a $934 million in Rogers
Cantel Mobile Communications, a Canadian company. The joint investment
gives AT&T and BT a 33% equity stake in Canada's largest wireless provider,
with 1.7 million cellular and digital subscribers. John Zeglis, AT&T's
president, said this investment will give Canadian customers access to a
global network, as well as more products and services such as Internet
access on wireless phones. AT&T also agreed to buy MetroNet Communications
in March of this year to expand its Canadian presence in a deal worth $2.4
billion. Analysts say the move reflects increasing consolidation in the
Canadian telecommunications market. Alfred T. Mockett, president and chief
executive of BT Worldwide, said BT, AT&T and Rogers Canel plan to work
together on the next generation of wireless communications to develop
global calling plans for one set fee. This is the second time AT&T and BT
have joined forces to make a deal and chose Canada because they have a
higher concentration of wireless consumers than the U.S. The companies say
they will likely work together in the future to take on giants such as
MCIWorldcom.
[SOURCE: Wall Street Journal, B4, AUTHOR: Rebecca Blumenstein and Solange
De Santis]
(http://interactive.wsj.com/articles/SB933858931897643293.htm)
See Also:
AT&T and British Telecom Invest $1 Billion in Toronto Company
[SOURCE: New York Times (C4), AUTHOR: Timothy Prichard]
(http://www.nytimes.com/yr/mo/day/news/financial/canada-telecom.html)

LEGISLATION

HOUSE VOTES, 217-210, TO APPROVE SPENDING BILL TOTALING $37.7 BILLION
Issue: Legislation/Budget Issues
The House of Representatives approved a $37.7 billion spending bill last
night by a slim 217-210 vote. The bill makes deep cuts in Commerce
Department programs and freezes spending for major regulatory agencies. The
Federal Trade Commission, Securities and Exchange Commission and Federal
Communications Commission are denied any funding increases and must live
with a combined budget at least $92 million below the Administration's
request for the new fiscal year. Over $250 million is cut from
other accounts to pay debts owed to international organizations such as the
United Nations. This vote came after regional telephone companies won an
amendment to overturn the decades-old uniform accounting system imposed on
the telephone industry by the Federal Communications Commission. The
accounting system served the FCC when telephone rates were set on a cost
basis. With the advent of deregulation and changes in how rates are set,
regional bell operating companies (RBOC's) said the requirements were
outdated. The RBOC's also said the FCC should be satisfied if the phone
companies follow general accounting principles such as the system used by
the SEC. SBC Communications and other RBOC's were involved in lobbying
Congress and the industry estimates it could save as much as $270 million a
year by no longer having to keep a second set of books for the FCC. By
shedding the extra accounting costs, the RBOC's hope to gain ground against
their long-distance rivals such as AT&T and MCIWorldcom, which opposed the
same amendment brought by Representative Billy Tauzin (R-LA). Consumer
groups and rival long-distance companies criticized the action as a victory
for special-interest politics. John Windhausen, president of a trade group
representing smaller companies now competing with the same regional
telephone companies, said consumers could suffer and the amendment
represents an "abuse of the legislative process."
[SOURCE: Wall Street Journal, AUTHOR: David Rogers]
(http://interactive.wsj.com/articles/SB933897450228060932.htm)

COMMITTEE MARKUP
Issue: Legislation
1) H.R. 1714 ELECTRONIC SIGNATURES IN GLOBAL AND NATIONAL COMMERCE ACT, was
ordered reported to the House, amended, by a voice vote (see News Release
http://com-notes.house.gov/cchear/hearings106.nsf/eeae8466ba03a215852567...
4b4d11/c40d48774b04bb02852567c400601e67?OpenDocument). 2) H.R. 1858 CONSUMER
AND INVESTOR ACCESS TO INFORMATION ACT OF 1999, was ordered reported to the
House, amended, by a voice vote (see News Release
http://com-notes.house.gov/cchear/hearings106.nsf/eeae8466ba03a215852567...
4b4d11/678dfe07eee8c84e852567c4005e302d?OpenDocument). 3) H.R. 486 COMMUNITY
BROADCASTERS PROTECTION ACT OF 1999, was ordered reported to the House,
amended, by a voice vote (see
http://www.benton.org/News/Extra/broad080399.html for summary).
[SOURCE: House of Representatives]
(http://com-notes.house.gov/cchear/hearings106.nsf/eeae8466ba03a2158525677f0
04b4d11/d8ec6f2ac726193f852567c2005b8c50?OpenDocument)

