February 2004

Benton's Communications-related Headlines for 2/13/04

OWNERSHIP/MERGERS
Prometheus Radio Project v. FCC Oral Argument Report
Big Three Will Run World's Media, Says Murdoch
Comcast's Bid for Disney Ripples Through a Linked Industry
Cingular, Vodafone Show Their Cards to AT&T
Cellphone Merger Cure

ACCESSIBILITY
A New Cellphone Nods to the Needs of the Disabled
Censor 'Scooby-Doo'? Words Fail

BROADCASTING
Telecom Subcommittee Approves Indecency Bill
Public Telecommunications Facilities Program

TELEPHONY/BROADBAND
FCC Open Meeting Summary

Communications-related Headlines is a free online news summary service
provided by the Benton Foundation (www.benton.org). Posted Monday through
Friday, this service provides updates on important industry developments,
policy issues, and other related news events. Headlines are compiled by
Kevin Taglang (ktaglang( at )etpost.net) -- we welcome your comments.

OWNERSHIP/MERGERS

PROMETHEUS RADIO PROJECT V. FCC ORAL ARGUMENT REPORT
The Media Access Project has made available a report on the oral arguments
on the FCC's media ownership rules. Highlights of the oral arguments
include: 1) The court is very concerned that the diversity index is flawed
-- one judge characterized the diversity index as making "hypothetical"
assumptions when the FCC could have instead relied upon real market data.
The FCC included in the index TV stations that do not offer local news. 2)
One judge quoted the brief of United Church of Christ saying that while the
number of stations has increased, the number of owners decreased, and
challenged Clear Channel's lawyer's argument that a single owner owning
several radio stations could offer more diversity. 3) Public interest
lawyers showed that the FCC got its duty expressly backward as between
protecting competition and diversity. The law and facts show that rules to
protect competition are not enough to protect diversity: more restrictive
rules are needed to protect diversity than competition. 4) Lawyers showed
that the FCC failed to consider whether the UHF discount should be lowered.
5) The judges seemed to believe the FCC retains some ability to continue to
regulate in the public interest despite recent legislative changes in the
Telecommunications Act of 1996.
See the full report at the URL below.
[SOURCE: Media Access Project]
http://www.mediaaccess.org/MAPOralArg02-12-04.pdf

BIG THREE WILL RUN WORLD'S MEDIA, MURDOCH SAYS
"In three years the media scene will have at least three very big
competitive companies in Comcast, News and Time Warner, and several very
good and well-run smaller companies such as (US satellite pay-TV group)
DISH and (US cable group) Cox," said News Corp's Rupert Murdoch after
releasing the company's half-year results on Wednesday night. Comcast's
move is seen as a strong vindication of Mr Murdoch's strategy to build News
into a global content and distribution company. But Mr Murdoch did not
believe News would be disadvantaged by the might of the Comcast-Disney
group if that deal was approved. "We will have just as much ability to
pressure them as them us," he said.
[SOURCE: The Australian, AUTHOR: Jane Schulze and Geoff Elliott]
http://www.theaustralian.news.com.au/common/story_page/0,5744,8663759%25...

COMCAST'S BID FOR DISNEY RIPPLES THROUGH A LINKED INDUSTRY
What's the reaction of investment bankers to the Comcast bid for Disney?
They are suggesting that Time Warner make its own bid for Disney and
telling Viacom to make a run for satellite service EchoStar. Big media
companies are feeling pressure to get bigger, especially given the News
Corporation's acquisition two months ago of control of the satellite
service DirecTV. A company can't just be big in content or distribution; to
remain a player, it seems, a company needs to have both. But that trend may
mean less variety in new programming or make it harder for newcomers to
break into the business. "In a world where you have Warner Brothers, Turner
and AOL and Time Warner Cable and a WB Network in the control of one
company, and in a world where there is a DirecTV and a Fox and Fox Studio
and the Fox Cable networks," said Larry Gerbrandt, chief content officer of
the research company Kagan Media World, "Comcast can make a strong case
that this just gets them back to a level playing field. With some
relatively small exceptions, they have been pretty much at the mercy of the
content owners, the studios and the network owners without any means of
really effectively addressing their single largest expense, which is
programming costs." Fears of consolidation come not only from public
interest advocates. "These people essentially only accommodate each other;
there is no way in any more," said InterActiveCorp's Barry Diller of the
media giants.
[SOURCE: New York Times, AUTHOR: David Kirkpatrick]
http://www.nytimes.com/2004/02/13/business/media/13MEDI.html?pagewanted=all
(requires registration)
In a related article, the Wall Street Journal reports that if the deal goes
through, Comcast will have the power to decide when Disney's movies and TV
shows are released on cable services such as video on demand, threatening
to upend long-established ways of Hollywood.
http://online.wsj.com/article/0,,SB107663719354229166,00.html?mod=techno...
See also
WashPost: Will it Work?
http://www.washingtonpost.com/wp-dyn/articles/A37887-2004Feb12.html

CINGULAR, VODAFONE SHOW THEIR CARDS TO AT&T
Expect to see news by the end of the day that Cingular Wireless and
Vodafone have made official bids for AT&T Wireless. There is a 5pm deadline
for bids today and the board will consider offers this weekend. They are
currently six national U.S. wireless carriers, but price and marketing wars
have eroded profits. ''Cingular is by far the most likely buyer here, with
a straightforward deal, for a whole variety of reasons,'' said a Goldman
Sachs report out Thursday. Goldman cited Cingular's ability to generate
greater ''synergies,'' such as cost cuts, for the best investor returns.
[SOURCE: USAToday, AUTHOR:Andrew Backover]
http://www.usatoday.com/usatonline/20040213/5924807s.htm

CELLPHONE MERGER CURE
When cellphone prices drop because of competition, the historical cure has
been to merge with another company and losing a competitor. But that remedy
may not work any longer because of challenges from new technologies and a
rush of new entrants into the market. Mergers would likely have to shrink
the field of providers in half before they lead to higher prices and less
competitive behavior. One reason is that the big carriers sell their
services wholesale to resellers -- like Virgin -- who then retail to
targeted markets. Another factor is the growing popularity of Wi-Fi to
route calls over the Internet -- and avoid conventional cellphone networks
altogether.
[SOURCE: Wall Street Journal, AUTHOR: Jesse Drucker jesse.drucker( at )wsj.com ]
http://online.wsj.com/article/0,,SB107662632127528809,00.html?mod=home%5...
(requires subscription)

ACCESSIBILITY

A NEW CELLPHONE NODS TO THE NEEDS OF THE DISABLED
A complaint filed at the FCC against Verizon Wireless and cellphone maker
Audiovox has lead to the Toshiba VM4050 which can talk to users. In a
recorded voice, the phone tells a user, for example, that the battery is
low or the phone is in roaming mode. "This is certainly a significant step
forward," said Darren Burton, a technology associate for the American
Foundation for the Blind who is testing the phone. He said he most
appreciated the voiced reports on battery level, signal status, roaming,
new voice-mail messages and missed calls. But he said it still had "a way
to go'' in making other features equally accessible, like the phone's
menus, e-mail in-box, text messaging and Internet browser. Section 255 of
the Telecommunications Act of 1996 requires telephone makers and service
providers to make their products and services accessible to people with
disabilities. "We were hoping that Section 255 would be the impetus" for
improvements to cellphones, Dr. Bonnie O'Day said. "Unfortunately, we had
little compliance up until last year." See more at the URL below?
[SOURCE: New York Times (2/12), AUTHOR: Lisa Gurnsey]
http://www.nytimes.com/2004/02/12/technology/circuits/12phon.html

CENSOR 'SCOOBY-DOO'? WORDS FAIL
Department of Education grants for closed-captioning will be denied for
some 200 programs the Bush Administration has deemed inappropriate for the
funding, deciding that the shows don't fit the required definition of
"educational, news or informational" programming. "They've suddenly
narrowed down the definition of those three kinds of programming without
public input," says Kelby Brick, director of the NAD's law and advocacy
center. "Basically, the department wants to limit captioning to puritan
shows. The department wants to ensure that deaf and hard-of-hearing
individuals are not exposed to any non-puritan programming. Never mind that
the rest of the country is allowed to be exposed." (CBS is finding out that
that may not be true.) The Department of Education is refusing to reveal
the names of the panel members whose opinions determined the caption grants
and also won't disclose the new guidelines. By every appearance, the
government has changed its definition of what constitutes a caption-worthy
program. But it's keeping the new rules secret, Moffet writes in his
editorial. "They apparently used a panel of five individuals and then made
the censorship decisions based on the individuals' recommendations," Mr.
Brick says. "We have found the identity of one of the panelists. This
individual tells us that he never knew he was on such a panel and that his
views would be used for censorship. No panel was convened. The five
panelists were contacted individually and separately."
[SOURCE: Palm Beach Post (2/8), AUTHOR: Dan Moffett]
http://www.palmbeachpost.com/opinion/content/auto/epaper/editions/sunday...

BROADCASTING

TELECOM SUBCOMMITTEE APPROVES INDECENCY BILL
The House Telecommunications Subcommittee unanimously approved H. R. 3717
on Thursday, a bill that would increase the maximum fines ten-fold for
broadcast indecency. A number of amendments to the bill were introduced but
then removed as they are fine tuned or combined. Amendments would make
networks liable for indecent programming, make indecency an automatic
trigger for a license revocation hearing and bring violence under the FCC's
indecency purview as well. Expect to hear more about the bill after the
President's day break. Subcommittee Chairman Fred Upton hopes to send the
bill to President Bush in March.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA381263?display=Breaking+News

PUBLIC TELECOMMUNICATIONS FACILITIES PROGRAM
The Fiscal Year 2004 grant round of the Public Telecommunications
Facilities Program was published February 11. Public broadcast stations,
non-profit organizations organized for educational or cultural purposes,
state and local governments and Indian tribes are eligible for funds for
the planning and construction of public telecommunications facilities in
order to: 1) extend delivery of services to as many citizens as possible by
the most cost-effective means, including use of broadcast and non-broadcast
technologies; 2) increase public telecommunications services and facilities
available to, operated by, and controlled by minorities and women; and 3)
strengthen the capability of existing public TV and radio stations to
provide public telecommunications services to the public. About 100 grants
will be made; $19.75 million is available. Completed applications must be
received at the Public Telecommunications Facilities Program office no
later than 6:00 p.m., EST, on Wednesday, March 31, 2004.
[SOURCE: NTIA]
http://www.ntia.doc.gov/ptfp/attachments/FFO_Notice_04.htm

