September 1999

EDTECH
Project Trains Teachers to Use Technology (CyberTimes)
MINORITIES
Latino Actors Press TV Execs for Visibility (USA)
BROADBAND
FCC May Deal Regional Bells a Victory Today (USA)
U S West Targets Mass Market With $19.95 DSL Service (SJM)
E-COMMERCE
Internet Tax Panel Faces Thorny Issues (CyberTimes)
TELEPHONY
FCC Expected to Relax Wireless Airwave Cap (SJM)
Small, Local Phone Carriers Go in Search of Big Suitors (NYT)

DTV
Step Right Up For the Next Push in Remote Control (USA)

EDTECH
PROJECT TRAINS TEACHERS TO USE TECHNOLOGY
Issue: Ed Tech
The U.S. Department of Education is backing a project by the University of
Northern Iowa in Cedar Falls where a group of colleges and institutions
hope to identify good examples of classroom technology in use. The project
will tape teacher's work with technology, add footage of teachers
explaining the techniques and then post the results on a Web site. The goal
is for teachers to get guidance on using technology as an educational tool
and begin emulating what they have learned. This project comes on the tail
of a recent survey, conducted by Market Data Retrieval, an educational
market research firm, that found that 61% of teachers felt at best only
"somewhat prepared" to integrate technology into classroom instruction. The
study also found little difference between older teachers and those new to
the profession. According to the Department of Education, over the next ten
years the nation will be hiring 2.2 million new teachers as the retirement
of the Baby Boom generation of teachers and the push to reduce class sizes
come into play. The expected turnover in teachers, combined with the fact
that school districts have begun spending billions of dollars on hardware
and software, means that now is the time to ensure that educators receive
adequate technology training, said Linda Roberts, director of the Office of
Educational Technology at the DOE. Last month, the DOE announced that it
had awarded about $75 million in grants to the initiative as well as to 223
other projects in its new Preparing Tomorrow's Teachers to Use Technology
program
[SOURCE: Cybertimes, AUTHOR: Pamela Mendels]
(http://www.nytimes.com/library/tech/99/09/cyber/education/15education.html)

MINORITIES
LATINO ACTORS PRESS TV EXECS FOR VISIBILITY
Issue: TV/Minorities
Hispanic Heritage Month just happens to coincide with the kick-off of the
new season of network TV shows. And this year, the issue of minority
representation on television is taking center stage for many Latino
entertainers, advocates and politicians. While Latinos make up 11% of the
U.S. population, only 3.8% of television roles went to Latinos last year.
Many Hispanic Americans are staging a two-week network boycott to protest
the lack of Latino faces on this fall's shows. "If network executives don't
care enough about us to include us in the family picture, why should we
care about their programs," said actor and National Hispanic Foundation for
the Arts co-founder Esai Morales at the foundation's third annual dinner.
Vice President Gore, who also spoke at the dinner, said that he was not in
favor of quotas, but "simply in favor of reality."
[SOURCE: USA Today (3B), AUTHOR: Cesar G. Soriano]
(http://www.usatoday.com/)

BROADBAND
FCC MAY DEAL REGIONAL BELLS A VICTORY TODAY
Issue: Broadband
The Federal Communications Commission is scheduled to vote today on a
proposal that would allow regional Bell companies to not offer deep
discounts on high-speed equipment to long-distance companies. Firms like
AT&T and MCI are eager to enter the emerging market for high-speed digital
subscriber line (DSL) services, but say that buying the equipment
themselves would be costly and inefficient and would "inhibit competitors
from providing broadband service to mass market residents," according to an
AT&T statement. The United States Telephone Association, representing the
regional Bells, argues that they should not be forced to spend large sums
of money developing networks just to give their rivals low cost access. The
association asks; "Why risk large investment in facilities when you will
have to share the fruits?"
[SOURCE: USA Today (1B), AUTHOR: Paul Davidson]
(http://www.usatoday.com/)

U S WEST TARGETS MASS MARKET WITH $19.95 DSL SERVICE
Issue: Broadband
US West is targeting a wider economic base of customers with plans to offer
high-speed Internet access in more than 40 Western cities, including
Denver, Minneapolis/St. Paul and Salt Lake City for $19.95 per month. U S
West is offering the service to its U S West.net to customers for only
$17.95 per month.
It will be available in other areas in U S West's 14-state territory next
month, the company said. The new (digital subsciber line) DSL service is
called MegaBit Select. The company said its "DSL on-demand" service is not
the always-on connection typical of DSL, but allows customers to access the
Internet at speeds nearly 10 times faster than the average dial-up modem at
the click of a mouse at any time, for several hours at a time. There is no
limit on access time, said spokesman Garth Neuffer.
[SOURCE: San Jose Mercury, AUTHOR: Associated Press]
(http://www.sjmercury.com/svtech/news/breaking/merc/docs/001023.htm)

