May 26, 2011 (AT&T/T-Mobile News)
We'll see you Friday, but a little later than usual.
BENTON'S COMMUNICATIONS-RELATED HEADLINES for THURSDAY, MAY 26, 2011
The PROTECT IP Act and AT&T's purchase of T-Mobile are on today's agenda and there's news about both below http://benton.org/calendar/2011-05-26/
AT&T/T-MOBILE
Reps Markey, Conyers Oppose AT&T-T-Mobile Merger
These Companies Hate the AT&T/T-Mobile Merger - analysis
Free Press Requests AT&T/T-Mobile Studies Be Made Public
Wireless merger: Too big to sell?
Testimony Preview: AT&T's Stephenson, Deutsche Telekom's Obermann
AT&T Finds Unlikely Source Of Support
MORE ON SPECTRUM/WIRELESS
Public-safety network tees up House, Senate showdown
Air war - analysis
Clearwire Investor Demands Spectrum Sale in Letter to Stanton
AT&T looking to buy even more 700 MHz spectrum for LTE [links to web]
Rural Cellular Association Calls on FCC to reject Reverse Auctions [links to web]
Verizon CFO: We will combat heavy data users with overage charges, not throttling [links to web]
Republican pushes FCC for details on Google 'Wi-Spy' [links to web]
How Microsoft And Google Could Change Smartphones - analysis [links to web]
TELEVISION
NBC's new deal with affiliates may be topic of discussion at FCC
Rep Dingell: Finish Retransmission by End of Year
Retransmission Revenue to Top $3.6 Billion through 2017
Litton to Supply Kids Block for ABC Stations [links to web]
Foxtel bids A$1.9bn for rival Austar
Comcast Tests Tech Overhaul [links to web]
ELECTIONS & MEDIA
Study: More Money, More Media Coverage Lead to More Negative Political Ads
Palin's Secret Weapon: New Film to Premiere in June
CONTENT
Judiciary Committee Set to Pass Anti-Piracy Bill
YouTube users upload two days of video per minute [links to web]
A Library of Listening, Made by You - analysis [links to web]
INTERNET/BROADBAND
FCC slow to publish network neutrality rules
FCC Report Finds U.S. in Middle of Broadband Pack: That Isn't the Point - analysis
Measuring the Net’s growth dividend [links to web]
The Netherlands To Enact Law That Ensures Network Neutrality [links to web]
CYBERSECURITY
US and UK Cooperation on Cyberspace
House panel worries that Obama cybersecurity plan could open door to abuse
DHS plans expansion of cybersecurity workforce [links to web]
PRIVACY
Sen. Al Franken calls for app privacy policies
Privacy debate ahead, Facebook adds Bush aides to lobby team [links to web]
GOVERNMENT & COMMUNICATIONS
Internet activists, entrepreneurs warn G-8 leaders against restricting Web freedom
As world burns, G8 leaders fiddle ... with the Internet. Seriously? - op-ed
Why it is right to fight web pirates - analysis
SHOPPING
How will states tax Internet downloads? Congress may decide
More Shoppers Trust the Internet Than TV [links to web]
REGULATION
21st-Century Regulation: An Update on the President's Reforms
MORE ONLINE
Food makers resist lawmakers’ proposal for guidelines in marketing to children [links to web]
CBO’s Estimates of ARRA’s Impact on Employment and Economic Output for the First Quarter of 2011 [links to web]
AT&T/T-MOBILE
MARKEY AND CONYERS OPPOSE AT&T/T-MOBILE
[SOURCE: National Journal, AUTHOR: Juliana Gruenwald]
Two senior members of Congress announced their opposition to AT&T’s proposed acquisition of rival T-Mobile USA, saying it would be a “historic mistake.” Rep. Ed Markey (D-MA), a senior member of the House Commerce Committee, and House Judiciary ranking member John Conyers (D-MI) both called on regulators to block the proposed $39 billion merger.
Rep Markey wrote legislation in 1993 requiring the release of 200 megahertz of spectrum for private-sector uses such as mobile phones. He said if the AT&T/T-Mobile merger is approved, it will return the country to a time when the nation’s wireless market was dominated by two players who had little incentive to innovate or lower prices. AT&T and Verizon are aiming to “divide the country up into Bell East and Bell West,” Markey said. “That’s the inevitable result that will occur if agreement is given to this proposed merger.”
Rep Conyers called for more hearings on the merger than just the one currently scheduled by Judiciary. He said he would like to hear from Sprint, which opposes the merger, and the Communications Workers of America, which has more than 40,000 AT&T wireless union members and is backing the merger.
