November 2010

Economy Leads News Again Post-Election

Even with no major new developments or numbers to report, the economy remained the top story in the news last week as the media settled into a kind of post-election holding pattern.

From Nov. 15-21, the economy accounted for 11% of the newshole according to the Pew Research Center's Project for Excellence in Journalism. That coverage included a handful of storylines, mostly policy-oriented, including the federal debt panel and the debate over Bush-era tax cuts. Stories about the labor and housing situation made the news as well. Although coverage is far below the peak levels in late 2008 and early 2009 when the prospect of a depression seemed real, the economy has proved to be a resilient and consistent story, never straying off the media radar screen. To date, it is the biggest story of 2010, at 12% of the newshole from January 1 through Nov. 21. And in the past 12 weeks, for example, it has registered as the No.1 or No. 2 story 11 times.

Lobby scandal tars competitive media

India's fiercely competitive and hungry free press has become the rising nation's watchdog, unearthing a long list of banking scandals, real estate scams and, most recently, extensive government corruption during the international Commonwealth Games. But in recent days, Indian journalists have also been accused of wrongdoing, including having inappropriate conversations with a corporate lobbyist and acting more like power brokers in recordings released as part of an investigation into an alleged high-stakes swindle - considered the biggest scandal to hit the new India.

At the heart of the controversy is Andimuthu Raja, a little-known regional politician who became the powerful telecommunications minister in the world's fastest-growing mobile phone market. During his first stint as minister, he was accused of selling lucrative mobile telephone licenses at dirt-cheap prices, costing the Indian treasury as much as $40 billion. Despite a high-level investigation into the allegations against Raja, he was reappointed to head the ministry. Business leaders who are alleged to have benefited from the low-priced licenses seemed to go out of their way to hire lobbyists to talk to well-known media personalities, among others, to ensure that Raja remained in the telecom ministry, said Manoj Mitta, a founding member of India's Foundation for Media Professionals. While the journalists have not been accused of giving or receiving bribes, the recorded conversations raise questions about ethics in the Indian media and its coziness with corporate and political bigwigs, especially at a time of unprecedented economic growth.

Ofcom opens second TalkTalk investigation

Regulators have opened a new investigation into TalkTalk, the UK's second- largest broadband provider by customer numbers.

Ofcom, the telecoms watchdog, on Monday said it had begun an investigation into alleged mis-selling of fixed-line phone services by TalkTalk following complaints from the public. It is Ofcom's second inquiry into TalkTalk this year. This month Ofcom gave TalkTalk one month to comply with Ofcom rules after finding that it had wrongly issued customers with bills for services that had been cancelled. Ofcom said the new investigation focused on complaints by people "who claim to have been mis-sold a fixed-line telephone service by [TalkTalk] or have had their service switched to [TalkTalk] without their consent". Fixed-line phone and broadband providers must comply with Ofcom's rules that seek to guard against mis-selling. The watchdog in recent years has had to clampdown on so-called "slamming", where people discover they have been moved to a new service provider without their consent.

Schlick Suggests FCC May Not Need to Reclassify

Speaking at a panel discussion over the weekend, Federal Communications Commission general counsel Austin Schlick seemed to suggest that the FCC may not need to apply a so-called "nuclear option" to move on its broadband goals.

"The Comcast [appeals court] case is fascinating in this junction between its headline value and its legal value," he said. "Its headline value is 'is the FCC regulating the Internet?' The actual decision said nothing at all about the FCC's power with respect to Internet access service at Comcast or any other Internet service." The comments are notable because they come as the FCC may be poised to make network neutrality rules without taking using the "nuclear option" of reclassification to shore up its legal authority first.

McDowell: FCC Should Lead Coordinated Consumer Protection Effort, Not Reclassify Broadband

Speaking to the Federal Society's National Lawyers Convention, Federal Communications Commission member Robert McDowell said the debate over whether the FCC should regulate Internet network management hasn't changed much in the past year.

One question regarding the FCC's authority to regulate Internet network management under Title I has been answered by the D.C. Circuit in its decision in the Comcast v. FCC case. The court ruled that the FCC failed to show what underlying statutory mandate provided the legal foundation needed to claim Title I ancillary authority to regulate the Internet. The court did not go so far as to say that the Commission had absolutely no authority to act. It merely determined that the FCC failed to make its case.

Commissioner McDowell suggests that the FCC create a heightened role for itself. It could lead a coordinated effort with similarly inspired partners such as already established, non-governmental, Internet governance groups, the Federal Trade Commission and other antitrust and consumer protection agencies, public interest and consumer groups, trade associations, academics, engineers, economists and others. This new alliance could spotlight allegations of anticompetitive behavior and use already existing consumer protection and antitrust laws to punish bad actors and aid consumers. Coupled with a continued drive to create new opportunities for broadband competition, such an approach could help preserve the open and freedom-enhancing Internet we enjoy under today's deregulatory model, all without the uncertainty, costs and risks new rules always bring.

