For upcoming media policy events, see http://www.benton.org/calendar.htm
OWNERSHIP
Fighting Big Cable (and why it matters)
Big Media Paying Big to Find Kids
Cable Companies Call Up New Growth Story
News Corp Television Unit Under the Spotlight
REVENUES
Senate Bill Aimed at Cable-Data Revenue
Estimates Vary On Value Of Spectrum
Senators Seek Web Porn Tax
AT THE FCC
Telcos May Get Own Brand X
Paxson Shuffles Off DTV in Buffalo
QUICKLY -- Isolating our points of viewing; NAB/MSTV Tout Digital Dozen;=20
ACA, PBS Eye Carriage Guidelines; NCTC Says Yes to TiVo; Nextel to seek=20
more time for locating 911 callers; Job Openings: Free Press; Online Gym Cl=
ass
OWNERSHIP
FIGHTING BIG CABLE (AND WHY IT MATTERS)
Comcast (the nation's biggest cable company) and Time Warner (the second=20
biggest) are dividing up the bankrupt corpse of Adelphia. At the same time,=
=20
they are swapping their own systems so that in cities where Time Warner and=
=20
Comcast compete against each other (like New York and Los Angeles) they=20
won't compete anymore. Well, you may ask, what's the big deal? So I=20
switch from having no choice but Adelphia to no choice but Comcast or Time=
=20
Warner. Why should I care? The answer depends on some rather complicated=20
economics. Briefly, to advertisers, programmers, and politicians, the=20
ability to control a city (or, as they call it when measuring effects, a=20
=93designated market area=94 or DMA) is much more valuable than the same nu=
mber=20
of customers spread out over the whole country. Also, it turns out, DBS=20
makes a rather poor competitor to cable.
[SOURCE: Tales of the Sausage factory, AUTHOR: Harold Feld]
http://www.wetmachine.com/totsf/item/328
See also:
* It's time to stand up to Comcast
Last week, 12,000 people complained to the FCC about cable's rising prices=
=20
and anti-competitive practices. They urged it to reject a proposed deal=20
that would further enlarge Comcast and Time Warner, already the nation's=20
top two cable companies.
[SOURCE: Philadelphia Inquirer, AUTHOR: Jeff Gelles]
http://www.philly.com/mld/inquirer/business/12272327.htm
BIG MEDIA PAYING BIG TO FIND KIDS
Recent deals by News Corp. and Viacom for two popular social Web sites =AD=
=20
MySpace.com and NeoPets.com =AD priced in the hundreds of millions of dolla=
rs=20
underscore the frantic search for teens and 20-somethings who have cut back=
=20
on their television time and are turning down newspapers, magazines and=20
even radio. MySpace=92s 22 million members, nearly all in their teens or=20
early 20s, represent the Sasquatch of the advertising world =AD elusive and=
=20
hunted. People create a presence on the site through profiles that list=20
their interests, activities, and favorite bands, books and movies. It=92s a=
=20
wealth of information that people don't usually make available to companies=
=20
or advertisers. And it=92s a marketer=92s dream, making News Corp.=92s $580=
=20
million purchase for Intermix Media Inc., parent of MySpace, worth the=20
price in the eyes of some on Wall Street. =93It=92s so much more than just=
=20
e-mail addresses,=94 said Scott Kessler, Internet analyst with Standard &=
=20
Poor=92s. =93You can see what kinds of activities they=92re engaged in and =
tap=20
into trends.=94 Consider the ways in which the information can be used. Whe=
n=20
trying to reach potential buyers of running shoes, for example, News Corp.=
=20
knows which MySpace members are joggers. Those ads could command a premium=
=20
from advertisers, although they also carry a risk. =93That would likely end=
=20
up in alienating the usership, depending how it=92s done,=94 Kessler said.=
=20
=93Part of it is figuring out how quickly that is going to turn someone off=
.=94
[SOURCE: Los Angeles Business Journal, AUTHOR: Hilary Potkewitz]
http://www.labusinessjournal.com/article.asp?aID=3D160434202.7060305.117...
