September 2011

Disney Rejects Sports-Tier TV Fees

Though there continues to be soaring prices for sports television programming, a senior Walt Disney executive doesn't believe extra sports-tier fees for TV consumers will work. "We don't see a fundamental shift to tiering being a good thing," says Jay Rasulo, senior executive vice president and CFO of The Walt Disney Company, speaking at the Goldman Sachs Goldman Sachs Communacopia event. "We don't think it's good for consumers. Subsequently, we are strongly in support the current framework and eco-system."

Cuts to E-Gov fund could slow federal cloud transition

Current funding levels for electronic government initiatives in the House and Senate Appropriations committees could cripple the government's ability to modernize federal information technology and thereby save money in the long run, a General Services Administration official told lawmakers. That includes new security and certification projects aimed at helping agencies transition their data storage to more nimble cloud computing, a governmentwide initiative that officials expect to save $5 billion annually, GSA Associate Administrator Dave McClure said.

Problems with rural phone calls prompt FCC probe request

Rural telecommunications associations nationwide have reported to federal officials that complaints about call completion problems rose more than 2,000 percent from March 2010 to April 2011.

After receiving an increasing number of telephone "call termination" complaints in recent months, the Oklahoma Corporation Commission joined public officials in other states in requesting an investigation by the Federal Communications Commission. The commission sent a letter to the FCC supporting a National Association of Regulatory Utility Commissioners resolution in July to investigate the call termination issue and pursue a solution. The commission letter to the FCC was signed by Chairwoman Dana Murphy, Vice Chairman Jeff Cloud and Commissioner Bob Anthony.

Shocks to the Broadband Ecosystem: Implications for Competition and Market Structure

An evaluation of the consequences to broadband service providers ("BSPs") from the tremendous innovation in Internet applications and devices.

Our findings reveal that as consumers continue to flock to network-agnostic devices and over-the-top services, they are less wedded to any particular broadband service provider. The problem appears particularly acute for mobile wireless networks where much of the innovation is directed. As a result of this "commoditization" of broadband services, network operators are likely to intensify price competition with each other to the benefit of consumers. However, given the high fixed and sunk costs required to build and operate broadband networks, increasing the intensity of price competition could also result in lower profit margins, thus potentially shrinking the equilibrium number of firms that could profitably serve the market. This possible result is of interest for policymakers because it could mean that in an inter-related broadband ecosystem, prices fall even as markets become more concentrated. These complex responses also suggest that if the ecosystem analogy is appropriate for the broadband marketplace, then public policy must contemplate the full and wide-ranging effects of structural changes across the entire ecosystem, particularly if such changes are driven, in part or whole, by regulatory intervention. A disturbance to one part of an ecosystem, whether of natural or of contrived origins, inevitably flows to other parts of the system and may, in some cases, threaten the overall health and sustainability of the broadband sector. Understanding, and perhaps quantifying, the flow of costs and benefits across the ecosystem is essential to sound policymaking.

AT&T, T-Mobile vs. DOJ: Top 5 things to watch

Here are the top five things to watch at the AT&T/T-Mobile-Department of Justice hearing Sept 21:

Timeline: The Justice Department wants the trial to take place in March, saying it needs time for discovery. AT&T and T-Mobile want a faster process and have asked for a Jan. 16, 2012 trial date. Keep in mind that AT&T will have to pay T-Mobile an estimated $6 billion penalty if it can't close the deal.
Leaning: All in the courtroom will be watching Judge Ellen Huvelle like they do Fed chief Ben Bernanke, reading every word for nuances in her opinions of the proposed $39 billion merger.
Plaintiffs: What will the additions of seven state attorney generals, Sprint Nextel and Cellular South in opposition to the merger mean? Will Judge Huvelle allow more of those parties to participate and join the Justice Department’s lawsuit? In that case, experts say, it will be harder to reach a settlement and will give the Justice Department greater resources.
Party watching: Will the Justice Department or AT&T/T-Mobile say anything that grabs Judge Huvelle’s attention — in a good or bad way? All sides will put their best foot forward and early impressions mean a lot, experts say. For inside Beltway intrigue, observers will watch closely for who attends. Will AT&T’s Washington head of lobbying and government affairs Jim Cicconi appear to back up general counsel Wayne Watts?
Settlement: Judge Huvelle has asked the parties to update her on the status of a settlement. So far the companies and the Justice Department have been silent about any potential talks. Here we will see how far they've come — or if talks have started at all — on reaching a compromise. The parties may ask for that discussion to be private and in her chambers.