E-COMMERCE
INTERNET TAX PANEL FACES THORNY ISSUES
Issue: E-commerce
House Republican leaders sent a letter to the 19-member Advisory Commission
on Electronic Commerce, a commission appointed by Congress last year to
report back on Internet taxation, reminding them that the reason the body
was formed was to decide whether or not to tax Internet transactions, not
how to tax them. House Majority Leader Dick Armey and 34 colleagues signed
the letter. "We recognize the challenge you face, as members of this
national commission, in trying to tackle some very important issues
regarding the future of e-commerce," the letter said. "...We are concerned,
however, about the fact that most of the news reports from the first
commission meeting seemed to focus on how to tax the Internet, rather than
whether to tax the Internet." The Congressional leaders discussed Internet
taxation saying, "This idea is not a popular one in Congress or among the
American people. You should also know that there are many members who will
oppose any new taxes on the Internet." There are now more than 30,000 tax
jurisdictions with varying tax rates and rules in the country, so the idea
of taxation and the Internet opens many taxation jurisdiction issues, which
Congress faces in the future. The panel is expected to begin discussing its
various options today, but no final recommendations to Congress are
expected until spring.
[SOURCE: Cybertimes, AUTHOR: Jeri Clausing]
(http://www.nytimes.com/library/tech/99/09/cyber/articles/15tax.html)

TELEPHONY
FCC EXPECTED TO RELAX WIRELESS AIRWAVE CAP
Issue: Wireless
Today, the Federal Communications Commission is expected to ease ownership
limits on wireless telephone service licensees, in a move to help carriers
roll out new Internet and data services. Large wireless carriers had asked
the agency to remove altogether the ownership cap, which limits the amount
of airwaves any one company may control in a market to 55 megahertz out of
180 megahertz available for wireless phone service. But with competition
flourishing and prices for service plummeting, FCC officials were fearful
that totally removing the cap would reverse the trend and lead to massive
consolidation. So the FCC plans to begin granting case-by-case waivers to
the cap when companies can show that they plan to use new spectrum for new
services like high-speed Internet connections or in rural areas where
competition has not yet arrived and some airwaves are going unused. The FCC
is expected to give wireless carriers greater flexibility in meeting its
regulations on emergency calls using 911 services which have required
wireless carriers to add the capability to locate callers using 911 by
October, 2001.
[SOURCE: San Jose Mercury, AUTHOR: Reuters]
(http://www.sjmercury.com/svtech/news/breaking/reuters/docs/852779l.htm)

SMALL, LOCAL PHONE CARRIERS GO IN SEARCH OF BIG SUITORS
Issue: Telephony
Young communications companies trying to compete against the Bells in local
phone and data communications markets are looking to be acquired. According
to executives on Wall Street, E.Spire Communications, GST
Telecommunications, ICG Communications and Intermedia Communications are
among the competitive local exchange carriers (CLECs) searching for someone
to buy them. The companies are looking to reduce costs and analysts say
that often the fastest way to do that is to merge. CLEC's have found
competing against regional Bell companies to be more difficult and
expensive than expected. But, for all of their volatility, many CLECs have
built valuable fiber optic networks in cities and towns across the nation
and have won many business customers away from the Bells. Groups that may
be interested in the CLEC's include McLeodUSA, Nextlink Communications,
Teligent, Winstar, Qwest Communications, Level 3 Communications, Global
Crossing and the regional Bells themselves -- especially SBC and Bell
Atlantic.
[SOURCE: New York Times, AUTHOR: Seth Schiesel]
(http://www9.nytimes.com/yr/mo/day/news/financial/local-phone-carriers.html)

DTV
STEP RIGHT UP FOR THE NEXT PUSH IN REMOTE CONTROL
Issue: Digital TV/Cable
Free Pizza. WebTV Plus, Domino's Pizza and B3TV recently ran interactive
commercials offering free pizza to 9,000 San Francisco homes equipped with
the WebTV Plus system. Nearly 140 homes took the partners up on their
offer, raising hopes that interactive television systems will be the next
venue for online goods. Advertisers were further encouraged by the response
of the homes that got the free pizza, 96% said they would be inclined to
buy pizza through their television, and 98% said they would buy other
products. By 2004, Forrester Research predicts that interactive television
systems, such as WebTV Plus and Wink, will provide advertisers with the
potential to reach 24 million households generating an estimated $3.8
billion in interactive commerce. The market potential of the technology is
spurring advertisers such as General Motors, AT&T and Procter & Gamble to
step up their development of interactive commercials. Major broadcasters
and cable stations, such as E! and HBO plan to enhance some of their
existing programs with interactive elements for the fall. While the
technology is ready to move forward, some artistic and legal concerns for
interactive media are yet to be addressed.
[SOURCE: USA Today, (7D) AUTHOR: Bruce Haring]
(http://www.usatoday.com/)
--------------------------------------------------------------

INTERNET ACCESS
Why pay for Internet service? (SJM)

EDTECH
Graduating From File Cards to Databases (WP)

E-COMMERCE
Debate on Internet Taxes Takes Political Turn (NYT)
European law seen as grave threat to E-Commerce (SJM)

ANTITRUST
Microsoft and US Square Off In Antitrust Trial's Final Round (WSJ)

ACCESS TO GOVERNMENT INFORMATION
Group Puts Disaster Data on Internet (NYT)

MERGERS
Motorola expected to buy General Instrument (SJM)
Bell Atlantic and Vodafone, Once Enemies, Are Said to Be Near a
Deal(NYT)

INTERNET/ACCESS

WHY PAY FOR INTERNET SERVICE?
Issue: Internet/Access
The viability of free Internet access providers has long been
questioned, but several companies are eager to bet that consumers will
put up with floods of ads and poor customer service in exchange for
free monthly connections. The recent announcements of a AltaVista's new
free Internet service and NetZero initial public offering of stock
highlight the growing momentum of free Internet access. While the free
service movement is gaining more attention, there have already been
many failures and all of the no-cost providers have yet to turn a
profit. "They need to develop an advertising model that supports
them,'' said Kathey Hale, a Dataquest analyst. "The only places
supported purely by ads are radio and TV. On the Internet, no one's
cracked it." Free ISPs are currently being helped along by a drop in
the cost of running the networks caused by increased competition and
falling long-distance rates.
[SOURCE: San Jose Mercury News, AUTHOR: Chris O'Brien]
(http://www.mercurycenter.com/svtech/news/indepth/docs/isp091399.htm)

