October 2010

Police Try to Thumb a Ride With Anti-Texting Message

Iowa police are on the lookout for drivers who send text messages behind the wheel. So far, the effort is all thumbs. Instead of tickets, police are giving texting drivers colorful bands to wear on their thumbs that say: "TXTNG KILLS." The bands are part of a statewide campaign to raise awareness about the dangers of texting while driving under a new law prohibiting the practice that took effect July 1. For the first year, police can give scofflaws warnings only. Next year, fines will kick in.

Harold Feld is Right

[Commentary] Kudos to Public Knowledge's Harold Feld for sharpening his lawyer pencil and addressing some of the legal issues around the (apparently) fascinating issue of "paid prioritization." In a recent blog post, Harold explained how, under Title II, the FCC might approach various business models that include payment for prioritization.

Harold's basic point was that the FCC might either permit or prohibit particular instances of "paid prioritization" based at least in part on decisions the FCC has made in the past. I agree completely on this point. Contrary to the title of Harold's blog, I don't think anyone at AT&T has said that Title II would "require" the FCC to permit any and all practices that include both payment and prioritization. But, if someone has, then he or she should go back to common carrier school. What I and others have said is that under Title II the FCC could not a priori (for some reason lawyers like Latin) ban all practices that may combine payment and prioritization, since in the past they have allowed some practices that do so. Under Title II, carriers would be free in the first instance to offer such services and concerned parties would be free to challenge them. At which point, the process Harold describes would kick in and the FCC would have to decide whether the service in question is "unreasonable," or "unjustly and unreasonably discriminatory."

An analyst's take on Fox-Cablevision dispute

The battle between Cablevision and Fox appears to pit a runt against a heavy-weight fighter, analysts say. So why is Cablevision fighting so hard against New Corp. in its battle over fees paid to retransmit Fox's shows? To get federal officials to step into what appear to be increasingly contentious negotiations between broadcasters and cable/satellite video distributors, analysts say.

"Today, retransmission consent disputes pit a government-mandated monopoly broadcaster against a distributor for whom there are readily available substitutes. It was never a fair fight," said Craig Moffett, an analyst at Sanford and Bernstein in a research note to investors. "Regulatory and/or legislative intervention could be the great leveler, and that may be what Cablevision is playing for." The battles will only intensify, analysts say. In two weeks, Dish Network will renegotiate its retransmission consent agreement with Fox. Cablevision's willingness to take blackouts, even as Fox has advised subscribers to go to Cablevision's competitors, shows the cable operator was willing to lose the battle "in an effort to win the war," Moffett wrote in a white paper.

What Broadcast Networks Are Getting From Advertisers For Each Primetime Show This Season

American Idol retains its status as the most expensive show on broadcast television for advertisers, despite a 9% dip in viewers between the ages of 18-49. Next year's "Idol" is getting an average $467,617 per 30-second ad on Tuesday night and $400,546 per 30-second ad on Wednesday's weekly results show, according to Advertising Age's annual TV pricing survey of media buyers, making "Idol" far and away the priciest show on TV for advertisers.

Fox dominates the list of top-dollar shows this year, in part due to the success of musical drama "Glee." Fox airs half of the top 10 most-expensive programs for the 2010-2011 season. NBC's "Sunday Night Football" continues its reign as the most-expensive program for advertisers for the first half of the TV season, commanding an average of $415,000 for a 30-second ad -- a testament to advertisers' fervent desire to align their commercials with live sports, where viewers watch in real time and can't fast-forward past the ads. For its part, "Glee" gets an average of $272,694 per 30-second ad in the fall, when it appears on Tuesdays, and $373,014 per 30-second ad in the spring, when it appears Wednesdays after the "Idol" results show.

Fox Steps Over The Internet Line

Over the weekend, Fox committed what should be considered one of the grossest violations of the open Internet committed by a US company. Unfortunately, there was no one to call them on it.

Fox blocked Cablevision subscribers from accessing Fox content online, from fox.com web sites or from Hulu. Even if a customer received only Internet service from Cablevision, and TV programming from another company like DirecTV or Dish, that Internet user trying to reach a Fox online was redirected to keepfoxon.com -- a Fox site that gives Fox's side of the negotiations and even has a couple of helpful links to Cablevision competitors like AT&T's U-verse, Verizon FiOS and DirecTV. The theory behind the Internet blockage was to keep Cablevision subscribers from watching Fox content online, and thus taking away a Cablevision incentive to negotiate. Never mind that some Cablevision Internet access subscribers might want to do something else on the great big Internets. Keeping them away from Fox content was paramount.