TELEPHONY/BROADBAND

FCC OPEN MEETING SUMMARY
The FCC held an open meeting and began a number of new rulemaking
procedures on Thursday Here are some highlights.
1) Internet Telephony (VoIP)
"IP networks cost much less to build and operate We will not dumb down the
genius of the Web to match the limited vision of a regulator," said FCC
Chairman Michael Powell as the Commission began a major proceeding to
examine opportunities that allow consumers greater choices created by voice
services provided over the Internet. It is also designed to provide a
measure of regulatory stability to the communications marketplace and to
further promote the development of these Internet-based services. The
Notice of Proposed Rulemaking (Notice) adopted today assumes not only that
Internet services should continue to be subject to minimal regulation, but
also that mechanisms to implement important social objectives, such as
public safety, emergency 911, law enforcement access, consumer protections
and disability access, may change as communications migrate to
Internet-enabled services. The Notice asks broad questions covering a wide
range of services and applications to differentiate between Internet
services and traditional telephony services and to distinguish among
different classes of Internet services. Specifically, the Notice asks
which regulatory requirements - for example, those relating to E911,
disability accessibility, access charges, and universal service - should be
extended to different types of Internet services. "Some of these goals may
well be achieved without heavy-handed regulation, but I am willing to
support targeted governmental mandates where necessary," said FCC
Commissioner Kathleen Abernathy. The Notice also asks questions on the
legal and regulatory framework for each type of Internet service and the
relevant jurisdictional considerations for each category.
Analysts do not expect many decisions by the FCC on the broader issues
until after the presidential election and any decision could be challenged
in court, as is often the case with telecommunications regulations
2) Separately, the FCC also adopted a Declaratory Ruling stating that
pulver.com's Free World Dialup (FWD) offering should remain free of
unnecessary regulation
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243869A1.doc
3) FCC Proposes Rules for Broadband Over Power Lines to Promote Broadband
Service to Underserved Areas and Increase Competition
The FCC proposed changes to certain technical rules that will foster
broadband deployment using the significantly untapped capabilities of the
nation's power grid, while safeguarding existing services against harmful
interference. The Part 15 rule changes, proposed in a Notice of Proposed
Rulemaking (Notice), set forth procedures to measure the radiofrequency
(RF) energy emitted by equipment used to provide broadband service over
power lines and establish particularized interference mitigation
requirements. By facilitating access to broadband over power lines (BPL),
the Commission takes a step toward increasing the availability of broadband
in rural and underserved areas because power lines reach virtually every
home and community in the country. In areas in which consumers already
have broadband access, BPL enhances competition by providing another
broadband alternative. These proposed changes will also facilitate the
ability of electric utilities to dynamically manage the power grid itself,
increasing network reliability.
[SOURCE: FCC]
http://www.fcc.gov
There's a lot of coverage of the FCC decisions; here are some links you may
want to check out.
Reuters: FCC Wades Into World of Internet Calls
http://www.reuters.com/newsArticle.jhtml;jsessionid=XQC2BRJUAZPVYCRBAE0C...
News.com: FCC: 'Pure' VoIP not a phone service
http://news.com.com/2100-7352_3-5158105.html?tag=nefd_top
LA Times: FCC Opens Study of Net Telephony
http://www.latimes.com/business/printedition/la-fi-fcc13feb13,1,6421628....
NY Times: F.C.C. Begins Rewriting Rules on Delivery of the Internet
http://www.nytimes.com/2004/02/13/technology/13net.html
Mercury News: FCC to take up Internet phone regulations
http://www.mercurynews.com/mld/mercurynews/business/technology/7935817.htm
USAToday: Few rules proposed for Internet calls
http://www.usatoday.com/usatonline/moneyindex12.htm
WashPost: FCC Considers Regulating Internet-Based Phone Calls
http://www.washingtonpost.com/wp-dyn/articles/A37745-2004Feb12.html
--------------------------------------------------------------
...and we are outta here. Have a wonderful weekend. We'll be back on
Tuesday; enjoy the holiday.
--------------------------------------------------------------

Benton's Communications-related Headlines for 2/12/04

OWNERSHIP
Prometheus Radio Project v. FCC
Comcast Bids to Purchase Disney
* Links to Press Releases in Response to Comcast-Disney Deal
Comcast Disney Combination Hazard to Public Interest
Proposed Comcast Cable Takeover of Disney Likely Leads to Less Consumer=20
Choice,
Higher Costs, More Media Concentration
Comcast-Disney Merger Should Be Rejected By Bush Administration/FCC

BROADCAST DECENCY ENFORCEMENT
Coverage of House/Senate Hearings

CABLE
Cable Competition =AD Increasing Price; Increasing Value?

TELEPHONY
California Regulators Advance VoIP Plans

OWNERSHIP

PROMETHEUS RADIO PROJECT V. FCC
The United States Court of Appeals Third Circuit heard oral arguments on=20
the FCC's ownership rules on Wednesday allowing the parties a good deal of=
=20
extra time to argue their cases. Challenges to the 39% national TV cap were=
=20
not allowed given new legislation signed by President Bush last month. The=
=20
court also put a hold on the controversial UHF discount rule which the FCC=
=20
said it will revisit anyway. The FCC=92s diversity index for local=20
cross-ownership was called =93inconsistent=94 by the judges. In addition to=
=20
public interest advocates' claims that the relaxing of rules went too far,=
=20
arguments against the regulations were heard from a group of newspapers,=20
television networks and other broadcasters, including Clear Channel=20
Communications, the nation's largest broadcast radio company. These=20
industry players contend that the FCC has not deregulated the industry=20
enough. They urge the court to return the rules to the commission and order=
=20
it to apply a higher standard of review in trying to justify all of its=20
media regulations.
A Consumer Union Press Release=20
(http://www.consumersunion.org/pub/core_telecom_and_utilities/000859.html...
re)=20
predicts the ownership rules will be overturned. CU helped argue against=20
the rules in court. More info at the Media Access Project's=20
http://www.mediaaccess.org/mediaownershipcase.html
[SOURCES: Communications Daily, New York Times]
Court Is Urged to Change Media Ownership Rules
http://www.nytimes.com/2004/02/12/business/media/12media.html
(requires registration)

COMCAST BIDS TO PURCHASE DISNEY
The NYTimes has a wide range of coverage of the bid by Comcast, the=20
nation's largest cable system owner, to purchase Disney and become the=20
largest media company in the world. Media reform advocates may be=20
interested in Jennifer Lee's article "Politics Could Overshadow Legal=20
Hurdles Of a Merger"=20
(http://www.nytimes.com/2004/02/12/business/media/12regs.html). "Does the=20
proposed merger violate any laws that are on the books right now?" said=20
Harold Feld, associate director of the Media Access Project, a public=20
advocacy group that has challenged media deregulation decisions. "In this=20
case, it is probably no." But media ownership consolidation has become a=20
hot political issue. "They are landing in a very inhospitable climate for a=
=20
content-distribution combination," said Rebecca Arbogast, a media analyst=20
at Legg Mason. "Plus, it's an election year, and it puts a bit more gas on=
=20
the fire." One concern of a regulatory review would be whether Comcast's=20
cable operations would have an advantage over competitors in negotiations=20
over clearance fees for its content businesses. The Washington Post's=20
Jonathan Krim wrote a similar article, "Comcast Bid Stirs Media=20
Cauldron"=20
http://www.washingtonpost.com/wp-dyn/articles/A34727-2004Feb11.html, and=20
quotes the ranking members of the Senate Judiciary Committee: the=20
Comcast-Disney deal "may well pose a risk to competition in the marketplace=
=20
of ideas and the diversity of news, information and entertainment available=
=20
to the American public." If the merger is successful, Comcast, with 22=20
million television subscribers, would, in several U.S. cities, operate the=
=20
only cable system and one or possibly two of the local over-the-air=20
broadcast stations. The deal would also raise concerns about the Internet.=
=20
"As a content company, [Disney] was a powerful force in favor of keeping=20
the net neutral -- so it could compete equally with other content companies=
=20
to sell its content," said Stanford University law professor Lawrence=20
Lessig. "But why compete when you've got control over the pipes?"
USA Today reports that the deal could beat back efforts to bundle phone,=20
and satellite TV=20
(http://www.usatoday.com/usatonline/20040212/5919432s.htm). ''There's a=20
death struggle between cable and traditional (phone companies) for the=20
consumer wallet,'' says Ford Cavallari, a broadband and media expert at=20
consultant Adventis. ''The idea that phone companies can compete against=20
cable for share of the television wallet will have a stake put in its heart=
=20
if a deal like this happens.''
[SOURCE: New York Times]
http://www.nytimes.com/business/businessspecial/
(requires registration)
The Wall Street Journal also has a number of stories; find them at
http://online.wsj.com/page/0,,2_1070,00.html
(requires subscription)

* Links to Press Releases in Response to Comcast-Disney Deal Follow

COMCAST DISNEY COMBINATION HAZARD TO PUBLIC INTEREST
=93Comcast=92s proposed merger with Disney would deal a devastating blow to=
the=20
few diverse viewpoints, voices, and sources of programming still remaining=
=20
on broadcast and cable television,=94 says Center for Creative Voices in=20
Media Executive Director Jonathan Rintels. =93This merger is worse than=20
=91Goofy=92 =AD this supersized media combo is hazardous to the health of=
our=20
democracy and culture, which depend on a diverse and vibrant=20
media. Regulators must reject it as not in the public interest. The=20
Comcast-Disney combination would own dominant cable systems in the largest=
=20
markets in the US (8 out of 10 top markets); own one of the largest=20
broadcast TV networks (ABC); own and/or be affiliated with local stations=20
across the country, which will soon be broadcasting hundreds of added new=20
digital TV channels; own cable content including all the ESPNs, ABC Family=
=20
Channel, Disney Channel, E! and many more; and own the nation=92s largest=20
broadband Internet service provider.
[SOURCE: Center for Creative Voices in Media Press Release]
http://www.creativevoices.us/php-bin/news/showArticle.php?id=3D66

PROPOSED COMCAST CABLE TAKEOVER OF DISNEY LIKELY LEADS TO LESS CONSUMER=20
CHOICE, HIGHER COSTS, MORE MEDIA CONCENTRATION
Today=92s proposed takeover of the Walt Disney Co.=96 which owns ABC News=
and=20
TV stations reaching 25 percent of the population =96 by Comcast, the=20
nation=92s largest cable provider, raises significant questions about media=
=20
concentration and the impact it will have on consumers=92 wallets as well as=
=20
what they see on TV. =93If this deal goes through it tightens the ownership=
=20
grip over some of the most important sources of news, information and=20
entertainment in our country,=94 said Gene Kimmelman, senior public policy=
=20
director for Consumers Union, publisher of Consumer Reports. =93Disney has=
an=20
enormous package of extremely popular, marquee programming and a national=20
network that would now be owned by the largest cable distributor in the=20
country which has little to no competition in most communities. The=20
potential impact is enormous.=94
[SOURCE: Consumers Union Press Release]
http://www.consumersunion.org/pub/core_telecom_and_utilities/000858.html...
e

COMCAST-DISNEY MERGER SHOULD BE REJECTED BY BUSH ADMINISTRATION/FCC
Comcast's proposed takeover of the Walt Disney Company (ABC) is a deal that=
=20
should be unacceptable to federal officials, who are entrusted with=20
protecting the public interest. A Comcast-Disney combine would permit one=20
entity to dominate cable system distribution in the largest markets in the=
=20
US (8 out of 10 top markets); control a broadcast TV network and the=20
dozens--if not hundreds--of digital channels from its owned-and-affiliated=
=20
stations; own cable content including ESPN, Toon, Disney, Golf, E, and TV=20
One; as well as remain the major broadband ISP. Given Microsoft's=20
investment in Comcast and its new relation with Disney, there are also=20
implications for every desktop and set-top. Comcast has opposed any federal=
=20
policy that would ensure that the broadband Internet operates on an open=20
and nondiscriminatory basis.
This deal is the direct legacy of Michael Powell and the Bush FCC. Powell=
=20
has supported further consolidation, signaling to Comcast that such a deal=
=20
is possible. Powell could have sought to restore the broadcast-cable=20
cross-ownership rule (something his fellow Commissioner Michael Copps=20
urged). Finally, it should come as no surprise that Comcast's Roberts is=
=20
backing President. Bush for re-election and that the company's president,=20
Stephen Burke, is a $100,000-plus "Pioneer" for Bush-Cheney. ( Broadcasting=
=20
and Cable , 2/9/04). Such support is designed to ensure that the Bush=20
Administration doesn't craft rules that prevent this kind of proposed=20
merger, or force Comcast to operate its cable and online systems under=20
public interest safeguards.
[SOURCE: Center for Digital Democracy]
http://www.democraticmedia.org/news/ComcastDisney.html

