July 2006

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For upcoming media policy events, see http://www.benton.org

PUBLIC BROADCASTING
Another battle for the CPB
BBC Presses for Financing, and Its Detractors Cry Foul

CABLE
Hooray for Media Consolidation
Adelphia Decided
Serendipity vs. =C0 La Carte
Cable Rips Nielsen=92s Ad Ratings

LEGISLATION
Don't touch that television dial
Neutrality Rules Would Clog the Pipe
Senators Push For E911 Funding
A nation left behind on ed tech?

IN THE COURTS
Judge Asks for FCC Merger Orders
BellSouth Stock Downgraded on Regulatory Uncertainty
Judge dismisses antitrust complaint vs Google

QUICKLY -- Specter NSA Bill Shields=20
Administration's Illegal Wiretaps; The=20
Intersection of Wireless and Broadband; New=20
Senate Commerce Committee Staff; Sixty Percent of=20
Wired Homes Now Use Broadband; News Online Seems to Have Long Shelf Life

PUBLIC BROADCASTING

ANOTHER BATTLE FOR CPB
[SOURCE: Los Angeles Times 7/14, AUTHOR: Matea Gold]
Less than a year after the chairman of the=20
Corporation for Public Broadcasting was forced to=20
resign amid charges that he injected partisanship=20
into the agency, President Bush has nominated to=20
the nonprofit's board a television sitcom=20
producer who has described himself as "thoroughly=20
conservative in ways that strike horror into the=20
hearts of my Hollywood colleagues." The=20
nomination of Warren Bell, executive producer of=20
ABC's "According to Jim" and a contributor to the=20
online edition of the conservative National=20
Review magazine, has puzzled and alarmed some=20
public broadcasters, who fear he would revive the=20
sharp political debate that engulfed the system last year.
Bell said he was surprised by his nomination but=20
stressed that he had no intention of letting his=20
personal political beliefs influence his role on=20
the board. He asked skeptics to withhold judgment=20
until they have a chance to hear about his goals=20
for the post. "I have every intention of working=20
in a nonpartisan fashion with CPB," he said.=20
"Anybody who spends 15 minutes talking to me will=20
find that I am an eminently reasonable man." But=20
Bell's past comments have raised eyebrows among=20
some Democrats who serve on the Senate Commerce=20
Committee, which must approve his nomination.=20
Questions about his qualifications are expected=20
to dominate his confirmation hearing, which has=20
not yet been scheduled. "Based on what we know=20
right now, this nominee doesn't appear to have=20
the credentials and background one would expect=20
for this position, which is in contrast to the=20
other nominees," said California Sen. Barbara=20
Boxer, a committee member. "I am also concerned=20
about some of the partisan statements Mr. Bell=20
has made over the years." The disquiet over=20
Bell's nomination comes on the heels of last=20
year's controversy, triggered by then-board=20
Chairman Kenneth Y. Tomlinson, who worked=20
aggressively to right what he saw as a liberal slant at PBS and NPR.
http://www.calendarlive.com/tv/cl-et-bell14jul14,0,3099233.story?coll=3D...
tvent
(requires registration)

BBC PRESSES FOR FINANCING, AND ITS DETRACTORS CRY FOUL
[SOURCE: New York Times, AUTHOR: Eric Pfanner]
The BBC is under more than the usual degree of=20
scrutiny because the license fee of $242 a year=20
that every British television owner must pay to=20
finance its operations is under review by the=20
government. While the broadcaster=92s royal charter=20
has been renewed for another decade, the level of=20
financing must still be determined. A majority of=20
Britons, in a recent survey commissioned by the=20
BBC, said they supported the license fee. But the=20
review process and the corporation=92s plans for=20
spending the money have opened the door to all=20
sorts of critics from outside the BBC and some=20
from within. The BBC has asked the government to=20
increase the license fee, which raises nearly=20
$5.5 billion a year, by 2.3 percentage points=20
more than the annual inflation rate over the next=20
seven years. The BBC says the money is needed to=20
pay for digital television and Internet services=20
as it prepares for an uncertain future in which=20
consumers will be able to choose from a=20
proliferating array of media options. Mark=20
Thompson, director general of the BBC, is=20
expected to announce on Wednesday a=20
reorganization aimed at meeting this challenge.=20
=93The BBC is going through huge change, moving=20
from traditional linear broadcasting to the=20
challenging and exciting world of interactive=20
on-demand digital media,=94 Mr. Thompson said this=20
month as the corporation published its annual=20
report. =93It means the BBC=92s relationship with=20
audiences is also constantly changing.=94 Signs of=20
change include declining audiences for the BBC=92s=20
flagship conventional television channels as=20
viewers turn to digital alternatives or log on to=20
the Internet. Meanwhile, some of the BBC=92s plans=20
to move into new areas, particularly in its small=20
but growing commercial activities, have upset=20
some competitors in the private sector.
http://www.nytimes.com/2006/07/17/business/media/17bbc.html
(requires registration)

