July 2011

Sen Reid Budget Proposal Includes Spectrum Auctions

Senate Majority Leader Harry Reid (D-NV) is proposing a $2.7 million package of cuts and revenue-raisers that included spectrum auctions, according to a summary of the proposal.

According to Reid's office, the plan anticipates $15 billion in "spectrum sales." Part of the proceeds from an incentive auction to reclaim broadcast spectrum for wireless broadband will go toward deficit reduction according to various bills now in Congress. The Senate bill, S 911, was scored by the Congressional Budget Office (CBO) as providing $6.5 billion for deficit reduction. The possibility or either appending one of the current spectrum auction bills to the financial package or writing in new language has been on the table for several weeks and was raised in a slide presentation last month by Republican House Majority Leader Eric Cantor (R-VA), one of the lead Republicans on the debt negotiations, although he had a figure of $20 billion-$25 billion.

Cell phone market bigger than we thought

The researchers at Deutsche Bank are throwing out old estimates of the worldwide mobile phone market because they say we’re still underestimating its size. The reason? They’re still trying to grasp how many cell phones are made and sold in China.

As a result, Deutsche Bank is increasing its 2011 forecast of the worldwide market to 1.68 billion phones, up from 1.57 billion earlier this year. The problem with counting the phones sold in China is that a sizable chunk of them are “Shanzhai” phones, or knock-off phones that are cheap to make and popular in China and in neighboring emerging markets. The manufacturers of these handsets don't have official licenses to build phones from the Chinese government and typically do not sell them through what we might think of as traditional retail channels.

FCC: No Contact With Gips About LightSquared

Federal Communications Commission Chairman Julius Genachowski had no contact with South African Ambassador Don Gips during the Commission's vetting of LightSquared, the company trying to launch a hybrid satellite/terrestrial wireless broadband service. Sen. Charles Grassley (R-Iowa) was seeking info on Gips' sale of stock in the company following the FCC's approval of the sale of the company back in 2009, then called Sky Terra, to a private equity firm Harbinger Capital Management, which is headed by Philip Falcone.

New York City LPTV Goes for $5.3 Million

Prime Time Partners has purchased WMBQ-CA New York from Renard Broadcasting Corp. for $5,250,000, pending Federal Communications Commission approval. The buyer is headed by Jose A. Rodriguez. Seller is owned by Craig Fox, of Syracuse (NY).

Gawker Will Go to Court in Fox Investigation

Gawker is going to court to investigate the relationship between the Fox News chairman, Roger Ailes, and Gov Chris Christie (R-NJ).

The company and one of its reporters, John Cook, plan to file a civil suit against Christie’s office to try to obtain records of the communications between the two men. Cook, who regularly uses freedom of information and open public records acts to ferret out information for his Gawker articles, said the court action represents the first lawsuit filed by Gawker to obtain information. The lawsuit has its origins in a New York magazine story in May which reported that Ailes had called Gov Christie and “encouraged him to jump into the race” for president earlier this year. The report piqued the attention of people like Cook who believe that Ailes, a former Republican strategist who has run Fox News since its founding in 1996, still has a hand in politics. Gov Christie has repeatedly ruled out running for president in the current election cycle. In an interview with The Daily Beast weeks later, Ailes denied urging Mr. Christie to run, but acknowledged having dinner with him last summer.

Group says AT&T/T-Mobile merger bad for mobile app makers

Allowing AT&T to purchase T-Mobile would give two firms too much control over the market for mobile software applications and services, according to the Computer and Communications Industry Association.

CCIA President Edward Black said that the deal would hurt the entire Internet ecosystem by giving AT&T the ability to block innovation in the wireless marketplace. Aside from app makers, Black said the merger would also negatively affect handset makers, who would have fewer potential buyers for their wares. However, unlike app developers, which are often small firms, he said handset makers are large and have shown leverage against carriers in the past.

Nexstar Files Antitrust Suit Against Granite

Nexstar Broadcasting Group today filed a federal civil antitrust lawsuit in the Northern District of Indiana against Granite Broadcasting, alleging that Granite is monopolizing local TV sales in Fort Wayne (IN).

According to Nexstar, Granite will control the local ad sales in the market for stations affiliated with Fox, NBC, ABC, CW and MNT. The suit is an apparent reaction to Granite's WISE picking up the Fox affiliation in Fort Wayne after Nexstar was unable to come to terms with Fox on renewing the affiliation for its WFFT. WISE is named in the suit. WISE is an NBC affiliate that now carries MNT on a subchannel. Starting Aug. 1, it plans to split the time on the subchannel between MNT and Fox. Under an arrangement with Malara Broadcasting, WISE also operates ABC affiliate WPTA, which carries the CW on a subchannel. Nexstar’s lawsuit asserts that Granite’s actions violate Section 1 and 2 of the Sherman Act, Section 7 of the Clayton Act, and Indiana antitrust law.

Eight small telcos ink deals to evaluate new broadband wireless technology

Eight small telcos aren't waiting around to find out whether the Federal Communications Commission moves ahead with its plans to use a 4 Mb/s target for the proposed broadband Universal Service program -- a move that would likely favor broadband wireless deployments, at least in areas that cannot get broadband today. Instead, the eight telcos have signed agreements to evaluate the roll out of mobile broadband technology from xG Technology that operates in unlicensed spectrum bands.

xG Technology is pioneering what the company calls “cognitive” wireless technology that can sense interference from other devices using the same spectrum and hop away from those frequencies, said Chris Whiteley, vice president of business development for xG Technology. Initially the company is targeting spectrum between 902 and 928 MHz -- a band used in the U.S. for garage door openers, baby monitors, cordless phones and some video surveillance. But a new version of the xG chip scheduled for availability in September will also support communications in 100 MHz of unlicensed spectrum in the 5.8 GHz range and will be able to shift between the two spectrum bands within 30 milliseconds.

US-CERT Director Leaves Abruptly

The director of the agency that protects the federal government from cyber attacks has resigned abruptly in the wake of a spate of hacks against government networks.

U.S. Computer Emergency Readiness Team (US-CERT) director Randy Vickers resigned his position July 22, effective immediately, according to an e-mail to US-CERT staff sent by Bobbie Stempfley, acting assistant secretary for cybersecurity and communications. Vickers served as director of US-CERT since April 2009; previously, he was deputy director. Current US-CERT deputy director Lee Rock will serve as interim director until the DHS names a successor for Vickers.

Netflix addresses customers 'upset' with price hike

Netflix passed 25.5 million subs, including 24.6 million in the U.S. and 970,000 in Canada, producing a $68 million profit on $789 million in revenue -- but that wasn't enough to meet revenue expectations. Customers reacted angrily when Netflix announced earlier this month that it's hiking prices on plans that include DVDs and streaming, in a move that highlights the company's shift from physical discs to online video. "It is expected and unfortunate that our DVD subscribers who also use streaming don't like our price change, which can be as much as a 60% increase," Netflix said.

Benton

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