BROADCAST DECENCY ENFORCEMENT

COVERAGE OF HOUSE/SENATE HEARINGS
The House hearing on decency enforcement centered on the Super Bowl=20
halftime incident. Opening statements from Members of Congress took two=20
hours. Viacom's Mel Karmazin and NFL Commissioner Paul Tagliabue said they=
=20
had no prior knowledge of Janet Jackson's plan to expose herself. Ranking=20
member John Dingell criticized both the halftime show and the number of=20
violent commercials during the game. Mr. Karmazin said the problem is the=20
vagueness of the FCC=92s indecency standard....=93The precedent constantly=
=20
changes and the standard is not clearly articulated to broadcasters.=94
FCC Chairman Michael Powell told Congress that the Commission will act=20
swiftly to protect children and respond to the public's concerns about the=
=20
Super Bowl halftime show. In addition, he said the FCC is stepping up=20
enforcement of indecency, especially on TV. He said he fully supports=20
legislation introduced in the House and Senate aimed at substantially=20
increasing the fines for infractions by broadcasters. He also suggested=20
that enforcement could be expanded to include other types of coarse or=20
inappropriate programming not suitable for our children, such as excessive=
=20
violence. Read the Chairman's remarks at
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243802A2.pdf and=20
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243802A3.pdf
FCC Commissioner Copps told Congress that the Commission is failing to do=20
its job. "At the same time that we are not adequately enforcing indecency=20
laws, the Commission is dismantling media concentration rules without=20
considering whether there is a link between increasing media consolidation=
=20
and increasing indecency. It makes intuitive sense that as media=20
conglomerates grow ever bigger and control moves further away from the=20
local community, community standards go by the boards." He offered a=20
five-point plan for the Commission to do a job: 1) Use the FCC's Full=20
Authority to Punish Transgressors - License Revocation, License Non-Renewal=
=20
and Higher Fines, 2) Reform the Complaint Process, 3) Tackle Graphic=20
Violence, 4) Convene an Industry Summit that includes Cable and DBS and 5)=
=20
Affirm the Rights of Local Broadcasters to Control Their Programming. See=20
Commissioner Copps remarks at
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243790A2.pdf and=20
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243790A3.pdf
Cable TV was not spared from the Senate discussion with many Members of=20
Congress and FCC Commissioners agreeing that a la carte pricing for cable=20
or DBS services would help parents control the content coming into the home=
=20
and save money.
[SOURCES: House of Representatives, Senate, Communications Daily]
http://energycommerce.house.gov/108/Hearings/02112004hearing1200/hearing...
Find links to additional testimony at the Senate Commerce Committee=20
hearing, Protecting Children from Violent and Indecent Programming, at
http://commerce.senate.gov/hearings/witnesslist.cfm?id=3D1042
Also see:
Indecency Laws Examined in Wake of Halftime Show
http://www.nytimes.com/2004/02/12/national/12DECE.html?pagewanted=3Dall
Get Tough on TV Indecency, Lawmakers Urge
http://www.washingtonpost.com/wp-dyn/articles/A35276-2004Feb12.html
In a related story, the National Association of Broadcasters announced an=20
All-Industry Summit to address topics related to responsible programming to=
=20
be held in early Spring. A broad cross section of local broadcasters,=20
network representatives and other stakeholders from across the country will=
=20
be invited to the private event.
http://www.nab.org/Newsroom/PressRel/Releases/responsible.htm

CABLE

CABLE COMPETITION -- INCREASING PRICE; INCREASING VALUE?
Senators tongue-lashed cable television executives for escalating rates.=20
The ranking members of the committee announced three plans: 1) Requiring=20
cable companies to make all of their programming available to pay TV=20
competitors, 2) Urging the Justice Department to investigate allegations of=
=20
predatory pricing, which would violate antitrust laws, and 3) Asking the=20
General Accounting Office (GAO) to study whether satellites were truly=20
competitive with cable in all areas. Technical difficulties may prevent=20
satellite from being a strong competitor in urban areas and cable does not=
=20
serve rural areas well.Senators also criticized some cable TV content as=20
indecent.
For links to testimony, see
http://judiciary.senate.gov/hearing.cfm?id=3D1041
[SOURCE: US Senate, Communications Daily, Multichannel News]
http://www.multichannel.com/article/CA381034?display=3DBreaking+News

TELEPHONY

CALIFORNIA REGULATORS ADVANCE VoIP PLANS
The day before the FCC is expected o begin a rulemaking process concerning=
=20
Internet phone service (VoIP), the California Public Utilities Commission=20
tentatively assumed jurisdiction over any Internet phone call that connects=
=20
with traditional phone networks. The CA PUC also began an 18-month long=20
process to write Net phone regulations. VoIP providers are not thrilled.=20
But California is just one of 25 states beginning to weigh in on VoIP in=20
part because they see there will be some role for state regulators to play=
=20
and they fear that as more telephony traffic moves to the Internet there=20
will be less funds available for state public services
[SOURCE: C-Net|News.com, AUTHOR: Ben Charny]
http://news.com.com/2100-7352_3-5157628.html?tag=3Dnefd_top
See also:
PUC to Look Into Regulating Net Telephony
http://www.latimes.com/business/printedition/la-fi-voip12feb12,1,5175353...
ry?coll=3Dla-headlines-pe-business
(requires registration)
--------------------------------------------------------------
Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday through=20
Friday, this service provides updates on important industry developments,=20
policy issues, and other related news events. Headlines are compiled by=20
Kevin Taglang (ktaglang( at )etpost.net) -- we welcome your comments.
--------------------------------------------------------------

Benton's Communications-related Headlines for 2/11/04

TELEVISION
Ownership and Indecency
Critics Blame Big Media for Sleaze Factor
Let's Get Ready to Rumble
More TV Hits Cutting Room Floor
Hearing: H.R. 3717, the Broadcast Decency Enforcement Act of 2004
Hearing: Protecting Children from Violent and Indecent Programming
Hearings to Probe Media Indecency (audio file)
CBS: What the FCC Is Going On With Indecency Standard?
Cable
Hearing: Cable Competition =AD Increasing Price; Increasing Value?
Wire-Based Competition Benefited Consumers in Selected Markets
GAO Wire-Based Study Not Realistic
Advertising & News
Mistake Leads to Complaints on Ads

INTERNET
Senators Try to Break Impasse on Internet Taxes

SPAM AND SCAM
Study: Spammers turning blind eye to the law
Officials Say Mob Stole $200 Million Using Phone Bills

TWO OWNERSHIP MOVES IN PLAY
Comcast Bid for Disney
Vodafone and Verizon Talk

TELEVISION
Ownership and Indecency

CRITICS BLAME BIG MEDIA FOR SLEAZE FACTOR
Media ownership and indecency are connected, some critics say -- but one=20
prominent TV station owner does, too. Jim Goodmon owns stations in North=20
Carolina and said, "If a network owns a station, they can put anything on=20
they want and there's no local input." As an example, Mr. Goodman decided=20
not to air Fox's "Who Wants to Marry a Millionaire?" in 2000 because he=20
felt it made fun of marriage and would offend his Raleigh audience.=20
Congress will be asking the FCC and television executives today why there=20
is indecent content broadcasted on television and what the FCC can do=20
better to curtail it. While in Philadelphia, the 3rd U.S. Circuit Court of=
=20
Appeals is scheduled to hear arguments concerning the FCC's decision to=20
ease the limits on media ownership. What's the connection? Indecency=20
complaints are on the rise since 1996 legislation opened the door for=20
increased media ownership concentration. And Viacom and Clear Channel=20
Communications, the nation's largest radio chain with more than 1,250=20
stations, have been fined for indecent radio broadcasts much more than=20
other chains.
[SOURCE: Washington Post, AUTHOR: Frank Ahrens]
http://www.washingtonpost.com/wp-dyn/articles/A30541-2004Feb10.html
See Also:
MEDIA CONSOLIDATION WILL LEAD ONLY TO MORE INDECENCY ON THE AIRWAVES
The more media outlets and related companies that media giants like Viacom=
=20
(which owns CBS and MTV) are allowed to own, the more likely it is that=20
Americans will be treated to the kind of tasteless breast barring that was=
=20
showcased at the Superbowl on CBS. Sure, Congress can and should pass=20
legislation stiffening the fines for broadcast indecency. But if the media=
=20
continues to merge and consolidate, we'll still be left with entertainment=
=20
that, at best, provides us with a steady stream of the coarse, the=20
juvenile, and the vulgar. That's because when a handful of media giants=20
control all of what we see and hear on the airwaves, things like concern=20
for community standards are ignored, while the focus becomes making cheap=20
programming that will appeal to an advertiser's target audience.
[SOURCE: Common Cause Press Release]
http://www.commoncause.org/news/default.cfm?ArtID=3D280

LET'S GET READY TO RUMBLE
No, Vince McMahon wouldn't be calling the action, but expect a three-way=20
smackdown as lawyers argue that the FCC's new ownership rules are too=20
lenient, not lenient enough and just right. The U.S. Court of Appeals for=20
the Third Circuit, in Philadelphia, PA, will hear oral argument regarding=20
the FCC=92s newly relaxed media ownership rules today. This challenge was=20
brought by public interest advocates who believe that the media=20
deregulation adopted by the FCC last June will substantially undermine=20
civic discourse on the nation=92s media. A significant problem with the new=
=20
rules, the Media Access Project argues, is that they will reduce the number=
=20
of reporters competing to
cover stories. The number of reporters dedicated to covering local news is=
=20
shrinking every day, just as the resources dedicated to covering=20
international events has drastically decreased. When media outlets merge,=20
fewer reporters are competing to cover a story. This is particularly=20
dramatic because in most cities, a single newspaper is often responsible=20
for virtually all of the in-depth local news coverage. With less=20
competition between the local newspaper and local television stations (they=
=20
will be allowed to merge in most markets in this country), citizens will be=
=20
poorly served. The FCC=92s order will diminish the quality of news essential=
=20
to democracy. Civic participation and democracy depend on citizens=92=
ability=20
to find out what is going on in their home towns and cities.
The public interest advocates scored a significant victory last September,=
=20
when the court temporarily stopped enforcement of the
rules. Given the stay last year, it is unlikely the court will uphold the=20
rules as written.
[SOURCE: Media Access Project]
http://www.mediaaccess.org/MAPFeb11PressRel.pdf
http://www.mediaaccess.org/mediaownershipcase.html

MORE TV HITS CUTTING ROOM FLOOR
In response the recent heat over broadcasted indecency, network censors are=
=20
editing TV shows. The cuts mainly affect brief nude scenes and depictions=20
of sexual behavior. The networks' newfound skittishness about nudity is in=
=20
sharp contrast to their practice of the last few years, when they all took=
=20
halting steps to match cable networks in pushing edgier, more-explicit=20
programming. "The standards-and-practices departments are being much more=20
vigilant about what's going through," one network executive said on=20
condition of anonymity. "I think everybody's been put on notice" since the=
=20
Super Bowl. There's already backlash on this new trend; shows' creators=20
fear that avoiding controversial material will lead to blander programs,=20
driving away audiences.
[SOURCE: Los Angeles Times, AUTHOR: Scott Collins and Maria Elena=
Fernandez]
http://www.latimes.com/business/printedition/la-fi-censors11feb11,1,5176...
tory?coll=3Dla-headlines-pe-business

HEARING: H.R. 3717, THE BROADCAST DECENCY ENFORCEMENT ACT OF 2004
Subcommittee on Telecommunications and the Internet
February 11, 2004 10:30AM 2123 Rayburn House Office Building
URL below offers list of witnesses and link to Web cast.
[SOURCE: House of Representatives]
http://energycommerce.house.gov/108/Hearings/02112004hearing1200/hearing...

