July 2009

Ad Collapse in Television, Radio and Magazines is Permanent

A new study from private equity fund Catalyst Investors says mainstream media's advertising meltdown is the "new normal" for the ad business. Plummeting consumer spending and the Web's ability to eat away at the pricing power of traditional media has driven the declines. In the magazine sector, for example, the drop in ad dollars is fueled in part by the move to "just-in-time spot ads vs. advance ad purchasing." The Internet's unlimited content and ability to measure ad impact broke "the oligopolistic pricing power that traditional media enjoyed in the 1980s and 1990s." A further dip in ad spending as a percent of GDP will occur over the next two to three years, predicts Catalyst.

Malone Says 'It May Be Too Late' for Media Companies

Liberty Media Corp. Chairman John Malone said television, film and publishing companies must find a way to charge Internet users for content they provide. "The Internet is moving too fast, too far.... Clearly advertising revenue is going to be insufficient as a sole source of revenue. It may be too late" for some companies, he said, citing the newspaper industry as an example. Newspapers "are dropping like flies," Malone said. "Just changing the ownership doesn't solve the problem." Without new pay models, the Internet will drain profits at media conglomerates, as it has at newspapers, he said .

An Internet for rural India

India, famous for its bureaucracy, is where entrepreneur Sriram Raghavan intends to prove that the world's billion-plus rural poor can be a lucrative market for online services. Raghavan, 36, once built software for U.S. corporate clients. Now, backed by U.S. venture capital and undeterred by acts of violence against his outlets, he is succeeding where others failed: providing Internet services that villagers actually need and making a profit from their micropayments. "We're democratizing information services," he says.

House Committee on the Judiciary
July 9, 2009
10:00 A.M.
2141 Rayburn House Office Building
http://judiciary.house.gov/hearings/hear_090709.html

Witness List

Oscar Joyner
President
Reach Media
Dallas, TX

Kendall Minter
Chairman of the Board
Rhythm and Blues Foundation
Philadelphia, PA

Andrew Schwartzman
President and CEO
Media Access Project
Washington, DC

Michael Skarzynski
President and CEO
Arbitron, Inc.
Columbia, MD

James L. Winston
Executive Director and General Counsel
National Association of Black Owned Broadcasters
Columbia, MD



BTOP-BIP Workshops (Los Angeles)
Omni Los Angeles Hotel at California Plaza
251 S. Olive St
Los Angeles, CA 90012
888-444-6664
July 24, 2009
9am-4:30pm local time
https://www.badgeguys.com/reg/2009/julyworkshops2009/register.aspx



Marriott Albuquerque Pyramid North
5151 San Francisco Road NE
Albuquerque, NM 87109
800-262-2043
July 23, 2009
9am-4:30pm local time
https://www.badgeguys.com/reg/2009/julyworkshops2009/register.aspx



Washington, DC Area
Gaylord National Resort & Convention Center
201 Waterfront Street
National Harbor, MD 20745
July 7, 2009
https://www.badgeguys.com/reg/2009/julyworkshops2009/register.aspx



BroadbandCensus.com
Thursday, July 9, from 2 p.m. to 4 p.m. ET
http://www.nlctv.org/events/broadbandstimulus_thm/090709/?utm_source=Mas...

Anthony Wilhelm, Deputy Associate Administrator at the Commerce Department's NTIA; and Ken Kuchno, Director of the Broadband Division of Agriculture Department's RUS; will lead off the webcast and participate in a discussion moderated by Drew Clark, Editor and Executive Director of BroadbandCensus.com, and Marty Stern, Partner at K&L Gates.

The July 9 event comes on the heels of the initial Notice of Funds Availability (NOFA) and programmatic rules for broadband stimulus funds were released on July 1. Up to $4 billion of funding available in the first round. Time is of the essence, with applications due on August 14, just over a month from now.

The July 9 event builds on a prior webcast on June 4. It was also presented by BroadbandCensus.com and TV Worldwide.

Wilhelm, who serves in NTIA's Office of Telecommunications and Information Applications, together with Kuchno of RUS, will discuss details of the releases, timing of applications, and how some of the key issues that had been left open these last few months have been resolved.

NTIA is the agency responsible for the bulk of the $7.2 billion in broadband stimulus funds; RUS has also received a sizable infusion of funds from which it will make loans, grants, and loan-grant combinations to a range of rural infrastructure projects.

To help educate grant applicants, the Telecommunications Industry Association (TIA) and Alcatel-Lucent are among the main sponsors of the free live webcast, presented by BroadbandCensus.com, TV Worldwide and two of its internet television channels: National League of Cities TV and TV Mainstream.

The interactive live workshop will provide a first look at what applicants need to know in putting together successful broadband grant and loan applications.