Verizon Chief McAdam Says AT&T’s Bid for T-Mobile USA ‘Had to Occur’

Verizon Communications Chief Executive Officer Lowell McAdam said AT&T’s proposed acquisition of T-Mobile USA “had to occur” as mobile-phone carriers use more wireless spectrum.

“The AT&T merger with T-Mobile is kind of like gravity, it had to occur,” McAdam said. If the government wants to stop the takeover, it needs to have a plan to distribute spectrum and ease the crunch some carriers are facing, he said. “We’re going to watch that very closely.” “If you look at the path that wireless is on, clearly we need to have more spectrum in the marketplace,” McAdam said. McAdam also said Verizon Wireless, the mobile-phone carrier it co-owns with Vodafone Group, will pay dividends if it doesn't need its cash for other purposes, such as spectrum purchases. “When it makes sense, we'll have a dividend,” McAdam said. “When there’s a better first use for those dollars, we'll do that. The key is, for us, that Verizon gets to make that decision.”

Rep Eshoo urges NTIA to find solution for LightSquared's interference issues

Rep. Anna Eshoo (D-CA) wrote to Larry Strickling, the head of the National Telecommunications and Information Administration, to urge his agency to find a solution that will allow wireless startup LightSquared to co-exist with Global Positioning System (GPS) devices.

LightSquared plans to offer wholesale wireless broadband service, but tests have revealed that its land-based cell towers interfere with GPS devices, including those used by the military. The Federal Communications Commission ordered LightSquared to undergo another round of testing to resolve the GPS issues. NTIA is the agency that will lead the testing.

"LightSquared's proposal to build a nationwide terrestrial-based wireless broadband network, offers exciting job opportunities for our nation," she wrote. "It is well worth the effort to work on interference issues to the nearby GPS band. I have the utmost confidence that a solution can be obtained by both parties that will mitigate any harmful interference." She said LightSquared will achieve President Obama's goal of bringing high-speed wireless service to 98 percent of Americans.

Google Ad Rate for Microsoft Said to Be Investigated by US

Apparently, the Federal Trade Commission is investigating whether Google illegally increased advertising rates 50-fold for rival Microsoft.

The FTC is probing the increase, along with other allegations against Google related to advertising, as a result of complaints from Microsoft, according to the person, who wasn't authorized to publicly comment. The complaints are being examined as part of a larger antitrust probe into Google that began earlier this year. If true, the Microsoft allegations could be used to help the FTC build a case showing that Google abused its power as the owner of the world’s most popular search engine, violating the Sherman Act and other antitrust laws, said Andre Barlow, an antitrust lawyer at Doyle, Barlow & Mazard.

Social media, multi-tasking and the death of the billable hour

[Commentary] Thanks to the web and social media, interruptions have become not just a way of life, but a way to work according to survey data out from Cisco.

The networking giant found that among college students and young professionals, 24 percent experience three to five interruptions in a given hour, while 84 percent get interrupted at least once while trying to complete a project. What’s stunning about this isn't that college students and young professionals (defined by Cisco as folks in their first job out of college) are being interrupted, it’s Dave Evans’ assessment that these interruptions are now part of the way of corporate life. Evans, who is Cisco’s chief futurist, conveniently points to more survey data showing that seven out of 10 respondents friend managers and coworkers on Facebook as well as follow them on Twitter. Evans says that they work there. Given that young people are conducting work online via social media sites, and that they are both multi-tasking and being interrupted, I wonder if we need to rethink the billable hour?

Amazon Kindle Users Finally Can Check Out (Some) Library E-Books

Roughly five months since Amazon promised library lending that would work for Kindle, the service is live at more than 11,000 U.S. libraries covering “millions” of Kindle and Kindle app customers.

The launch follows reports of beta testing in two Seattle libraries and finally puts Kindle in the league of Sony and other e-readers that allow temporary access to DRM-protected e-books. The new service is powered by OverDrive. Amazon has prepped a support area to explain it but here’s the gist: Kindle owners, Cloud Reader, and app users should be able to log into their participating library’s web site, select a book available for Kindle, and after logging into their Amazon account, send the book to the appropriate device.

Benton

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