HEARING: PROTECTING CHILDREN FROM VIOLENT AND INDECENT PROGRAMMING
Full Senate Commerce Committee Hearing
Wednesday, February 11 2004 - 9:30 AM - SR- 253
Members will hear testimony on the adequacy of current regulations=20
protecting children and parents from violent and indecent broadcasts.
URL below offers list of witnesses and link to Web cast.
[SOURCE: US Senate]
http://commerce.senate.gov/hearings/witnesslist.cfm?id=3D1042

HEARINGS TO PROBE MEDIA INDECENCY
Congress holds hearings Wednesday on the FCC's role in regulating indecent=
=20
material on TV and radio. Lawmakers want to increase the fines the FCC can=
=20
impose on broadcasters. But legal precedents limit the FCC's power to=20
define what qualifies as indecent. Link to audio file can be found at:
http://www.npr.org/rundowns/rundown.php?prgDate=3D10-Feb-2004&prgId=3D3

CBS: WHAT THE FCC IS GOING ON WITH THE INDECENCY STANDARD?
Proposed changes in indecency enforcement will not cure the failing=20
regulations unless the FCC adopts a clearer standard, CBS said in a letter=
=20
to House Telecommunications Subcommittee Ranking Member John Dingell=20
(D-MI). There has been talk in Washington that CBS could face heavy fines=20
or revocation of television licenses over its Super Bowl halftime show.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA380928?display=3DBreaking+News

Cable

HEARING: CABLE COMPETITION -- INCREASING PRICE; INCREASING VALUE?
The Senate Committee on the Judiciary Subcommittee on Antitrust,=20
Competition Policy and Consumer Rights has scheduled a hearing on =93Cable=
=20
Competition =AD Increasing Price; Increasing Value?=94 for Wednesday,=
February=20
11, 2004, at 10:00 a.m., in Dirksen Senate Office Room 226. Senator Mike=20
DeWine (R-OH) will preside. The hearing is to include testimony from=20
Insight Communications CEO Michael Willner, National Cable and=20
Telecommunications Association President Robert Sachs, Consumer Federation=
=20
of America's Mark Cooper, The Precursor Group CEO Scott Cleland and Knology=
=20
CEO Rodger Johnson.
[SOURCE: US Senate]
http://judiciary.senate.gov/hearing.cfm?id=3D1041

WIRE-BASED COMPETITION BENEFITED CONSUMERS IN SELECTED MARKETS
The General Accounting Office is sharing a new report with the Senate=20
Judiciary Committee concerning competition and cable services. One of the=20
primary purposes of the Telecommunications Act of 1996 was to promote=20
competition in telecommunication markets, but wire-based competition has=20
not developed as fully as expected. However, a new kind of entrant, called=
=20
broadband service providers (BSP - also know as overbuilders), offers an=20
alternative wirebased option for local telephone, subscription television,=
=20
and highspeed Internet services to consumers in the markets they have=20
chosen to enter. This report provides information on (1) BSPs' business=20
strategy (to build a fiber-optic network to provide consumers with a bundle=
=20
of services, including subscription television, highspeed Internet access,=
=20
and local telephone), (2) the impact of BSPs' market entry on incumbent=20
companies' behavior and consumer prices for telecommunications services=20
(rates for telecommunications services were generally lower in the study=20
cities with BSPs), (3) the key factors that BSPs consider when making=20
decisions about which local markets to enter (city size, income, and=20
computer use), and (4) the success of BSPs in attaining subscribership and=
=20
any key factors that may limit their success.
[SOURCE: General Accounting Office]
http://www.gao.gov/highlights/d04241high.pdf
http://www.gao.gov/new.items/d04241.pdf

GAO WIRE-BASED STUDY NOT REALISTIC
Progress & Freedom Foundation Senior Fellow and Director of Communications=
=20
Policy Studies Randolph J. May responded quickly to the GAO report=20
summarized above saying there may be problems with the agency's methodology=
=20
and failure to include competition from satellite operators in its findings.
[SOURCE: Progress and Freedom Foundation Press release]
The Progress & Freedom Foundation is a market-oriented think tank that=20
studies the digital revolution and its implications for public policy.
http://www.pff.org/news/news/2004/021004gaoreport.html

Advertising & News

MISTAKE LEADS TO COMPLAINTS ON ADS
In a segment on healthy eating sponsored by General Mills, CNN briefly=20
aired the image of one of the company's products. To many viewers, the=20
placement of the product seemed intentional. "The news should not be for=20
sale to the highest bidder," said Gary Ruskin, executive director for=20
Commercial Alert in Portland, Ore., an organization that fights what its=20
members consider to be the creeping commercialization of American culture.=
=20
"The influence of General Mills upon a major news outlet like CNN is so=20
worrisome," Mr. Ruskin said, because of the increasing coverage by CNN and=
=20
other news media of issues like the role that food marketing plays in the=20
growing obesity of the general public. CNN claims the placement was=20
accidental and not part of the sponsorship agreement with General Mills.
[SOURCE: New York Times, AUTHOR: Stuart Elliott]
http://www.nytimes.com/2004/02/11/business/media/11adco.html?pagewanted=...
l
(requires registration)

INTERNET

SENATORS TRY TO BREAK IMPASSE ON INTERNET TAXES
Sens. Lamar Alexander (R-TN), Thomas R. Carper (D-DE), Ernest F. Hollings=20
(D-SC) and Kay Bailey Hutchison (R-TX) are introducing a bill that would=20
extend a ban on Internet access taxes for two years. They want the tax ban=
=20
to apply only to the fees consumers pay to their Internet service=20
providers, not to the various businesses that run the telecommunications=20
network that enables both telephone and Internet service. The bill would=20
allow the roughly 25 states that tax DSL Internet access, which is=20
delivered via phone lines, to continue to do so. The bill will be competing=
=20
with legislation sponsored by Sens. George Allen (R-VA) and Ron Wyden=20
(D-OR). Sens Alexander and Carper say their proposal will save states as=20
much as $9 billion by 2006 when compared to the Allen-Wyden bill. A bill=20
similar to the Allen-Wyden prop0sal has already passed the House.
[SOURCE: Washington Post, AUTHOR: Jonathan Krim]
http://www.washingtonpost.com/wp-dyn/articles/A30201-2004Feb10.html

SPAM AND SCAM

STUDY: SPAMMERS TURNING BLIND EYE TO THE LAW
The most frequent visitors to our mailboxes, spammers, are not complying=20
with a new federal law, a new study finds. Just 3% of unsolicited=20
commercial bulk email includes a valid US postal address and a link that=20
provides a valid opt-out option. What's more, the percentage of email that=
=20
is spam grew in January to 60%, up 2% since December. While enforcement of=
=20
the new legislation is being worked out, some spammers have started to=20
comply with the law. "It's a little bit early to see huge amounts of=20
compliance, but we are seeing people start to comply," said Ken Schneider,=
=20
chief technology officer at Brightmail, one of the largest spam-filtering=20
companies.
[SOURCE: Reuters, AUTHOR: Stefanie Olsen]
http://news.com.com/2100-1032-5156629.html?tag=3Dcd_top

OFFICIALS SAY MOB STOLE $200 MILLION USING PHONE BILLS
A nationwide scheme had telephone subscribers paying up to $40/month for=20
services they never requested or used. "Cramming" is nothing new, but=20
federal authorities say that New York organized crime has been involved and=
=20
collected over $200 million over five years piggybacking bogus charges on=20
phone bills. "These defendants conspired to defraud consumers by using a=20
sophisticated web of shell companies to generate one of the largest=20
consumer frauds schemes in United States history, : said Roslynn R.=20
Mauskopf, the United States attorney in Brooklyn, in a prepared statement.=
=20
Investigators believe that cramming may be the most profitable enterprise=20
in organized crime today. Tony Soprano was unavailable for comment.
[SOURCE: New York Times, AUTHOR: William Rashbaum]
http://www.nytimes.com/2004/02/11/nyregion/11MOB.html
(requires registration)

TWO OWNERSHIP MOVES IN PLAY

Comcast is making a bid to purchase Disney in a deal that values the Big=20
Mouse at ~$54 billion. "The combination would create one of the world's=20
leading entertainment and communications companies with an unparalleled=20
distribution platform and an extraordinary portfolio of content assets,"=20
Comcast said in a prepared statement.
http://online.wsj.com/article/0,,SB107650105603626825,00.html?mod=3Dtech...
gy_main_whats_news
Comcast's Letter to Eisner
http://online.wsj.com/article/0,,SB107650146687026828,00.html?mod=3Dtech...
gy_main_whats_news
Vodafone Group PLC and Verizon Communications Inc are in talks to end=20
their partnership in Verizon Wireless. Vodafone is Europe's largest=20
wireless carrier and wants to make a bid for AT&T Wireless. But the last=20
thing Verizon wants is for Vodafone to buy AT&T Wireless and emerge as an=20
independent, formidable competitor.
Cingular Wireless still considers itself the front-runner to purchase AT&T=
=20
Wireless.
http://online.wsj.com/article/0,,SB107645812713426256,00.html?mod=3Dtech...
gy_main_whats_news
[SOURCE: Wall Street Journal, AUTHOR: Robin Sidel at robin.sidel( at )wsj.com,=20
Almar Latour at almar.latour( at )wsj.com and Ken Brown at ken.brown( at )wsj.com ]
(requires subscription)
--------------------------------------------------------------
Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday through=20
Friday, this service provides updates on important industry developments,=20
policy issues, and other related news events. Headlines are compiled by=20
Kevin Taglang (ktaglang( at )etpost.net) -- we welcome your comments.
--------------------------------------------------------------

Benton's Communications-related Headlines for 2/10/04

CABLE
Satellite, Cable Operators Get Ready to Raise Rates
Cable Prices Rising, Anti-Consumer Practices Continue
Hearing: Cable Competition =AD Increasing Price; Increasing Value?
Powell to Cable: Protect Internet Freedom

MEDIA AND POLITICS
Campaign Legal Center Asks FCC for Election Coverage Challenge
Campaign Ads Enrich Advisers, Raise Questions
Michigan Net Ballots Get Vote of Approval

CABLE

SATELLITE, CABLE OPERATORS GET READY TO RAISE RATES
DirecTV plans to boost average rates by more than 3% starting March 1.=20
Prices will range from $36.99 a month for basic service with 125 channels=20
to $90.99 for the ''premier'' package with 210 channels and free TiVo=20
service. The increase is the fourth in 10 years, but the last, 3.3%, came=20
in March. EchoStar is raising rates an average of 1.7% on its most popular=
=20
packages. Comcast, the nation's largest cable operator with 21 million=20
subscribers, will boost average cable rates by 5.4%. Time Warner Cable will=
=20
raise average rates by 4.9%. Cox Communications' rates are going up by an=20
average 3% to 4%. Cablevision is upping rates by an average of 3.2%.
[SOURCE: USAToday, AUTHOR:Michael McCarthy]
http://www.usatoday.com/usatonline/20040210/5911853s.htm

CABLE PRICES RISING, ANTI-CONSUMER PRACTICES CONTINUE
Cable rates continue to rise at three times the rate of inflation, cable=20
companies are using "bundling" of products and services to further gouge=20
consumers and lack of real competition is costing the public at least $4.5=
=20
billion/yr, according to a consumer group analysis of the cable industry.=20
Co-sponsored by Consumers Union and released in response to the FCC=92s=
Tenth=20
Annual Report on Competition in Video Market, the analysis shows that=20
climbing cable rates have far outpaced all cost increases and that most=20
consumers don't want the extra channels/services they are forced to pay for=
=20
in the "bundles" of channels cable companies compel them to buy. As a=20
result, the excess profits on basic and expanded basic service have mounted=
=20
sharply since the passage of the Telecommunications Act of 1996. "The time=
=20
has come for Congress to give consumers the right to choose and pay for the=
=20
cable channels they want," said Gene Kimmelman, Consumers Union public=20
policy director. "It is ridiculous that the FCC gives a nod and wink to=20
cable companies' practice of bundling channel packages at exorbitant rates=
=20
when it knows the typical household watches only 17 channels."
Read The Continuing Abuse Of Market Power By The Cable Industry: Rising=20
Prices, Denial Of Consumer Choice, And Discriminatory Access To Content at=
=20
http://www.consumerfed.org/mpcableindustry.pdf
[SOURCE: Consumers Union Press Release]
http://www.consumersunion.org/pub/core_telecom_and_utilities/000853.html

POWELL TO CABLE: PROTECT INTERNET FREEDOM
At the Silicon Flatirons Symposium, FCC Chairman Michael Powell called on=20
broadband-network providers (and especially cable system operators that=20
offer high-speed Internet access) to guarantee that consumers enjoy "Four=20
Freedoms": Freedom to access legal content; Freedom to run any application=
=20
that won't harm the network; Freedom to attach any device that does not=20
abet crime; and Freedom to obtain meaningful information about service=20
plans. Chairman Powell said, "It is time to give the private sector a clear=
=20
road map by which it can avoid future regulation on this issue by embracing=
=20
unparalleled openness and consumer choice."
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
http://www.multichannel.com/article/CA380530?display=3DBreaking+News
Read Chairman Powell's full remarks "Preserving Internet Freedom: Guiding=20
Principles For The Industry" at
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243556A1.pdf

