September 2012

Few choices for broadband service, thanks to regulators

[Commentary] It's amazing to me that even here in the heart of Silicon Valley consumers have so few choices for high-speed home Internet access. Valley residents can typically choose between AT&T and Comcast, if they have any choice at all. Neither company offers a great deal for consumers. Unfortunately, thanks to regulations put in place over the past two decades and the huge cost of building out networks, we don't have any other choices. In fact, we're lucky to have any choice at all; according to the Federal Communications Commission, the vast majority of Americans live in areas where they have just one choice --at best -- for high-speed broadband.

Small TV Stations Get Hot

Small television stations face a tougher time than most competing with cable and the Web. But some investors are snapping them up, betting on a surge in the value of their airwaves.

Investors including Michael Dell's MSD Capital LP and Fortress Investment Group LLC are buying small, sometimes bankrupt stations in major markets including Los Angeles, New York and Seattle, where the demand for airwaves, or spectrum, is at a particular premium. The investors are jumping into the market ahead of a so-called incentive auction hosted by the Federal Communications Commission, which plans to reclaim spectrum for use by wireless phone companies and other bidders. The auction is part of a broader rearrangement of U.S. airwaves by the FCC aimed at addressing consumers' seemingly voracious appetite for wireless broadband services. While the private-equity funds are buying stations for as little as several million dollars, observers say their value could be many times higher once the FCC auction gets under way. Much about the auction remains uncertain, however, including the timing.

Democrats push for open Internet, cybersecurity

Democrats reiterated support for open Internet policies that protect free speech and consumer choice, stronger cybersecurity laws and the protection of movies and songs from online copyright violations.

The goals were outlined in the party’s platform on the eve of the 2012 Democratic National Convention in Charlotte this week. The tech policy is largely a continuation of promises made by President Obama during his 2008 campaign and initiatives launched during his administration. The party touted the administration’s push for more wireless spectrum to be converted into commercial mobile networks. It promised a public safety network — a long elusive goal first set after the terrorist attacks of Sept. 11. Yet the most controversial goals were described in vague terms. And it’s unclear how Democrats would like to proceed if current net neutrality rules are knocked out by the courts.

Reporters: We loathe 2012 campaign

Presidential campaigns are supposed to be the greatest show in American politics — infused with big ideas and historical import. Yet after 16 months enduring a Republican primary and then a two-man contest so far defined by gaffes, cynicism, knife-fights and rapid-fire news cycles, even the best political reporters want the whole thing over with.

Yet another high-profile veteran campaign correspondent had his Howard Beale moment this week — mad as hell (or rather, sad as hell) and not willing to take it anymore — when Mark Leibovich lamented the devastating “joylessness” of the 2012 grind and wondered what the hell he was doing with his life. “How am I ever going to get through it?” the chief national correspondent of The New York Times Magazine asked. But his cri de coeur is just the latest primal scream in a campaign that is sending a whole generation of journalists to the confessional.

Politics on Social Networking Sites

A portion of social networking site users say the sites are important for some of their political activities and the way they decide how to engage with campaigns and issues. At the same time, most users of the sites say they do not use the sites for political purposes or debates.

A nationally representative phone survey by the Pew Research Center’s Internet & American Life Project finds that:

36% of social networking site (SNS) users say the sites are “very important” or “somewhat important” to them in keeping up with political news.
26% of SNS users say the sites are “very important” or “somewhat important” to them in recruiting people to get involved in political issues that matter to them.
25% of SNS users say the sites are “very important” or “somewhat important” to them for debating or discussing political issues with others.
25% of SNS users say the sites are “very important” or “somewhat important” to them in finding other people who share their views about important political issues.

In each activity, Democrats who use social networking sites are more likely than Republicans or independents to say the sites are important.

Big Apple dwarfs entire regions

Apple became the world’s most valuable-ever company two weeks ago. It is worth $624 billion, more than all the listed companies in Portugal, Ireland, Greece and Spain together.