CABLE

HOORAY FOR MEDIA CONSOLIDATION
[SOURCE: Los Angeles Times, AUTHOR: Editorial Staff]
[Commentary] For the 1.2 million Adelphia=20
customers in greater Los Angeles, it's time to=20
say hooray for media consolidation. When the dust=20
settles this summer in LA, Time Warner will go=20
from minor player to kingpin =97 it will be the=20
sole cable operator for about 98% of the city and=20
75% of the region. So why is this good news? This=20
is the cable industry, after all, which ratchets=20
up prices as regularly as swallows return to San=20
Juan Capistrano. For starters, removing Adelphia=20
from the local cable TV picture is addition by=20
subtraction. Although it is currently the largest=20
cable operator in the region, with customers from=20
Ojai to Temecula, Adelphia has been notorious for=20
poor customer service and sparse product=20
offerings, particularly in the years leading up=20
to its 2002 bankruptcy filing. The primary=20
benefit of Time Warner's ascendance in Southern=20
California is that the company plans to start=20
offering local phone service soon, giving parts=20
of the city their first taste of local-phone=20
competition. Many residents also will be offered=20
cable-modem service, an alternative to the local=20
phone companies' high-speed Internet lines, for=20
the first time. Judging from what has happened in=20
other communities, competition may not drive down=20
prices significantly, but it should yield more value for the money.
http://www.latimes.com/news/printedition/opinion/la-ed-cable17jul17,1,37...
03.story?coll=3Dla-news-comment
(requires registration)

ADELPHIA DECIDED
[SOURCE: Tales of the Sausage Factory, AUTHOR: Harold Feld]
[Commentary] A look at the FCC's approval of the=20
sale of Adelphia cable TV assets two industry=20
giants Comcast and Time Warner. Negotiations over=20
the move delayed the FCC's meeting last week for=20
5 hours. The FCC did not adopt a network=20
neutrality condition, they did not adopt a=20
condition on PBS Sprout, allowing Comcast to get=20
by with a voluntary commitment to make the=20
programming available on a non-exclusive basis=20
for the next three years. They acted on the=20
Washington Nationals, and gave a nod to leased=20
access. Find a detailed analysis of the=20
conditions, which will expire in six years, at=20
the URL below. Feld concludes: "So, all things=20
considered, do I count this as a win? In the end,=20
I have to wait for the final order to come out to=20
know the full impact. We got a lot of stuff out=20
of an order that could easily have been a=20
catastrophe, even if we lost a skirmish in the=20
Net Neutrality war and the media consolidation=20
fight generally. So do I measure by what was=20
reasonable to achieve in a 3-2 Republican=20
administration, in which case this is a pretty=20
amazing success? Or do I measure by the fact=20
that, at the end of the day, Comcast and Time=20
Warner got their merger through? As a long time=20
Red Sox fan, allow me to offer a possible=20
analogy. Red Sox fans consider it a bad season if=20
the Sox don't make the playoffs. It's a good=20
season if they make it to the play offs, a great=20
season if they win the play offs (especially if=20
they beat the Yankees along the way), and a once=20
in a life time day of holy celebration if they=20
win the World Series. On the =93Red Sox=94 scale, I=20
place this somewhere between making the playoffs=20
by beating the Yankess and actually winning the=20
playoffs. If we'd gotten Network Neutrality as=20
well, I'd have bumped it up to winning the=20
playoffs." (Just one question from Chicagoland --=20
what are these 'playoffs' of which you speak?)
http://www.wetmachine.com/totsf/item/550