MEDIA AND POLITICS

CAMPAIGN LEGAL CENTER ASKS FCC FOR ELECTION COVERAGE CHALLENGE
The Campaign Legal Center has asked the FCC to issue a challenge to=20
broadcast and cable channels to voluntarily increase their political=20
coverage this year. Coverage dropped 33% in 2000 compared to 1996 and is=20
now considered minimal and declining. =93As we approach the Presidential=20
elections we hope the Commissioners will vigorously push to impose=20
political discourse,=94 said Norman Ornstein, CLC advisory board member. CLC=
=20
is also calling on the FCC to complete a rulemaking on public interest=20
obligations for digital broadcasters to determine whether additional=20
regulation is necessary.
[SOURCE: Communications Daily, AUTHOR: Tania Panczyk-Collins]
(Not available online)

CAMPAIGN ADS ENRICH ADVISERS, RAISE QUESTIONS
How exactly do you burn through $41 million running for president? Ads, ads=
=20
and more TV ads. For candidate Howard Dean, those ads have not helped him=20
win a primary yet. But did they help campaign manager Joe Trippi? He was=20
both the head of Dean's campaign and a partner in Trippi, McMahon & Squier=
=20
(TMS), the Alexandria firm that still handles Dean's media buying and has=20
been associated with his political career since 1992. Commissions for the=20
advertising purchased for the Dean campaign are estimated at $700,000. The=
=20
case highlights a serious conflict of interest: paid on commission, media=20
advisors are rewarded for increasing the cost of elections, which in turn=20
fuels the candidates' constant hunt for donations
[SOURCE: Washington Post, AUTHOR: Paul Farhi]
http://www.washingtonpost.com/wp-dyn/articles/A26975-2004Feb9.html
See also:
HOW WEB SUPPORT FAILED DEAN IN CRUNCH: EX-MANAGER
Joe Trippi also said Monday that the Internet's transparency hindered the=20
Dean campaign in the weeks before the primaries. "We were having a real=20
problem with how to say, 'We could be in real trouble here,"' Trippi told=20
the O'Reilly Emerging Technology conference of the tactical trouble the=20
Dean campaign had in balancing the need to keep supporters informed. "We=20
couldn't figure out how to tell people we had a problem without raising the=
=20
wrong impression. Part of the problem is that the press are reading our=20
blogs (Internet journals)," he said. With the media watching, it was hard=20
for the campaign to come up with a unified message as the candidate made=20
policy misstatements leading up to the barbaric yelp in Iowa. Internet=20
supporters were no match to the relentless replay of that moment, Trippi=
said.
[SOURCE: Reuters, AUTHOR: Eric Auchard ]
http://www.reuters.com/newsArticle.jhtml?type=3DinternetNews&storyID=3D4...
12

MICHIGAN NET BALLOTS GET VOTE OF APPROVAL
46,000 of the nearly 163,000 cast in the Michigan Democratic Caucus=20
Saturday were cast via the Internet. "I think it was a success," said Jason=
=20
Moon, a Michigan Democratic Party spokesman. "We, the Democratic Party here=
=20
in Michigan, look for any way to bring voters to the polls." Because the=20
party held a caucus, the Michigan secretary of state was not involved. The=
=20
Michigan Democratic Party hired a private contractor, Election Services=20
Corporation (ESC), which owns portions of Election.com, the company which=20
conducted the March 2000 Arizona primary.
[SOURCE: C-Net|News.com, AUTHOR: Declan McCullagh ]
http://news.com.com/2100-1028-5156089.html?tag=3Dcd_top
--------------------------------------------------------------

Benton's Communications-related Headlines for 2/9/04

THIS WEEK'S AGENDA
Conf -- The Digital Broadband Migration: Toward A Regulatory Regime For
The Internet Age
Oral Arguments: Prometheus Radio Project v. FCC [re: Media Ownership Rules]
Hearing: Broadcast Decency Enforcement Act of 2004
Hearing: Protecting Children from Violent and Indecent Programming
Speech: Making the Right Choices About the Future of Communications
Thorny Issues Await F.C.C. as It Takes Up Internet Phones
FCC Open Meeting Thursday, February 12

INTERNET
Safety, Blogs and Protocols

BROADCASTING
PBS #1 in Public Trust, Respect According to New Roper Poll
Localism Task Force Public Hearing Online

PRIVACY
TiVo and Privacy
Online Search Engines Help Lift Cover of Privacy

THIS WEEK'S AGENDA

THE DIGITAL BROADBAND MIGRATION: TOWARD A REGULATORY REGIME FOR THE INTERNET
The transformation of telecommunications from an analog, narrowband network
optimized for voice to a digital, broadband network optimized for data
traffic has created a slew of challenges for businesses, policymakers, and
academics alike. In the fall of 2000, as he prepared to take the helm at
the FCC, Michael Powell analogized this transition to one of people having
to "migrate" across continents. Like the migrations taken by ancient
peoples, the transition to a digital, broadband environment is painful and
will not happen overnight. Consequently, as increasing numbers of users are
adopting digital products and services that are networked through broadband
connections, it is now an opportune time to evaluate the issues that
policymakers, academics, and businesses will confront over the course of
this transition. This conference will examine three central areas of
regulatory policy associated with the Internet age: broadband policy,
digital rights management, and privacy and security policy. Principal
speakers will be Chairman Powell, who has spearheaded a set of regulatory
responses to these issues; Lawrence Lessig, the foremost academic in the
study of Internet regulation; and Craig Mundie, the Chief Technology
Officer for Microsoft. With a thoughtful array of leaders from academic,
industry, and governmental circles, this conference will continue the
Silicon Flatirons' tradition of encouraging "bolder thinking" in Boulder.
Like its predecessors, the proceedings from this conference will be
published in the Journal on Telecommunications and High Technology Law.
February 8-9, 2004
[SOURCE: Silicon Flatirons Telecom Program, University of Colorado School
of Law]
http://www.silicon-flatirons.org/conferences/DBM_feb_2004.html

PROMETHEUS RADIO PROJECT V. FCC
Case No. 03-3388, United States Court of Appeals Third Circuit
The Court will hear oral argument on Wednesday on the FCC's media ownership
rules.
In June 2003, the FCC announced its changes to media ownership rules. On
August 13, 2003, the Media Access Project's attorneys asked the U.S. Court
of Appeals for the Third Circuit to throw out the FCC's media ownership
rules on behalf of its client, the Philadelphia-based Prometheus Radio
Project. As part of a careful strategy, MAP and its allies filed in three
separate federal courts on the same day in order to move the case out of an
unfriendly forum. MAP is working in close coordination with attorneys at
the Georgetown Law Center's Institute for Public Representation in the
suit. After MAP's President and CEO represented the public interest
organizations at oral argument, the Third Circuit U.S. Court of Appeals
stayed the FCC's order on September 3rd, 2003 thus preventing the rules
from being enforced until court review is complete. Subsequently, there
have been several procedural battles, including several industry requests
that the Third Circuit in Philadelphia transfer the case to a federal court
in Washington DC, and some changes to the briefing schedule. All briefs
will be filed by January 6, 2004, and oral argument will be held February
11, 2004 in Philadelphia.
For more on the case, visit the Media Access Project
http://www.mediaaccess.org/programs/diversity/courts.html#mo

HEARING: BROADCAST DECENCY ENFORCEMENT ACT OF 2004
H.R. 3717 "To increase the penalties for violations by television and radio
broadcasters of the prohibitions against transmission of obscene, indecent,
and profane language." The bill would increase fines to $275,000 per
station for each violation and cap a multiple station group's liability at
$3 million per violation. The bill also would codify the FCC's new policy
stipulating that each indecent utterance during a program constitutes a
separate violation liable for a new fine.
Subcommittee on Telecommunications and the Internet
2123 Rayburn House Office Building Wednesday, February 11, 2004 9:30 AM
This hearing is expected to include a long discussion on the Super Bowl
halftime show. The FCC has received more than 200,000 complaints on
this subject. Complaints and inquiries can be filed via the FCC's toll-free
consumer line at 1-888-225-5322 or via e-mail at fccinfo( at )fcc.gov
The Subcommittee may vote on H.R. 3717 on Thursday, same time, same place.
Subcommittee Chairman Upton wants to send the bill to President Bush by the
end of March.
Get more information on the bill from Thomas
http://thomas.loc.gov/
[SOURCE: House of Representatives]
A link to a live Web stream is available at the URL below.
http://energycommerce.house.gov/108/Hearings/02112004hearing1200/hearing...

HEARING: PROTECTING CHILDREN FROM VIOLENT AND INDECENT PROGRAMMING
Members of the Senate Commerce Committee will examine whether the current
protections afforded parents and children concerning violent and indecent
content in broadcast programming are adequate.
[SOURCE: US Senate]
A link to a live Web stream is available at the URL below.
http://commerce.senate.gov/hearings/index.cfm

SPEECH: MAKING THE RIGHT CHOICES ABOUT THE FUTURE OF COMMUNICATIONS
Wednesday, 11 February 2004 12:00 pm SHARP - 1:00 pm
New America Foundation
1630 Connecticut Avenue NW, 7th Floor
Washington, D.C.
January 2004 marked the 20th Anniversary of the Divestiture Order in
January 1984 that broke up AT&T into many competing companies. The
question today is what the future of communications will look like -- and
whether the nation which was well served by breaking up a huge monopoly
twenty years ago is still facing serious competition problems in the
telecommunications/IT policy arena. The New America Foundation has asked
AT&T's CEO, David W. Dorman, to reflect on this anniversary; to comment on
the state of competition in telecom today; to give insight into the VoIP
debate; and to share his view on why policy choices being made today will
have an enormous impact on the next two decades of communications
innovations and customer service.
RSVP to Jennifer Buntman at buntman( at )newamerica.net or (202) 986-4901
Boxed Lunches will be served to all registered attendees
www.newamerica.net

THORNY ISSUES AWAIT F.C.C. AS IT TAKES UP INTERNET PHONES
Some technology optimists as well as companies like AT&T and Verizon think
Internet-based telephony could revolutionize the telecommunications
industry. About a million customers are expected to use Internet phone
service (often called VoIP) by the end of the year. But first the
government must decide how the new service should be regulated and that
process is expected this Thursday with the FCC opening a rulemaking on VoIP
(see below). The issue is a tough one for regulators because the technology
highlights the convergence of communications and computers and the
different ways the FCC has regulated the two. Industry watchers will be
interested to see what the FCC's rulemaking looks like: a list of questions
or a detailed statement of the Commission's position. To be decided is 1)
how VoIP should be classified -- as an information service or a
telecommunications service; 2) whether or not VoIP should be subject to
access fees paid between carriers to complete calls; and 3) will VoIP
providers be required to pay into the Universal Service Fund used to keep
rural and underserved areas' phone bills down and other fees to support
emergency 911 funds. And since VoIP is computer-based, should there be
worries about viruses and hackers? Tune in Thursday at www.fcc.gov
[SOURCE: New York Times, AUTHOR: Stephen Labaton]
http://www.nytimes.com/2004/02/09/technology/09rules.html
(requires registration)

FCC OPEN MEETING THURSDAY, FEBRUARY 12
The FCC release an agenda for its open meeting on Thursday; items include:
1) Pulver.com's Free World Dialup (see story above)
2) VoIP Notice of Proposed Rulemaking
3) Broadband over Power Line Systems Notice of Proposed Rulemaking
4) Access Charges/Universal Service Reform Report and Order
5) Service Disruption Reporting Requirements Notice of Proposed Rulemaking
[SOURCE: FCC]
http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243614A1.pdf