EDTECH

GRADUATING FROM FILE CARDS TO DATABASES
Issue: EdTech
Throughout the Washington region, school systems are utilizing
interactive Web sites, high-concept software and lap-top computers in
their administration offices. They hope that better technology will
eliminate costly paperwork and clerical staff, allowing more money and
resources to be spent on classrooms, and enable educators to catalogue
student data in ways that can help them improve instruction. Some
districts are having more success than others. Upgrading technology is
expensive--up to $15 million for the basics, according to estimates
from Prince George's County officials. To find the money for such
technology upgrades, schools are eliminating central office positions,
and outsourcing, or hiring private companies to store documents on a
customized computer system accessible by school officials
district-wide. The alternative is an old system still used by some
schools. The ultimate goal in utilizing databases is to be able to go
to a shared file and pull files electronically. In Fairfax County, a
school system which makes use of such a system, administrators can pull
files of teachers and other employees at the click of a computer mouse
while transportation officials feed data into a computer that
recommends the most efficient bus routes. Additionally, every school
has been linked to an information system that allows principals to
download student records and place purchase orders electronically. In
some systems data is warehoused in powerful computers that can
catalogue it and analyze it by race, gender, age or other criteria.
School officials say low-tech administrative operations have led to
real problems that affect the classroom, such as slowdowns in hiring
teachers and backups on ordering supplies and furniture.
[SOURCE: Washington Post, B1, AUTHOR: David Nakamura]
(http://www.washingtonpost.com/wp-srv/local/daily/sept99/technology13.htm)

E-COMMERCE

DEBATE ON INTERNET TAXES TAKES POLITICAL TURN
Issue:E-Commerce
The Advisory Commission on Electronic Commerce (ACEC), meets this week
in New York to continue discussion on a draft proposal for Internet
sales tax structures. The proposal, slotted for a spring presentation
to Congress, will recommend structures for federal, state, local and
international taxation and tariffs on transactions using the Internet.
Additionally, the proposal will recommend an Internet access tax
structure. Not all of the members of the commission see Internet taxes
as a given, while others are more concerned with the form the process
takes. Governor James Gilmore (R) of Virginia, an opponent of taxes
himself, says that he wants all sides to be heard. Gilmore is confident
that the commission will be able to define the issues for Congress, if
not present a comprehensive proposal, by spring. That process will be
made harder by the commission's goal to recommend a structure for more
than 30,000 state and local jurisdictions which, in the past forty
years, have disagreed over how to collect taxes from mail order sales.
One recommendation would ask each state to adopt a single tax rate and
provide tax-calculating software to businesses. Created along with
legislation that Internet tax moratorium, the commission's 19 members
include eight business representatives, eight politicians from state
and local governments and three members of the Clinton administration.
[SOURCE: New York Times, AUTHOR: Jeri
Clausing](http://www.nytimes.com/library/tech/99/09/biztech/articles/13pane.
html)

EUROPEAN LAW SEEN AS GRAVE THREAT TO E-COMMERCE
Issue: E-Commerce
Legislation pending in the European Union would allow Internet shoppers
to sue e-commerce firms in their own national courts regardless of
whether the company had actively sought to sell its product in the
consumer's country or not. At the moment, disgruntled online shoppers
can only take legal action in the country where the business is based.
Critics say, if passed, the law could be damaging to both e-commerce
and international trade. "Compliance with the laws of many different
countries would impose tremendous, even unbearable, costs for small and
medium sized enterprises," warned Dirk Hudig, secretary-general of the
Union of Industrial and Employers' Confederations of Europe (UNICE).
The passage of the controversial bill might "create another
transatlantic trade war;" according to Michael Pullen key lobbiest
opposing the legislation. Pullen suggests that the EU should not
over-regulate e-commerce if it hopes to recreate the type of success
the U.S. has experiences in this area.
[SOURCE: San Jose Mercury News, AUTHOR: Reuters]
(http://www.mercurycenter.com/svtech/news/breaking/internet/docs/844313l.htm)

ANTITRUST

MICROSOFT AND US SQUARE OFF IN ANTITRUST TRIAL'S FINAL ROUND
Issue: Antitrust
Microsoft and the US Department of justice entered the final round of
the government's antitrust suit against the computer software company
on Friday with both sides submitted their proposed fact findings.
Closing arguments are scheduled for next week. In the filings, the
government said Microsoft's explanations of its alleged attack on an
Internet software rival had changed repeatedly over the course of the
trial. The Justice Department also questioned the credibility of Bill
Gates, Microsoft's chairman, who gave testimony in the case. In its
response, Microsoft said the government relied broadly on hearsay and
had not proven their case. In the trial, which began
in October, the government alleges that Microsoft used its dominant
Windows operating system to crush Netscape and thwart other rivals that
threatened
the Redmond, Wash. software company's power. Microsoft maintains that
consumers weren't harmed by its actions and that Netscape hasn't been
prevented from distributing its software. Microsoft argued that
Netscape, far from being crushed, had been sold for $10 billion to AOL,
which continues to pose a competitive threat to Microsoft. The maker of
Windows software also cited rising competition from a computer operating
system called Linux. The government argued that even if consumers
benefited in the short run from Microsoft's decision to give away its
Internet software, they have been harmed over the long run by a lack of
choice and lost innovation by rivals. Restrictive contracts that
Microsoft imposed on its Internet partners and on personal-computer
makers that preinstall Windows resulted in Microsoft's browser's being
installed on 100% of new PCs, the government said.
[SOURCE: Wall Street Journal Interactive Edition, AUTHOR: John R.Wilke]
(http://interactive.wsj.com/articles/SB936971152435821176.htm)
See also:
E-MAIL OFFERS INSIGHTS ON MICROSOFT TRIAL STRATEGY
[SOURCE: New York Times, Author:Joel Brinkley]
(http://www.nytimes.com/library/tech/99/09/biztech/articles/13soft.html)