GOP fight for House Commerce gavel mars otherwise seamless transition

An acrimonious fight for the gavel of one of the House's most powerful committees has marred an otherwise seamless transition for Republicans taking power.

Republicans are jockeying fiercely for position in a race to lead the House Commerce Committee -- a battle that, at times, has resembled a GOP primary where candidates run to the right. The panel is ground zero for debates on climate change, telecommunications and the future of the Internet, and the top Republican will have to spar with Rep Henry Waxman (D-CA), the Democratic chairman who will become the committee's ranking member. Rep. Fred Upton (R-MI.) has positioned himself as the favorite in large part because Rep Joe Barton (R-TX), the current ranking Republican, needs a waiver from GOP rules to continue leading a committee on which he has served as chairman and ranking member. But Upton's conservative credentials have come under challenge from Rush Limbaugh and other critics on the right, leaving a door open for Barton as well as Reps. John Shimkus (R-IL) and Cliff Stearns (R-FL).

TV Stations Maintained Political Ad Share

Kantar's media analyst Evan Tracey disagrees with the notion that TV stations' role as the chief outlet for political advertising is shrinking.

TV stations captured 80% of the nearly $3 billion spent in campaigning and issue advertising this year. But to the extent money moved from broadcasting to other media was solely because broadcasting could not meet all the demand. The market was "driven by a supply-and-demand equation where you actually probably had more money than there was broadcast TV to buy." According to Tracey, electronic mass media attracted between $2.7 billion and $2.8 billion in political spending. If outdoor and direct mail are added in, the total spending swells to nearly $3 billion, a record year. Of that, TV stations accounted for $2.4 billion. When the stations spots "started to get sold out or the pricing was going up too high to keep up [with] the demand ... what happened is you started having a lot of this money that was looking for a new home.

Sen Franken Seeks Probe of Comcast for Naming NBC Managers Before Deal Cleared

Sen Al Franken (D-MN) asked federal officials to investigate whether Comcast violated antitrust law by naming new managers at NBC Universal as regulators weigh the purchase.

"Comcast's actions may constitute 'gun-jumping' in violation of the letter and spirit of federal antitrust law," Sen Franken said in a letter to Christine Varney, the assistant U.S. attorney general for antitrust. Comcast may be seeking to indirectly control NBC "well in advance of federal approval" and its action may trigger impermissible exchanges of sensitive information, he wrote. Comcast "does not have the right to effect that merger absent explicit federal approval," Sen Franken wrote.

"Transition and integration planning is common, proper, and expected," Sena Fitzmaurice, a Washington-based spokeswoman for Comcast, said in an e-mail. "Post-closing management teams are regularly announced prior to antitrust approval. NBC Universal has remained in total control of all decision making."

The Gold Rush in Kansas

At the Kansas Broadband Summit, Stanley Adams, the broadband planning manager for the state's Department of Commerce reported that Kansas received over $250 million in broadband deployment grants and loans from the National Telecommunications and Infrastructure Administration (NTIA), which is part of the Department of Commerce and the Rural Utility Service (RUS), which is part of the Department of Agriculture.

That's a lot of amount of money for a smaller state, but Kansas has a significant rural population, and its leaders are aiming to make broadband available to all. The Kansas plan is comprehensive, covering everything from detailed mapping, to provider validation, and even adoption plans. And like any time you get a room of stakeholders engaged, new ideas were sparked on how to improve the plan. As an FCC staff person, it was a thrill for me to see and feel the excitement of a state actually implementing its broadband plan. And as with the beginnings of California's gold rush in 1879, the new broadband gold rush in Kansas promises great benefits to the state citizenry . "From a business standpoint, [broadband] means increased opportunities for entrepreneurship and new small-business development," Kansas Lt. Governor Findley said. "How many entrepreneurs out there have the next big-idea, but have no way to share it?" Kansans know that broadband is just as valuable as gold, and know the wealth it can bring.

One More Time: Mobile TV Is a Tough Sell to Everyone

[Commentary] Don't get me started. When news hit last week that a consortium of broadcasters planned to equip 20 major markets to service mobile digital TV, commentators reiterated that old dream of "TV in your hand." The Mobile Content Venture claims it will cover almost 40% of the U.S. population with free-to-consumer digital channels to their phones by the end of 2011. As someone who has tested and covered the jagged, mostly unsuccessful roll-out of live mobile TV service for several years, who has had this capability on a number of review phones I have covered around for months at a time, all I can say is -- good luck with that. There are a number of sheer business hurdles to overcome. Foremost, how do you get the hardware OEMs and carriers on board a scheme that potentially takes user attention and potential revenue away from their core businesses of voice and data? If free mobile TV is going to be driven by advertising and the mobile phone platform will be its transportation device, then carriers will need a sizable cut of this.

Benton

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