INTERNET

SAFETY, BLOGS AND PROTOCOLS
Will security problems, ever more intrusive advertising and efforts to tax
online activities result in technical and commercial ruin for the Internet?
Will innovation be stifled by battles over intellectual property? When will
vast repositories of human knowledge in the form of books and other media
go online in a serious way? How will technology help users navigate all
that information? What will today's leading Internet companies look like
tomorrow? These are a few of the questions asked and addressed in this
Journal Report. Concerning regulation, market-research firm Forrester
Research estimates that local and state governments are losing $11 billion
in potential Internet access tax revenue this year because of the Internet
tax ban passed by Congress in 1998. And the Federal legislation on spam
that went into effect January 1 is considered more lenient than state laws
that the federal act superceded. As to content, the nonprofit Internet
Archive in San Francisco is working to bring more creative and intellectual
material online. The organization is building a digital library that
provides free computer storage and Internet access for any historical
collections now available in digital format.
[SOURCE: Wall Street Journal, AUTHOR: Nick Wingfield at
nick.wingfield( at )wsj.com, Mylene Mangalindan at mylene.mangalindan( at )wsj.com,
Kara Swisher at kara.swisher( at )wsj.com, David Bank at david.bank( at )wsj.com,
David P. Hamilton at david.hamilton( at )wsj.com and Don Clark at
don.clark( at )wsj.com]
http://online.wsj.com/article/0,,SB107582325268319257,00.html?mod=e%2Dco...
(requires subscription)

BROADCASTING

PBS #1 IN PUBLIC TRUST, RESPECT ACCORDING TO NEW ROPER POLL
The Public Broadcasting System and RoperASW released results of a poll on
Thursday finding that the American public called PBS the most trusted
institution on a list of nationally known organizations in the country and
the best use of tax dollars, second only to military defense. Americans are
more satisfied with programming on PBS compared with commercial
broadcasting or cable networks and consider PBS news and public affairs
series the most trustworthy. The majority of people surveyed believe that
public broadcasting receives "too little" funding from the federal
government and that money given to PBS stations from the government,
corporations and individuals is "money well spent."
For more information, contact Lea Sloan 703/739-5021 lsloan( at )pbs.org or Jan
McNamara 703/739-5028 jmcnamara( at )pbs.org
[SOURCE: Public Broadcasting System Press Release]
http://www.pbs.org/aboutpbs/news/20040205_RoperPollRelease.html

LOCALISM TASK FORCE PUBLIC HEARING ONLINE
The FCC's Localism Task Force has scheduled six public hearings on the
subject of localism. The purpose of this public hearing is to gather
information from consumers, industry, civic organizations, and others on
broadcasters' service to their local communities. The second of these
hearings was held in San Antonio, Texas on January 28. You may now read
statements from panelists or see a Web cast of the event. Yes, yes, I know,
I'm pointing you towards a 5.5 hr long video for your computer. But if
broadcasting isn't local, why have it?
[SOURCE: FCC]
http://www.fcc.gov/localism/hearing-sanantonio012804.html

PRIVACY

TIVO AND PRIVACY
Did it bother anyone that TiVo was able to report last week that the Janet
Jackson incident was the most replayed event in the devices history? TiVo
records the habits of its users and is ready to sell data on specific users
to the TV industry through a partnership with Nielsen Media Research. The
company says it protects the identity of users unless users expressly
permit otherwise. "What they're saying is, 'You have to trust us,' " says
Richard Smith, a privacy and security consultant, who has examined TiVo's
technology. " 'We're going to snoop on you, but we will disconnect all that
information we have about you from your actual identity.' "
[SOURCE: Wall Street Journal, AUTHOR: Nick Wingfield at
nick.wingfield( at )wsj.com and Jennifer Saranow at jennifer.saranow( at )wsj.com]
http://online.wsj.com/article/0,,SB107627909024923840,00.html?mod=techno...
(requires subscription)

ONLINE SEARCH ENGINES HELP LIFT COVER OF PRIVACY
The Post explores "Google hacking," a completely legal use of the Internet
search to find sensitive information about people and organizations tucked
away in online crannies. For Web Masters, there are measures to take for
protection, but misconfiguration can mean Google gains access to
information that may not be meant for sharing.
[SOURCE: Washington Post, AUTHOR: Yuki Noguchi]
http://www.washingtonpost.com/wp-dyn/articles/A24053-2004Feb8.html
--------------------------------------------------------------

Communications-related Headlines for 2/6/04

NEXT WEEK'S AGENDA
Everyone's Talkin' (In)decency
FCC, FBI Reach VoIP Accord
FCC Open Meeting 2/12

INTERNET
Pentagon Calls Off Voting by Internet
Pay, Don't Sue, Song-Swappers, Trade Group Urges

NEXT WEEK'S AGENDA

EVERYONE'S TALKIN' (IN)DECENCY
Both the House and Senate Commerce Committee's will hold hearings on
Wednesday morning on broadcast television content. The House hearing will
focus on the Janet Jackson flap and HR-3717, Rep Fred Upton's bill to
increase indecency fines. The Committee will continue the discussion on
Thursday morning. The Senate hearing will be broader, looking at both
sexual and violent content. All five FCC commissioners are expected to
testify before both committees. On the table at the Senate hearing are
bills from Chairman John McCain (R-AZ) and Sen Ernest Hollings (D--SC). The
former's bill, the FCC Reauthorization Act (S-1264), is a more complete
modification of FCC procedures and would take a tougher stance on indecency
than Rep Upton's approach. The bill also addresses the UHF discount for
broadcasters and FCC travel policy. Sen Hollings bill, S-161, would create
a family hour safe harbor. A version of the bill has passed in this
committee three times, but it has never been voted on by the entire Senate.
FCC Chairman Michael Powell is heading an investigation of the Janet
Jackson incident. Many believe he will treat CBS parent Viacom as a repeat
offender.
[SOURCE: Communications Daily]
(Not available online)

FCC, FBI REACH VoIP ACCORD
The FCC and law enforcement agencies have an agreement that will allow the
Commission to approve a request by Pulver.com's Free World Dialup to offer
free Internet telephone service. But the FCC has also agreed to move
quickly to develop the new wiretap rules for telephone calls made using
Internet technology.
[SOURCE: Wall Street Journal, AUTHOR: Mark Wigfield
mark.wigfield( at )dowjones.com]
http://online.wsj.com/article/0,,SB107603088921922571,00.html?mod=techno...
(requires subscription)

INTERNET

PENTAGON CALLS OFF VOTING BY INTERNET
After computer-security specialists released a report last week saying the
Internet and personal computers are so inherently vulnerable that online
election results could be undermined, the Department of Defense has decided
to cancel plans to collect votes over the Internet from military personnel
and civilians abroad for this fall's presidential election. The greatest
security concern is the personal computer of the individual voter; a virus
or other hidden program in a voter's computer could monitor keystrokes and
intercept -- or change -- votes.
[SOURCE: Washington Post, AUTHOR: Dan Keating]
http://www.washingtonpost.com/wp-dyn/articles/A17147-2004Feb5.html
See also:
Online Voting Clicks in Michigan
http://www.washingtonpost.com/wp-dyn/articles/A17123-2004Feb5.html
California Seeks to Improve Electronic-voting Security
http://www.mercurynews.com/mld/mercurynews/7885748.htm

PAY, DON'T SUE, SONG-SWAPPERS, TRADE GROUP URGES
The Distributed Computing Industry Association is proposing that the
recording industry pay Internet users who swap in a protected format. Under
the plan, record labels would encode their songs with copy-protection
technology so users would have to pay a small fee, between 80 cents and 40
cents, to listen to them. Prolific song-swappers would be encouraged to
convert their collections of unprotected material into the protected
format, and then paid a portion of the fees collected each time somebody
purchases a song after copying it from them. Eventually, user-friendly
software would allow amateur musicians without recording contracts to make
their music available as well, DCIA said.
[SOURCE: Reuters, AUTHOR: Andy Sullivan]
http://www.reuters.com/newsArticle.jhtml?type=internetNews&storyID=4296386
--------------------------------------------------------------
Thanks so much for all the "welcome back" notes; they are very much
appreciated. Have a great weekend, "see" ya Monday...and we are outta here.
--------------------------------------------------------------

Benton Announces New Media Policy Focus and Center Creation

Submitted by benton on Thu, 02/05/2004 - 09:38

February 5, 2004

Communications-related Headlines for 2/5/04

TOP STORY
Barton Likely Next House Commerce Committee Chair

BROADCASTING
Where's the Beef? News Network Election Coverage Thin on Issues
NLMC: Nielsen Undercounts Latinos

INTERNET
Survey Finds 'Opinion Leaders' Logging on for Political News
IBM Sets Out to Make Sense of the Web

TELEPHONY
Texas Officials Decide Not to Investigate Baby Bells
Everyone's Talkin' VoIP
Protecting the Cellphone User's Right to Hide

QUICK HITS
Consumers Union Urges Reconsideration of Ownership Rules
Geeks Put the Unsavvy on Alert: Learn or Log Off
Correction

TOP STORY

BARTON LIKELY NEXT HOUSE COMMERCE COMMITTEE CHAIR
With Rep Billy Tauzin's resignation from Congress official, attention is
now turning to his likely successor as chair of the House Commerce
Committee. Rep Joe Barton (R-TX), an energy expert, is the front runner in
this race. Rep Barton does not have much of a record concerning
telecommunications legislation; his last bill on the subject was an attempt
to repeal the Cable Act of 1992 in 1993. Recently, Rep Barton co-sponsored
Rep Fred Upton's bill to increase indecency fines for broadcasters. Rep
Barton is expected to push for major telecommunications reform, however, in
2005 along the lines of that suggested by Sen Ted Stevens (R-Alaska), who
will likely be his counterpart in the Senate in 2005. Rep Barton's approach
is to "maximize markets and minimize regulation." Reform will likely
include local phone competition and Universal Service Fund contributions.
Multichannel News
(http://www.multichannel.com/article/CA379809?display=Breaking+News)
reports that Rep Barton will be a friend to cable. Three years ago, Rep
Barton told a Consumer Electronics Association audience in Las Vegas, "It's
time that must-carry must die." On broadcasters' latest demand for digital
carriage, Rep Barton declared: "There is no reason for must-carry in terms
of digital signals. There is simply not."
[SOURCE: Communications Daily, AUTHOR: Terry Lane]
(Not available online)

BROADCASTING

WHERE'S THE BEEF? NEWS NETWORK ELECTION COVERAGE THIN ON ISSUES
A January 4 CBS/New York Times poll found that the economy is the issue
registered voters "would most like to hear the candidates for president
discuss during the 2004 presidential campaign." This was followed by the
war against terror, health care, education and taxation. But that's not
what network TV newscasts are covering. In fact, international media
monitoring firm Media Tenor found that in January CBS, NBC and ABC devoted
less than 5% of their coverage of the Democratic campaigns to the
candidates' positions on these five issues. And the trend is towards less
and less coverage according to Media Tenor. "For the past four weeks, all
three networks have decreased their share of policy coverage on the
candidates," Media Tenor president Roland Schatz reported. "Television is
depriving the voters of information about the position of the candidates on
certain issues."
Read the Media Tenor report at (http://www.mediatenor.com/us_elec_3001.pdf)
[SOURCE: MediaChannel, AUTHOR: Timothy Karr]
(http://www.mediachannel.org/views/dissector/affalert139.shtml)

NLMC: NEILSEN UNDERCOUNTS LATINOS
For those who see a lack of diversity on television, the National Latino
Media Council is offering a new rationale: a study by Rincon & Associates
finds that Latinos and underrepresented in Nielsen surveys. This undercount
leads to premature cancelation of Latino-targeted programs by networks and
makes them reluctant to produce and air new Latino-themed shows. "This in
turn leads to diminished employment opportunities for Latino actors,
writers, directors and other behind-the-camera professionals, as well as to
significant loss of revenue from potential advertisers seeking to reach
Latino audiences," NLMC said in a statement.
[SOURCE: Broadcasting&Cable, AUTHOR: Paige Albiniak]
(http://www.broadcastingcable.com/article/CA379822?display=Breaking+News)

INTERNET

SURVEY FINDS 'OPINION LEADERS' LOGGING ON FOR POLITICAL NEWS
A survey by George Washington, RoperASW and Nielsen/NetRatings finds that
community opinion leaders are the most likely users of the Internet to find
and spread political information. "The main finding of the study is that if
you want to reach the people who are reaching everyone else, that place is
still the Internet," said Carol Darr, director of the university's
Institute for Politics, Democracy & the Internet. "The growing support for
this medium is not dependent on any one candidate." The study found that
online political activists are nearly seven times more likely than the
average citizen to influence their peers when it comes to telling them what
to buy, where to go on vacation, and which politicians to support. Roper
says about 10% of Americans typically fall into its definition of
"influential," which requires participation in a combination of community
activities that might include making a speech, attending a PTA meeting or
writing a letter to a newspaper. Only 7% of the American population
regularly use the Internet for political purposes, according to the study -
but 69% of them are "influential."
[SOURCE: New York Times, AUTHOR: Amy Harmon]
(http://www.nytimes.com/2004/02/05/politics/campaign/05INTE.html)
(requires registration)

