January 2014

FCC Releases Latest Inquiry into Competition in the Market for the Delivery of Video Programming

This Notice of Inquiry solicits data, information, and comment on the state of competition in the delivery of video programming for the Federal Communications Commission’s Sixteenth Report.

The Commission seeks to update the information and metrics provided in the Fifteenth and report on the state of competition in the video marketplace in 2013. Using the information collected pursuant to this Notice, the FCC seeks to enhance its analysis of competitive conditions, better understand the implications for the American consumer, and provide a solid foundation for FCC policy making with respect to the delivery of video programming to consumers.

Comments are due March 21, 2014; reply comments due April 21, 2014.

In Response to Mark Cooper

[Commentary] At its core, I believe the debate between Mark Cooper and myself in this instance arises from Mark’s belief that higher market shares, higher profits, or higher cash flow are per se evidence of an abuse of market power and consumers. This is simply not true.

Higher market shares, higher profits, and higher cash flow are a reward to firms that better serve the needs of consumers. As Adam Smith stated, “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.” Why do firms bother to improve quality? Mark apparently wants them to do it out of the goodness of their heart, but this is not reality. Quality improvements are motivated by a desire to increase market share and increase profits. AT&T and Verizon do not have high market shares because they abuse customers; they have high market shares because they serve consumers better than their rivals do. If they didn’t, then their customers would flee; they have options.

Competition and Cost-Effectiveness Analysis should Drive FCC Policy

Promoting competition, entry, and experimentation with innovative business models should be the goal of an updated Telecommunications Act, states Technology Policy Institute's Scott Wallsten in comments sent to the House Commerce Committee in response to their recent white paper.

In order to achieve these goals, Wallsten urges the Committee to require the Federal Communications Commission to apply competition analysis and cost-effectiveness analysis to its decision making. In addition, Wallsten advises Congress to continue to support schemes for efficient and flexible uses of spectrum. In his comments, Wallsten, TPI Vice President for Research and Senior Fellow, identifies the FCC's current "public interest" standard as "too vague for coherent and consistent policy decisions." Instead, the Commission should apply a better-defined consumer welfare standard, which could make use of competition analysis in its decisions. Such an approach would have two advantages. "First, it becomes possible to construct a framework that allows the Commission to make coherent and consistent decisions," Wallsten explains. "Second, such analysis explicitly makes it possible to think about and quantify how different technologies, products, and services compete with each other, reducing the 'silo' problem."

T-Mobile: We need more low-band spectrum despite Verizon deal

T-Mobile US is buying lower 700 MHz A Bock spectrum from Verizon Wireless for $2.36 billion, but argues that it still needs more low-band spectrum to compete more effectively with Verizon and AT&T Mobility.

Kathleen Ham, T-Mobile's vice president of federal regulatory affairs, wrote that the deal "will provide us with a good base of low-band spectrum, but it does not eliminate our need to continue to add to our portfolio." The block of spectrum T-Mobile is buying form Verizon is small, essentially a 5x5 MHz block. Ham added: "Even though interference and other problems previously associated with the A-Block are rapidly diminishing, thanks in part to an interoperability deal brokered by the FCC with AT&T and Dish, not all of the spectrum will be immediately usable." T-Mobile has said the transactions, combined with its existing A Block holdings in the Boston metro area, will result in T-Mobile having low-band spectrum in nine of the top 10 and 21 of the top 30 markets across the United States. Combined with its existing Boston A Block holdings, T-Mobile has said it will have low-band spectrum covering approximately 158 million POPs, including Atlanta, Dallas, Detroit, Houston, Los Angeles, New York City, Philadelphia and Washington, DC. T-Mobile said the spectrum covers 70 percent of its existing customer base.

Statement Of Commissioner Ajit Pai On The Conclusion Of The Technology Transitions Policy Task Force

Since December 2013, the Federal Communications Commission’s work on the IP Transition has been guided by the steady hand of the Technology Transitions Policy Task Force. I had called for the creation of such a group back in July 2012 and was pleased when former Chairman Julius Genachowski set it up later that year. Now that the task force has established the framework for an All-IP Pilot Program, as well as other transition trials, its work is done.

I thank all the members of the task force for their work over these many months, including Claude Aiken, Jonathan Chambers, Mindel De La Torre, Kate Dumouchel, David Furth, Lisa Gelb, Rebekah Goodheart, Patrick Halley, Matthew Hussey, Walter Johnston, Julius Knapp, Padma Krishnaswamy, William Lake, Sean Lev, Albert Lewis, Marcus Maher, Allan Manuel, Charles Mathias, Carol Mattey, Timothy May, Kris Monteith, Brendan Murray, Alison Neplokh, Eric Ralph, Jim Schlichting, Henning Schulzrinne, Roger Sherman, David Simpson, Jerome Stanshine, Tim Stelzig, Mark Stone, David Turetsky, Julie Veach, and Stephanie Weiner. And I especially commend Jonathan Sallet, the director of the task force, for his efforts to craft a bipartisan order that aims to expedite American consumers’ transition to a promising, all-IP future.