1.9719163.4442175.654&aID2=3D90458
CABLE CONSUMERS CALL UP NEW GROWTH STORY
Enterprises such as phone and high-speed Internet may be just the ticket=20
for cable companies, which need a new growth story as their=20
bread-and-butter video businesses steadily lose subscribers to=20
satellite-television operators. The companies want to maintain the=20
double-digit rate of revenue increases that Wall Street needs to keep=20
valuing cable shares as growth stocks, which investors commonly believe=20
should trade at more than nine times earnings before interest, taxes,=20
depreciation and amortization, or Ebitda, a common metric in cable. For=20
cable, the phone business has the potential to deliver results as good as,=
=20
or even better than, high-speed Internet -- eventually easing the concerns=
=20
over the video side of the business. The residential phone market is=20
estimated by Sanford C. Bernstein & Co. to be $60 billion, about $10=20
billion more than the entire pay-TV market. Analysts believe cable=20
companies could capture as much as 30% of it.
[SOURCE: Wall Street Journal, AUTHOR: Peter Grant peter.grant( at )wsj.com]
http://online.wsj.com/article/0,,SB112294394752002167,00.html?mod=3Dtoda...
us_money_and_investing
(requires subscription)
NEWS CORP TELEVISION UNIT UNDER SPOTLIGHT
News Corp's TV station group, one of the largest in the nation, has long=20
been one of the company's biggest profit centers. The stations account for=
=20
roughly 10% of revenue and 30% of operating income at News Corp. Just as=20
important, the group is strategically crucial as the main outlet for the=20
Fox broadcast network. The stations are also useful for other businesses,=
=20
such as Fox's sister cable networks, that need on-air promotion. Over the=
=20
past several years, the TV station group's performance has come under=20
pressure and turning the stations around has become a high priority. While=
=20
operating income increased 6% at the station group in the most recent=20
quarter, Wall Street analysts say the growth has been weaker than expected.=
=20
Poor programming decisions have hurt the group over the past few years. An=
=20
ill-fated talk show with "American Idol" host Ryan Seacrest proved to be an=
=20
expensive flop and an attempt to revive its 1980s tabloid hit "A Current=20
Affair" has failed to catch on with viewers. In the May sweeps, a crucial=
=20
ratings period, the Fox stations affiliated with the Fox network saw a=20
collective drop of almost 20% in the key adults 18-49 demographic,=20
according to Nielsen Media Research. Viewership for the late news, a key=20
profit center for local television stations, dropped by almost 10% in that=
=20
same demographic from two years ago.
[SOURCE: Wall Street Journal, AUTHOR: Julia Angwin julia.angwin( at )wsj.com and=
=20
Joe Flint joe.flint( at )wsj.com]
http://online.wsj.com/article/0,,SB112294019656102084,00.html?mod=3Dtoda...
us_marketplace
(requires subscription)
REVENUES
SENATE BILL AIMED AT CABLE-DATA REVENUE
Last Friday, Sens. Gordon Smith (R-OR), Byron Dorgan (D-ND) and Mark Pryor=
=20
(D-AR) introduced legislation, (S. 1583), could require cable to contribute=
=20
some of its $10 billion in broadband-access revenue to launch and sustain a=
=20
new subsidy program designed to deliver high-speed data to unserved areas.=
=20
Cable contribution of access revenue would be decided at the discretion of=
=20
the Federal Communications Commission. The agency would be authorized to=20
spend a maximum of $500 million annually on the rural-broadband program.=20
The phone-subsidy program, called universal service, is popular with rural=
=20
lawmakers. But expanding it to including broadband access could prove=20
controversial because some on Capitol Hill think the current program is=20
mismanaged and needs to be reformed before mission expansion is adopted.
[SOURCE: Multichannel News, AUTHOR: Ted Hearn]
http://www.multichannel.com/article/CA631488.html?display=3DBreaking+News
(requires subscription)
ESTIMATES VARY ON VALUE OF SPECTRUM
The Congressional Budget Office has not revised its $10 billion estimate of=
=20
the value of the spectrum to be obtained when a "hard date" is set to=20
complete the transition to digital television broadcasts. But CBO's=20
estimate is considerably lower than two separate private sector analyses of=
=20
the value of the broadcast spectrum currently in use from channels 52 to=20
69. Those estimates are $24-$28 billion. CBO's estimate of $10 billion in=
=20
federal receipts from auctioning airwaves comes on top of top of an=20
estimated $15 billion in federal receipts from another piece of spectrum=20
currently scheduled for auction in June 2006. Individuals familiar with=20
budget officials' thinking said they believe the anticipated auction of 90=
=20
megahertz of spectrum for advanced wireless services is certain to diminish=
=20
the value of the DTV spectrum below what has been scored by private sector.
