January 2006

Three events this week: the CPB Board meets and there will be
hearings on video franchising and video content. For these and other
upcoming media policy events, see http://www.benton.org

JOURNALISM
And Now, a Word for Our Demographic
Planted Articles May Be Violation
The Day the News Left Town
DeLay appearance cost Fox $14,000

OWNERSHIP
The Math Behind The CW
Identity Crisis
Could CW Lead to a CBS, CNN Union?
Gentrifying the Airwaves
Multimedia Launch of 'Bubble' Gets Mixed Response

PAY TV
Dish Has 'Free Speech TV' Problem
Per-Channel Pricing Sought In Purchase Of Adelphia
Congress Unlikely to Ease TV Rules for US Telcos Soon
Verizon Favors Narrower Bill
Senate Commerce To Hear Access Arguments
Texas-Sized Fight Over Law

INTERNET/BROADBAND
Web's Fate May Hinge on ISPs' Neutrality
G**gle in China ...
... And Google at Home
Google eyes how mobile devices will use city Wi-Fi
Resisting Municipal Broadband is Futile
Microsoft Would Put Poor Online by Cellphone

TELECOM
Court Rulings May Spur End To 19th-Century Telecom Tax
Hearing on Protecting Consumers' Phone Records

PUBLIC BROADCASTING
Protecting Public Broadcasting Stations from the Effects of Rescission
National Journal Teams With 'Washington Week' of PBS

QUICKLY -- Pricing the Word; Los Angeles sues over 'Grand Theft Auto'
game; Why Disney Bought Pixar; Ripple Effect in Tennessee; Universal
Service in Arkansas

JOURNALISM

AND NOW, A WORD FOR OUR DEMOGRAPHIC
[SOURCE: New York Times, AUTHOR: Ted Koppel]
[Commentary] I cannot help but see that the industry in which I have
spent my entire adult life is in decline and in distress. Once, 30 or
40 years ago, the target audience for network news was made up of
everyone with a television, and the most common criticism lodged
against us was that we were tempted to operate on a
lowest-common-denominator basis. This, however, was in the days
before deregulation, when the Federal Communications Commission was
still perceived to have teeth, and its mandate that broadcasters
operate in "the public interest, convenience and necessity" was
enough to give each licensee pause. Network owners nurtured their
news divisions, encouraged them to tackle serious issues, cultivated
them as shields to be brandished before Congressional committees
whenever questions were raised about the quality of entertainment
programs and the vast sums earned by those programs. News divisions
occasionally came under political pressures but rarely commercial
ones. The expectation was that they would search out issues of
importance, sift out the trivial and then tell the public what it
needed to know. With the advent of cable, satellite and broadband
technology, today's marketplace has become so overcrowded that
network news divisions are increasingly vulnerable to the
dictatorship of the demographic. Now, every division of every network
is expected to make a profit. And so we have entered the age of
boutique journalism. The goal for the traditional broadcast networks
now is to identify those segments of the audience considered most
desirable by the advertising community and then to cater to them.
http://select.nytimes.com/2006/01/29/opinion/29koppel.html
(requires subscription)

PLANTED ARTICLES MAY BE VIOLATION
[SOURCE: Los Angeles Times 1/27, AUTHOR: Mark Mazzetti]
A secret U.S. military program that pays Iraqi newspapers to publish
articles favorable to the American mission appears to violate a 2003
Pentagon directive, according to a newly declassified document
released Thursday. The information campaign run by U.S. troops in
Baghdad and a Washington-based private contractor is the subject of a
high-level military investigation. Last month, the top U.S. general
in Iraq said a preliminary investigation into the program had found
it did not violate U.S. law or Pentagon regulations. A secret
directive on the Pentagon's information operations policy released
Thursday, however, appears to prohibit U.S. troops from conducting
psychological operations, or psy-ops, targeting the media. "Psy-op is
restricted by both DoD [Department of Defense] policy and executive
order from targeting American audiences, our military personnel and
news agencies or outlets," says the directive, dated Oct. 30, 2003,
and signed by Defense Secretary Donald H. Rumsfeld. The document,
titled "Information Operations Roadmap," was released by the National
Security Archive, a research institution based at George Washington
University that obtained it under the Freedom of Information Act.
http://www.latimes.com/news/nationworld/world/la-fg-infowar27jan27,0,170...
(requires registration)