ACCESS TO GOVERNMENT INFORMATION

GROUP PUTS DISASTER DATA ON INTERNET
Issue: Access to Government Information
Environmental advocates have published information about the risks of
chemical accidents on the Right To Know Web site (http://www.rtk.net).
The information includes a state-by-state executive summary of
"worst-case scenarios" related to chemical companies in the United
States. The summaries were presented to the Environmental Protection
Agency by the chemical corporations. The information is intended to aid
the government in preparing people who live near factories for toxic
catastrophes such as spill or explosions. The information is provided
to the EPA through the Clean Air Act amendments of 1990. The EPA
intended to release the summaries on its own Web site, but the released
was suspended for a year by President Clinton and Congress. President
Clinton and Congress felt that the information would provide uninspired
terrorists with a road map for mayhem, while environmentalists believe
that the release was prevented to avoide mbarrassment to the chemical
companies providing the information.Members of Congress expressed
outrage that the EPA intended to make the information available
worldwide. Rep. Thomas Bliley, (R) said he never imagined the
information would be easily searchable "from Boston to Baghdad, from
Los Angeles to Libya." Environmental advocates believe that the
publication of the material will lead to better preparedness on the
parts of communities and may lead to fewer accidental releases.
[SOURCE: The New York Times, AUTHOR: Carl
Hulse](http://www.nytimes.com/library/tech/99/09/biztech/articles/13chemical
-accid)

MERGERS

BELL ATLANTIC AND VODAFONE, ONCE ENEMIES, ARE SAID TO BE NEAR A DEAL
Issue: Alliance
Bell Atlantic and Vodafone Airtouch officials declined to comment but
sources say further discussion has taken place between the two
companies with respect to a deal which could allow each others cellular
customers to make calls in each companies' respective areas without
being charged for long distance in the U.S. For Bell Atlantic, a joint
venture with Vodafone Airtouch would give it the national cellular
footprint it has craved for several years. Vodafone Airtouch would get
an expanded American presence to rival the national wireless networks
of AT&T and Sprint.
[SOURCE: New York Times, AUTHOR: Laura M. Holson]
(http://www.nytimes.com/library/tech/99/09/biztech/articles/13voda.html)
See also:
Bell Atlantic, Vodafone Boards To Vote on Joint-Venture Firm
[SOURCE: Wall Street
Journal](http://interactive.wsj.com/articles/SB937153357235367789.htm)

MOTOROLA EXPECTED TO BUY GENERAL INSTRUMENT
Issue: Merger
Motorola has begun talks to acquire General Instrument in an all-stock
deal valued at about $9.5 billion, according to reports. General
Instrument stockholders would get slightly more than half of a Motorola
share for each of their common shares of General Instrument The
partnership would bring together one of the best-known
consumer-electronic makers with the cable industry's leading provider
of cable TV set-top boxes. General Instrument and Motorola declined to
comment. The Wall Street Journal said General Instrument's chief
executive, Edward Breen, was expected to keep his post as head of the
company, though it would become a unit of Motorola. The journal also
reported that since Motorola has high name recognition that outranks
the marketplace recognition of General Instrument, the Motorola name
would be used on General Instrument equipment.
[SOURCE: San Jose Mercury]
See Also:
Motorola Is Negotiating Stock Deal To Acquire General Instrument
[SOURCE: Wall Street Journal]
(http://interactive.wsj.com/articles/SB937172483147417806.htm)

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

Congratulations, Kevin, on becoming a dad!

THE DEAL
Viacom to Buy CBS, Forming 2d Largest Media Company (NYT)
Act I in an Opus of Hollywood Deals (NYT)
Advertising: A Behemoth Casts Its Shadow on Madison Ave. (NYT)
Good News For CBS? Observers Split On Merger (WP)
Viacom-CBS Deal Likely to be Approved (WSJ)

TELEPHONY
ICC's Wishes on Deal May Not Wash (ChiTrib)
Public Forum on 711 Access to Telecommunications
Relay Services (FCC)
Global Crossing to Unveil Asia Venture (WSJ)

INTERNET
Regulators Ready to Set Some Rules on Internet Campaigning (CyberTimes)
Ford is Denied Injunction to Prohibit Web-Site Publication
of Internet Data (WSJ)
CISCO Builds a Web-athon to Fight Poverty (SJM)

EDTECH
Survey Finds Teachers Unprepared For Computer Use (CyberTimes)