[SOURCE: Technology Daily, AUTHOR: Drew Clark]
http://www.njtelecomupdate.com/lenya/telco/live/tb-UDUP1122927526162.html
SENATORS SEEK WEB PORN TAX
Last week, Sen. Blanche Lincoln (D-AK) introduced the Internet Safety and=
=20
Child Protection Act of 2005, a bill that would apply only to adult sites=
=20
subject to controversial record-keeping requirements regarding the=20
identities of people participating in sex acts displayed on Web sites.=20
Those sites must cough up the taxes and use age verification techniques=20
"prior to the display of any pornographic material, including free=20
content." Sen Lincoln characterized her bill as a way to make the Internet=
=20
a "safer place" for children. The bill would impose a 25 percent tax on the=
=20
revenue of most adult-themed Web sites. But legal scholars who specialize=
=20
in the First Amendment say courts have rejected similar taxes in the=20
past--and are likely to do so again, if Lincoln's proposal becomes law.=20
Other Senate sponsors of the legislation--all Democrats--include Thomas=20
Carper of Delaware, Mark Pryor of Arkansas, Mary Landrieu of Louisiana,=20
Joseph Lieberman of Connecticut, Ken Salazar of Colorado, Debbie Stabenow=
=20
of Michigan, Evan Bayh of Indiana and Kent Conrad of North Dakota.
[SOURCE: C-Net|News.com, AUTHOR: Declan McCullagh]
http://news.com.com/Senators+seek+Web+porn+tax/2100-1030_3-5814309.html?...
=3Dnefd.top
AT THE FCC
TELECOS MAY GET OWN BRAND X
Circulating at the FCC is a proposal to extend cable's "Brand X" Supreme=20
Court victory to teleco's DSL service. The item could potentially make it=
=20
to the Aug. 4 meeting agenda, which has activist group Public Knowledge=20
weighing in with its own suggestions. =93The Commission=92s actions will sh=
ape=20
the broadband future for years to come," says Legal Director Mike Godwin.=
=20
"Thus, its deregulatory efforts should be implemented in ways that favor=20
the competition inherent in open and accessible
networks.=94 Of course, the Brand X decision was all about freeing cable fr=
om=20
open access requirements, which the FCC concluded would advance the=20
roll-out of broadband, one of President Bush's priorities.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA631497?display=3DBreaking+New...
eferral=3DSUPP
(free access for Benton's Headlines subscribers)
PAXSON SHUFFLES OFF DTV IN BUFFALO
Paxson's WPXJ (Buffalo, NY) is voluntarily turning in its digital channel=
=20
assignment (53) -- it was not yet broadcasting a DTV signal, according to=
=20
the FCC--and will continue to broadcast in analog on its current channel=20
(51), agreeing to "flash-cut" to digital on that channel by the end of the=
=20
transition. The FCC has eight more pending requests to "flash-cut." While=
=20
most stations are required to broadcast in both analog and digital during=
=20
the transition, stations other than affiliates of the top four networks=20
whose digital allotments are outside the core channels 2-51, are allowed to=
=20
turn those non-core digital channels (52-59) back to the government and=20
broadcast in analog-only on their in-core channel before switching over to=
=20
digital-only on that same channel by the deadline for the digital=20
changeover. The reason behind allowing the flash-cuts and give-backs is to=
=20
more swiftly clear out broadcasters so the upper spectrum tier can be=20
reclaimed for auctioning for advanced wireless services and emergency=20
communications.
