April 2015

Hello Facebook! WhatsApp voice calling a threat to telecoms

Voice calling is coming to WhatsApp. The popular messaging service owned by Facebook is preparing to roll out the new feature on iOS and Windows phones, part of its ongoing march to become an all-around communications service for the masses. WhatsApp began rolling out voice calling to select users in February. The feature is already being used by around 20 million people. WhatsApp offered an application file on its website, which when downloaded, lets anyone with an Android phone call other WhatsApp users. Forbes is calling it Facebook’s new phone company. When Facebook bought the start-up for $22 billion in February 2014, it was already a force to be reckoned with. Now it has the backing of a publicly traded company. At last count WhatsApp had 700 million users. Its growth rate puts it on track to surpass 1 billion users by the end of 2015. And that is making telecommunications carriers very nervous. Voice minutes on mobile, especially in North America and Western Europe, are already declining.

AT&T vs. TV White Spaces: Parsing a Blog Post

In a blog post by an AT&T executive, the author cited a filing with the Federal Communications Commission from the National Association of Broadcasters charging that the database designed to support TV white spaces is riddled with errors. Noting that the FCC has big plans for spectrum sharing based on the assumption that a database can accurately track spectrum usage, the author argues that “NAB’s petition now exposes those assumptions to some serious doubts.” What the executive didn’t mention is the response to the NAB from the Wireless Innovation Alliance. According to the alliance, the alleged erroneous database entries are actually test records put into the database to make sure equipment was functioning properly. The WIA says there have been no interference problems involving TV white spaces and broadcasters because companies deploying TVWS broadband “have been following rules for testing and deployment.” The WIA suggests that the FCC consider standardizing certain database policies such as requiring inactive transmitter records to be purged. It’s not clear whether AT&T was unaware of the WIA explanation or whether it was aware and chose to omit the explanation in the blog post. But whatever the reason the blog post doesn’t tell the whole story.

Sprint exec says it's 'immaterial' if T-Mobile passes Sprint in terms of subscribers

Sprint continues to argue that even if T-Mobile officially passes it in terms of total subscribers to take the mantle of the No. 3 US carrier it won't have a material impact on Sprint's business or strategy. Jaime Jones, Sprint's president of postpaid and general business organization, said that the ranking is "immaterial" to the plans of Sprint CEO Marcelo Claure, who took the helm last August. Jones said customers and employees aren't asking about it. Sprint is focused on "winning in the long-term and not really worrying or being concerned about whether we're No. 3 or 4 in the short term," Jones said. That echoes comments Claure and CFO Joe Euteneuer have made in recent months.

New Frontiers in TV Diversity

[Commentary] The 2014-15 television season is almost in the books, and it will arguably go down as one of the most groundbreaking as it pertains to diversity. The success of a group of new shows on both traditional and digital TV platforms has helped to eradicate some long-held preconceived notions about shows created by and starring people of diverse backgrounds.

First, this TV season has proven that content with diverse themes and lead characters can appeal beyond specific niche groups. Second, services including Amazon and Netflix have proven you can build successful series around transgender characters who are complicated, compelling and three-dimensional, rather than cartoonish caricatures that viewers could easily dismiss as weird or somehow not real. Third, it’s good to have diversity behind the camera as well as in front of it. The new wave of multicultural producers, directors, writers and showrunners is providing viewers with narratives that reflect unique experiences and cultural nuances -- no better or worse than anyone else’s; just different than what viewers have seen in the past -- that have put a fresh and colorful coat of paint on traditional TV genres that viewers love to watch.

YouTube Kids app exposes children to too many ads, some groups say

YouTube's big push into kids' programming is under scrutiny for blurring the lines between entertainment and advertising. A string of children's advocacy groups planned to file a complaint asking the Federal Trade Commission to investigate whether the newly launched YouTube Kids app is exposing young audiences to an unwanted barrage of commercials. The app, which rolled out in February, enables kids to choose from hundreds of channels to watch entertainment and educational programs. But mixed into the offerings are branded content from corporate giants such as McDonald's, Mattel and Hasbro.

The coalition of advocacy groups, which includes Campaign for Commercial Free Childhood and the Center for Digital Democracy, contends that that violates federal laws in place since the 1970s that limit how advertisers target young children. The crux of those rules protect kids who can't distinguish between commercials and entertainment. "This is the most hyper-commercialized media for kids I have ever seen," said Dale Kunkel, a University of Arizona professor specializing in children's media who helped draft the FTC complaint. "Children don't understand the persuasive intent of advertising." The coalition wants the FTC to "stop these and any other deceptive or unfair practices uncovered as a result of its investigation." The complaint marks one of the first times that advertising regulations are being used to monitor how digital programming is presented.

Google Removes Links to Images of Slain Prosecutor in Turkey

Google was spared from a recent wave of Internet bans in Turkey after it reportedly complied with a court order to remove links to images of Mehmet Selim Kiraz, a prosecutor who died after leftist militants took him hostage at an Istanbul courthouse. Twitter and YouTube were temporarily blocked in Turkey after they failed to respond to an order to remove photographs and other content showing one of the hostage takers pointing a gun at Mr. Kiraz’s head during the assault. In a separate court ruling, the authorities gave Google four hours to comply with the restrictions.