THE DAY THE NEWS LEFT TOWN
[SOURCE: New York Times, AUTHOR: Katharine Seelye]
In Louisville (KY), the Courier-Journal, which was bought 20 years
ago by the Gannett Company, announced in December that it was pulling
the plug on its bureau in Hazard (population 5,000) and two others in
the state. They are the last of the newspaper's once-robust statewide
system of bureaus, all of them gone now except for one in Frankfort,
which is the state capital. Newspapers across the country are
retrenching, redeploying their employees and resources while they try
to ride out what they hope is a temporary slump but one made all the
more worrisome as readers and advertisers migrate to the Internet.
These strategic decisions, about what to keep and what to cut,
determine which regions and which issues receive attention and which
do not. The Hazard bureau is closing just as the coal-mining industry
is resurgent and mine safety issues are back in the news.
http://www.nytimes.com/2006/01/30/business/media/30hazard.html
(requires registration)

DELAY APPEARANCE COST FOX $14,000
[SOURCE: Austin American-Statesman 1/27, AUTHOR: Chuck Lindell]
Four days after former House Majority Leader Tom DeLay's stunning
indictment last September in Travis County (TX), the political talk
show "Fox News Sunday" trumpeted an exclusive interview with the
combative Texas Republican. Unsaid, but revealed in documents Rep
DeLay later filed in the U.S. House, was that the Oct. 2 appearance
cost Fox News $14,000. The money rented a private jet to ferry DeLay
from a small airport near his Sugar Land home to Fox studios in
Washington. The next day, after engaging in a give and take with host
Chris Wallace, DeLay and his Capitol Police security detail were
flown back to suburban Houston. Amid mounting interest in when and
why corporations pay for congressional travel, one small slice of
Washington's ways has escaped notice -- media companies themselves
sometimes foot the bill. The Sunday morning news shows routinely pay
travel costs, from car fare to airfare, to get politicians into their
studios, a review of congressional disclosure forms shows. But
chartering expensive jets to amuse a few million political junkies is rare.
http://www.statesman.com/news/content/news/stories/nation/01/27delayfox....

OWNERSHIP

THE MATH BEHIND THE CW
[SOURCE: Broadcasting&Cable, AUTHOR: John M. Higgins]
Time Warner is the largest media company, not just in the country but
in the entire world. Its Warner Brothers Television dominates the
TV-production industry, supplying more shows to broadcast networks
than anyone. Yet, for all that clout, Time Warner executives couldn't
manage to successfully program The WB for two prime time hours, six
nights a week. Viacom and its new spawn, CBS, are smaller but did no
better with UPN. After a decade on the air, the networks are folding,
with the pieces combined into a new channel, The CW network. The
inability of such powerful companies to make even modest channels
work on the air speaks volumes about the state of TV networks.
Consolidation is a classic response of companies stuck in a mature
business, and every network is stuck. The broadcast networks' revenue
growth averaged an unimpressive 4% over the past five years, and the
next five look no better. If the ad market is slow and programmers
can't chisel audience from rivals, combining operations is often the
only way to squeeze some earnings growth. The deal may initially look
like a merger of The WB and UPN, but it's carefully crafted in a
different way. The two networks are being shut down and some of their
assets drawn upon to create what CBS and Time Warner tout as "the new
fifth network." That's more than mere hype. Executives believe that
closing the old networks frees them of obligations to angry former WB
and UPN affiliates not chosen for The CW. That's a contentious issue
roiling station groups, even big ones like Fox TV Stations.
http://www.broadcastingcable.com/article/CA6302852?display=News&referral...
(free access for Benton's Headlines subscribers)
* Can You Feel the Love?
http://www.broadcastingcable.com/article/CA6302838?display=News&referral...
(free access for Benton's Headlines subscribers)

