October 2014

Facebook’s bill for WhatsApp climbs to $21.8 billion

Facebook's acquisition of WhatsApp Messenger has ended up being even more expensive than it originally thought.

After receiving European, the deal has closed. The final combination of cash, stock and management incentives that Facebook is paying for the wildly popular chat app now totals $21.8 billion. That figure is above the $19 billion stated when the deal was first announced, because Facebook's share price has risen more than 13 per cent since mid-February to $77.29 on Oct 6. Over the same period, WhatsApp's usage has continued to grow rapidly.

The Fourth Major Era of Computing Kicks In

[Commentary] We’re now on our fourth major era in computing. The original mainframe computer of the 1960s automated back offices and transactions, bringing efficiency and lowering costs. That cycle ended in the early 1990s when the personal computer picked up steam. By the mid-1990s the Web was helping to automate interaction between companies and their customers, allowing people to buy goods and services through the magical Internet. The mobile era began this summer, as there are now more mobile users than desktop users, with 1.8 billion surfing the Web on their smartphones. Having a personal computer in your pocket is changing the tech world because, unlike a computer, a smartphone is always there when you need it.

[Kessler is a former hedge-fund manager]

Blair Levin Joins Brookings as a Nonresident Senior Fellow

Blair Levin, telecommunications expert and former Communications & Society Fellow at the Aspen Institute, has joined the Brookings Institution’s Metropolitan Policy Program as a nonresident senior fellow, Bruce Katz, Brookings vice president and Metropolitan Policy Program co-director announced.

Levin will join the Program’s Metropolitan Infrastructure Initiative, which is directed by Brookings Senior Fellow Robert Puentes. Levin’s work will continue to focus on the nexus between broadband availability, market structure, and the health of metropolitan economies. In this capacity, he will work to inform city efforts to apply innovative practices to expand broadband access.

Levin joins Brookings after four years at the Aspen Institute Communication and Society Program where he served as executive director of Gig.U, a consortium of university research communities working toward accelerating the deployment of next generation broadband networks in the United States.

Before joining the Aspen Institute, Levin worked for the Federal Communications Commission, where he served as the Executive Director of the Omnibus Broadband Initiative and oversaw the development of a National Broadband Plan, a project of the American Recovery and Reinvestment Act. Levin rejoined the FCC in 2009 after eight years as an analyst at Legg Mason and Stifel Nicolaus. Levin served as Chief of Staff to FCC Chairman Reed Hundt from 1993 to 1997 and oversaw implementation of the historic 1996 Telecommunications Reform Act.

Canadian Newspaper Ownership Consolidation

Postmedia Canada Network, the country’s largest newspaper publisher, is tightening its grip on the industry, buying the Sun Media chain of 175 tabloids and small city dailies, a move that reflects the declining fortunes of the news business.

The Montreal-based broadcasting and publishing company Quebecor acquired and expanded Sun Media through acquisitions, spending about $1.5 billion over 15 years. Postmedia paid around $275 million ($301 million Canadian dollars) for the group, which includes The Toronto Sun and The London Free Press. Both companies have been struggling in an increasingly digital world, with Postmedia and Sun Media facing a series of cutbacks and layoffs.

Europe Digital Nominee Demands Stronger US Data Rules

Europe may suspend data-sharing agreements with the United States if American policy makers do not improve how Europeans’ online information is protected, according to Andrus Ansip, the nominee to lead Europe’s digital agenda.

His statements could have major implications for American tech giants like Google and Facebook, which routinely compile data generated by their European customers through web searches and other online activities. Those companies’ data policies have come under greater scrutiny in Europe in the wake of the revelations about spying by the National Security Agency, using online data. Ansip, 58, said that the United States still had to convince European lawmakers that it took a hard line on data protection.

FCC’s Wheeler: Transitions to IP are Not a License to Limit Competition

Let me be clear: transitions to IP are not a license to limit competition.

The three keys to preserving network competition are access to last-mile facilities, the future of copper networks, and VoIP interconnection. In September, I made a point that is worth repeating. Communications policy has always agreed on one important concept: the exercise of uncontrolled last-mile power is not in the public interest. This has not changed as a result of new technology. That is as true for businesses and other enterprise customers as it is for consumers. There is no choice between embracing technological change and protecting values.

USTelecom Petitions FCC To Drop 'Archaic' Regulations

USTelecom filed a petition asking the Federal Communications Commission not to apply legacy regulations to incumbents in the new IP world, regulations like sharing newly built conduit with competitors, that don't apply to cable operators and competitive carriers.

The petition argues argue that the business services market is increasingly competitive, citing Comcast/Time Warner Cable's merger as an example of how it could get even more competitive -- the cable operators have been pitching the deal as a way to strengthen business services broadband vis a vis AT&T and Verizon. Among the legacy regulations they want axed are ones that require them to continue to maintain traditional networks, which they say takes away from investment in new services their customers want.

USTelecom wants the FCC to forbear (not enforce) the following regulations:

  • Outdated provisions in Sections 271 and 272, and the related equal access rules;
  • Rule 64.1903 structural separation requirements;
  • The requirement that an ILEC provide an unbundled 64 kbps voice channel where it has replaced a copper loop with fiber;
  • Section 214(e)(1) eligible telecommunications carrier (“ETC”) requirements where a price cap carrier does not receive high-cost universal service support;
  • The remaining Computer Inquiry rules;
  • The Section 224 and 251(b)(4) requirement that ILECs share newly deployed entrance conduit; and
  • Rules prohibiting the use of contract tariffs to offer special access and high capacity data services in the absence of pricing flexibility.

Municipal Broadband: A Bad Deal For Taxpayers

[Commentary] The inherent problem with municipal broadband is that government entities are incapable of fairly competing in the free market, as they are taxpayer-backed and therefore able to charge less for a service than it actually costs.

Private businesses cannot do this, as doing so would result in bankruptcy. The costs of building out and maintaining broadband networks are considerable. It is not a fiscally sound use of scarce taxpayer dollars for governments to compete with billion dollar networks already in existence. State legislators have the right and responsibility to protect economic and fiscal interests of their constituents. The concern that municipal broadband puts a risky and unsustainable burden on the backs of taxpayers is justified based on experience.

[Gleason is Director of State Affairs at Americans for Tax Reform]

The Dark Side of Net Neutrality

Rep Darrell Issa (R-CA) fears applying the Federal Communications Commission’s phone carrier authority (Title II) to the Internet may allow the FCC to censor website content.

When asked to explain these fears, FCC Chairman Tom Wheeler would not comment on the Communications Act provision, simply responding, “Title II is on the table.” Fortunately the FCC is unlikely to expand all parts of Title II to Internet providers or apply it in a way that would allow it to censor Web content, explains Harold Feld, senior vice president at Public Knowledge. The FCC already selectively applies its Communications Act authority to phone carriers on a case-by-case basis if the “application of a particular provision makes no sense,” he says. “There is a profound disingenuousness on the part of the cable operators and telecommunications companies and trade associations … who are therefore intimately familiar with how utterly unremarkable this is in practice to pretend that this is whacko, crazy stuff,” Feld said about Internet censorship fears. (Oct 1)

GreatLand to FCC: We'll keep Internet Essentials

GreatLand says it will continue Comcast's Internet Essentials program, which provides $10-a-month broadband service to families of schoolchildren who qualify for subsidized school lunches. And Charter Communications, which proposes to take over Time Warner Cable markets in Ohio, Kentucky, and metropolitan Milwaukee, says it also plans to start offering low-cost service for low-income households.