April 2013

[Commentary] Netflix is not going to kill cable. Nor is Amazon Prime. Nor is the mythical Apple TV. Because if they do, they will essentially be sawing off the limb on which they have built their businesses: content funded by the very cable model against which they offer an alluring alternative. And wow, is it ever funded—programming is expensive, as you may have heard.

Cord cutting may be on the rise, but it's nowhere near the level of an existential threat to the cable industry, despite the hype. Nielsen’s fourth-quarter cross-platform report counted more than 5 million "zero-TV" households in 2012, up from just over 2 million as recently as 2007. Those are small numbers given the 110 million TV household universe. That said, cable operators (or MVPDs, for multichannel video programming distributors) and the networks they carry are dragging each other kicking and screaming toward the rich seam of multiplatform video distribution that Netflix and Amazon are already mining as fast as they can. To be sure, there's a new economic model for content coming, but it’s big enough to allow all parties to survive, perhaps even thrive. Here's how.

Dazzled by the potential of free online college classes, educators are now turning to the gritty task of harnessing online materials to meet the toughest challenges in American higher education: giving more students access to college, and helping them graduate on time.

Nearly half of all undergraduates in the United States arrive on campus needing remedial work before they can begin regular credit-bearing classes. That early detour can be costly, leading many to drop out, often in heavy debt and with diminished prospects of finding a job. Meanwhile, shrinking state budgets have taken a heavy toll at public institutions, reducing the number of seats available in classes students must take to graduate. In California alone, higher education cuts have left hundreds of thousands of college students without access to classes they need. To address both problems and keep students on track to graduation, universities are beginning to experiment with adding the new “massive open online courses,” created to deliver elite college instruction to anyone with an Internet connection, to their offerings.

A year ago this month, Stanford Law School hosted a little-noticed meeting that may help decide the future of free speech online. It took place in the faculty lounge, where participants were sustained in their deliberations by bagels and fruit platters. Among the roughly two-dozen attendees, the most important were a group of fresh-faced tech executives, some of them in t-shirts and unusual footwear, who are in charge of their companies’ content policies. Their positions give these young people more power over who gets heard around the globe than any politician or bureaucrat—more power, in fact, than any president or judge. The session at Stanford concluded with the attendees passing a resolution for the formation of an “Anti-Cyberhate Working Group,” then heading over to Facebook’s headquarters to drink white wine out of plastic cups at a festive reception. But despite the generally laid-back vibe, the meeting, part of a series of discussions dating back more than a year, had a serious agenda. Because of my work on the First Amendment, I was asked to join the conversations, along with other academics, civil libertarians, and policymakers from the United States and abroad. Although I can’t identify all the participants by name, I am at liberty, according to the ground rules of our meetings, to describe the general thrust of the discussions, which are bringing together the Deciders at a pivotal time.

Clearwire will again tap financing from Sprint Nextel under their buyout deal, taking a $80 million draw for May that will be the last available before Clearwire shareholders vote on the deal.

In December, Sprint offered to buy the rest of Clearwire in a $2.2 billion deal, and provided the wireless broadband operator up to $800 million in financing that it could draw on in installments of $80 million over 10 months. The company didn't take that funding in January or February, as it was considering an offer from satellite TV company Dish Network, but took the cash in March and April. Clearwire shareholders are set to vote on the deal on May 21. In a regulatory filing, Clearwire warned that the failure of the Sprint deal could force it to stop its network overhaul if it can't find alternative funding. The company's board is "actively considering" whether to make a June 1 interest payment on about $4.5 billion of outstanding debt, in order to save cash if the deal doesn't close for any reason. Clearwire said that its current cash could last until the first quarter of 2014.