A second panel of experts on NTIA on RUS funding programs will be available to take your questions live. Confirmed panelists include:

  • Gary Bolton, Vice President, Global Marketing, Adtran
  • Maria Browne, Partner, Davis Wright and Tremaine LLP
  • John Kneuer, President Kneuer LLC and former NTIA Administrator and Assistant Secretary of Commerce for Communications and Information

The program will conclude with a discussion on compliance issues, how the agencies are expected to police waste, fraud and abuse, and what applicants need to pay attention to now to avoid potential issues down the road. The invited guest is Cynthia Schultz, Director of Compliance and Audits for NTIA's Broadband Technology Opportunities Program.



July 9, 2009 (Cellphone Straitjacket)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for THURSDAY JULY 9, 2009

Find Headlines online at http://www.benton.org/headlines


CYBERWARFARE
   State cyberattack 'ongoing'
   Cyber Scare Could Be Warning Shot

WIRELESS
   Cellphone Straitjacket
   AT&T takes issue with antitrust criticism
   Senate Commerce Committee Passes Kerry's Spectrum Inventory Bill; Companion Bill in House

THE STIMULUS
   BTOP-BIP Workshop Presentations
   BTOP, FCC and Broadband Subscribership Info
   Call for Reviewers for Broadband Technology Opportunities Program
   The Missouri plan for broadband stimulus

OWNERSHIP
   Consumers could pay for Google's power
   Google Operating System Raises Apple Antitrust Issues
   Verizon Files Program Access Complaint Against Cablevision
   Some TV stations refuse to air marijuana-tax advertisement

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CYBERWARFARE


STATE CYBERATTACK 'ONGOING'
[SOURCE: The Hill, AUTHOR: Bridget Johnson, Jordy Yager]
A State Department spokesman said Wednesday that a cyberattack launched against its website is "still ongoing" as more fingers pointed toward North Korea in the denial-of-service assault on numerous government sites. Ian Kelly told reporters at the State Department briefing that the attack had started on July 5. "It's still ongoing, but I'm told that it's much reduced right now," Kelly said, noting that the U.S. Computer Emergency Readiness Team was working on the problem. "But I think, as you know, the State Department wasn't the only target of these attacks." Targets included the websites of the White House, Treasury Department, Secret Service, Federal Trade Commission, the Pentagon and the Department of Homeland Security. Government websites in South Korea -- the office of the president, the National Assembly, Defense and Foreign ministries -- were also affected.
http://benton.org/node/26374
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CYBER SCARE COULD BE WARNING SHOT
[SOURCE: CongressDaily, AUTHOR: John Maggs]
This week's crude and fairly ineffective attacks on U.S. and South Korean Web sites were a minor event, network experts said, but could represent a warning shot portending much more serious threats to worldwide communications and commerce on the Internet. James Lewis, a cybersecurity scholar at the Center for Strategic and International Studies, noted the paradox in the attacks - that they were well-coordinated and broad in scope, but very limited in their aims. If they were the work of the North Korean government or affiliated forces, as South Korean officials suspect, said Lewis, it seems that the real purpose might have been to get the attention of foreign governments.
http://benton.org/node/26362
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WIRELESS


