November 2009

Government groups or non-profit consortiums that bring private companies and government entities together may be the big winners when broadband stimulus awards are announced. The National Telecommunications and Information Administration asked Governors' offices and state broadband program officials to recommend first round project funding in their states. Their support for local government-run or nonprofits created for public-private partnerships runs from 30 percent to 50 percent, says Craig Settles. Indeed, a number of groups around the country are forming at the local, state and regional level and consist of disparate entities — anchor institutions, such as colleges, hospitals, libraries, counties and towns — brought together by the need for broadband connectivity and mobilized by the promise of federal stimulus money. Many are planning to build and share networks, often in cooperation with the private sector.

The high-tech sector is growing restless as it awaits President Obama's appointment of a White House cybersecurity coordinator. In one of the most recent displays of that frustration, the trade group TechAmerica wrote to Obama urging him to name "a qualified, credible, senior level official... at the earliest possible opportunity." While he tends to other priorities, bad actors around the world are not sitting idly by, the Friday letter stated. "Those that would seek to harm America by exploiting our digital infrastructure continue to increase their efforts," the group said. Ideally, the cyber czar would have relevant experience in both government and industry in order to truly reflect the shared roles and responsibilities in cybersecurity, TechAmerica President Phil Bond wrote. The letter came on the heels of a series of meetings in Washington in which industry executives sought to impress upon members of Congress and administration officials the importance of strong cooperation between industry and governments at the national and international levels in securing cyberspace.

Academics took aim at the media ownership review process Monday in the first of three workshops at the Federal Communications Commission this week as the agency begins its congressionally mandated quadrennial review of media-ownership rules. Advice ran the gamut from suggesting that, beyond the current antitrust laws, the government had no business regulating the ownership of media outlets -- former Republican Commissioner Harold Furchtgott-Roth -- to suggestions that the FCC might be able to regulate the media virtually at will if it could be justified as advancing the democratic role of the media. Media Bureau chief Bill Lake said the goal of all the workshops was not necessarily figuring out not so much "where we should go out as much as where we go in." Furchtgott-Roth said those not convinced of the dire straits of those TV and newspapers should visit them, but quickly, before they went out of business. He said virtually all newspapers were either shuttered, in bankruptcy, or in trouble, and that the TV station business was not much better. He said they were the victims of competition, not the absence of it. Economists and academics assembled for the panel talked about the need for more and better research, and at least one made a point about improvements the FCC needed to make to its databases so better information could be distracted. There was no consensus, but none could have been expected from the variety of views assembled. Those favoring some regulatory governor on the market tended to argue that the Internet was not necessarily a substitutable competitor. Steve Wildman, from the Quello Center For Communications Management at Michigan State, came armed with data from a study he and colleagues are conducting in association with the National Science Foundation. The bad news for broadcasters was that according to his analysis of 120 markets, in most of those, most stations weren't doing news period, and those that did weren't necessarily covering local issues. For example, he said, in Chicago only five of 15 stations were doing news. The good news was that where they were doing news, local TV and newspapers dominated in terms of local news items, far outstripping the "citizen journalist" category, cable and others.

[Commentary] Does the Federal Communications Commission have jurisdiction over Comcast's purchase of NBC Universal? At this time, it is unclear whether all the assets held by NBC Universal would be included in the deal. NBC Universal owns lots of radio and television stations. Transfer of the licenses to the new Comcast-controlled entity would require FCC approval. But if the deal does not include the licenses, the FCC would probably lack a jurisdictional hook. Review of the deal would lie strictly in antitrust — at either the Department of Justice or the Federal Trade Commission. From an antitrust perspective, the deal raises some concerns given the concentration of content and Comcast's position vis-a-vis other existing subscription television providers (e.g., FIOS, DIRECTV) and potential new competitors (e.g., Netflix and other "over the top" video providers)). It may also concern broadcasters -- both a) NBC affiliates worried about the change in management and b) other broadcasters worried how this would impact Comcast's retransmission negotiations. Much of this will also depend on whether the deal includes movie production studios, prior existing content, and a host of other details that impact the universe of content distribution these days.