IDENTITY CRISIS
[SOURCE: Broadcasting&Cable, AUTHOR: Allison Romano]
With The WB and UPN shutting down next fall to form The CW, dozens of
orphaned affiliates are scrambling to align with the new network or
find a way to go it alone. The shift could mean more local news and
programming in some markets, but it also threatens to put some
affiliates out of business. And now some station owners, who had no
advance warning about the deal, are threatening legal action. "These
broadcasters woke up one day and found out that, come September, the
affiliation agreements were null and void," says an executive at a
major station group who declined to be named for potential legal
reasons. "Everyone is trying to figure out what they'll do."
http://www.broadcastingcable.com/article/CA6302849?display=Feature&refer...
(free access for Benton's Headlines subscribers)
* Who Loses in This Deal?
Fox and stations that end up with no network affiliation.
http://www.broadcastingcable.com/article/CA6302839?display=News&referral...
(free access for Benton's Headlines subscribers)

COULD CW LEAD TO A CBS, CNN UNION?
[SOURCE: MediaWeek, AUTHOR: Anthony Crupi]
A successful launch of CW could very well presage a momentous
transformation in how co-parents Time Warner and CBS Corp. gather and
disseminate news. According to sources in both camps, CNN and CBS
have never quite closed the door on the idea of merging their news
operations, although the last formal talks were dissolved in 2003,
thanks in large part to the financial distractions posed by Time
Warner's struggling AOL. Now that the companies have sidled closer to
each other, many observers expect merger talks to resume. "Some kind
of combination is inevitable," said Hal Vogel, principal of Vogel
Capital Management. "The cost of having far-flung bureaus is way too
high for any one organization to take on alone."
http://www.mediaweek.com/mw/news/recent_display.jsp?vnu_content_id=10019...

GENTRIFYING THE AIRWAVES
[SOURCE: On the Media]
The broadcast spectrum became a little less crowded this week. The
owners of the fifth and sixth networks - UPN and The WB - announced
they're joining forces to create a single network: The CW. When UPN
and The WB were born, the idea was to target urban youth. But the new
network will focus simply on youth. What will that mean for the
future of programming created by African-Americans?
http://www.onthemedia.org/

MULTIMEDIA LAUNCH OF 'BUBBLE' GETS MIXED RESPONSE
[SOURCE: Wall Street Journal, AUTHOR: Sarah McBride sarah.mcbride( at )wsj.com]
"Bubble," a film directed by Steven Soderbergh about a murder in a
rural town, opened in theaters Friday -- the same night it was
available on a cable service and just days before a DVD release
tomorrow. It has been a closely watched example of whether Hollywood
can deliver movies to consumers on different platforms at once,
allowing viewers to choose how they want to see it from the outset.
Typically, films are released first in theaters, then as video
rentals, cable TV and other avenues. The strategy didn't result in
much excitement about the film in theaters. "Bubble" took in an
estimated $72,000 at the 32 screens where it played -- an average of
$2,250 a screen. The movie was largely shunned by theaters, which
rely on the usual gap between the theatrical release and the DVD
release to give them an exclusive play period for each film. "Bubble"
is showing mostly at Landmark Theaters, a chain owned by "Bubble"
producers Mark Cuban and Todd Wagner, plus a handful of independent
movie theaters. The movie aired twice Friday night on HDNet Movies, a
cable- and satellite-TV channel co-owned by Mr. Cuban, Mr. Wagner and
TV producer Phil Garvin. Mr. Cuban estimates that 500,000 people saw
all or part of one of the two showings on HDNet Movies. "Bubble" DVDs
go on sale tomorrow. "Bubble" cost $1.6 million to make, and the
film's backers said it did well when the entire picture is taken into
account. "Although we would have liked more theatrical performance,
the overall revenue numbers were outstanding for this film," said
Eamonn Bowles, president of Magnolia Pictures, also owned by Messrs.
Cuban and Wagner. The company says DVD orders were four to five times
what could normally be expected for a small movie such as "Bubble."
Because of its unusual distribution plan, "Bubble" got a lot of free
publicity in the media.
http://online.wsj.com/article/SB113857586431459468.html?mod=todays_us_ma...
(requires subscription)

