March 2012

The key to Netflix's future is steady subscriber growth. Could it get some extra juice by hooking up with cable companies? Recent reports indicated that the DVD and video-streaming company was in discussions with cable operators about offering its content alongside other pay-television channels.

While it doesn't appear those talks have any traction, at least yet, it is worth asking why Netflix would even consider such deals. Netflix loses more than 50% of its customers each year and has to replace all of them just to keep a steady count. Tony Wible of Janney Montgomery Scott says pay television has a lower churn rate of 20% to 25%. That may mean customers who purchase Netflix through a cable platform would stick around longer. Meanwhile, for cable companies, there may be a chance to profit from Netflix's success. Netflix's streaming service depends on high-speed connections that cable companies provide, but right now they don't see any extra revenue from it. The obvious hurdle is that Netflix competes directly with cable companies. If cable customers become fond of Netflix, they might decide to abandon their pay-TV packages and just subscribe to the streaming service directly alongside other Web-based services. Perhaps a bigger concern is the economics of any deal. As it stands, Netflix's $7.99-a-month fee for streaming content doesn't appear very profitable. Margins would be squeezed by a deal in which Netflix shared some of that fee, unless it were offset by lower marketing costs.

News Corp and NDS, the technology company it once controlled, have hit back at claims that NDS facilitated piracy by accusing the BBC of “gross misrepresentation” over allegations made in a broadcast earlier this week.

NDS demanded a retraction of allegations by the BBC’s Panorama program, which outlined claims that the company had used hackers to undermine security systems used by OnDigital, a pay-television rival to News Corp’s British Sky Broadcasting affiliate. Chase Carey, News Corp’s president and chief operating officer, said: “Panorama presented manipulated and mischaracterized emails to produce unfair and baseless allegations.” Abe Peled, executive chairman of NDS, wrote in a separate letter to Panorama, published by News Corp, that the program had “seriously misconstrued legitimate activities we undertake in the course of running an encryption business” and taken emails out of context. Those emails had been stolen and manipulated “as part of an ongoing plan by third parties to damage the reputation of NDS, our sister companies, and News Corp,” Peled said.

In a recent pamphlet trumpeting the achievements of the European Union, one of the top arguments put forward by the European Commission was the EU’s long-running policy to cut the cost of mobile phones use among international travelers.

Though the price of roaming is but a small part of Europeans’ holiday budgets, the issue has been the subject of repeated regulations since 2007, when caps first appeared for voice calls. The agreement brokered on March 28 extends price caps on cross-border phone calls to data usage and further lowers the price for voice calls. The announcement by Neelie Kroes, EU telecoms commissioner, that an agreement had been reached was typical of the discourse between the EU and operators over roaming in the past five years. “Consumers are fed up with being ripped off by high roaming charges,” she said. For all the bluster around the issue, European telecoms groups say privately that fighting roaming price cuts is scarcely a priority when they lobby EU policy makers.

[Commentary] The truth matters.

For nearly two weeks, the theater and journalism worlds have buzzed with the tragedy surrounding Mike Daisey, a talented performer who portrayed his work as fact when it was actually a blend of reality and fiction. When he finally apologized this week, it was, frankly, too little too late. His downfall began in January when he brought his one-person stage production "The Agony and the Ecstasy of Steve Jobs" to the public radio program "This American Life." Daisey has performed the show since 2010, including a stint at Berkeley Repertory Theatre. It takes aim at an Apple supplier in China and raises legitimate issues about working conditions that also have been raised by advocacy groups and journalists, including from the New York Times. But Daisey said he witnessed events that did not happen. It all came unraveled when the China correspondent for the radio program Marketplace heard the broadcast and realized the story contradicted his own reporting experiences.

On March 25, as criticism mounted, Daisey finally apologized to theater colleagues, to journalists, to activists who had done the heavy lifting on issues he trumpeted, and to his audiences. It has been a great privilege, he wrote, "to be able to call myself a storyteller and to have audiences come and listen to what I have to say, to extend their trust to me. I am sorry I was careless with that trust." If he had said that weeks ago, it might have helped. But now, most will only remember him for his lies. And the chip in the journalistic foundation he once claimed as his own will be impossible to repair.