Some consumer and public-interest groups joined the lawmakers in their concern that the merger will lead to higher prices for consumers and stifle innovation in the wireless space. Andrew Jay Schwartzman with the Media Access Project said T-Mobile has been innovative by being the first to offer new products such as Google’s Android smartphone and offering lower-priced plans than the three other major carriers. He noted that mergers involving a “maverick” carrier like T-Mobile require extra antitrust scrutiny by the Justice Department. Public Knowledge President Gigi Sohn criticized AT&T’s takeover of T-Mobile, saying, “It would be hard to imagine a takeover that could do more harm to consumers.”
benton.org/node/67850 | National Journal | The Hill
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COMPANIES LINE UP AGAINST AT&T/T-MOBILE
[SOURCE: Wall Street Journal, AUTHOR: Shira Ovide]
The grumbles are beginning to pop up over AT&T’s attempted $39 billion takeover of T-Mobile. Here is a rundown of public comments from wireless carriers, and some subtext to explain their positions in terms of self-interest:
Verizon: Some industry analysts say Verizon Wireless, jointly owned by Verizon and U.K.’s Vodafone, could get a lift if AT&T strips low-cost rival T-Mobile from the market. At the same time, AT&T could be distracted for a year or more securing all the necessary government clearances for the deal, and then integrating T-Mobile into the fold. The lull might help Verizon poach subscribers from its biggest competitor.
Sprint: If the merger goes through, Sprint will be a distant No. 3 in the U.S. wireless market, which is increasingly looking like a two-man race.
MetroPCS: Wireless companies may privately grumble about the AT&T-T-Mobile deal. But they also have to position themselves under the basket to pick up any rebounds. In this case, rebounds would be any subscribers or other assets the government might force AT&T and T-Mobile to sell as a condition of their merger. Spectrum — or the airwaves that carry signals for phone signals and wireless-Internet data — will be a particularly hot ticket for MetroPCS if its rivals need to throw assets overboard.
Leap Wireless: Smaller, localized carriers such as Leap do matter in the proposed mega-merger. The Department of Justice is expected to scrutinize the AT&T deal for its effects on competition for wireless service in individual towns and cities — the markets where Leap’s Cricket wireless service and other mid-tier carriers sometimes beat up on big dogs like AT&T and Verizon.
benton.org/node/67848 | Wall Street Journal
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FREE PRESS WANTS STUDIES IN PUBLIC RECORD
[SOURCE: Free Press, AUTHOR: Aparna Sridha]
In a conversation with Federal Communications Commission staff, Free Press is urging the FCC to make public numerous academic studies, economic analyses, and other reports that are not publicly available by relied upon by AT&T and T-Mobile in their arguments in favor of AT&T's acquisition. In particular, AT&T and T-Mobile rely on the following studies and analyst reports:
The Nielsen Company, Carrier Share of Smartphone Subscribers – Q4 2010
The Nielsen Company, Q4 2010 Q4 Mobile Insights: National Report
The Nielsen Company, Q4 2010 Nielsen Mobile Retail &Customer Service Insights
“[T]wo recent surveys”
Strategy Analytics, US Wireless Market Outlook (2010-2015)
Verizon and Sprint react to US mega deal, Mobile Business Briefing (Mar. 22, 2011)
Deutsche Bank Analyst Report, MetroPCS Comm. Increasing 4Q10 Net Adds on Positive Channel Checks (Jan. 4, 2011)
Current Analysis, Company Assessment: T-Mobile USA (Jan. 18, 2011)
J.P. Morgan, North America Equity Research, U.S. Telecom Services & Towers (Jan. 13, 2011)
Morgan Stanley, Deutsche Telekom, US Options—No Easy Way Out (Jan. 10, 2011)
benton.org/node/67846 | Free Press
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A DEAL TOO BIG TO SELL?
[SOURCE: Politico, AUTHOR: Kim Hart]
Congress ultimately won't have a formal say in AT&T's proposed purchase of T-Mobile. That falls to the Department of Justice and the Federal Communications Commission, which are reviewing the deal’s potential impact on consumers and competitors. A few antitrust experts told reporters this week that they've conducted their own review, and they would urge regulators to block the deal. “We think it is anti-competitive on its face,” said Richard Brunell, director of legal advocacy at the American Antitrust Institute, a nonprofit think tank that promotes competition and often argues for more government intervention. Regulators are likely to be swayed by the deal’s impact on the competitive landscape. For the second year in a row, the FCC is expected to stop short of calling the wireless industry competitive in its annual report on the industry, according to people familiar with the report. The Mobile Wireless Competition report has not yet been publicly released, but it is expected to find that concentration has increased within the wireless industry. But the FCC also won't go so far as to call the industry uncompetitive, sources said. An FCC official said the “mobile marketplace is so incredibly diverse; an up-or-down determination on competition would be over-simplistic.”