SERENDIPITY VS A LA CARTE
[SOURCE: Multichannel News, AUTHOR: Larry Aidem, Sundance Channel]
[Commentary] The Sundance Channel's CEO writes,=20
The United States is multicultural, multi=ADlingual=20
and multifaceted, a vibrant and robust nation of=20
ideas. These diverse voices are in evidence in=20
the wide variety of programming available on=20
cable and satellite TV. Scores of channels=20
beckon, highlighting a range of interests and=20
serving a quintessentially American audience,=20
which represents a broad mix of ethnicity,=20
heritage and points of view." He warns that=20
pay-per channel cable regulation would reduce the=20
number of viewing alternatives, diminish=20
diversity in programming and raise costs for most=20
customers. He concludes," Organizations=20
representing African-Americans and Latinos have=20
warned Congress of the disastrous impact on=20
programming diversity and choice. Executives from=20
networks serving Asian, Latino and=20
African-American audiences sent a strongly worded=20
letter to key senators explaining that their=20
ability to reach audiences would evaporate.=20
Multiplicity of voices makes our nation great.=20
Let's not imperil that gift with =E0 la carte=20
regulations curtailing the many voices and viewpoints on television today."
http://www.broadcastingcable.com/article/CA6353653.html?display=3DOpinion

CABLE RIPS NIELSEN'S AD RATINGS
[SOURCE: Multichannel News, AUTHOR: Linda Moss]
In part of a growing brouhaha, several top=20
cable-research officials criticized Nielsen Media=20
Research=92s plans to start tallying national=20
viewership for commercials this fall. Both Jack=20
Wakshlag, Turner Broadcasting System=92s chief=20
research officer, and Tim Brooks, Lifetime=20
Television=92s executive vice president of=20
research, voiced their concerns about various=20
aspects of Nielsen=92s plan to provide average=20
national commercial-minute ratings, kicking off=20
in November. Ad agency Magna Global USA also=20
publicly blasted Nielsen=92s announced=20
commercial-rating initiative, which is being done=20
at the request of the broadcast networks. Before=20
it proceeds with these ratings, one of the issues=20
Nielsen needs to address, according to Wakshlag=20
and Brooks, is agreeing upon a definition of what=20
constitutes a commercial minute. =93Right now, a=20
commercial minute is a minute that has at least=20
one second of a commercial in it,=94 Wakshlag said.=20
=93I'm not sure if that=92s fair or that=92s the best=20
way to go about doing it.=94 Any system Nielsen=20
comes up with ultimately would need accreditation=20
by the Media Rating Council, and it must be=20
agreed upon by all of the ratings service=92s clients, Brooks said.
http://www.multichannel.com/article/CA6353313.html?display=3DBreaking+News

LEGISLATION

DON'T TOUCH THAT TELEVISION DIAL
[SOURCE: Beloit Daily News, AUTHOR: Rep Tammy Baldwin (D-WI)]
[Commentary] A look at Communications=20
Opportunity, Promotion, and Enhancement Act of=20
2006 (COPE HR 5252). Rep Baldwin writes:=20
"Competition in the video delivery business? I'm=20
all for it. Lower prices for the consumer? I'm=20
all for that. But the devil, once again, is in=20
the details. While I support the =93ends=94 of the=20
COPE bill (increased competition and lower=20
prices), I don't support the =93means=94 and voted=20
against the bill." Why? The bill does not contain=20
adequate local controls or consumer protections=20
nor does it promise =93net neutrality=94 or aspire to=20
universal service, assuring that every American=20
has a chance in the digital age. The legislation=20
also weakens funding support for local public,=20
educational, and governmental (PEG) channels. Rep=20
Baldwin concludes: "Do we need to update our=20
federal telecommunications policy to respond to=20
ever-changing technology and consumer demand?=20
Absolutely. But not at the expense of consumer=20
protections, municipal budgets, and the common=20
good. The COPE bill is yet another example of the=20
Republican majority favoring well-connected,=20
special interests over average Americans."
http://www.beloitdailynews.com/articles/2006/07/13/editorials/edit02.txt