CELLPHONE STRAITJACKET
[SOURCE: USAToday, AUTHOR: Editorial staff]
[Commentanters] When consumers walk into a store to buy a flat-screen television, they aren't locked into a particular cable or satellite provider. So why, when they get an Apple iPhone or a BlackBerry Storm, are they signed up with a particular carrier? That's a question a lot of Americans ask when they travel overseas and find that the hottest devices can be used with any service. Their handsets are not only wireless, they also come without strings attached. Allowing dominant service providers to cut exclusive deals with handset makers forces consumers to make an unnecessary compromise between the device they prefer and the service that is strongest in their area. And smaller competitors are hurt if they can't get access to the devices consumers crave.
http://benton.org/node/26373
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AT&T TAKES ISSUE WITH ANTITRUST CRITICISM
[SOURCE: Reuters, AUTHOR: Diane Bartz]
Telecommunications giant AT&T struck back on Wednesday at Sen Herb Kohl (D-WI), chair of the Senate Antitrust Subcommittee, saying the lawmaker's concerns about a lack of competition in the wireless industry were unfounded. Chairman Kohl wrote to the Justice Department's top antitrust regulator Christine Varney and Federal Communications Commission Chairman Julius Genachowski on Monday to reiterate concerns over texting prices, large carriers failing to cooperate with smaller carriers to resolve roaming disputes, disputes over spectrum and deals that give one or another carrier exclusive access to popular phones like the iPhone. AT&T argued that cell service had become progressively cheaper, with revenue per minute falling 89 percent since 1994. The company also argues that 1) texting prices have fallen because of package deals, 2) exclusive handset arrangements allowed a carrier and a manufacturer to split the high cost of marketing "an inventive but unproven new device," and 3) early termination fees are a way for the company to recoup money spent discounting handsets.
http://benton.org/node/26363
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SENATE COMMERCE COMMITTEE PASSES KERRY'S SPECTRUM INVENTORY BILL; COMPANION BILL IN HOUSE
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
The Senate Commerce Committee Wednesday passed Senator John Kerry's spectrum inventory bill, which now goes on to the full Senate. The Radio Spectrum Inventory Act (S.649), introduced in March, would require the Federal Communications Commission and National Telecommunications & Information Administration to report back to Congress with an inventory of the spectrum they manage and how it is being used. In the House, Commerce Committee Chairmen Waxman and Communications Subcommittee Chairman Boucher, and Ranking Members Barton and Stearns introduced H.R. 3125, the Radio Spectrum Inventory Act. This House bill requires the NTIA and the FCC to create a detailed inventory of radio spectrum bands, as well as a centralized portal or website to make the inventory available to the public. The NTIA and the FCC are also required to 1) submit an annual report to Congress updating the status of the inventory; 2) identify the least utilized blocks of spectrum inventoried; and 3) recommend whether any such spectrum should be reallocated. The bill was introduced with 14 original cosponsors, including Representatives Dingell, Markey, Doyle, Gordon, Space, McNerney, Inslee, Eshoo, Matsui, Stupak, Castor, Buyer, Welch and Upton.
http://benton.org/node/26368
Track the Senate bill
http://www.benton.org/node/26369

THE STIMULUS


BTOP-BIP WORKSHOP PRESENTATIONS
[SOURCE: BroadbandUSA.gov, AUTHOR: ]
The Department of Commerce's National Telecommunications and Information Administration (NTIA) and the Department of Agriculture's Rural Utilities Service (RUS) are holding a series of presentations around the country about the application process for $4 billion in broadband grants and loans under the Recovery Act. can't make it there in person? Read the presentations online.
http://benton.org/node/26367
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BTOP, FCC AND BROADBAND SUBSCRIBERSHIP INFO
[SOURCE: Free Press, AUTHOR: Ben Scott, Derek Turner]
Free Press filed an ex parte offering recommendations on the FCC's consultative role with the NTIA in creating rules for the issuance of broadband grants. Free Press had telephone conversations with Scott Deutchman, Legal Advisor to Commissioner Michael Copps, and Colin Crowell, Legal Advisor to Chairman Julius Genachowski. Free Press believes the FCC has a valuable role to play in assisting both grantees and the NTIA in evaluating whether the unserved and underserved thresholds have been met, especially in providing an index of data at the Census Tract level. Free Press suggests that the FCC immediately explore the feasibility of quickly publishing the raw subscriber counts for all Census Tracts. This information should at a minimum include for each Tract the total number of residential lines, excluding mobile wireless lines, which are classified by the Commission as "Broadband Tier 1 lines."
http://benton.org/node/26366
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CALL FOR REVIEWERS FOR BROADBAND TECHNOLOGY OPPORTUNITIES PROGRAM
[SOURCE: National Telecommunications and Information Administration, AUTHOR: ]
The National Telecommunications and Information Administration is soliciting volunteers to serve as panelists to evaluate grant proposals for the $4.7 billion Broadband Technology Opportunities Program (BTOP), an important part of the American Recovery and Reinvestment Act of 2009. NTIA is accepting applications for its first round of BTOP grants from July 14, 2009 until August 14, 2009, and will conduct panel reviews through at least the end of September, 2009. As a reviewer, your evaluations will be an important factor considered by NTIA in determining whether to award grant funding. To be considered as a reviewer you must have significant expertise and experience in at least one of the following areas: 1) the design, funding, construction, and operation of broadband networks or public computer centers; 2) broadband-related outreach, training, or education; and 3) innovative programs to increase the demand for broadband services. In addition you must agree to comply with Department of Commerce policies on conflict of interest and confidentiality.
http://benton.org/node/26365
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THE MISSOURI PLAN FOR BROADBAND STIMULUS
[SOURCE: TelephonyOnline, AUTHOR: Ed Gubbins]
The Missouri plan to achieve statewide broadband access by 2014, funded with federal stimulus money, may well represent the best model for stimulus applicants to follow to improve their odds of winning. The fact that at least one award must be given to each state puts state governments in a unique position — plus, federal administrators will be working with states on broadband mapping efforts. Each state would do well to start with a focus on universal (or near-universal) coverage in some form and then build a public/private coalition that can collectively achieve that goal. One of the benefits of the approach is critical mass. If a state government is building a coalition for a broadband stimulus bid, why would a city in that state — or a small independent operator — submit its own application and risk losing to the state? Seems like a safer bet to just join the state coalition and have everyone throw their weight behind that. The problem with this approach, of course, has been obvious since the NTIA first encouraged applicants to partner up for a better chance at winning: Too many chefs in the kitchen can spoil a pot, and chefs are a lot more competent than politicians. Multi-city broadband initiatives have been hard to pull off, in large part because it's so hard to reach consensus.
http://benton.org/node/26364
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OWNERSHIP