THE DEAL

VIACOM TO BUY CBS, FORMING 2D LARGEST MEDIA COMPANY
Issue: Mergers
Viacom will purchase CBS for $37.3 billion -- creating the second largest
media company behind Time Warner. The acquisition means that all three of
the original big broadcasting networks will be owned by conglomerates.
(General Electric has owned NBC since 1985 and Disney purchased ABC in 1995
for $19 billion -- the previous record for a media deal.) Viacom could
emerge now as the world's largest seller of advertising through television
and radio stations, cable networks, Internet Web sites and outdoor
billboards. "We will be a global leader in virtually every facet of the
wonderful, diverse media and entertainment industry," predicted Viacom's
Chairman Sumner Redstone, who has built Viacom into one of the world's most
successful entertainment companies since acquiring it 12 years ago. As Fred
Moran, an analyst at the investment firm ING Baring, said, "You can
literally pick an advertiser's needs and market that advertiser across all
the demographic profiles, from Nickelodeon with the youngest consumers to
CBS with some of the oldest consumers, and with the Country Music Network,
the Nashville Network, MTV and VH1 right in the middle." With the increasing
uncertainty in the media business, companies are seeing an advantage to
owning both programming and distribution networks as the new Viacom will.
"These are bet-hedging mergers in some ways," observed David Nadler of the
Delta Consulting Group. The challenge "is how to make these very large
companies with complex sets of relationships work in ways that pay off. Just
owning a bunch of different properties doesn't mean you get the
profit-making synergies that executives talk about when they announce these
mergers."
[SOURCE: New York Times (A1), AUTHOR: Lawrie Mifflin]
(http://www.nytimes.com/library/financial/090899cbs-viacom-deal.html)
Measuring a Combined Viacom/CBS Against Other Media Giants
(http://www.nytimes.com/library/financial/090899cbs-viacom-media.html)

ACT I IN AN OPUS OF HOLLYWOOD DEALS
Issue: Mergers
With newspapers, TV and the Internet awash in speculation about the
announced merger between CBS and Viacom, there is one question pursed on
everyone's lips: who's next? "After a deal like this, the urge to merge
becomes feverish," said Howard Stringer, chairman and chief executive of
Sony. "And right now temperatures are soaring all over the city." Most
industry insiders will admit that this type of consolidation puts pressure
on other companies to partner up. NBC is particularly vulnerable, because
the acquisition of CBS will leave it the only major network without a film
studio and entertainment industry partner. "It's like musical chairs," said
Jeff Logsdon, an entertainment analyst at Seidler Cos. "You keep taking
away one more chair. There's a scarcity issue now. Disney has ABC. Warner
Brothers starts their own network and is in a fledgling stage of success.
CBS now merges with Viacom. So NBC is sitting there. Whom do they go after?"
[SOURCE: New York Times (C15), AUTHOR: Bernard Weinraub]
(http://www.nytimes.com/library/financial/090899cbs-viacom-react.html)
WHO'S LEFT OUT AT MEDIA BALL? SUDDENLY, NBC LOOKS LONELY
[SOURCE: Wall Street Journal, B1, AUTHOR: John Lippman and Bruce Orwall]
(http://interactive.wsj.com/articles/SB936750967628680644.htm)

ADVERTISING: A BEHEMOTH CASTS ITS SHADOW ON MADISON AVE.
Issue: Mergers/Advertising
Reaction in the advertising world to the Viacom/CBS deal ranges from
outright acceptance to outrage. The advertising revenue for the combined
company is estimated at $11 billion for 1999. "That's not good for
advertisers in terms of negotiating clout," observed Joe Mandese, editor of
The Myers Report, a media newsletter, "because of the control of assets. CBS
already has a stranglehold on the radio marketplace," referring to its
Infinity Broadcasting Corp. division. "The new Viacom will own more local TV
stations than any other entity as well as cable networks popular with kids,
teens and young adults and CBS, the leader in household viewers among the
broadcast networks." To some leading agency executives, the continuing
concentration of the strongest media brands in fewer and fewer hands is no
laughing matter. The acquisition of CBS by Viacom is "obscene," said Jean
Pool, executive vice president and director for North American media
services at J. Walter Thompson. "There is an incredible amount of power
being concentrated in one person's hands," she added. "It's a bad idea." The
one person is Mel Karmazin, chief executive at CBS. "He's getting such
control, you can't buy around him," Ms. Pool said of Karmazin. "It's
unbelievable." In some markets CBS already controls 50% of ad revenue by
owning multiple stations with various music and talk formats. "Concentration
of station ownership in individual markets drives media buyers nuts," said
John Kamp, a Washington-based senior vice president of the agency
association, known as the Four A's. "We will work with the Justice
Department and the Federal Communications Commission to make sure those
agencies do what they are supposed to do," he added, in terms of
scrutinizing media mergers.
[SOURCE: New York Times (C8), AUTHOR: Stuart Elliott]
(http://www.nytimes.com/library/financial/090899viacom-ad-column.html)