NEUTRALITY RULES WOULD CLOG THE PIPE
[SOURCE: Multichannel News, AUTHOR: Tom Tauke, Verizon]
[Commentary] Phone giant Verizon's chief lobbyist=20
Tom Tauke makes his company's case, again,=20
against Network Neutrality. "Net neutrality is=20
perhaps the oddest Washington debate I have seen.=20
It amounts to holding a Congressional vote on=20
hypothetical business plans." He concludes, "If=20
policymakers decide that network access cannot be=20
created differently, we drag broadband back to=20
the days where there was no incentive to innovate=20
and very little competition. In a world of 30 or=20
50 or 100 Megabit networks -- more than enough=20
capacity to meet the needs of everyone -- there=20
are no network problems. In the midst of this=20
healthy, emerging marketplace, imposing=20
regulations isn't a policy approach government should be taking."
http://www.multichannel.com/article/CA6353464.html?display=3DOpinion

SENATORS PUSH FOR E911 FUNDING
[SOURCE: Technology Daily 7/12, AUTHOR: Michael Martinez]
Last week, Sens. Conrad Burns (R-MT) Hillary=20
Rodham Clinton (D-NY), co-chairmen of the=20
Congressional E911 Caucus, urged their Senate=20
colleagues to fund matching grants to state and=20
local governments to assist those jurisdictions=20
in deploying enhanced 911 services authorized by=20
a 2004 law. Burns and Clinton earlier this year=20
requested that $42 million from the budget for=20
the coming fiscal year be directed for such=20
purposes. Specifically, they have asked for half=20
of that sum to come from a transportation=20
appropriations measure, and the other half from a=20
commerce appropriations bill -- both of which are=20
soon slated for action in the Senate=20
Appropriations Committee or by the full Senate.
http://www.njtelecomupdate.com/lenya/telco/live/tb-NMWZ1152907353300.html

A NATION LEFT BEHIND ON ED TECH?
[SOURCE: eSchool News, AUTHOR: Robert Brumfield]
As lawmakers in the U.S. continue to scale back=20
funding for educational technology--Congress is=20
considering eliminating funding for the Enhancing=20
Education Through Technology block grant program,=20
the single largest source of technology-specific=20
funding for schools in the federal=20
budget--education officials in other countries,=20
including Britain and Mexico, are pouring more=20
dollars into school technology programs, gearing=20
up to prepare students for the global economy.
http://www.eschoolnews.com/news/showStoryts.cfm?ArticleID=3D6442

IN THE COURTS

JUDGE ASKS FOR FCC MERGER ORDERS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
D.C. U.S. District Court Judge Emmet Sullivan,=20
who is reviewing the Justice Department's=20
antitrust conditions placed on the SBC/AT&T and=20
Verizon/MCI mergers, has asked the FCC for an=20
unexpurgated copy of its order approving the two=20
deals. FCC General Counsel Michele Ellison told=20
the court that she will supply it once she has=20
contacted all the parties whose confidential=20
information was redacted in the public order to=20
get their permission. The FCC conditions on the=20
merger, including a 30-month net neutrality=20
provision, are not at issue in the court review.
http://www.broadcastingcable.com/article/CA6353333.html?display=3DBreaki...
News
* Judge Seeks FCC Documents On Recent Phone Mergers
http://online.wsj.com/article/SB115310805401708409.html?mod=3Dtodays_us_...
ketplace
(requires subscription)

BELLSOUTH STOCK DOWNGRADED ON REGULATORY UNCERTAINTY
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Broker A.G. Edwards has downgraded BellSouth=20
stock from "hold" to "buy," due to concerns over=20
the network neutrality debate and a D.C. court=20
merger review. The potential risk of merger=20
opposition and price deterioration no longer are=20
balanced by the potential price appreciation from=20
the successful completion of the merger with=20
AT&T..." said the broker. "Our specific concerns=20
include the intensity of the net neutrality=20
debate in the U.S. Senate and the U.S District=20
Court review of the SBC/AT&T and Verizon/MCI=20
mergers.=94 In addition, If the current antitrust=20
court review of the relatively light regulatory=20
touch applied to the mergers of SBC/AT&T and=20
Verizon/MCI does not go well for the government,=20
it could spell a tougher Justice Department=20
review of AT&T/BellSouth. A.G. Edwards says it is=20
not convinced the merger will go through at all,=20
or at least feels there is enough of an x factor to warrant the downgrade.
http://www.broadcastingcable.com/article/CA6353090?display=3DBreaking+News