CONSUMERS COULD PAY FOR GOOGLE'S POWER
[SOURCE: Los Angeles Times, AUTHOR: David Lazarus]
[Commentary] At first glance, Google's latest plan for global domination sounds very cool. Everyone's favorite pedal-to-the-metal, innovate-or-die tech company is throwing its Mensa-level brainpower behind the development of a computer operating system to rival Microsoft's Windows. But that's why you want to be worried. "They have so much market power, you've got to be concerned that they'll use that power in a way others can't compete with," said Gary Reback, a Silicon Valley antitrust lawyer best known for spearheading opposition to Microsoft Corp.'s once-market-dominating practices. Lazarus gets nervous whenever a big company controls hefty portions of any particular market, even when its success rests largely on building better mousetraps. And he gets extra nervous whenever a company controls huge volumes of customer data, which it can leverage for commercial gain without a second thought about people's privacy. And I get extra, extra nervous when I think about how competition can be stifled because a company is so dominant, it enjoys market power that not only makes it hard for rivals to put up a fight but also prevents fresh-faced upstarts from gaining a toehold.
http://benton.org/node/26372
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GOOGLE OPERATING SYSTEM RAISES APPLE ANTITRUST ISSUES
[SOURCE: New York Times, AUTHOR: Brad Stone]
As Google prepares to unveil its own operating system, based on its Chrome browser, all eyes are on its intensifying competition with the software giant Microsoft. But Google's announcement on Tuesday also complicates its relationship with Apple, a longtime ally. Regulators at the Federal Trade Commission have been investigating whether Google and Apple are violating antitrust laws by sharing two board members: Eric E. Schmidt, chief executive of Google, and Arthur D. Levinson, chief executive of Genentech. Under Section 8 of the Clayton Antitrust Act, companies with "interlocking directorates" face limits on sharing information through common board members. Google's new operating system, which the Internet search giant said could ship in the low-cost computers called netbooks by next year, is likely to create more questions for regulators looking into Google's relationship with Apple. "The circle of sensitive competitive information between Apple and Google seems to be widening," said Andrew I. Gavil, an antitrust specialist and a professor at Howard University School of Law. "The more you have potential overlap in products and marketing strategy, the more the FTC might get concerned about a violation of Section 8."
http://benton.org/node/26371
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VERIZON FILES PROGRAM ACCESS COMPLAINT AGAINST CABLEVISION
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Verizon has filed a program access complaint with the Federal Communications Commission against Cablevision, saying that the cable operator should be compelled to sell high-definition, digital programming from its Madison Square Garden Network to the telco and its FiOS multichannel video service. Verizon says the company has "intentionally and unlawfully" refused to make that unique programming available. The unique programming it is focused on includes the New York Knicks, New York Rangers, New York Islanders, New Jersey Devils and Buffalo Sabers. Verizon says that Cablevision has told analysts that its own carriage of the programming in HD is a competitive advantage.
http://benton.org/node/26361
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SOME TV STATIONS REFUSE TO AIR MARIJUANA-TAX ADVERTISEMENT
[SOURCE: Los Angeles Times, AUTHOR: Eric Bailey, Catherine Saillant]
Advocates for legalizing marijuana have released a new television advertisement calling for the drug to be decriminalized and taxed to help solve California's budget crunch. But the controversial topic of pot and taxes has proven too hot for several broadcast affiliates to handle, according to the Marijuana Policy Project, the national pro-pot group that is sponsoring the ad campaign.
http://benton.org/node/26370
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State cyberattack 'ongoing'

A State Department spokesman said Wednesday that a cyberattack launched against its website is "still ongoing" as more fingers pointed toward North Korea in the denial-of-service assault on numerous government sites. Ian Kelly told reporters at the State Department briefing that the attack had started on July 5. "It's still ongoing, but I'm told that it's much reduced right now," Kelly said, noting that the U.S. Computer Emergency Readiness Team was working on the problem. "But I think, as you know, the State Department wasn't the only target of these attacks." Targets included the websites of the White House, Treasury Department, Secret Service, Federal Trade Commission, the Pentagon and the Department of Homeland Security. Government websites in South Korea -- the office of the president, the National Assembly, Defense and Foreign ministries -- were also affected.