IBM SETS OUT TO MAKE SENSE OF THE WEB
Making sense of all that is floating around the Internet is a tough
business, pushing the limits of supercomputing design. Competitors
WebFountain, ClearForest, Fast Search and Transfer, and Mindfabric are
beginning to offer data-mining services that ferret out meaning and
context, not just lists of more-or-less relevant links. IBM's approach is
to monitor discussion boards, Web logs, newsgroups and other pages trying
to recognize trends. For businesses (big businesses, that is), this may be
the ability to ask a computer "What is my corporate reputation?"
WebFountain promises to combine its intelligence with visualization tools
to chart industry trends or identify a set of emerging rivals to a
particular company. The platform could be used to analyze financial
information over a five-year span to see if the economy is growing, for
example. Or it could be used to look at job listings to pinpoint emerging
trends in employment.
[SOURCE: C-Net|News.com, AUTHOR: Stefanie Olsen]
(http://news.com.com/2100-1032_3-5153627.html?tag=nefd_lede)
Of course, for us mere mortals looking for quality information, see New
York Times article
When a Search Engine Isn't Enough, Call a Librarian
(http://www.nytimes.com/2004/02/05/technology/circuits/05libr.html?pagewa...)
(requires registration)

TELEPHONY

TEXAS OFFICIALS DECIDE NOT TO INVESTIGATE BABY BELLS
Five telephone service providers and trade groups have asked the Senate and
House judiciary committees as well as nine state attorneys general to
investigate whether incumbent local exchange carriers (known affectionately
as the Baby Bells) conspired illegally to suppress competition at a United
States Telecommunications Association dinner on October 20, 2003. House
Judiciary Committee Chairman F. James Sensenbrenner Jr. (R-WI) has said he
believed the Bells' conduct was protected by the 1st Amendment, and he had
no plans to call a formal inquiry. Now Texas Assistant Attorney General
Mark Tobey has weighed in, writing that a preliminary inquiry failed to
turn up enough evidence to warrant a formal investigation. The competing
telephone companies alleged that the Bells violated Texas law by
arm-twisting their suppliers to join a $40-million lobbying campaign and by
dividing market territories to avoid competing against one another.
[SOURCE: Los Angeles Times, AUTHOR: James Granelli]
(http://www.latimes.com/business/printedition/la-fi-bells5feb05,1,7399016...)

EVERYONE'S TALKIN' VoIP
About four items in today's Communications Daily center on possible
regulation of Internet telephone service (know as VoIP). Here's some
highlights. The FCC could adopt a Notice of Proposed Rulemaking covering
VoIP as soon as Thursday, February 12. The FBI, Department of Justice and
Drug Enforcement Administration have asked the FCC to delay any decisions
on VoIP fearing the Commission could rule that VoIP is an information
service rather than a telecommunications service. If that is the case, VoIP
could be exempt from wiretapping laws.
The House Telecommunications subcommittee heard testimony from market
analysts Wednesday and one suggested that one-third of the market will use
some form of VoIP within five years. Ned Zacher, the director of
telecommunications research at Weisel Partners, projected 30 million cable
VoIP customers in 5 years. The copper-based telephone market will continue
to shrink because of competition from VoIP and wireless service. [Find out
more about the hearing at
(http://energycommerce.house.gov/108/Hearings/02042004hearing1164/hearing...)]
Speaking to investors, Sprint Chairman Gary Forsee called on the FCC to
bring "much-needed clarity by promptly ruling that phone-to-phone VoIP
should pay access charges." he added, "We need to quickly get to a system
where the compensation a carrier pays for interconnection to another
carrier's network is the same, regardless of whether the call is local or
toll, state or interstate, information or communication."
The Telecommunications Industry Association adopted a policy statement on
the regulation of voice over Internet protocol. The trade group says
regulation should not be applied to VoIP without thorough justification
that it is necessary as a matter of public policy. See the group's press
release at
(http://www.tiaonline.org/media/press_releases/index.cfm?parelease=04-07).
[SOURCE: Communications Daily, AUTHOR: Edie Herman, Terry Lane, Susan
Polyakova]
(Not available online)

PROTECTING A CELLPHONE USER'S RIGHT TO HIDE
Because of a government mandate to be able to locate cellphones during 911
calls, carriers are introducing location-tracking features such as AT&T's
"Find Friends," which lets users locate up to five other within a certain
distance. Marketers are also interested in using the technology to send
geographic-sensitive, commercial message (an instant 25 cents off the donut
store across the street, say). But these are the kinds of features some
people call bugs. How to manage it? Privacy-Conscious Personalization,
software for your cellphone, allows users to decide who will know how much
about where their cellphone (and, presumably, their person) is.
[SOURCE: New York Times, AUTHOR: Jeffery Selingo]
(http://www.nytimes.com/2004/02/05/technology/circuits/05next.html)
(requires registration)

QUICK HITS

* Consumers Union is urging Congress to reconsider the FCC's new ownership
rules in light of the Janet Jackson/Super Bowl incident. Letters to
Congress ask the Senate to support S. 1046, and the House to back H.J. Res.
72, as well as to require cable companies to allow consumers to choose the
channels they want (rather than force them to buy packages of channels) to
empower those consumers who are offended by today's programming.
See letter at
(http://www.consumersunion.org/pub/core_telecom_and_utilities/000791.html...)
Also see:
Bracing for Fallout From Super Indignation
[SOURCE: New York Times, AUTHOR: Bill Carter]
(http://www.nytimes.com/2004/02/05/arts/television/05MTV.html)
(requires registration)

* Geeks Put the Unsavvy on Alert: Learn or Log Off
Who's to blame for the spread of computer viruses? Well, you and me, of
course. And the computer-savvy are becoming openly hostile toward the
not-so-savvy: don't be fooled again, they say.
[SOURCE: New York Times, AUTHOR: Amy Harmon]
(http://www.nytimes.com/2004/02/05/technology/05VIRU.html?pagewanted=all)
(requires registration)

* Correction: Public Knowledge does not intend to file a petition for
reconsideration of the FCC broadcast flag decision, as we reported
yesterday. The group will focus solely on its lawsuit against the Commission.
--------------------------------------------------------------

Communications-related Headlines for 2/4/04

TOP STORY
House Commerce Chair Tauzin Resigns

BROADCASTING
New DTV Transition Plan From Pubcasters
Challenge to Broadcast Flag

INTERNET FILE SHARING
U.S. Appeals Court Hears Key File-Sharing Case

QUICK HITS
TODAY: The Current State of Competition in the Communications Marketplace
Another Forum on Spectrum Management Reform
Call for Papers: The Impact of Regulatory Changes on Media Market
Competition and
Media Management

TOP STORY

HOUSE COMMERCE COMMITTEE CHAIR TAUZIN RESIGNS
Rep Billy Tauzin (R-LA) has delivered a letter of resignation to House
Speaker Dennis Hastert (R-IL) effective Sunday, February 15. The
Congressman has been rumored for openings as head of the Motion Picture
Association of America and the Pharmaceutical Research and Manufacturers of
America (PhRMA), but there has been no announcement of yet of future plans.
[SOURCE: Wall Street Journal, AUTHOR: Associated Press]
(http://wsj.com/)
(requires subscription)
See also:
Tauzin Quits Chairmanship, Will Retire From House
(http://www.washingtonpost.com/wp-dyn/articles/A10138-2004Feb3.html)
This Washington Post article adds that Rep Tauzin is likely to take the
PhRMA job soon and that Rep Joe Barton (R-TX) is likely to take over Rep
Tauzin's chairmanship.
Find out more about Rep Barton from Project Vote Smart
(http://www.vote-smart.org/bio.php?can_id=H3831103&PHPSESSID=f5f783fd0830...)

BROADCASTING

NEW DTV TRANSITION PLAN FROM PUBCASTERS
Here's an interesting trade. Public broadcasters are working on a plan for
a hard date for returning analog TV spectrum to FCC in exchange for a long
sought after [think Lyndon Johnson administration] trust fund for public
television. The fund would support public television content as well as
subsidies for set-top convertor boxes for those who "simply can't afford
even cheap set-top boxes but also depend on over-the-air TV.". In addition,
pubcasters would also need carriage of all their digital signals on cable
and satellite TV systems. Public television stations control 21% of the
analog spectrum and the is interest in Congress in freeing that spectrum up
for wireless providers as well as for use by public safety community.
Public TV stations would save $36 million per year in electricity costs by
operating in digital only vs digital and analog.
The proposal is coming from the Association of Public Television Stations
(http://www.apts.org/) and a formal plan is expected by the end of the month.
[SOURCE: Communications Daily, AUTHOR: Dinesh Kumar]
(Not available online)

CHALLENGE TO BROADCAST FLAG
Consumer Federation of America (CFA), Consumers Union (CU), Electronic
Frontier Foundation (EFF), Public Knowledge (PK), the American Library
Association, the Association of Research Libraries, the American
Association of Law Libraries, the Medical Library Association and the
Special Libraries Association have joined together in a court challenge to
the FCC decision to institute a broadcast flag content protection regime.
CU and PK have also asked the FCC to reconsider the decision and will ask
for a court review if unsuccessful at the Commission. The groups fear the
broadcast flag, which prevents distribution of content over the Internet,
could impede on consumers' fair use of content.
For more on the issue, see The Broadcast Flag and the DTV Transition
(http://www.publicknowledge.org/content/policy-papers/pp-broadcast-flag-d...).
[SOURCE: Communications Daily, AUTHOR: Brigitte Greenberg]
(Not available online)

INTERNET FILE SHARING

U.S. APPEALS COURT HEARS KEY FILE-SHARING CASE
Lawyers for the Recording Industry Association of America, National Music
Publishers' Association, and Motion Picture Association of America squared
off with representatives for file-sharing services Grokster and Morpheus
before a three-judge panel of the U.S. 9th Circuit Court of Appeals in
Pasadena (CA) Tuesday. The entertainment industry wants the Internet
file-sharing sites shut down when they enable users to illegally exchange
copyrighted music or movies. Grokster and Morpheus counter by arguing that
their services should enjoy the same legal protection as the makers of
videocassette and DVD recorders which have substantial uses besides the
taping of copyrighted material and, the Supreme Court has ruled, those uses
outweigh the copying function.
[SOURCE: Reuters, AUTHOR: Bob Tourtellotte]
(http://www.reuters.com/newsArticle.jhtml?type=internetNews&storyID=4276293)
See also File-sharing issue lands in court again
(http://www.mercurynews.com/mld/mercurynews/business/technology/7870984.htm)

QUICK HITS

* The Current State of Competition in the Communications Marketplace
Today, Wednesday at 1:15 (eastern), a hearing of the House Subcommittee on
Telecommunications and the Internet.
Listen live at the URL below.
[SOURCE: House of Representatives]
(http://energycommerce.house.gov/108/Hearings/02042004hearing1164/hearing...)