Until this spring, the 2005 Federal Communications Commission (FCC) policy statement held that Internet users had the right to access lawful content of their choice. There was no exception in that policy for customers who happened to have their Internet provider caught up in a nasty retransmission battle with a broadcaster. Yes, it would be nice if someone could step in and tell Fox that it is unacceptable to block Internet content. Unfortunately, there isn't that someone around to protect consumers. And that's truly the "harm" here, and why a referee is needed to call the "foul."

Apple's Steve Jobs Rants About His Competitors: 'Open Doesn't Always Win'

Steve Jobs doesn't usually participate in the company's quarterly earnings conference call, but he says he couldn't help stopping by to celebrate the company's first $20 billion quarter.

As part of the festivities, he tore apart Research In Motion's strategy by questioning its ability to compete; he explained how fragmentation will bury Android and why "open doesn't always win,' and how the bevy of tablets coming in time for the holidays will be "dead on arrival." Jobs presence on today's Q4 call confirms one thing that Google's Android increasing market share is now worth talking about. Jobs: "It's a battle of the mind share for developers and customers, and right now iPhone and Android are winning that battle." In addition, Jobs continued to feel comfortable taking shots at Research In Motion's BlackBerry, which still has the highest smartphone market share in the U.S. despite being outsold by both iPhone and Android.

Hard News Pays

The Vault Index is a new ranking of the 10 most valuable topics for news publishers. It finds that while the Lindsay Lohan sentencing and other celebrity coverage drove significant online traffic for major news publishers, articles about unemployment benefits, the Gulf oil spill, mortgage rates and other serious topics were the top-earning news topics based on advertising revenue per page view.

"This data proves that serious journalism does pay," said Julie Schoenfeld, CEO of Perfect Market. "The great insight unveiled by the Vault Index is that the stories with real revenue opportunity for news organizations today are not always, as it turns out, celebrity scandals but difficult subjects that affect people's lives."

The Business Of Burying Internet Search Results

Unseen battles are waged every day on the Internet to protect and destroy brands and reputations.

The Internet can be a hostile place, with powerful companies paying handsome sums to hide negative content in Google search results or any quest for information that might hurt their bottom line. According to the digital media research firm eMarketer, search optimization — and suppression — is a $2 billion industry. Prominent public companies including BP and Toyota spend fortunes in an effort to keep negative press about oil spills or faulty brakes far away from the first page of a Google search. "It is an absolute game changer, and a fundamental piece of marketing for any company out there," says Jon Kaufman, a senior vice president at the search optimizer Zog Media. He says this industry is about who controls the message.

Facebook's Biggest Worry: Search Neutrality

The potential for social information reaches beyond search. Facebook's most popular feature is photo sharing and tagging friends in pictures. Picasa, Google's photo-sharing service, is not nearly as social. Ads also have the potential to be social, when people share and comment on them.

Neal Mohan, the Google vice president in charge of display ads, said that by 2015, three-quarters of display ads will be social. But Facebook already allows users to do this. Knowing the information people share on social networks -- like their age, gender and the restaurants and musicians they like -- could also help Google direct ads more effectively. Larry Yu, a Facebook spokesman, said his company expected competitors large and small to emerge but was focused on building a valuable service.

Privately, though, Facebook executives have said that their biggest worry is that Google will prioritize a Google profile page over a Facebook page in search results.

Unsticking the FCC

[Commentary] To put it plainly, the Federal Communications Commission is stuck.

Although it recently adopted some promising orders related to broadband (e.g., new rules for accessing new portions of wireless spectrum called "white spaces" and for enhancing access in schools and libraries), the Commission has failed to move forward with implementing core provisions of its monumental National Broadband Plan. The business of governing is messy. Congress is influenced by a diverse array of factors that often grind the legislative process to a halt. Part of the reason for having independent expert agencies like the FCC is to insulate specialized policymaking from the political pressures that often bog down those on the Hill. Indeed, even though Congress sets the parameters within which agencies can operate, expert entities like the FCC have wide latitude to push forward with new policies. Yet, despite a clear Congressional mandate to enhance broadband connectivity, the FCC has put this duty on the back burner, in favor of pursuing the Chairman's white whale net neutrality. As a result, the misguided actions of the FCC have imperiled the digital destinies and civil rights of millions of Americans.

If we are to sustain our position as the world's most innovative and digitally inclusive country, we must urge those in power the President, Congress, Chairman Genachowski and others to put political posturing aside and move forward with implementing the National Broadband Plan and shepherding the Waxman Open Internet bill to the President's desk for signature. Doing so will grant immediate benefits to individual Americans and to the overall economy.

Benton

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