benton.org/node/67863 | Politico
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HEARING PREVIEW
[SOURCE: The Hill, AUTHOR: Sara Jerome]
The CEOs of AT&T and Deutsche Telekom, the parent company of T-Mobile, will try to allay congressional concerns about their proposed merger at a House Judiciary hearing May 26. AT&T CEO Randall Stephenson will reiterate points he made before the Senate Judiciary Committee earlier this month:
:This transaction is about consumers. It's about keeping up with consumer demand. It's about having the capacity to drive innovation and competitive prices for consumers. And most important, it's about giving consumers what they expect — fewer dropped calls, faster speeds and access to state-of-the-art mobile broadband Internet service — whether they live in a large city, a small town, or out in rural areas."
Deutsche Telekom CEO Rene Obermann will cite competition from online voice services such as Skype and Google Voice. "T-Mobile has been caught in the middle of this dynamic marketplace and has had an increasingly difficult time competing," he notes. He will make it clear that DT is thinking more about Europe than the U.S., potentially a selling point for lawmakers who would like to see the No. 4 U.S. cell phone company move into American hands. Obermann says DT would have trouble investing in T-Mobile even if spectrum were available for purchase due to the company's needs in Europe. "Even if [spectrum were] available, such an acquisition would have forced Deutsche Telekom to reallocate funds from our core European operations into T-Mobile USA — which would have been very difficult for us given our overall group debt situation and our capital investment needs in Europe."
benton.org/node/67862 | Hill, The
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SIERRA CLUB BACKS AT&T DEAL
[SOURCE: National Journal, AUTHOR: Juliana Gruenwald]
While most of the usual stakeholders have weighed in on whether federal regulators should back AT&T's bid to buy rival T-Mobile USA, one unlikely player to give its two cents is the Sierra Club. The group sent a letter to Members of Congress "to express optimism about the potential expansion of broadband that the proposed merger of AT&T and T-Mobile provides," though it did not explicitly say if it supports approval of the deal. "Expansion of broadband technologies to rural America brings a vital 21st century infrastructure to all our communities and will conserve energy by eliminating carbon emissions related to travel and promote other efficiencies through smart grids and smart meters accessed through broadband," Sierra Club Executive Director Michael Brune wrote. "As regulators examine this transaction, they should consider these values in their deliberations."
benton.org/node/67860 | National Journal
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MORE ON SPECTRUM/WIRELESS
HOUSE VS SENATE IN PUBLIC SAFETY SPECTRUM DEBATE
[SOURCE: The Hill, AUTHOR: Sara Jerome]
Lawmakers are laying the groundwork for a showdown between the chambers on the question of how to build a communications network for police and firefighters to talk to one another, as was recommended by the 9/11 Commission Report in 2004. After months of politicking on the issue, it's clear that the battle won't be fought along party lines but rather in a standoff between the House and Senate. The top House Commerce Committee Democrat, Rep Henry Waxman (D-CA), revealed during a subcommittee hearing that he wants to team up with Republican committee members to create a House proposal. That means Democrats are just as divided on this issue as Republicans, who have been feuding over it for months.
Rep Waxman said in his opening statement: "Last month, I approached Chairman [Fred] Upton [R-MI] and Chairman [Greg] Walden [R-OR] and suggested that we emulate our Senate counterparts and work together on a bipartisan House bill that would provide for a nation-wide public safety network and make new spectrum available through incentive auctions. I hope they will take us up on this offer."
Rep Waxman was presumed to favor the auction of a valuable block of spectrum to commercial providers, rather than the reallocation of that block to public-safety agencies. He paired up with Republicans to draft a bill accomplishing that last year. But after saying little in public on the issue since his party assumed the minority, it was unclear whether Rep Waxman and a handful of other Commerce Committee Democrats would lend their support to a Senate proposal in order to help isolate the committee's Republicans, who favor a less expensive option.
benton.org/node/67311 | Hill, The | Broadcasting&Cable
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AIR WAR
[SOURCE: AdWeek, AUTHOR: Katy Bachman]
It is a battle that has it all: power, money, entrenched interests, and a fair share of snark. It’s the spectrum war, where two of the major sets of players in the media business -- the broadcasters and the telecoms -- are battling over how to divide a path to consumers that the TV guys have controlled for decades.
The broadcasters are the ones carrying the scars, having already been forced two years ago to surrender 25 percent of the airwaves they held, when the federal government’s long-planned, long-delayed conversion from analog to digital TV finally went through. In this fight they, and their representatives at the National Association of Broadcasters, have been cast as the old guard, desperately trying to ward off change despite the fact that, thanks to the spread of cable and satellite, only about 40 million out of their 300 million-strong American audience comes to them exclusively via the airwaves these days.
benton.org/node/67306 | AdWeek
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CLEARWIRE SPECTRUM SALE?