* The National Academy of Sciences will hold a forum on spectrum management
reform, sponsored by NTIA, on February 12-13 in the NAS Lecture Room,
Washington, D.C. For more information and how to register, please see the
agenda on the NAS website
(http://www7.nationalacademies.org/cstb/project_wireless_workshopagenda.pdf).
This forum is the third in a series of discussions to implement the
President's Spectrum Policy Initiative, which will result in
recommendations to the President for improving spectrum management policies
and procedures.
[SOURCE: NTIA]
(http://www.ntia.doc.gov/new.html)

* Call for Papers International Journal on Media Management
Special Issue on The Impact of Regulatory Changes on Media Market
Competition and Media Management
Guest Editor: Philip Napoli, Director, Donald McGannon Communication
Research Center, Fordham University, Assistant Professor of Communications
and Media Management, Graduate School of Business
The International Journal on Media Management is seeking manuscripts for a
special issue on the impact of regulatory changes on media market
competition and media management. Papers may address a wide range of
topics, including:
--Merger and acquisition activities and strategies resulting from
regulatory changes
--Public service obligations and their place in the contemporary regulatory
environment
--Shifts in the balance between government regulation and industry
self-regulation
--Regulatory responses to new media
--Competitive analyses of media markets
Deadline for submissions is May 15, 2004. For the full call for papers,
see (http://www.mediajournal.org/modules/issue/view.php?id=20)
--------------------------------------------------------------

Communications-related Headlines for 2/3/04

2005 FEDERAL BUDGET
FY 05 Budget Proposal

BROADCASTING
The Public Is Interested
Why More Choices May Mean Fewer
Over the Line? Only If Over the Air

TELEPHONY
Stevens: Make Payments "Universal"
Cable Offers Regulatory Framework for VoIP

QUICK HITS
Center for Public Integrity Expands Media Ownership Search
Media For Democracy 2004 Launched
National Education Technology Plan Seeks Input
Call for Papers for the 32nd Annual Telecommunications Policy and=
=20
Research Conf
MacArthur Foundation Award to the Electronic Frontier Foundation

Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday through=20
Friday, this service provides updates on important industry developments,=20
policy issues, and other related news events. Headlines are compiled by=20
Kevin Taglang (ktaglang( at )etpost.net) -- we welcome your comments.

2005 FEDERAL BUDGET

FY 05 BUDGET PROPOSAL
I Washington, DC, the conversation has turned to the fiscal year 2005=20
budget which the White House proposed on Monday. Here are some=20
communications-related highlights: 1) The FCC would receive an increase of=
=20
about $20 million in the new budget to ~$293 million. 2) The Administration=
=20
again proposed an analog spectrum fee for all broadcasters who have not=20
vacated that spectrum by 2007 [this is proposed every year now, it seems=20
and is always shot down with lobbying from the National Association of=20
Broadcasters]. 3) The National Telecommunications and Information=20
Administration (NTIA) would receive $22 million, a $7 million increase. The=
=20
new monies would be devoted to spectrum management and research projects.=20
4) The Administration proposed ending both NTIA's Technology Opportunities=
=20
Program and the Public Telecommunications Facilities, Planning and=20
Construction fund. 5) The Department of Commerce's Technology=20
Administration would see a boost in funding. 6) FY 05 funds for the=20
Corporation for Public Broadcasting were set in 2003; the new budget=20
proposes to end the forward-funding strategy for CPB. 7) Broadband=20
deployment in rural areas would be supported by the Department of=20
Agriculture with $495 million in direct loans.
For more on the FY 05 budget see (http://www.commerce.gov/),=20
(http://hraunfoss.fcc.gov/edocs_public/attachmatch/DOC-243444A1.pdf) and=20
(http://www.usda.gov/).
[SOURCE: Communications Daily, AUTHOR: Terry Lane]
(Not available online)

BROADCASTING

THE PUBLIC IS INTERESTED
Thanks to the Esperanza Peace & Justice Center, the FCC's localism hearing=
=20
in San Antonio last week had the feel of a protest march. Five hundred=20
people crammed city hall there for a five and a half hour hearing on how=20
local stations serve the community. But the media reform activists in=20
attendance and commercial broadcasters could not be further apart.=20
Broadcasters say intense competition for local news ratings and the FCC's=20
licence renewal process are incentive enough to serve community,=20
broadcasters say. Activists think the FCC has no choice than to better=20
define what it means for stations to serve community. Critics are looking=20
for rules that will encourage debate on public issues, minimums for local=20
news and public affairs programming and a return of ascertainment of local=
=20
programming needs.
[SOURCE: Broadcasting&Cable, AUTHOR: Bill McConnell]
(http://www.broadcastingcable.com/article/CA378531?display=3DTop+of+the+W...
)
(requires subscription)

WHY MORE CHOICES MAY MEAN FEWER
The Chicago Tribune's TV critic gives a good overview of how the economics=
=20
of broadcast TV is changing, how audiences are growing smaller and smaller=
=20
and what this means to the advertiser-supported model of paying for=20
programming. He offers three possible outcomes for the current trend: the=20
end, or shrinking, of over-the-air free TV to be replaced by much more=20
pay-per-view; more stealth ads sneaked into the content of a show itself,=20
like today's product placement only more so; and, in all likelihood,=20
probably more repeats and a greater ratio of reality schlock to carefully=20
produced scripted fare, because the latter is so expensive to make.
[SOURCE: Chicago Tribune, AUTHOR: Steve Johnson]
(http://www.chicagotribune.com/features/chi-0402010530feb01,1,675702.story)
(requires registration)

OVER THE LINE? ONLY IF OVER THE AIR
The lack of coverage on Janet Jackson is gaining lots of coverage in the=20
press (if you'll allow me to step over all the possible jokes). The FCC is=
=20
investigating and considering possible fines (see www.fcc.gov). The show=20
was produced by CBS corporate partner MTV, a cable channel not subject to=20
the same regulation CBS station are. Now that the prime-time cable audience=
=20
is larger than the audience that watches broadcast networks, some federal=20
regulators, advocacy groups and a bipartisan group of lawmakers worry that=
=20
broadcast networks will increasingly be tempted to spice up their shows to=
=20
win over viewers. A potential result: A race to the bottom, say a number of=
=20
lawmakers and regulators. "The concerns I hear from parents aren't limited=
=20
to broadcast, but also include channels on cable," said FCC Commissioner=20
Kevin J. Martin. "I think there's an obligation and an opportunity to talk=
=20
about how we should be trying to deal with this issue and for parents to be=
=20
able to try to protect children from some of the content they might be=20
concerned about."
See much more at the URL below.
[SOURCE: Washington Post, AUTHOR:Frank Ahrens]
(http://www.washingtonpost.com/wp-dyn/articles/A7073-2004Feb2.html)

TELEPHONY

STEVENS: MAKE PAYMENTS "UNIVERSAL
Alaska's senior senator, Ted Stevens (R), is likely the next chairman of=20
the Commerce Committee. As such, he's already letting it be known that he's=
=20
interested in rewriting the Telecommunications Act of 1996. Coming from a=20
rural state, he's concerned that universal service funds will dry up as=20
phone services move from the traditional, circuit-switched networks to the=
=20
Internet. So Sen Stevens would like to see broadband Internet providers pay=
=20
into the Universal Service Fund. Such a change would be a contrast to the=20
FCC's approach to Internet services which have remained unregulated. Sen=20
Stevens delivered his proposal to large telephone companies in a speech in=
=20
Washington, DC last week. Those companies are likely to embrace the idea=20
while cable companies will likely oppose it.
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
(http://www.multichannel.com/article/CA378347?display=3DPolicy&pubdate=3D...
2F02%2F2004)
(requires subscription)

CABLE OFFERS REGULATORY FRAMEWORK FOR VoIP
NCTA has sent "Balancing Responsibilities and Rights: A Regulatory Model=20
for Facilities-Based VoIP Competition" to the FCC, outlining the industry's=
=20
thoughts on how state and federal regulators should regulate the new=20
service. The industry group writes that even the most vital public policy=20
objectives should be secured through the "lightest possible regulation" of=
=20
VoIP services. The NCTA white paper proposes a four-prong baseline test to=
=20
determine whether a particular IP-based voice service should be subject to=
=20
the regulatory framework proposal. If a service meets the qualifications,=20
NCTA writes, then providers should be given responsibilities including=20
assistance to law enforcement and public health, offering of 911/E911=20
services, and access for the disabled; contributions as appropriate to the=
=20
Universal Service Fund (USF); participation in intercarrier compensation;=20
and general consumer protections.
[SOURCE: National Cable & Telecommunications Association Press Release]
(http://www.ncta.com/press/press.cfm?PRid=3D435&showArticles=3Dok)
In a related story, Alliance for Public Technology, Alliance for Technology=
=20
Access, American Association of Law Libraries, American Association of=20
People with Disabilities, Communications Workers of America, Community=20
Action Partnership, Department of Professional Employees, Independent=20
Living Network, MAAC Project, National Consumers League, National Hispanic=
=20
Council on Aging, Telecommunications for the Deaf and Telecom Research &=20
Action Center have signed a letter to House Telecom Subcommittee Chairman=20
Upton (R-MI) asking that VoIP providers be subject to rules concerning=20
universal service, accessibility, public safety and consumer protections.=20
Rep Upton will oversee a hearing on VoIP tomorrow. See=20
(http://energycommerce.house.gov/schedule.html)
[SOURCE: Communications Daily]

QUICK HITS

* The Center for Public Integrity Expands Media Ownership Search. Visitors=
=20
to (www.openairwaves.org) can simply plug in a zip code or city name and=20
find the owner of every radio station, television station and cable=20
television system in the area. While the Center's ownership Web site is=20
useful, it is far from perfect. Much of the information relies on FCC data=
=20
that is out of date or inaccurate. Ownership information regarding the=20
largest broadcasters, however, has been verified by Center researchers, who=
=20
continue to update and improve the site.

* Media For Democracy 2004 is a non-partisan citizens' initiative to=20
monitor mainstream news coverage of the 2004 elections and advocate fair,=20
democratic and issue-oriented standards of reporting. The project links=20
voters with more than 100 independent media reform groups in a targeted=20
campaign to prevent the types of media mistakes -- such as early and=20
erroneous projections -- that plagued the 2000 election.
(http://www.mediafordemocracy.us/mfd/homepage.html)

* The National Education Technology Plan (NETP) for the U.S. Department of=
=20
Education is being developed as part of a long-range national strategy and=
=20
guide for using technology effectively to improve student academic=20
achievement=ADeither directly or through integration with other approaches=
to=20
systemic reform. The NETP is inviting the public to share ideas on specific=
=20
ways technology can support school improvement. The comment section is open=
=20
now through March 12, 2004.
[SOURCE: U.S. Department of Education, Office of Educational Technology]
(http://www.nationaledtechplan.org/)

* Call for Papers for the 32nd Annual Telecommunications Policy and=20
Research Conference
The TPRC hosts this annual forum for dialogue among scholars and=20
decision-makers from the public and private sectors who are engaged in=20
communication and information policy. The purpose of the conference is to=
=20
acquaint policymakers with the best of recent research and to familiarize=20
researchers with the knowledge needs of policymakers and industry. TPRC is=
=20
now soliciting abstracts of papers for presentation at its 2004=20
conference. Proposals should be based on current theoretical and/or=20
empirical research relevant to communication and information policy, and=20
may be from any disciplinary perspective. TPRC welcomes national,=20
international, comparative, and multi- or inter- disciplinary studies.
For more information see (http://www.tprc.org/TPRC04/call04.htm). The=20
conference will be held at George Mason University School of Law in=20
Arlington, October 1-3, 2004. Paper submissions must be received before=20
March 31, 2004.

* The John D. and Catherine T. MacArthur Foundation has awarded a $600,000=
=20
grant to the Electronic Frontier Foundation to represent the public=20
interest at meetings of the Digital Video Broadcasting Project in Europe=20
where global standards on digital television and other digital data=20
services will be set. The Digital Video Broadcasting Project is a=20
consortium of broadcasters, manufacturers, network operators, software=20
developers, regulatory bodies, and others from more than 35 European=20
countries that work together to set standards for their industry including=
=20
copy-management standards for digital television. At these industry=20
meetings, policy is often set that has far-reaching implications for the=20
future use of technology on digital rights management and intellectual=20
property. Because these meetings have traditionally been closed to the=20
media and the cost of attendance has limited the participation of public=20
interest advocates, the Foundation is providing support to ensure there is=
=20
input that balances the commercial interests normally represented at these=
=20
meetings with those of the public. The Electronic Frontier Foundation will=
=20
use MacArthur funding to prepare for and attend industry meetings, and to=20
educate the European public and European consumer groups about issues=20
related to digital rights management and intellectual property.
[SOURCE: Electronic Frontier Foundation Press Release]
(http://www.eff.org/IP/Video/HDTV/20040128_eff_pr.php)
--------------------------------------------------------------

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