“Google is different from hosting providers like Twitter or YouTube. It is a major search engine,” Burcak Unsal, an expert in digital law, said. “It may take days to clear Google content when it gets constantly re-added, so the company must have ensured that it has started the process to evade the ban.” Some see the recent restrictions on the Internet as an early sign of efforts by the governing Justice and Development Party to curb freedom of expression and to silence dissenting voices before national elections in June.

Hollywood joins push for President Obama's Trans-Pacific Partnership trade deal

The US entertainment industry is joining in a last-ditch push to sway wavering Democratic lawmakers to back President Barack Obama's pro-trade agenda, as his hard-fought Pacific Rim trade deal heads to an uncertain end game. Hollywood and the music industry see the potential for lucrative enhanced-copyright protections in the 12-nation trade pact known as the Trans-Pacific Partnership. With congressional action nearing on a bill that would clear the way for President Obama to win passage of the agreement, snowballing numbers of free-speech groups and Internet activists are stepping up their campaign to foil one of the legislative priorities of President Obama's second term.

On the copyright term, officials argued that the world is moving away from the century-old Berne Convention standard of 50 years toward a longer period. Anissa Brennan, the Motion Picture Association of America's head of trade, said harmonizing terms and other rules will reduce friction, help protect content and open up rapidly growing foreign markets. The fate of fast track -- and TPP -- lies with lawmakers such as Sen Ron Wyden (D-OR), the Ranking Member of the Senate Finance Committee. He is negotiating with Republican leaders on trade-promotion legislation.

Patent case could shift power balance in tech industry

A US appeals court is set to hear a landmark patent case on April 8 that could change the way royalty rates are set for commonly used intellectual property in the tech industry. The case, pitting Microsoft against Google, has already involved a lower court in setting patent rates for the first time, in a move that critics warn will upend the balance of power between leading tech companies. Microsoft brought the case in 2010 against Motorola Mobility, the handset maker later acquired by Google. The search company sold Motorola’s operating business to Lenovo in 2014 but kept its patents and has now taken the case to the court of appeals.

The dispute centres on so-called standard-essential patents, which cover technology that is included in industry-wide technology standards. Since others have to use the technology if they want their own products to meet an industry standard, the companies that submit their patents for approval by standards bodies are required to license them out on “reasonable and non-discriminatory”, or RAND, terms. If upheld, Judge Robart’s approach could tilt the balance of power in negotiations away from companies that own large portfolios of commonly used patents and instead favour those -- like Microsoft or Apple -- whose businesses are based more on implementing technology standards in their products. "It’s going to be very significant indeed. Nobody quite understands what the term [RAND] means,” said Alexander Poterack, chief executive of General Patent Corp, a US intellectual property firm.

Regulators Tap Prosecutors for Key Jobs

Federal agencies eager to sharpen their enforcement chops are turning to former US prosecutors to help bring -- and win -- big cases. Nearly a dozen US regulators have installed former Justice Department attorneys to lead their enforcement units in recent years. Some, like the Securities and Exchange Commission and the Federal Energy Regulatory Commission, are tapping prosecutors to head the entire agency: Former New Mexico US Attorney Norman Bay is set to become FERC chairman later in April.

Bigger penalties also are being targeted by the Federal Communications Commission’s enforcement unit, which tapped a former Justice Department lawyer in 2014. This past fall, the FCC reached a record $105 million settlement with AT&T Mobility, a unit of AT&T, over unauthorized charges on consumers’ cellphone bills, and a similar $90 million accord with T-Mobile. Both companies denied they violated the law. The FCC also brought an unusual case against Marriott International alleging the company blocked some wireless signals. The company paid a $600,000 civil penalty to resolve the claims and admitted that one of its employees used the technology that prevented the signals. “We are doing larger cases, with a more strategic focus, and those cases have generated more fines,” said Travis LeBlanc, who heads the FCC’s enforcement effort.

Is this what net neutrality is really about?

[Commentary] Recent congressional hearings held in the wake of the Federal Communication Commission's network neutrality ruling provide a glimpse into what is so deeply wrong with this regulation, and why so many activist groups were behind it. It's an aspect of this matter of which you were perhaps unaware while the FCC was considering its regulatory strategy. Perhaps you thought net neutrality meant what was said of it: that it was intended to prevent the blocking or throttling of websites, or of "paid prioritization." Silly you. Actually, those were the interests of those companies -- like Google and Netflix -- that saw in governmental sway over the Internet commercial benefits for themselves.

But what about those groups and individuals who had political or ideological interests, and who played such outsized roles in the deal? You know, groups like Free Press, Media Matters, Public Knowledge and New America's Open Technology Institute? Or what about the large grant-giving foundations, like Ford, MacArthur, Knight and George Soros's Open Society Institute that, in addition to munificently funding third-party net neutrality activists, directly lobbied the FCC themselves? It should now be clear, even to those who weren't paying attention earlier, that the primary interest these groups had, and have, in net neutrality is their desire to insinuate government in the regulation of speech on the Internet.

The really interesting thing is how little attention has been focused, by the media or FCC officials themselves, on this aspect of net neutrality. Indeed, a quick search of comments made by Tom Wheeler, the chairman of the FCC, yields some vague (and inapposite) comments about net neutrality and free speech, but nowhere is there an indication that he, like the people quoted above, believes that the FCC now has authority, under its Net Neutrality Order, to ensure "viewpoint diversity" or "political debate."

[Patrick Maines is president of the Media Institute]