[SOURCE: Bloomberg, AUTHOR: Amy Thomson]
A Clearwire investor asked interim Chief Executive Officer John Stanton to reexamine a sale of spectrum holdings to help boost the stock price and the wireless service provider’s value to an acquirer. A sale of the rights to wireless frequencies that carry voice and data signals will help establish a higher value for Clearwire’s assets and free up cash, New York-based Pardus Capital Management said in a letter to Stanton and the board. This month, Stanton ruled out selling the spectrum in 2011 after considering offers. Pardus said Sprint Nextel, which owns more than half of Clearwire, may be preventing sale of the spectrum to hold down the company’s stock price and make a buyout easier later.
“Clearwire manages its business in the best interests of all of the company’s shareholders,” Mike DiGioia, a spokesman for Clearwire, said. “We have received Pardus’ inquiry, however, it is against our policy for us to discuss shareholder interactions publicly.”
benton.org/node/67308 | Bloomberg
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TELEVISION
NBC AFFILIATES DEAL
[SOURCE: Los Angeles Times, AUTHOR: Joe Flint]
NBC appears to have reached a peace accord on the retransmission issue with its local television station partners. The network and its affiliates are positioning this as a win for them and consumers. Though the two sides have not said what the split of so-called retransmission consent fees would be, the idea is that the stations have a better chance of getting more money from distributors if they team up and have NBC fronting for them than if they go it alone. But NBC’s plans may hit a bump in the road in the form of the Federal Communications Commission.
Earlier this year, after getting heat from Congress following several high-profile disputes between cable operators and programmers that led to or nearly led to service disruptions, the FCC launched a proceeding to review its retransmission consent rules to determine whether there were some actions it could take that would limit disruptions to consumers and make for smoother negotiations between programmers and distributors. One of the aspects the FCC said it wanted to look at was the role a network played in the negotiation efforts of its affiliate. Specifically, the FCC said it wanted comments on “whether it would be a per se violation for a station to agree to give a network with which it is affiliated the right to approve a retransmission consent agreement with an MVPD (Multichannel Video Programming Distributor) or to comply with such an approval position.” Although NBC’s deal with its affiliates is not specifically what the FCC is seeking comment on, it is virtually the same thing. By turning over negotiating rights to NBC, the affiliates are basically letting the networks sign off on the contracts. Cable operators are likely to make noise at the FCC about NBC’s efforts. Distributors would rather negotiate with one station in one town than a network representing multiple stations.
benton.org/node/67844 | Los Angeles Times
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DINGELL WANTS FCC TO WRAP-UP RETRANSMISSION REVIEW
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Reps. John Dingell (D-MI) and Jo Ann Emerson (R-MO) have called on the Federal Communications Commission to complete its retransmission consent review by the end of the year, which would be before the next round of Dec. 31 contract expirations. Rep Dingell did not weigh in on the substance of the issue beyond saying that the FCC's recognition of its limited authority suggested it could get the item moved by the end of the year deadline, though he did say that "reasonable action by the commission" would "provide greater certainty in the video marketplace and ultimately benefit the American consumer."
Rep Emerson went beyond the date issue to hit on points raised by American Television Alliance (cable operators, satellite operators and others), which petitioned the FCC to open the retransmission review. She said she had heard from some of her state's smaller pay-TV providers about the possibility of increased signal losses due to impasses and consumer disaffection and dislocation. Rep Emerson was all for new rules of the road for retrans. "With more than a thousand carriage deals set to expire by the end of this year," she said, "it is essential that the commission have new rules in place to help avoid the types of carriage disruptions for consumers that we've seen increasingly occur."
benton.org/node/67842 | Broadcasting&Cable
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RETRANSMISSION REVENUE TO TOP $3.6 BILLION
[SOURCE: TVNewsCheck, AUTHOR: ]
Although broadcast television station owners' share of retransmission dollars is under siege, SNL Kagan expects that total national retrans revenues will continue to rise thanks to the steady upward pressure on the monthly fees paid by multichannel operators to TV stations. That is despite an outlook for slower potential future growth of multichannel subs due to such things as over-the-top substitution. SNL Kagan’s study projects that total industry retrans fees could increase from $1.14 billion in 2010 to $3.61 billion by 2017, with average per-sub fees for cable MSOs potentially more than doubling over time from their 2010 levels through 2017.