United Nations Calls For Action Over Detained Al Jazeera Journalists

The United Nations is criticizing the recent spate of attacks and harassment against journalists in Egypt.

The UN's High Commissioner for Human Rights said that the "increasingly severe clampdown and physical attacks" are making it extremely difficult for journalists to do their jobs and tell their stories. The statement called attention to three reporters in particular, Al Jazeera's Peter Greste, Mohamed Fadel Fahmy and Baher Mohamed, who have been detained in Egypt for more than a month, Al Jazeera said. "In recent months, there have been numerous reports of harassment, detention and prosecution of national and international journalists as well as violent attacks," a UN spokesperson said. "This accentuates the difficult and increasingly dangerous environment for journalists trying to carry out their work in the country."

LPFM Watch: More than 400 LPFM Applications Granted this Month

It’s been a busy week at the Federal Communications Commission, with the tally of newly granted low power FM (LPFM) applications now inching towards 500 (up from just over 200 at this time last week). It’s incredible to see the wide variety of organizations that are now one step closer to getting on the air. Animal advocacy groups (at least three of them!), colleges, school districts, churches, tribal groups, cities & related municipal groups, arts organizations, and social service agencies are amid the mix of 450+ organizations with granted applications.

IBM and Twitter Announce Patent and Cross-License Agreement

In December Twitter acquired over 900 patents from IBM and the companies entered into a patent cross-license agreement. Financial terms were not disclosed.

“This acquisition of patents from IBM and licensing agreement provides us with greater intellectual property protection and gives us freedom of action to innovate on behalf of all those who use our service," said Ben Lee, Legal Director for Twitter. “We are pleased to reach this agreement with Twitter because it illustrates the value of patented IBM inventions and demonstrates our commitment to licensing access to our broad patent portfolio. We look forward to a productive relationship with Twitter in the future,” said Ken King, General Manager of Intellectual Property for IBM.

MediaVest Says Super Viewers Will Have Cellphone in Hand

Despite the buzz surrounding streaming video, television’s biggest event, the Super Bowl, will still be watched on traditional TV by most viewers. According to research conducted by media agency MediaVest, 97% of fans plan to take in the Denver Broncos and the Seattle Seahawks on their TVs. But a large number of them won’t be satisfied by sitting and watching.

MediaVest’s research found that 52% of those viewers plan to use their mobile phones during the game and another 23% will be using their tablets. “We can expect huge amounts of multi-tasking during this year’s game, as more and more viewers plan to take advantage of and use other devices while they are also watching the game, according to David Shiffman, executive VP, research director at MediaVest. “We expect that this multi-screen usage will be a balance of game-related content, talking/texting, and very high levels of social media engagement.”

Could Latinos End Up Censored Online? It Certainly Looks Like It...

[Commentary] As Latino filmmakers and journalists, we understand that the stories we tell matter. But too often, the stories that are being told on the local news, on cable outlets or on the big screen about Latinos reinforce dangerous stereotypes to the detriment of our community. It is why we are deeply troubled by the impact of a recent court decision on our online free speech rights.

Earlier in January 2014, a federal court struck down the Federal Communications Commission's open Internet rules, which were intended to prevent Internet service providers like Verizon and AT&T from blocking content or discriminating online. Now these companies are free to interfere with Web traffic. We understand the open Internet provides our members and community with the means to speak for themselves, which has been difficult to do in the mainstream media. One reason is that Latinos own few broadcast stations or major entertainment companies. Despite making up 17 percent of the US population, only 4 percent of journalists working at daily newspapers are Latinos and 5.5 percent working at English-language TV stations. This has made us dependent on large media companies to tell our stories. So, in recent years, our members have turned to the Internet to tell the stories that are often ignored by the media. But the court decision will now make it harder for our members to tell those stories since ISPs like Verizon can now block Web content and sites that are relevant to our community.

As the two largest organizations representing Latino journalists and filmmakers, we are calling on the Federal Communications Commission to take quick action to reestablish its legal authority and pass strong Net Neutrality protections. We urge our members and our community to sign the petition from Presente.org that calls on the FCC to preserve Network Neutrality.

[Hugo Balta is President of NAHJ and a coordinating producer for ESPN; Axel Caballero is Executive Director of NALIP & Founder of Cuentame and Metafora Politica]

Benton

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