GOOD NEWS FOR CBS? OBSERVERS SPLIT ON MERGER
Issue: Merger
Viacom Inc.'s merger with CBS Corp. could provide the struggling CBS Evening
News with entertainment through Viacom's MTV, Nickelodean and VH1. While no
one expects the CBS Evening News to be transformed under the deal, any added
zest could be a boon to a network with no cable news presence. However,
other critics were quick to question whether Viacom cares about news, which
traditionally has not been a major moneymaker. "My first instinct on this is
that it saves CBS News," Marvin Kalb, a former CBS newsman who is now
executive director of Harvard University's Shorenstein media center said.
But "news shouldn't have to make money," he said. "If CBS is now put in the
position where there are increased pressures to provide higher profits, then
CBS News is lost, even if it has been saved." The trend toward mega-media
entities resulting from mergers has lead to questionable news coverage
recently. Time has been criticized for cover stories on Warner Bros. movies
and ABC's "Good Morning America" took heat for an upbeat visit to Walt
Disney World. The question remains what happens when CBS news needs to cover
a Simon & Schuster book or a star from a movie produced by Viacom's
Paramount Pictures?
[SOURCE: Washington Post, p.E1, AUTHOR: Howard Kurtz]
(http://www.washingtonpost.com/wp-srv/business/feed/a31699-1999sep8.htm)

VIACOM-CBS DEAL LIKELY TO BE APPROVED
Issue: Merger/Policy
The new Viacom-CBS merger is probably going to get criticism from consumer
advocates and some in Congress -- but those same arguments have failed to
stop other megamergers like Time Warner/Turner and Walt Disney's buyout of ABC.
Among the policy issues under discussion by Federal Communications
Commission regulators and Viacom-CBS for this merger: 1) the federal policy
that prohibits a company from controlling more than 35% of the television
broadcasting market (CBS already reaches 32% of the market and this
acquisition would increase that number to 41%); 2) an FCC rule that prohibits
a company from owning two networks (This is a problem because Viacom has a
50 percent interest in the UPN network); and 3) Even though the broadcast
ownership rules were relaxed last month, the new standards permit a company
to own two stations in cities where there are a sufficient number of 'media
voices'. Each city must have at least eight independently owned television
stations for a single company to own two. Right now Viacom and CBS overlap
stations in five cities including Philadelphia, Boston, Detroit, Miami and
Pittsburgh. Federal regulators, who asked not to be identified, said that
these overlaps could raise antitrust problems. They also said the overlap
issue as well as the cap of 35% could be resolved with Viacom divesting some
of its stations. Another regulatory body Viacom and CBS need to worry about
is the Justice Department -- as the agency will concentrate on whether the
combined company would gain too much power in individual markets with
respect to advertising. CBS spokesman, Dana McClintock, said selling the
properties would not kill the deal. "We will work with the FCC to be within
the law," he said.
[SOURCE: Wall Street Journal, A8, AUTHOR: John R. Wilke]
(http://www.wsj.com)
See also:
WIDE BELIEF U.S. WILL LET A VAST DEAL GO THROUGH
[SOURCE: New York Times (C14), AUTHOR: Stephen Labaton]
(http://www.nytimes.com/library/financial/090899cbs-viacom-regulate.html)
FCC MAY LET COMBINED ENTITY KEEP STAKE IN UPN
[SOURCE: USA Today (3B), AUTHOR: Paul Davidson]
(http://www.usatoday.com)

TELEPHONY

ICC'S WISHES ON DEAL MAY NOT WASH
Issue: Mergers
Illinois Commerce Commissioner Richard Kolhauser is warning his colleagues
that in their efforts to open up Illinois' local phone market, the ICC may
be overstepping its legal authority. A majority of ICC commissioners seem to
want SBC-Ameritech to offer the use of its networks to competitors based on
the best conditions competitors can find in other SBC states. Commissioner
Kolhauser believes the Telecommunications Act of 1996 favors state by state
negotiations. "All the competitors seek pretty much the same things in each
state," countered another Commissioner. "If anything exotic came in that
might violate Illinois law or policy, our staff would flag it and the
commission could disallow it."
[SOURCE: Chicago Tribune (Sec 3, p.3), AUTHOR: Jon Van]
(http://chicagotribune.com/business/printedition/article/0,2669,SAV-99090800
91,FF.html)

PUBLIC FORUM ON 711 ACCESS TO TELECOMMUNICATIONS RELAY SERVICES
Issue: Disabilities/Access
From Public Notice: The FCC invites individuals with hearing or speech
disabilities, state administrators, members of the telecommunications
industry, and other members of the public to a forum to discuss implementing
711 access to telecommunications relay services ("TRS"). The goal of this
forum will be to identify the steps that must be taken to implement 711
access to TRS, as well as any obstacles to implementation and how those
obstacles can be resolved. The forum will be held on Wednesday, September 8,
1999. For more information about the forum, please contact Helene Schrier
Nankin at (202) 418-1466 (voice), (202) 418-0484 (TTY), or hnankin( at )fcc.gov
(e-mail); or David Ward at (202) 418-2336 (voice), (202) 418-0484 (TTY), or
doward( at )fcc.gov (e-mail) -- or see URL below.
[SOURCE: FCC]
(http://www.fcc.gov/Bureaus/Common_Carrier/Public_Notices/1999/da991170.html)

GLOBAL CROSSING TO UNVEIL ASIA VENTURE
Issue: International/Infrastructure
Yesterday, Global Crossing, an undersea-cable operator based in Hamilton,
Bermuda, announced a venture with Microsoft and Japan's Softbank, one of the
leading investors in Internet start-ups, to build an advanced
telecommunications network in Asia. Asia Global Crossing, as the venture
will be called, will build a network linking Japan, China, Singapore, Hong
Kong, Taiwan, South Korea, Malaysia and the Philippines with fiber-optic
cables capable of transmitting vast streams of voice, video and Internet
traffic. The companies hope Asia Global Crossing will deliver digital
telephone and data services at high speeds to customers. Since this venture
brings another carrier into the region, it could also help lower prices. The
availability this network could help fuel demand for software and systems
such as those sold by Microsoft.
[SOURCE: Wall Street Journal, A3, AUTHOR: Stephanie N. Mehta and Steven
Lipin]
(http://interactive.wsj.com/articles/SB936755551505708177.htm)