benton.org/node/67310 | TVNewsCheck
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AUSTRALIAN PAY-TV DEAL
[SOURCE: Financial Times, AUTHOR: Peter Smith]
Austar United Communications, the Australian pay-television group majority owned by US billionaire John Malone’s Liberty Global, said an indicative A$1.9bn (US$2bn) takeover bid from rival Foxtel had been pitched at an “appropriate” value. The May 26 offer from Foxtel, half-owned by Australian telecoms group Telstra with 25 per cent stakes held by Rupert Murdoch’s News Corp and James Packer’s Consolidated Media, potentially ends close to a decade of failed negotiations between the media investors on merging Australia’s two biggest pay-TV groups. A successful deal would combine Austar’s regional network with Foxtel’s metropolitan operations and generate cost savings of close to A$70m a year, analysts said. It comes after a delegation from Foxtel, led by chief executive Kim Williams, flew to Denver earlier this year to discuss a potential deal. The A$1.52 a share cash offer was pitched at a 20 per cent premium to Austar’s Wednesday close of A$1.265. The shares were up at A$1.37 by lunch time in Sydney. The deal will face scrutiny by Australia’s competition regulator although analysts said the country’s relatively low pay-TV penetration rates, a strong terrestrial TV sector and the rise of Internet-based entertainment would encourage the authorities to clear the transaction.
benton.org/node/67854 | Financial Times
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ELECTIONS & MEDIA
MONEY AND NEGATIVE ADS
[SOURCE: AdAge, AUTHOR: Ken Wheaton]
A study published in the May-June issue of Marketing Science has found that big budgets and media saturation are among two key contributing factors to negative campaign advertising. In "The Seeds of Negativity: Knowledge and Money," co-authors Mitchell Lovett, an assistant professor of marketing at the Simon Graduate School of Business at the University of Rochester, and Ron Shachar, professor at the Arison School of Business, Israel, and a visiting professor at Duke University's Fuqua School of Business, followed U.S. House of Representative races in 2000, 2002 and 2004 and found that "negativity indeed increases in both voters' knowledge and the candidate's budget." Or, in the non-academic English used in the press release, "if voters know little about each candidate, the advertisements will generally focus on a candidate's positive attributes. But a candidate with deep pockets or media saturation is much more likely to turn to attack ads." Early in the election, a candidate will introduce himself and let voters get to know him. In a non-competitive race, as in Eliot Spitzer's race for governor of New York in 2006, the candidate can continue to take this approach. But, as is more often the case, once the race becomes competitive and voters achieve a baseline knowledge of all candidates -- thanks to previous advertising or to media coverage -- something must be done to cut through the clutter. So the fur begins to fly.
benton.org/node/67296 | AdAge
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SARAH PALIN -- THE MOVIE
[SOURCE: Real Clear Politics, AUTHOR: Scott Conroy]
Shortly after Republicans swept last November to a historic victory in which Sarah Palin was credited with playing a central role, the former Alaska governor pulled aside her close aide, Rebecca Mansour, to discuss a hush-hush assignment: Reach out to conservative filmmaker Stephen K. Bannon with a request. Ask him if he would make a series of videos extolling Palin's governorship and laying to rest lingering questions about her controversial decision to resign from office with a year-and-a-half left in her first term. It was this abdication, Palin knew, that had made her damaged goods in the eyes of some Republicans who once were eager to get behind her potential 2012 presidential campaign. The response was more positive than Palin could have hoped for. He'd make a feature-length movie, Bannon told Mansour, and he insisted upon taking complete control and financing it himself -- to the tune of $1 million.
The fruits of that initial conversation are now complete. The result is a two-hour-long, sweeping epic, a rough cut of which Bannon screened privately for Sarah and Todd Palin last Wednesday in Arizona, where Alaska's most famous couple has been rumored to have purchased a new home. When it premieres in Iowa next month, the film is poised to serve as a galvanizing prelude to Palin's prospective presidential campaign -- an unconventional reintroduction to the nation that she and her political team have spent months eagerly anticipating, even as Beltway Republicans have largely concluded that she won't run.
benton.org/node/67273 | Real Clear Politics
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CONTENT
PROTECT IP ACT MARK-UP
[SOURCE: AdWeek, AUTHOR: Katy Bachman]
The PROTECT IP Act, a bill aimed at cracking down on rogue sites that steal content or sell counterfeit goods, is on the fast track. Introduced by Sen. Patrick Leahy (D-VT) just two weeks ago, the bill will go before the Senate Judiciary Committee, which he chairs. It's likely to sail through the committee, especially because 12 of the committee's 18 members are co-sponsors. The content community—TV programmers, the movie and music industries, book publishers, and entertainment unions—has been pushing for legislation for years. A version of this bill legislation passed the committee 19-0 last year, only to be stopped by Sen. Ron Wyden (D-OR), who put a hold on it. Google Executive Chairman Eric Schmidt has come out strongly against the bill. A group of 13 public interest organizations, including the Electronic Frontier Foundation, Public Knowledge, and the Center for Democracy and Technology, chimed in with a letter sent Wednesday to Leahy and ranking member Sen. Chuck Grassley, R-Iowa. Acknowledging the Protect IP Act as an improvement over last year's version, the groups said they are still concerned about provisions that would allow Internet service providers to interfere with domain name look up services as well as what they consider overly broad requirements for search engines and hyperlinks.
