September 2011

Investor sues Motorola Mobility, Google over $12.5-billion deal

A Motorola Mobility shareholder has reportedly filed a lawsuit against the company and Sanjay Jha, its CEO, alleging that the smartphone and tablet maker undervalued the firm when agreeing to sell it to Google for $12.5 billion.

That purchase price is a 63% premium over Motorola Mobility shares' closing price and also the largest amount that Google has ever agreed to pay in an acquisition. "The offered consideration does not compensate shareholders for the company's intrinsic value and stand-alone alternatives going forward, nor does it compensate shareholders for the company's value as a strategic asset for Google,” the suit states.

(Aug 18)

Internet theft is a job-killer, too

[Commentary] If there is any question about the need for the United States to crack down on foreign websites engaged in criminal commerce, one need only enter keywords such as "MP3," "DVDScreener," or "Oxycontin" into popular search engines and scroll through the countless pages of site listings and sponsored ads.

These listings feature everything from illegal copies of American art and entertainment products to adulterated baby formulas, counterfeit toothpaste containing chemicals found in anti-freeze, and phony medications, including those used to treat high blood pressure and mental illness. Theft of American products and ideas is no longer the hobby of teenagers with laptops; it's big business. As Congress debates legislation that would enable U.S. law enforcement to protect American businesses and consumers from foreign criminal enterprises on the Web, search engines such as Google are heavily lobbying lawmakers to allow the companies to continue to list illegal websites in search results. This loophole would render the bill virtually useless. Critics of this pending legislation need to be honest about the company they keep and why they essentially aid and abet these criminal endeavors.

(Aug 21)

South Bay economic recovery charges ahead

Led by tech hiring, the South Bay's economic recovery charged ahead in July with better-than-average increases in several industries, the state Employment Development Department reported. The valley's tech-heavy professional and business services sector gained 1,900 jobs in July, a month when the valley typically loses some of these jobs, the EDD reported. "San Jose is leading the charge," said Brad Kemp of Beacon Economics. "Every industry is growing. It's the one area in California you can't find anything negative to say about." Even so, Santa Clara County's unemployment rate remained stuck at 10.3 percent. San Mateo County's unemployment was up slightly from a revised 8.6 percent to 8.7 percent, the second lowest in the state. But over the year, Silicon Valley employers have added 30,800 jobs.

Hawaii gov aims to speed up Internet connections

Gov. Neil Abercrombie's (D-Hawaii) administration said it aims to make Hawaii's Internet connection 200 times faster over the next seven years.

A Communications Workers of America report last year ranked Hawaii 31st in the nation in Internet speeds. The administration's goal is to have connection speeds of 1 gigabit per second by 2018. "We want to take it into every household," Abercrombie said at an event announcing the plan. "And we want to take it at a level that assures ubiquitous access." The Department of Commerce and Consumer Affairs and other state agencies would play a critical role in implementing the plan by easing the regulatory process to help companies invest in broadband, Hawaii Broadband Task Force chairman David Lassner said.

(Aug 24)

Feds repair, improve rural broadband

Telecommunications companies in 16 states will share more than $103 million in federal funding through the Department of Agriculture to help expand broadband Internet access to those areas of rural America that haven't been reached by the high-speed service or are underserved.

"There's a big gap that remains between rural and urban areas because it's just hard to make a business case in rural areas," said Jonathan Adelstein, the agriculture department's rural utilities service administrator, in a conference call with reporters. "Rural areas' future depends upon access to broadband and we're not where we need to be today." The states that will benefit from the funding are: Alabama, Arkansas, California, Illinois, Kentucky, Louisiana, Missouri, Nebraska, Nevada, Ohio, Oklahoma, Texas, Virginia, West Virginia, Wisconsin and Wyoming. Adelstein said rural areas lag behind the urban areas of the country when it comes to broadband Internet access because the more remote areas don't have enough people, have rugged terrain, or it's too costly for companies to serve them.

(Aug 22)

FCC: Emergency phone systems worked as planned after quake

Although wireless networks were jammed following last week’s East Coast earthquake, there were no reports of problems with public safety communications, according to a preliminary assessment by the Federal Communications Commission.