PAY TV

DISH HAS 'FREE SPEECH TV' PROBLEM
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
FCC rules adopted in 1998 that require direct-broadcast satellite
carriers to create channel space "for noncommercial programming of an
educational or informational nature." OK, that's good. But as the
Dish satellite service launches "Dish Family", it is not including
some of these educational/informational channels because their
programming includes occasional nudity and some profanity. Whoops.
The programming covered by the FCC's rules must be offered to all
satellite subscribers at no additional charge and without any
editorial interference from the satellite provider. FCC rules do not
address whether family tiers can exclude these channels with
programming that would be deemed indecent under FCC rules that apply
to local TV stations. To some extent, cable is facing a similar
problem. Under the same legislation affecting satellite, cable
systems must carry, and subscribers must purchase, local TV stations
and public-access channels in the basic tier at the same time they
purchase a family tier from Comcast or Time Warner Cable. Indecent
programming aired by TV stations and PEG (public, educational and
government) channels is beyond the cable system's editorial control.
EchoStar's exclusion of educational/informational channels could
spark a fight at the FCC. "Yes, I would have a problem with that,"
said Andrew Jay Schwartzman, president of the Media Access Project, a
public-interest law firm that fought at the FCC to reserve 4% of
satellite channels for noncommercial channels. Schwartzman said his
preference would be to let families decide whether to block a
channel. "This is not a complete solution, you understand," he added.
"The way out of it is that DirecTV and Dish have much more effective
parental-control devices than cable has in the first place. You can
block out on a per-channel basis a lot easier than you can on cable."
http://www.multichannel.com/article/CA6302544.html?display=Breaking+News
(requires subscription)

PER-CHANNEL PRICING SOUGHT IN PURCHASE OF ADELPHIA
[SOURCE: Technology Daily, AUTHOR: Drew Clark]
Having deployed family-friendly television tiers after policymakers
strongly encouraged them to do so, the cable companies Comcast and
Time Warner may face another obstacle in their quest to acquire the
bankrupt Adelphia Communications. As a condition on the merger
proposals, the satellite provider EchoStar Communications wants the
FCC to require Comcast and Time Warner to sell distributors their
video content on a per-channel basis. If Time Warner and Comcast are
required to unbundle such programming from existing contractual
arrangements, the proposal calls for distributors to be required to
offer the programs as a la carte programming to consumers. A la carte
programming is something that FCC Chairman Kevin Martin repeatedly
has sought from the cable industry, in addition to a family tier.
Social conservatives and consumer groups support the bid.
http://www.njtelecomupdate.com/lenya/telco/live/tb-BRTV1138389712601.html

CONGRESS UNLIKELY TO EASE TV RULES FOR TELCOS SOON
[SOURCE: Reuters, AUTHOR: Jeremy Pelofsky]
The chances are seen as slim that the U.S. Congress will pass
legislation in 2006 to make it easier for companies like Verizon
Communications to offer subscription television service despite
intense lobbying. The U.S. House of Representatives and Senate are
working on bills that would simplify the process for new companies to
enter the video market, but they are part of larger bills to speed
deployment of high-speed Internet service, or broadband. The Senate
Commerce Committee on Tuesday plans to examine the system, but
Congress is working on a short schedule because many lawmakers are
running for reelection in November. And the complicated nature of
communications issues often makes it difficult for lawmakers to reach
consensus quickly. "Congress wants to promote Bell (telephone
companies) entry into video and is considering franchise relief, but
we believe legislation is unlikely before mid-2007," according to a
Stanford Washington Research Group report last week. Analysts at
Stifel Nicolaus, which also watches the issue, said in their own
report this month that "unless dynamics change, congressional relief
(is) an uphill fight this year, making state, local battles more critical."
http://today.reuters.com/news/newsArticle.aspx?type=politicsNews&storyID...