benton.org/node/67841 | AdWeek | Broadcasting&Cable
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INTERNET/BROADBAND
NETWORK NEUTRALITY RULES
[SOURCE: Politico, AUTHOR: Eliza Krigman]
Opponents itching to upend the Federal Communications Commission’s controversial network neutrality rules can forget about doing so anytime soon. The FCC adopted the controversial net neutrality order five months ago — and it may be another five months before the rules are published in the Federal Register. The delay, say FCC officials, has to do with the sheer complexity of implementing the order. But until the rules are officially published, Congress can't pass legislation to overturn the regulations, and opponents can't challenge the rules in court. The unusually long turnaround — typically FCC rules are published in the Federal Register within a few months — is fueling speculation about what’s taking so long. The net neutrality rules require carriers to reveal very specific data about broadband performance — disclosure that will involve extensive and time-consuming filings with the FCC. Moreover, details of what broadband providers will have to disclose aren't entirely clear. The back-and-forth between FCC officials and broadband carriers to clear up the paperwork requirements could keep the rules from final publication until sometime this fall. “The FCC is trying to cut a deal with the carriers on what would make for effective transparency disclosures,” an industry observer said.
benton.org/node/67865 | Politico
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FCC BROADBAND REPORT
[SOURCE: , AUTHOR: Gary Kim]
The latest Federal Communications Commission report on global broadband suggests the United States ranks about ninth for mobile broadband adoption among Organization for Economic Co-operation and Development member countries and 12th for fixed (DSL or cable) broadband on a per-household basis. In March 2010, economists at the Phoenix Center said “historical trends suggest the United States will likely move to 13th in broadband adoption by 2012 even without significant policy changes.” The latest FCC (News - Alert) report shows that was an accurate forecast. But nobody should expect the United States to rank much better than where it is, for historical reasons. The United States ranks no better than 15th in global measures of telephone density. But nobody really suggests the United States has a fixed-line voice availability problem. In fact, most observers say demand for that product is declining. So where does the United States currently rank on per-capita measures of broadband penetration in early 2010? 15th, as it turns out; precisely where it has long ranked in terms of fixed-line voice line penetration. But assessing broadband availability is more complicated than it used to be, in large measure because of mobile broadband, an area where the United States is forecast to lead, at least in terms of fourth generation Long Term Evolution deployments.
benton.org/node/67280 |
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CYBERSECURITY
COOPERATION IN CYBERSPACE
[SOURCE: The White House]
President Barack Obama and Prime Minister David Cameron reaffirmed their close bilateral cooperation, and charted important new steps forward, on an area of increasing attention: cyberspace issues, particularly cybersecurity.
A shared vision for cyberspace’s future. Leaders noted that networked technology now provides one of the essential foundations for opportunities and growth within any modern prosperous global economy, and outlined their shared vision for cyberspace which places at its heart fundamental freedoms of speech and association, individual privacy, and the free flow of information.
Building consensus on responsible behavior. Both recognized that the same kinds of “rules of the road” that help maintain peace, security, and respect for individual rights internationally must equally apply in cyberspace. Leaders’ highlighted their commitment to building consensus on the basic principles, and participating in the London International Cyber Conference in November 2011.
Protecting our citizens and building the rule of law. Through its deposit of instruments of accession in Strasbourg today, the United Kingdom has now joined the U.S. and 30 other states as parties to the Budapest Convention on Cybercrime, the world’s foremost treaty to combat cybercrime internationally. The Convention sets standards for national laws in dealing with online fraud and abuse, but even more importantly permits effective cooperation between nations — a crucial tool since so many cybercrimes cross national boundaries. Noting this landmark achievement, leaders’ agreed to continue work to expand the reach of this important treaty.
Partnering with industry to win the future. In recent months, President Obama and Prime Minister Cameron each hosted milestone discussions with leaders from their respective technology industries. These innovators help spur the investment and long-term job growth on which economies depend; noting their contribution, Prime Minister Cameron and President Obama will continue to find ways to join with industry to maintain national competitiveness.