Public safety agencies have their own dedicated networks, so the wave of calls that temporarily crippled commercial networks did not affect first responders’ communications. 911 calls, however, operate on commercial networks, so people who tried to report emergencies during the cell outage likely were unable to do so. Although the problem of network congestion does not affect public safety agencies, some lawmakers argue that the “D Block” of spectrum should be set aside for a nationwide public safety network.

(Aug 27)

Wireless carriers, broadcasters point to cell outages to support spectrum claims

Both wireless service providers and television broadcasters argue that cellphone outages following an earthquake demonstrate their industry's need for spectrum.

In the aftermath of the rare magnitude-5.8 earthquake that rocked the East Coast, thousands of people trying to make phone calls at the same time overwhelmed wireless networks. Spokesmen for AT&T and Verizon acknowledged heavy call volumes disrupted service in some areas. But they emphasized there were no reports of physical damage to their networks and service returned to normal. Steve Largent, president of CTIA-the Wireless Association, a telecommunication trade group, said the earthquake "underscored the vital need for our industry to get more spectrum." He said spectrum is like lanes on a highway, and cellphones are like cars. "Yesterday, a huge number of users were trying to use the same highway at the same time, which caused the jam," he said. "With more spectrum, we'd have more lanes that would allow more users."

(Aug 24)

Support grows for AT&T, T-Mobile merger

AT&T’s proposed $39 billion acquisition of T-Mobile USA appears to have re-gained momentum just weeks after encountering its first significant resistance on Capitol Hill.

“We’re not really running into major concerns or disquiet about the deal on any scale that we feel would threaten approval,” said AT&T senior executive vice president Jim Cicconi, pointing out the deal has now been endorsed by 27 state governors, more than 100 mayors and over 150 Chambers of Commerce nationwide. “We've got good momentum on this and it’s growing.” Cicconi noted 77 House Democrats have expressed support for the merger and said while there has been interest on the Hill AT&T hasn't encountered much in the way of opposition beyond the few members that have come out publicly against the deal. Kohl’s counterpart, Senate Antitrust subpanel ranking member Mike Lee (R-Utah) and House Judiciary chairman Lamar Smith (R-Texas) have also weighed in on behalf of the merger. “I've not run into anything beyond a couple of members where people are arguing against approval of the merger,” Cicconi said. “Quite the contrary, I think we’re getting a lot of support and I think it continues to grow the more people look at this merger.”

(Aug 21)

Cable groups weigh in on USF reform

Two groups representing cable providers wrote to the Federal Communications Commission voicing their objections to a plan submitted last month by six leading telecom firms to reform the Universal Service Fund.

FCC Chairman Julius Genachowski has asked for public input on the agency's efforts to shift the focus of the high-cost portion of the USF away from subsidizing landline phone connections in rural areas and towards fostering broadband Internet access. In response, the telecom carriers unveiled the America's Broadband Connectivity (ABC) plan last month, which attempts to achieve that goal. But American Cable Association President Matthew Polka and National Cable & Telecommunications Association President Michael Powell argue the ABC plan would advantage legacy local exchange carriers (LECs) at the expense of their members' firms and others attempting to provide voice services using VoIP and other, newer technologies. "We appreciate the contribution to the reform efforts that the incumbent LECs have made by developing these proposals," wrote Polka and Powell.

(Aug 23)

Sen Schumer urges wireless providers to disable stolen phones

Sen. Chuck Schumer (D-NY) called on wireless service providers to disable stolen cellphones. If a phone is reported stolen, most major carriers disable its SIM card, which stores the user’s private data. But Sen Schumer said companies should use unique ID numbers to completely deactivate stolen phones, rendering them useless to thieves.

“While cellphones have become a convenient way to communicate on the go, they are also a convenient target for thieves who know they can make a pretty penny selling them on the black market,” Sen Schumer said. Almost half of property thefts in New York City involve a cellphone, Sen Schumer said, citing New York Police Department statistics. He said deactivating stolen phones would deter theft. Of the major carriers, only Verizon currently disables stolen phones. Verizon does not use SIM cards in its phones. (Aug 22)

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