INTERNET

REGULATORS READY TO SET SOME RULES ON INTERNET CAMPAIGNING
Issue: Political Discourse
As the Internet becomes an increasingly important venue for electoral
campaigning, the Federal Election Commission has to grapple with questions
of how to regulate this fledgling form of political communication. Federal
regulators must decide weather citizens who set up campaign Web sites
should be considered volunteers, or if their time should be counted as a
political contribution. "I personally hope we can construct the definition
of volunteer rather broadly," said FEC's chairman, Scott Thomas. "I'm
having a hard time seeing what is the harm of letting people use their home
computer." Until the commission makes final decisions about how the to
regulate the Internet, there is considerable ambiguity about what can, and
cannot be done online. Currently, there are no clear answers for campaign
managers who want to know whether links to a campaign Web site, or e-mail
sent out by volunteers, are considered contributions.
[SOURCE: CyberTimes, AUTHOR: Rebecca Fairley Raney]
(http://www.nytimes.com/library/tech/99/09/cyber/articles/08campaign.html)

FORD IS DENIED INJUNCTION TO PROHIBIT WEB-SITE PUBLICATION OF INTERNET DATA
Issue: First Amendment/Internet
Federal District Court Judge Nancy Edmunds denied Ford Motor Co. a preliminary
injunction to stop Robert Lane, the operator of blueOvalNews.com
(www.blueOvalNews.com), from publishing the company's internal documents.
The battle started when Ford sought a preliminary injunction against Lane
after he published proprietary internal documents, on his Web site, about
Ford's plans to meet future government emissions and fuel-economy
regulations. This ruling is expected to set a precedent for First Amendment
protections of Internet publications. The Court said that the First
Amendment protected the material, which Lane said he had received
anonymously. Judge Edmunds said that Ford had substantial evidence that Lane
had violated the Michigan Uniform Trade Secrets Act -- but ruled that the
First Amendment trumped the trade-secrets law, no matter what medium was
used to publish the information. Judge Edmunds also recognized the
uniqueness of this case when she said, "In the realm of law, we are only
beginning to grapple with the impact of the communications revolution and
this case represents just one part of one skirmish -- a clash between our
commitment to the freedom of speech and the press, and our dedication to the
protection of commercial innovation and intellectual property. In this case,
the battle is won by the First Amendment." The judge did, however, rule that
Lane must comply with the order which says he must file with the court and
Ford a statement identifying the Ford documents he has, identify his sources
for the documents and provide details on how he acquired the documents.
Floyd Abrams, a noted First Amendment lawyer, said he didn't know of a
previous ruling that said "in such clear and definitive terms that the same
First Amendment rules apply to Web sites a they do newspapers." Lane's
attorney, Mark Pickrell, maintained that Lane never violated Ford's
copyright, since the documents he posted were not stamped with a copyright
or "property of Ford Motor Co." Ford said it would not appeal the ruling.
[SOURCE: Wall Street Journal, A3, AUTHOR: Fara Warner]
(http://interactive.wsj.com/articles/SB936721069421101868.htm)

CISCO BUILDS A WEB-ATHON TO FIGHT POVERTY
Issue: Nonprofits and Technology
In an unlikely partnership, Cisco Systems and the United Nations are
sponsoring a Global Web event to raise money and awareness about hunger and
poverty. On Oct. 9, NetAid will simulcast concerts from three locations
around the world over TV, radio, and the Internet (www.netaid.org). "We
were looking for a way to demonstrate that the Internet wasn't just a
business technology any more, that it was impacting people's lives on a
social level," said NetAid creator and program manager Diane Merrick. The
event's organizers hope that NetAid will help make way for new
philanthropic uses of the Internet. In preparation for a large volume of
viewers netaid.org has been designed to handle 60 million hits per hour and
125,000 simultaneous live streams during the concerts, giving it the
potential to reach more viewers than the last Olympics and the 1998 World Cup.
[SOURCE: San Jose Mercury News, AUTHOR: Robert Elder]
(http://www.mercurycenter.com/svtech/news/indepth/docs/netaid090899.htm)

EDTECH

SURVEY FINDS TEACHERS UNPREPARED FOR COMPUTER USE
Issue: Ed-Tech
A new study found a majority of teachers, regardless of age, lacking a
sufficient level of technology training to lead classroom instruction. The
survey, by Market Data Retrieval, found that 39 percent of about 1,500
teachers polled reported that they felt well prepared to use technology for
teaching. The study found that 61 percent of teachers surveyed felt either
"not at all prepared" or only "somewhat prepared" to integrate technology
into classroom instruction. The study was based on the responses of 1,547
elementary and secondary school teachers to a questionnaire that was mailed
to about 9,000 teachers in April. Older teachers had only a slightly higher
rate of discomfort around computers in their classrooms than younger
teachers. About 62 percent of veteran teachers, whose average age was 39,
reported feeling ill prepared to use technology in the classroom, compared
with 60 percent of newer teachers, with an average age of 28. What made a
bigger difference than age in a teacher's level of ease when using
computers, the study found, was how much technology training the teachers
received. Critics say many school officials have focused too heavily on
hardware and software upgrading while ignoring the need to train teachers
how to use the equipment.
[SOURCE: CyberTimes, AUTHOR: Pamela Mendels]
(http://www.nytimes.com/library/tech/99/09/cyber/education/08education.html)