Expanding the reach of networked technologies. The U.S. and UK are committed to partnering to help more countries benefit from information and communications technologies. Leaders’ will direct new and regular government-wide consultations, sharing strategies and plans to more effectively deploy resources in building technological capacity in the developing world.
Sharing a responsibility for cybersecurity. Leaders’ concluded by noting the relationship on cybersecurity issues remains deeper than ever; that both nations benefit from a shared awareness of threats to national networks, share measures to better defend them. To maintain that leadership and better confront tomorrow’s threats, the President and Prime Minister noted new trans-Atlantic initiatives to provide joint funding and review of cybersecurity research and development (R&D) projects.
benton.org/node/67285 | White House, The
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HOUSE CYBERSECURITY HEARING
[SOURCE: National Journal, AUTHOR: Josh Smith]
Federal cybersecurity officials got a cold reception from House lawmakers on both sides of the aisle who questioned whether White House cyber proposals could result in abuse and government intrusion. Officials from the Justice, Homeland Security, and Commerce departments who testified before the House Judiciary Subcommittee on Intellectual Property, Competition, and the Internet faced pointed questions about the White House Cyberspace Policy Review unveiled last week. Lawmakers on the panel worried that the Administration's plan provides too much government control in cybersecurity issues. The proposal would grant legal immunity to companies that cooperate with federal cyber investigations. That, the subcommittee's ranking member, Melvin Watt (D-NC), said, sounds a lot like the controversial retroactive immunity given to telecom companies that helped in the government's warrantless wiretapping program after the 9/11 terrorist attacks. "These companies could then do something that's unconstitutional just because you say it's not," he said. "People get very uncomfortable with the idea that the government can just call up someone, demand information, and then provide them immunity."
benton.org/node/67839 | National Journal | The Hill
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PRIVACY
FRANKEN SEEKS MOBILE PRIVACY
[SOURCE: Politico, AUTHOR: Tony Romm]
Sen. Al Franken (D-MN) is pressing Apple and Google to require all apps made for iPhones, Androids and other devices to have privacy policies that detail when those games and other tools track a user’s location and why. Sen Franken expressed concern that neither tech company has such a rule in place, even though they maintain the largest clearinghouses of smartphone apps, according to a letter Sen Franken sent to both companies’ CEOs. “Requiring that each app in your stores have a clear, understandable privacy policy would not resolve most of the privacy concerns in the mobile market,” wrote Sen Franken, chairman of the Senate Judiciary Committee’s new privacy panel. “But it would be a simple first step that would provide users, privacy advocates and federal consumer protection authorities a minimum of information about what information an app will access and how that app will share that information with third parties,” he added.
benton.org/node/67837 | Politico | The Hill
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GOVERNMENT & COMMUNICATIONS
INTERNET ACTIVISTS AT E-G8
[SOURCE: Associated Press, AUTHOR: ]
Internet activists and digital entrepreneurs warned that if global leaders attempt to limit access to the Web, their restrictions will be bypassed and they will become irrelevant. The stark message adds to growing resistance — from big name companies like Google and Twitter to anonymous Internet vigilantes who have attacked government censorship networks — against creeping laws that might one day restrict services many users now take for granted. The leaders of the Group of Eight most powerful countries begin meeting in France on Thursday to discuss issues of global concern in the wake of the Arab uprising that have been described as the first Internet-enabled revolutions. “G-8 governments should say very clearly for once that Internet access is a fundamental human right,” said Jean-Francois Julliard, who heads free speech group Reporters without Borders. Julliard said more than 60 countries now have some form of Internet censorship in place, and that number is growing. Tony Wang, Twitter’s general manager for Europe, said attempts to crack down on free expression are self-defeating.
benton.org/node/67300 | Associated Press
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G8 AND THE INTERNET
[SOURCE: The Christian Science Monitor, AUTHOR: James Roberts]
[Commentary] President Obama will join other G8 leaders today at the posh, French seaside resort of Deauville. On the agenda: proposed global regulations for the Internet, post-tsunami Japan, and military escapades in North Africa. Bizarrely absent from the top priorities listed by hosting head of state Nicolas Sarkozy is the most urgent issue of all: the need to rein in massive government over-spending and debt. Certainly, improving information infrastructure, technology, and access is integral to the development of modern economies. But letting governments control or even censor information is counterproductive. Unfortunately, Sarkozy’s G8 proposal toes the statist line. He wants governments to intervene in cyberspace markets with intrusive regulation and taxes that could limit consumer choices and seriously distort both pricing and investment decisions. A micromanaging G8 also could threaten press freedom. New media Internet outlets can be invaluable in exposing political corruption and guarding against bribery, extortion, nepotism, cronyism, patronage, embezzlement, and graft. Yet disturbing acts of censorship, attacks on press freedom, and denials of Internet service are on the rise. The World Bank reports that bloggers in Burma, Iran, Syria, Cuba, Saudi Arabia, Vietnam, Tunisia, China, Turkmenistan, and Egypt are harassed and sometimes imprisoned. Scarcity of information resources and government censorship of the Internet work against people in developing nations who thirst for economic freedom, growth, and prosperity. But even that’s too big a problem for today’s G8 to address.