FCC OPEN MEETING

FCC SEEKS TO PROMOTE UNIVERSAL SERVICE IN TRIBAL LANDS AND OTHER INSULAR AREAS
Issue: Universal Service
From News Release: As part of its efforts to extend the full range of modern
telecommunications services to all Americans, the FCC has begun to address
impediments to deployment and subscribership in unserved and underserved
areas. While nearly 95% of all households in the United States have
telephone service today, Indians living on reservations and on tribal lands
have significantly lower rates of telephone subscribership. The FCC is
seeking comment on unserved and underserved areas as part of a Further
Notice of Proposed Rulemaking adopted Thursday. The Telecommunications Act
of 1996 provides that "consumers in all regions of the nation, including
low-income consumers and those in rural, insular, and high-cost areas,
should have access to telecommunications and information services . . . ."
Through decisions adopted over the past two years, the FCC has been striving
to ensure that consumers have access to and can afford the services
supported by federal universal service support mechanisms. The goal is to
ensure that the country does not become divided into information "haves" and
"have-nots." Despite these efforts, the FCC has recognized that certain
regions of the nation remain unserved or inadequately served. In the Further
Notice of Proposed Rulemaking, comment is sought to ascertain the
availability of, and to understand the possible impediments to, deployment
and subscribership in unserved and underserved areas of the Nation. In
addition, the FCC seeks comment on a range of possible modifications to its
high-cost, low-income and rural health care support mechanisms that are
designed to promote deployment and subscribership in these areas. The FCC
invites interested parties to comment on the implementation of section
214(e)(3) of the Act, which concerns the ability of the FCC and state
commissions to order carriers to provide service in unserved areas,
including the possibility of using a competitive bidding mechanism. The FCC
also sought comment on the implementation of section 214(e)(6) of the Act,
which authorizes the FCC to designate carriers not subject to the
jurisdiction of a state commission as eligible telecommunications carrier.
Common Carrier Bureau Contact: Valerie Yates 202-418-1500
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Common_Carrier/News_Releases/1999/nrcc9055.doc)

FCC TO EXPLORE WAYS TO EXTEND TERRESTRIAL AND SATELLITE WIRELESS SERVICES
TO INDIVIDUALS LIVING ON TRIBAL LANDS
Issue: Wireless/Universal Service
In a Notice of Proposed Rulemaking adopted Thursday, the Federal
Communications Commission (FCC) began exploring a number of possible
terrestrial and satellite wireless policy initiatives to promote greater
access to telecommunications services for individuals living on tribal
lands. In the Telecommunications Act of 1996, Congress directed the FCC to
help ensure that all Americans have access to affordable telecommunications
services. The relatively low incomes of most individuals living on tribal
lands and the rural environment of most tribal lands have contributed to
extremely low telephone penetration rates. Because telephone service is a
necessity in our modern society, this lack of access puts the Indian
community at a tremendous disadvantage. In today's Notice of Proposed
Rulemaking, the FCC seeks comment on ways wireless and satellite technology
can be used to provide basic telephone service and other telecommunications
services to tribal lands, particularly in remote areas where wireless
alternatives could be significantly less expensive than wireline service.
The FCC also seeks comment on how to provide greater incentives for
terrestrial and satellite wireless carriers to extend service to tribal
lands. In addition, the FCC seeks comment on whether to extend any
terrestrial or satellite wireless initiatives adopted in this proceeding to
individuals living in other unserved areas. Wireless Telecommunications
Bureau contact: Joel Taubenblatt at (202) 418- 1513; TTY at (202) 418-7233;
or e-mail jtaubenb( at )fcc.gov
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Wireless/News_Releases/1999/nrwl9031.html)

FCC ADOPTS PRICING FLEXIBILITY AND OTHER ACCESS CHARGE REFORMS
Issue: Telephone Regulation
From the News Release: Thursday the Commission adopted an Order that allows
competition, rather than regulation, to determine prices for interstate
access services, thus providing customers more choices among services,
carriers, and rates. The Order gives the nation's largest telephone
companies progressively greater flexibility in setting interstate access
rates as competition develops, gradually replacing regulation with
competition as the primary means of setting prices. Long distance companies
purchase interstate access service from local telephone companies to reach
end user customers. Today's Order changes rules that govern the provision
of interstate access services by local exchange carriers (LECs) subject to
price cap regulation to make them more compatible with the development of
competition in the marketplace. These reforms will enable those companies
to compete more efficiently, and customers of interstate access service
should benefit from increased choices among carriers and lower overall
rates. The Order grants greater pricing flexibility to price cap LECs as
competition for specific services develops, while ensuring that such
flexibility neither deters efficient entry nor results in unreasonable rate
increases for customers without competitive alternatives. Common Carrier
Bureau contact: Tamara Preiss, 202/418-1520
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Common_Carrier/News_Releases/1999/nrcc9054.wp)