VERIZON FAVORS NARROWER BILL
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
Verizon is calling on Congress to scrap the notion of major
telecommunication reform this year and instead focus on legislation
that would make it easier for telephone companies to enter video
delivery markets and compete with cable. But House Commerce Committee
Chairman Joe Barton (R-TX) has no plans to follow the advice. "We are
still planning on going with regular order -- subcommittee, then full
committee markup -- with a comprehensive broadband-regulatory-reform
bill similar to what we proposed already in our draft bill," Terry
Lane, a spokesman for Rep Barton, said. But Chairman Barton's broad
telecommunications bill has failed to generate wide support, creating
the need for a more narrow solution, said a Verizon executive last week.
http://www.multichannel.com/article/CA6302794.html?display=Breaking+News
(requires subscription)

SENATE COMMERCE TO HEAR ACCESS ARGUMENTS
[SOURCE: Broadcasting&Cable]
Tomorrow morning, the Senate Commerce Committee will hold a hearing
on video franchising. An impressive panel will be convened including
National Association of Telecommunications Officers and Advisors
President Lori Panzino-Tillery, the Alliance for Community Media's
Anthony T. Riddle, Gene Kimmelman of Consumers Union and Public
Knowledge's Gigi Sohn.
http://www.broadcastingcable.com/article/CA6302380?display=Breaking+News...
(free access for Benton's Headlines subscribers)
For more info about the hearing, visit:
http://commerce.senate.gov/hearings/witnesslist.cfm?id=1700

TEXAS-SIZED FIGHT OVER LAW
[SOURCE: Multichannel News, AUTHOR: Linda Haugsted]
The Texas Cable & Telecommunications Association is challenging a new
state law that created statewide franchising. In a law suit the group
asserts that the state law violates the due-process,
equal-protection, contracts and free-speech sections of the state
constitution. The suit targets three commissioners of the state
Public Utility Commission, the state body charged under the new law
with authorizing franchise applications. The suit keys on the fact
that new providers -- especially bill-backers AT&T and -- can enter
the video market without the same regulatory burden as incumbent
operators. The new providers face no build-out or universal-service
requirements, among other regulatory differences. Meanwhile,
incumbents must meet the terms of current municipal franchises, but
they are free to also apply to operate under state rules once those
franchises expire.
http://www.multichannel.com/article/CA6302688.html?display=Breaking+News
(requires subscription)

INTERNET/BROADBAND

WEB'S FATE MAY HINGE ON ISP's NEUTRALITY
[SOURCE: Los Angeles Times, AUTHOR: Michael Hiltzik
golden.state( at )latimes.com ]
[Commentary] Virtually since the Internet's creation, its most
devoted protectors have been wondering how long it would take for the
forces of unrestrained commerce to throttle its freedom and
innovation. Now they have a date: Some people believe the breakpoint
will come as early as Jan. 6, 2008. That's when the
telecommunications marriage of Verizon Communications and MCI marks
its second anniversary and sheds an important restriction imposed by
the Federal Communications Commission when it approved the deal in
November: a requirement that Verizon comply with the principle known
as "network neutrality" for two years following the completion of its
acquisition. (The FCC imposed the same provision on SBC
Communications and AT&T. But their deal closed in December, so the
restriction expires a couple of weeks sooner.) Absent network
neutrality, network operators could dictate to customers which
Internet services they could access, and at what quality. Customers
of Apple's iTunes music store, say, might find their downloads slowed
down, or blocked completely, if Apple refuses to pay a transaction
fee to their ISP. Users of the Vonage Internet phone service might
lose their dial tones if their Internet provider wants to sell its
own brand of phone service. The Internet might become more profitable
for network providers, and less useful for everybody else.
http://www.latimes.com/business/printedition/la-fi-golden30jan30,1,10673...
(requires registration)