JUDGE DISMISSES ANTITRUST COMPLAINT VS GOOGLE
[SOURCE: Reuters, AUTHOR: Eric Auchard]
On Thursday, the U.S. District Court for the=20
Northern District of California in San Jose=20
dismissed a lawsuit against Google by disgruntled=20
advertising customer Kinderstart that had accused=20
the Web search leader of monopolistic business=20
practices. Judge Jeremy Fogel said in a ruling he=20
would grant Google's motion to dismiss=20
Kinderstart's complaint, but gave Kinderstart=20
leave to amend and resubmit its case. "The court=20
concludes that Kinderstart has failed to allege=20
any conduct on the part of Google that=20
significantly threatens or harms competition,"=20
Judge Fogel wrote in a 23-page decision.
http://today.reuters.com/news/newsArticle.aspx?type=3DinternetNews&storyID=
=3D2006-07-14T090214Z_01_N14213988_RTRUKOC_0_US-GOOGLE-LAWSUIT.xml

QUICKLY

SPECTER NSA BILL SHIELDS ADMINISTRATION'S ILLEGAL WIRETAPS
[SOURCE: Center for Democracy & Technology]
Contrary to press reports of a White House=20
compromise on NSA legislation, Senator Specter=20
has agreed to a bill that would shield the=20
Administration from accountability for its=20
illegal warrantless wiretapping. The bill has=20
been erroneously described as requiring judicial=20
review of the President's warrantless wiretapping=20
program. In fact, the bill retroactively guts=20
the Foreign Intelligence Surveillance Act by=20
making judicial review of the program by the=20
Foreign Intelligence Surveillance Court=20
optional. It would also allow electronic=20
surveillance in violation of the Fourth=20
Amendment's requirements of probable cause and individualized suspicion.
Draft of Specter Compromise:
http://www.cdt.org/security/20060714specter.pdf

THE INTERSECTION OF WIRELESS AND BROADBAND: ADMINISTRATION SPECTRUM POLICY
[SOURCE: National Telecommunications and Information Administration]
John M. R. Kneuer, the Acting Assistant Secretary=20
for Communications and Information at the=20
National Telecommunications and Information=20
Administration, delivered a speech to at the=20
Wireless Communications Association International=20
2006 annual conference in Washington, DC, on June=20
28, 2006. His main points: 1) The Administration=20
has shown demonstrable success and leadership in=20
its broadband and spectrum policies. 2) There is=20
a strong cause and effect relationship between=20
these policies and the growth of broadband and=20
innovative wireless products and services, and of=20
jobs and economic growth in the country. 3) The=20
President=92s Spectrum Policy Initiative will=20
promote efficiency and lead to further growth in these areas.
http://www.ntia.doc.gov/ntiahome/speeches/2006/JKneuer_WCA_062806.htm