FCC REVISES LOCAL TELEVISION OWNERSHIP RULES
Issue: Broadcast Ownership
The FCC Thursday revised its local market television ownership rules - the
"TV duopoly" rule and the radio-television cross ownership (or
"one-to-a-market") rule to reflect changes in the media marketplace. In a
Report and Order, the Commission said the revised rules reflect the growth
in the number and variety of media outlets in local markets, including cable
and direct broadcast satellite, and the Commission's desire to permit
broadcasters to realize the efficiencies of common ownership where
consistent with its ongoing concern for diversity and competition in
broadcast markets. The changes are intended to strengthen the potential of
free over-the-air broadcast services to compete, particularly failed and
failing broadcast stations, and to continue to provide public service
benefits in the video marketplace. The FCC said the new rules would promote
diversity of ownership by imposing "minimum voice" floors in local markets
that must be met before owners could be eligible for the duopolies and
radio-TV crossownerships provided for in the new rules. It said it was also
adopting "failed station", "failing station" and unbuilt station waiver
standards, and grandfathering existing Local Management Agreements (LMAs),
to help promote additional media outlets in a market.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/1999/nrmm9019.html)
See also:
F.C.C. WILL PERMIT OWNING 2 STATIONS IN BIG TV MARKETS
[SOURCE: New York Times (A1), AUTHOR: Bill Carter]
(http://www.nytimes.com/yr/mo/day/news/financial/tv-station-ownership.html)
RULES ON TV STATIONS LOOSENED
[SOURCE: Chicago Tribune (Sec 3, p.1), AUTHOR: Tim Jones]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99080602
11,FF.html)
FCC OPENS UP BIG TV MARKETS
[SOURCE: Washington Post (E3), AUTHOR: John Schwartz]
(http://washingtonpost.com/wp-srv/WPlate/1999-08/06/094l-080699-idx.html)
FCC RELAXES ITS RULES ON TV-STATION OWNERSHIP
[SOURCE: Wall Street Journal, A3, AUTHOR: Kathy Chen and Martin Peers]
(http://www.wsj.com)

FCC REVISES RULES FOR CALCULATING AUDIENCE UNDER NATIONAL TELEVISION
OWNERSHIP RULE
Issue: Broadcast Ownership
From the News Release: The FCC Thursday revised its national TV ownership
rule to clarify that no market will be counted more than once when
calculating whether a group station owner complies with the rule's 35%
aggregate national audience reach limit. In a Report and Order, the
Commission said that owners of television stations that have an attributable
interest in another TV station in the same market, or that operate a
satellite station in the same market, would not have to include those
additional same-market outlets in calculating its 35% national aggregate
television audience reach cap. The FCC said that the public interest would
not be served by double-counting the audience of a market when calculating
an entity's national audience reach. The Commission clarified, however, that
a station owner with an attributable interest in a station in a separate
market (including time-brokered LMAs and satellite stations would have to
count that additional audience as part of its national aggregate audience.
It said the clarifications were being made in conjunction with its decisions
in two other Orders adopted today to revise its local broadcast ownership
rules and its television attribution rules. It said that the changes would
not be expected to cause any existing group television station owner to
exceed the 35% national aggregate reach cap. Pursuant to the national TV
ownership rule, a station's audience reach is defined as consisting of the
total number of television households within the television market for that
station. UHF stations are attributed with 50% of the audience within the
market (the UHF Discount). The Commission said it would begin utilizing the
Designated Market Areas (DMAs) compiled by A.C. Nielson, a commercial
ratings service, for national and local audience figures. Previously the
markets were defined as the Area of Dominant Influence (ADI) established by
Arbitron, another commercial audience-rating service. It said that DMAs are
now used for cable must-carry and retransmission consent determinations, and
that Arbitron no longer updates its county-by-county market definitions.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/1999/nrmm9018.html)

FCC AMENDS BROADCAST AND CABLE/MDS OWNERSHIP ATTRIBUTION RULES
Issue: Ownership
From News Release: The FCC has revised its broadcast and cable/MDS ownership
attribution rules. The attribution rules define what constitutes a
"cognizable interest" for purposes of applying the ownership rules. A
Report and Order adopted Thursday improves the precision of the attribution
rules and makes them more clear to financial markets. Regulatory certainty
for the attribution rules is necessary to prevent disruptions in the flow of
capital into broadcasting. Through these changes, the FCC and the industry
will be better able to identify the real interests that companies hold in
broadcast properties. Mass Media Bureau contacts: Mania K. Baghdadi, Roger
Holberg at (202) 418-2120.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Mass_Media/News_Releases/1999/nrmm9020.wp)

--------------------------------------------------------------
...and we're outta here. Have a great weekend.