G**GLE IN CHINA...
[SOURCE: Wall Street Journal, AUTHOR: Editorial Staff]
[Commentary] The WSJ notes the irony that Google is cooperating more
readily with China's dictators than it is with the U.S. government
(see below). China's leaders have made a bet that they can have
economic growth, and the exposure to the outside world that it
requires, while maintaining political control. In the long run, we
continue to think that's a losing bet. Google may have its own
business dilemma, but the modern dictator's dilemma is that the path
to economic progress demands a loosening of centralized control on
just about everything, including information. As for Google's
executives, we also hope that, even as they make their business
compromises with the Communists, they don't forget their larger
obligations to promoting the freedom that has made them as rich as they are.
http://online.wsj.com/article/SB113857784955159489.html?mod=todays_us_op...
(requires subscription)
* Google is risking its freedom in China
http://news.ft.com/cms/s/d4d8afd6-90f0-11da-a628-0000779e2340.html
(requires subscription)

... AND GOOGLE AT HOME
[SOURCE: Wall Street Journal, AUTHOR: Editorial Staff]
[Commentary] Google is fighting a Justice Department subpoena
covering a huge swath of data about the Web sites the company indexes
and the search terms its users submit. So unlike in China Google is
casting itself as a defender of privacy against a snooping
government, though in truth this is also a business calculation.
Google has acquired a reputation in some quarters, fairly or not, for
a vaguely Orwellian desire to gather as much information as it can
about its users. Its business model depends on users' confidence that
such information will not be misused, so turning it over to the
government would be a blow to its image. The Justice Department is
requesting reams of proprietary data from private companies to
resolve a question that a commission set up under COPA has already
answered, and not in the Bush Administration's favor. Under those
circumstances, it's no wonder that both Google and the ACLU have
raised concerns about the subpoena. Fortunately for Google, it is
making this challenge in America, which has the rule of law, as well
as a free press that might even take Google's side against the
government. For that we should all be thankful, regardless of the
outcome of Google's challenge.
http://online.wsj.com/article/SB113857763631159487.html?mod=todays_us_op...
(requires subscription)

GOOGLE EYES HOW MOBILE DEVICES WILL USE CITY WI-FI
[SOURCE: InfoWorld, AUTHOR: Stephen Lawson, IDG News Service]
Google has met with mobile gear vendors including Motorola and Sony
to explore how their devices might be able to take advantage of
municipal Wi-Fi networks, an executive of the search company said
Thursday. Google already operates a Wi-Fi network in Mountain View
(CA). One device in Google's crosshairs is Sony's PSP game platform.
"There's like five million of those in the U.S. now, they've all got
Wi-Fi in them. We're trying to do what we can to make those devices
able to log on to this network," Google's Christopher Sacca said. But
hardware makers are also exploring ways to take advantage of VOIP,
which could leave cellular operators and their per-minute billing out
of the equation, he said. But one of Google's biggest challenges is
the same one some broadband providers have been howling about lately,
Sacca said. After providing a high-speed Internet connection to its
customers, Google could find some of them using bandwidth-hungry
applications, such as streaming video or file-sharing, that hog the
network's capacity. In fact, that problem is more severe with a
wireless broadband network like the one Google envisions than on a
fiber, DSL (digital subscriber line) or cable network, which has much
more bandwidth, Sacca said. But unlike some large carriers that are
considering charging providers of Internet applications for
high-priority treatment, Google would never do that, he said while
crossing his fingers and hoping to die.
http://www.infoworld.com/article/06/01/27/74875_HNgooglewificity_1.html?...