NEW SENATE COMMERCE COMMITTEE STAFF
[SOURCE: US Senate Commerce Committee press release]
On Friday, Senate Commerce Committee Chairman Ted=20
Stevens (R-Alaska) announced the hiring of three=20
new staff: 1) Joe Brenckle is the Committee=92s new=20
Communications Director and most recently handled=20
communications for Congressman Rick Renzi (AZ-1).=20
Brenckle first came to the Hill in 1996 to work=20
for Senator Frank H. Murkowski (R-Alaska) both in=20
his personal office and later on the Senate=20
Energy and Natural Resources Committee, which=20
Murkowski chaired. After Murkowski became=20
Alaska=92s governor in 2003, he tapped Brenckle to=20
serve in Juneau as a Special Assistant and handle=20
special projects. Brenckle received a Bachelor=20
of Arts degree in American History from the=20
University of San Diego in 1996 and a Masters=20
Degree in American Studies from Georgetown=20
University in 2002. Brenckle is originally from=20
Kenai, Alaska. 2) Brian Eaton, the Committee=92s=20
new Press Assistant, began on the Hill as an=20
intern in Senator Arlen Specter=92s personal office=20
in May 2006. He graduated from the Pennsylvania=20
State University with a Bachelor of Arts degree=20
in Journalism and minors in Sociology and History=20
in April 2006. Eaton is a brother of Zeta Psi=20
fraternity and was their undergraduate president=20
in 2005. He is the Zeta Psi Pi Sigma=92s annual=20
golf tournament founder and coordinator and is=20
originally from Erie, Pennsylvania. 3) Dan=20
Neumann, the Committee=92s new Staff Assistant,=20
graduated from Boston University with a Bachelor=20
of Arts degree in American History in May=20
2005. Neumann formerly interned with=20
Congresswoman Sue Kelly of New York (NY-19) and=20
Governor George Pataki (Washington D.C.=20
Office). He is originally from Hopewell Junction, N.Y.
http://commerce.senate.gov/public/index.cfm?FuseAction=3DPressReleases.D...
il&PressRelease_id=3D248638&Month=3D7&Year=3D2006

SIXTY PERCENT OF WIRED HOMES NOW USE BROADBAND
[SOURCE: AdAge, AUTHOR: Gavin O'Malley]
Nearly 70% of all U.S. households now pay for an=20
online connection, and 60% of those homes connect=20
via broadband, according to new research from=20
Leichtman Research Group. Cable and DSL providers=20
added over 3 million subscribers in the first=20
quarter of this year. Indicating a growing=20
interest in broadband, 40% of current=20
narrowband/dial-up subscribers said they are=20
interested in getting broadband. Cable remains=20
the most common source for residential broadband,=20
driven by its strength among higher-income=20
households. Thirty-seven percent of all=20
households with annual incomes of more than=20
$75,000 subscribe to cable broadband, while 27%=20
subscribe to DSL. Among households earning=20
between $30,000 and $75,000 per year, 21%=20
subscribe to DSL and 18% to cable. The mean=20
annual household income of cable-broadband=20
subscribers is 12% higher than their DSL=20
counterparts, according to the study. The mean=20
income of broadband subscribers is 35% greater=20
than narrowband/dial-up subscribers. "By the end=20
of the year 2010, there will be over 105 million=20
residential subscribers in the U.S., with over=20
80% subscribing to broadband," Bruce Leichtman,=20
president and principal analyst at Leichtman=20
Research Group, said in the report.
http://adage.com/mediaworks/article?article_id=3D110500

NEWS ONLINE SEEMS TO HAVE LONG SHELF LIFE
[SOURCE: New York Times, AUTHOR: Noam Cohen]
A new research paper seeks to answer a riddle for=20
publishers, editors and even readers: when does=20
new news become old news? In the case of a news=20
article on the Internet, the answer is=20
surprisingly long: 36 hours on average, according=20
to the paper, =93The Dynamics of Information Access=20
on the Web,=94 which appeared in the June issue of=20
Physical Review E, the journal of the American=20
Physical Society. More precisely, 36 hours is the=20
amount of time it takes for half of the total=20
readership of an article to have read it, the=20
paper found. The physicist who led the research,=20
Albert-L=E1szl=F3 Barab=E1si of the University of Notre=20
Dame, said that the paper=92s conclusion should=20
give journalists hope, even in the era of instant=20
news. Dr. Barab=E1si said that traditional ideas=20
about the way people use the Internet would have=20
led researchers to expect a much shorter=20
half-life, more like two to four hours. =93You can=20
spin it two ways,=94 said Dr. Barab=E1si, a=20
specialist on complex networks. =93Gee, only 36=20
hours is the typical half-life of an article. Or=20
gee, I would have expected it to be shorter.=94
http://www.nytimes.com/2006/07/17/business/media/17decay.html
(requires registration)
--------------------------------------------------------------
Communications-related Headlines is a free online=20
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through Friday, this service provides updates on=20
important industry developments, policy issues,=20
and other related news events. While the=20
summaries are factually accurate, their often=20
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