benton.org/node/67868 | Christian Science Monitor, The
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FIGHTING WEB PIRATES
[SOURCE: Financial Times, AUTHOR: John Gapper]
[Commentary] It was probably inevitable that when Nicolas Sarkozy invited the leaders of the world’s biggest technology companies and high representatives of Silicon Valley to Paris to mull over the future of the Internet, a culture war would break out. At one extreme was the French president, who has backed one of the strictest anti-piracy enforcement laws of any country. At the other end were activists and open source advocates such as John Perry Barlow of the Electronic Frontier Foundation and Yochai Benkler, a Harvard law professor, warning governments to back off. The Internet was not broken now, they said, but efforts to protect publishers, film and music companies could break it. The truth, inevitably, lies in the middle but the president is right about one thing. It is jejune to treat copyright enforcement as a breach of human rights, ethically equivalent to cracking down on free speech in China or the Middle East. Governments need to tread lightly to avoid damaging innovation but the Internet cannot become a safe harbor for illegality.
benton.org/node/67866 | Financial Times
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SHOPPING
TAXING DIGITAL GOODS AND SERVICES
[SOURCE: ars technica, AUTHOR: Matthew Lasar]
Here's an interesting conundrum, posed by Rep Dennis Ross (R-FL), at a House Judiciary subcommittee hearing:
"Imagine you are sitting in Dulles airport in Virginia, waiting for a flight back to Florida," Ross began in his opening remarks. "You download a music file from Apple, which is headquartered in California. The music is sent to you via a server in Oklahoma."
Which of these states should be allowed to tax the sale? Without a "clear national rule," he warned at the hearing, "all four states may attempt to tax the transaction."
And so Congress is considering one such national standard: HR 1860, the Digital Goods and Services Tax Fairness Act of 2011. Rep Lamar Smith (R-TX) submitted the bill to the Judiciary committee two weeks ago. A similar law sponsored by Ron Wyden (D-OR) awaits consideration in the Senate.
The crux of the legislation centers around this sentence: "No State or local jurisdiction shall impose multiple or discriminatory taxes on or with respect to the sale or use of digital goods or digital services." The bill defines a "discriminatory tax" as a tax imposed by a State or local jurisdiction at a higher rate than "is generally imposed on or with respect to the sale or use of tangible personal property or of similar services that are not provided electronically." A "multiple tax" is defined as one in which that State or locality "gives no credit with respect to a tax that was previously paid on or with respect to the sale or use of such digital good or digital service to another State or local jurisdiction." Then come more specific limits on taxation. Any tax on the sale of digital goods and services can only be imposed on the State and its localities "whose territorial limits encompass the customer's tax address." This is understood as the address that the customer offered and which the seller received in good faith.
benton.org/node/67290 | Ars Technica
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REGULATION
21ST CENTURY REGULATION
[SOURCE: Wall Street Journal, AUTHOR: Cass Sunstein]
[Commentary] A 21st-century regulatory system must promote economic growth, innovation and job creation while also protecting public health and welfare. Earlier this year, President Obama outlined his plan to create such a system by adopting a simpler, smarter and more cost-effective approach to regulation. As a key part of that plan, he called for an unprecedented government-wide review of regulations already on the books so that we can improve or remove those that are out-of-date, unnecessary, excessively burdensome or in conflict with other rules. Over the past four months, government agencies and departments have combed through their rules, listened carefully to the public, and developed plans to identify what works and what doesn't. The results of this review are in. Today, 30 agencies are laying out regulatory reforms that will save private-sector dollars and unlock economic growth by eliminating unjustified regulations, including what the president has called "absurd and unnecessary paperwork requirements that waste time and money." We are taking immediate steps to save individuals, businesses, and state and local governments hundreds of millions of dollars every year in regulatory burdens. The reforms have the potential to save billions of dollars more over time while maintaining critical health and safety protections for the American people. The reform plans being released today are a defining moment in that effort. They will not only yield significant savings for individuals and businesses, but they will also help us strike the right balance, protecting the public from serious harms even as we eliminate rules that just don't make sense. [Sunstein is administrator of the Office of Information and Regulatory Affairs, which is part of the White House's Office of Management and Budget.]
benton.org/node/67870 | Wall Street Journal | Financial Times
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