RESISTING MUNICIPAL BROADBAND IS FUTILE
[SOURCE: visiongain press release]
There are over 400 cities worldwide planning to deploy municipal
broadband networks and the number will double in 2006, making
community broadband initiatives a very real and significant trend.
That is the finding of the latest report, "Municipal Broadband
Networks: Market impact and implications, 2006-2011", published by
industry research firm visiongain. Despite legal opposition and
intense lobbying from incumbent telcos and cable companies, municipal
broadband is coming and is here to stay. As of Q1 2006, there are
over 100 city and regional wireless broadband networks operational
worldwide, more than 40 of which are in the US.
http://home.businesswire.com/portal/site/google/index.jsp?ndmViewId=news...

MICROSOFT WOULD PUT POOR ONLINE BY CELLPHONE
[SOURCE: New York Times, AUTHOR: John Markoff]
In the year since Nicholas Negroponte, the founder of the
Massachusetts Institute of Technology Media Laboratory, unveiled his
prototype for a $100 laptop, he has found himself wrestling with
Microsoft and the politics of software. He has made significant
progress, but he has also catalyzed the debate over the role of
computing in poor nations -- and ruffled a few feathers. He failed to
reach an agreement with Microsoft on including its Windows software
in the laptop, leading Microsoft executives to start discussing what
they say is a less expensive alternative: turning a specially
configured cellular phone into a computer by connecting it to a TV
and a keyboard.
http://www.nytimes.com/2006/01/30/technology/30gates.html
(requires registration)

TELECOM

COURT RULING MAY SPUR END TO 19TH CENTURY TELECOM TAX
[SOURCE: Technology Daily, AUTHOR: Drew Clark]
Nothing is certain but death and taxes, but what of the death of
taxes? The 3 percent excise tax, which is charged on all phone bills,
was first imposed in 1898 as a temporary, "luxury" tax meant to fund
the Spanish-American War. Congress passed language to repeal the tax
in 2000, but President Clinton vetoed a broader budget measure
containing the repeal provision. The IRS continues to assess and
collect the even though it has been overturned by three courts within
the past eight months. What can kill the beast? Americans for Tax
Reform, an anti-tax group influential in the Bush administration, is
spearheading a coalition opposed to the tax. The group's members
include the U.S. Telecom Association, the wireless group CTIA, the
Communications Workers of America, and the 60 Plus Association of
senior citizens. "If you look at the telecommunications industry,
they are only third in line [in taxes] behind alcohol and tobacco,"
said Tom Readmond of Americans for Tax Reform. "That level of
taxation tends to hold technology back."
http://www.njtelecomupdate.com/lenya/telco/live/tb-NDSV1138389909189.html

HEARING ON PROTECTING CONSUMERS' PHONE RECORDS
[SOURCE: US Senate Commerce Committee]
The Senate Commerce Committee today announced it will hold a Consumer
Affairs, Product Safety, and Insurance Subcommittee hearing on
Protecting Consumers' Phone Records on Wednesday, February 8, 2006,
2:30 p.m. in room 562 of the Dirksen Building. Senator George Allen
(R-Va.), Chairman of the Consumer Affairs Subcommittee, will chair
the hearing. The hearing will examine unauthorized third party access
to phone records, potential legislative solutions, and will assess
the proper roles of the Federal Communications Commission and the
Federal Trade Commission.
http://commerce.senate.gov/newsroom/printable.cfm?id=250828

PUBLIC BROADCASTING

PROTECTING PUBLIC BROADCASTING STATIONS FROM THE EFFECTS OF RESCISSION
[SOURCE: Corporation for Public Broadcasting]
On Friday, the CPB Board of Directors passed a resolution directing
CPB management to adjust the corporation's FY 2006 operating budget
to protect public broadcasting stations from the effects of recent
legislation rescinding one percent of federal domestic discretionary
funds, of which CPB is a recipient. CPB, through its Community
Service Grants (CSGs), is a critical source of funds to public
broadcasting stations. The one percent rescission, the largest
rescission in recent history, would reduce the amount of all CSGs.
Accordingly, it constitutes a significant financial threat to some
stations, particularly small and rural stations where CPB's
contribution comprises a greater percentage of the station's budget.
Specifically, the resolution directs CPB management to "reallocate
$2,830,200 from System Support funds to the Community Service Grant
fund to offset the effects of the rescission on public broadcasting stations."
http://www.cpb.org/pressroom/release.php?prn=520