The employer of 63,300 people – each valued at $10 million – is more valuable than all the shares available to investors in the MSCI China index, the international benchmark. Apple is not as big as the domestic Chinese market. But the comparison is not silly: it is more than half as big as the free float of A shares, where foreign investment is restricted. Investors should care not about the economic outlook, but the starting valuation. MSCI China rose 20 percent in the past 18 years, or 1 percent a year including dividends. As Percival Stanion at Barings points out, this coincided with stunning Chinese growth. Meanwhile, Apple investors made 27 percent a year, compound.

A victory for Apple but inventors still lose

[Commentary] Apple’s $1 billion win over Samsung should give inventors cautious optimism. It was an overwhelming victory in spite of a vacillating process that puts the onus on the patent’s owner to prove it has been copied, rather than the infringer to prove it has not. Lately, intellectual property cases have shown the global patent system to be complex and fickle, seemingly promoting plagiarism over progress and offering the holder little, if any, protection. Innovation is burdened by a double standard, by which it is deemed immoral to forge a painting or rip off a handbag, while copying others’ technology or industrial design is practically encouraged as part of healthy global competition. But it is akin to theft.

With Apple and Samsung sparring in almost a dozen countries, it is easy to forget that patents go beyond smartphones and intangible technology portfolios. But patents lead to revolutionary ideas and advances. We need compatible national patent systems – enforced uniformly around the world – that can deal with the realities of modern technology. They need to grant more robust patents and take copycats off the market faster. We need judicial systems to recognize that new ideas have value and should be protected.

[The writer is founder and chief engineer of Dyson]

Games groups taxed by questions of culture

More than three-quarters of the UK’s computer games developers plan to apply for the tax relief to be offered to the industry by the government from next year, but many are concerned about a rule that only games with British cultural content will qualify.

A game based on a British book, a national sport, such as football, or a historical event would have no difficulty qualifying under criteria mooted by the government and industry. Electronic Arts’ Harry Potter and FIFA series, and Activision’s second world war shooter game Call of Duty, for example, would be easy to approve for the tax breaks, which are expected to apply to about a quarter of production costs. But it could be difficult to judge the cultural relevance of a science fiction game or an arcade or puzzle game with little narrative, said Richard Wilson, chief executive of Tiga, the UK games developers industry association. Tiga will on Monday submit proposals on how tax relief should be structured.

Summer Olympics in Britain Helped Speed Growth of Public Wi-Fi

The Summer Olympics gave Britain not only a psychological lift, but a spate of free public Wi-Fi networks as well.

In preparations for the Games, the operators O2 U.K., Virgin Mobile, BT and the Cloud carved up public places across the British capital, broadcasting open wireless networks in major squares, airports and subways and on train platforms. Free Wi-Fi service is becoming an important tool for operators in maintaining quality mobile service during a time of skyrocketing data traffic, congested mobile networks and, for travelers, costly roaming charges. Public Wi-Fi networks have sprung up in many big cities.

According to Informa, a research firm, the number of Wi-Fi hot spots worldwide will reach 5.8 million by the end of 2015, up from 800,000 in 2010. Eight of the world’s 10 biggest mobile operators are using Wi-Fi to offload their cellular data traffic.

India: lost connections

Vsevolod Rozanov, the chief executive of India’s Sistema Shyam TeleServices, found his company’s mobile phone licenses abruptly cancelled by the supreme court this year, along with those of other foreign operators, including Telenor of Norway. Both groups, like UK-based Vodafone and India’s market leader, Bharti Airtel, must now choose whether to enter a hastily organized auction in November, potentially bidding more than Rs140bn ($2.5 billion) to win back their licenses. So the deep-voiced 41-year-old faces a particularly wrenching decision: having invested more than $3bn in the country’s ferociously competitive telecoms market, should his company double down or go home?

Benton

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