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

BROADCASTING
CBS and Viacom in Talks on TV Stations (NYT)
AT&T, Fox Program Deal Includes Digital TV Shows (WSJ)
Speech: A New Tomorrowland (FCC)

LEGAL ISSUES
Texas Committee Fights Spread of Electronic Legal Advice (NYT)

BROADCASTING

CBS AND VIACOM IN TALKS ON TV STATIONS
Issue: Television/Ownership
Viacom and CBS have been negotiating a possible deal that might involve a
merger of their television stations. The companies are seeking ways to take
advantage of new Federal Communications Commission rules that will allow a
firm to own two broadcast stations in the same market under certain
circumstances. Nevertheless, CBS and Viacom could not combine all their
stations, because FCC rules still prohibit any one company from owning
stations that reach more than 35% of the total U.S. TV market. Other
broadcast companies are also exploring possible mergers and alliances that
are now feasible under the revised ownership rules. "If you took the 10
leading media companies since the Federal Communications Commission
decision, everybody has talked to everybody more than before because there
is so much more opportunity for deals," said one industry expert.
[SOURCE: New York Times (C1), AUTHOR: Geraldine Fabrikant]
(http://www.nytimes.com/yr/mo/day/news/financial/viacom-cbs.html)

AT&T, FOX PROGRAM DEAL INCLUDES DIGITAL TV SHOWS
Issue: Digital TV/Cable
AT&T has agreed to carry Fox's broadcast programming, including shows in
high-definition television, on its cable systems. AT&T will carry the
digital signals of Fox's 22 major-market TV stations in systems being
upgraded to handle digital broadcast signals. The companies agreed to work
together to send high-resolution, digital programs to AT&T customers using
both traditional and digital TV sets. Despite pressure from the Federal
Communications Commission, some cable operators have shied away from
carrying digital TV signals from the big networks, arguing that they chew up
too much space on their systems. The terms of the deal were not disclosed.
[SOURCE: Wall Street Journal, AUTHOR: Staff Reporter]
(http://interactive.wsj.com/articles/SB936318591348813730.htm)

SPEECH: A NEW TOMORROWLAND
Issue: Broadcasting
Chairman Kennard's Speech before the National Association of Broadcasters
Radio Show. "[Disney's] Home of Future Living has arrived. Interactive TV,
ordering on-line, and
distance education are now part of our lives. And now it's mom on the PC
having a business meeting, while dad's ordering dishes. Tomorrowland is now
Todayland. Even in Disney World - the home of dreams and fantasy - they have
to constantly keep apace of our changing vision of the future....Think about
what broadcasting looked like thirty years ago when Walt Disney World was
being built. Back then, there were three TV networks; cable was still a
novelty; and, at least in my house, interactive television was when my mom
yelled at me to turn down the TV set. Most people listened to the radio by
tuning their handheld transistor to a local AM station. And there
were still homes where you could find a large wooden console radio sitting
in the living room. Today, there are seven networks, and cable systems serve
almost 65 million TV households. Although the transistor radio has not
disappeared, now, we listen in stereo, on FM, through headphones, and often
to nationally-syndicated programs. And some people are even listening on
their PC's linked to the Internet to ballgames, news, and music broadcast
from around the
country and around the world. The Internet is changing every facet of
communications as we know it, and now that includes radio. It is a
fundamental paradigm shirt." Chairman Kennard discussed the changes in
broadcast ownership in light of this paradigm shift -- as well as reviving
the tax certificate program and low power radio.
[SOURCE: FCC]
(http://www.fcc.gov/Speeches/Kennard/spwek929.html)

LEGAL ISSUES

TEXAS COMMITTEE FIGHTS SPREAD OF ELECTRONIC LEGAL ADVICE
Issue: Legal Issues
The Unauthorized Practice of Law Committee, a group of Texas lawyers
deputized by the state to protect citizens against unauthorized legal
advice, say citizens need to be protected against Nolo Press and its
self-help legal advice software package known as Quicken Family Lawyer
'99. The Committee decided that do-it-yourself legal materials oversimplify
the law, endanger consumers, and is a form of malpractice. The software
publishers however, say the lawyers have a self-interest to make the legal
processes seem difficult. Nolo Press says that in seeking to ban software or
books, the committee of lawyers is effectively engaging in censorship.
Originally, a Texas judge banned the sale of the software after concluding
that the software went beyond merely providing information and "ventured
into the unauthorized practice of law." In response to publicity surrounding
the software ban, the State Legislature in Texas passed a bill that
redefined "the practice of law." Under the legislation, publishing or
distributing software, books, Internet sites and similar materials "that
clearly and conspicuously state (they) are not a substitute for the advice
of an attorney" are not considered to be an attempt to "practice" law. So if
a software package includes the proper disclaimer, it cannot be banned. The
software is published by the Parsons Technology unit of Broderbund and is
sold for $30. The software allows users to draft wills, living trusts,
prenuptial agreements and documents authorizing power of attorney.
[SOURCE: New York Times, AUTHOR: Matt Richtel]
(http://www.nytimes.com/library/tech/99/09/cyber/cyberlaw/03law.html)

--------------------------------------------------------------
...and we are outta here. Enjoy the long weekend -- we will be back on Tuesday.