NATIONAL JOURNAL TEAMS WITH 'WASHINGTON WEEK' OF PBS
[SOURCE: New York Times, AUTHOR: Elizabeth Jensen]
Public television's longest-running public affairs program, the
Friday night "Washington Week," is joining forces with another
Washington fixture, the weekly nonpartisan magazine National Journal,
in a move that will bring more marketing heft to the small but
influential media outlets. The deal between the two sober chroniclers
of Capitol Hill will be announced today. The collaboration, which is
initially for two years, starts officially on Feb. 17, when the
program will become known as "Washington Week with Gwen Ifill and
National Journal." While National Journal articles may eventually
become occasional "Washington Week" features and the program's
researchers will be able to tap the magazine for editorial help, the
deal will most immediately be felt in shared promotion, marketing and
fund-raising, which will tie the two brands together in an
increasingly fragmented media environment.
http://www.nytimes.com/2006/01/30/business/media/30review.html
(requires registration)

QUICKLY

PRICING THE WORD
[SOURCE: On the Media]
Newspapers around the world reprinted sections of Pope Benedict's
first encyclical this week. No problem. But if you'd like to use a
portion of the Pope's writing in a book you're working on - get ready
to pay up. The Vatican publishing house will henceforth enforce
copyright fees on the reprinting of its texts.
http://www.onthemedia.org/

LOS ANGELES SUES OVER 'GRAND THEFT AUTO' GAME
[SOURCE: Reuters, AUTHOR: Gina Keating]
The city of Los Angeles has sued Take-Two Interactive Software for
selling pornographic video games to children with its best-selling
game "Grand Theft Auto: San Andreas," which last year was found to
have hidden sex scenes. Shares of Take-Two plunged 13.7 percent to
$14.69 on the Nasdaq -- a level unseen since 2003 -- after an analyst
downgraded its shares to "sell" from "neutral", citing a variety of
financial, operational and management risks. Los Angeles City
Attorney Rockard Delgadillo, in the suit filed on Thursday, accused
the game publisher of failing to disclose the pornographic content to
get the game onto shelves of major retailers that do not carry games
rated "Adults Only 18+". Delgadillo said the company further deceived
consumers by first claiming that hackers had modified the original
version of the games, then announcing a week later that the sex
scenes were written into the original game code. The lawsuit demands
that Take-Two and Rockstar Games, the subsidiary behind "Grand Theft
Auto," one of the best-selling in video game franchises history, stop
marketing the games to children, pay fines and return $10 million in profits.
http://today.reuters.com/news/newsArticle.aspx?type=technologyNews&story...
* LA sues maker of 'Grand Theft Auto'
http://news.com.com/LA+sues+maker+of+Grand+Theft+Auto/2100-1043_3-603216...

LOOKING BEYOND THE MOUSE
[SOURCE: The Economist]
By buying Pixar, Bob Iger hopes to restore Disney's creative magic.
http://www.economist.com/business/displaystory.cfm?story_id=5442077

EMPTY POSITION LEADS TO FULL PLATE
[SOURCE: Knoxville News Sentinel]
With former Tennessee Regulatory Authority Director Deborah Tate now
at the FCC, what's happening at the TRA? A look at the priorities of
new TRA Chairman Ron Jones.
http://www.knoxnews.com/kns/business/article/0,1406,KNS_376_4410325,00.html
* Shaffer will shape federal telecom rules
http://tennessean.com/apps/pbcs.dll/article?AID=/20060127/BUSINESS04/601...

COALITION URGING PHONE FEE SUPPORT
[SOURCE: Jonesboro (AK), AUTHOR: LeAnn Askins]
A look at what's at stake for The Natural State in the debate of
universal service reform.
http://www.jonesborosun.com/story.asp?ID=14165
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