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA631244?display=3DBreaking+New...
eferral=3DSUPP
(free access for Benton's Headlines subscribers)
QUICKLY
ISOLATING OUR POINTS OF VIEW
[Commentary] Ever wonder why cable TV news seems to be a growing morass of=
=20
true-crime stories, conflict-driven talk shows and endlessly repeated=20
minutiae? Or why mainstream media seems increasingly focused on a shrinking=
=20
niche of consumers and their very specific political/social interests? It=
=20
all ties into a growing trend among consumers: an impatience with media=20
that doesn't speak to their specific needs immediately "The audience . . .=
=20
is busier than it has ever been. They don't have time for stories that=20
waste their time," said CNN/U.S. president Jonathan Klein, who has drawn=20
criticism for the newschannel's aggressive coverage of hot-button,=20
videogenic stories such as Terri Schiavo's death, runaway bride Jennifer=20
Wilbanks and Michael Jackson's trial. "Technology has sped up the pace of=
=20
life, but it hasn't created more free time. So we've got to take the news=
=20
of the day and show viewers all aspects of the story in an arresting new=20
way." Such trends are great news for media that provide constant access for=
=20
a multitude of customers in small niches: cable TV, satellite radio, video=
=20
games and the Internet. But this on-demand attitude makes losers of media=
=20
that attract large numbers of consumers through a variety of material,=20
forcing every customer to wade through some things they don't like. That=20
list includes newspapers, network TV and broadcast radio.
[SOURCE: St. Petersburg Times, AUTHOR: Eric Deggans deggans( at )sptimes.com]
http://www.sptimes.com/2005/07/31/Floridian/Isolating_our_points_.shtml
NAB/MSTV TOUT DIGITAL DOZEN
The National Association of Broadcasters (NAB) and Association for Maximum=
=20
Service Television (MSTV) say they have received a dozen quotes from=20
consumer-electronics firms for a digital-to-analog converter box. The two=
=20
associations said they would start taking an active role in developing a=20
low-cost analog-to-digital converter box. MSTV President David Donovan=20
says the dozen includes "some of the largest consumer-electronics companies=
=20
in the world." In theory that means there's members of the Consumers=20
Electronics Association in the bunch. NAB and the Consumer Electronics=20
Association have been in a war of words over the switch to digital. CEA has=
=20
pushed a hard date while NAB has argued that could disenfranchise viewers.=
=20
At one point, the two groups were planning to work together to promote the=
=20
digital switch, but had a falling- out and have been at some variation of=
=20
public loggerheads ever since. However, Donovan says he is looking forward=
=20
to working with consumer electronics companies on the new box. Many=20
consider the digital switch to be political poison for both the TV industry=
=20
and Washington, particularly if analog television consumers are left=20
without a low-cost or no-cost alternative to digital (or if digital TV=20
offers just more of the same xxxx that's now on analog TV.)
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
http://www.broadcastingcable.com/article/CA631474?display=3DBreaking+New...
eferral=3DSUPP
(free access for Benton's Headlines subscribers)
ACA, PBS EYE CARRIAGE GUIDELINES
The American Cable Association is talking with PBS TV stations about=20
forging an agreement setting guidelines for smaller operators to carry=20
public stations and their digital-multicast signals. The agreement being=20
discussed -- which individual ACA members could decide whether or not to=20
participate in -- would be similar to the pact the National Cable &=20
Telecommunications Association reached earlier this year with the=20
Association of Public Television Stations.
[SOURCE: Multichannel News, AUTHOR: Linda Moss]
http://www.multichannel.com/article/CA631489.html?display=3DBreaking+News
(requires subscription)
NCTC SAYS YES TO TIVO
The National Cable Television Cooperative, which represents small- to=20
medium-sized cable operators that serve more than 14 million subscribers,=
=20
has inked a deal with TiVo to bring the DVR service to NCTC systems.
[SOURCE: Broadcasting&Cable, AUTHOR: Ken Kerschbaumer]
http://www.broadcastingcable.com/article/CA631487?display=3DBreaking+New...
eferral=3DSUPP
(free access for Benton's Headlines subscribers)
NEXTEL TO SEEK MORE TIME FOR LOCATING 911 CALLERS
Nextel Communications plans to ask for a waiver from a December deadline=20
that 95 percent of its customers' wireless phones be capable of identifying=
=20
the location of a caller to emergency personnel.
[SOURCE: Reuters]
http://today.reuters.com/news/newsArticle.aspx?type=3DtechnologyNews&sto...
D=3D2005-08-01T233916Z_01_N01565782_RTRIDST_0_TECH-TELECOMS-NEXTEL-911-DC.X=
ML
JOB OPENINGS: FREE PRESS
1) Free Press has immediate openings for: 1) an Online Organizer to develop=
=20
and implement strategies to encourage public participation in media policy=
=20
making. This position is based in its Northampton, MA office and 2) a=20
Finance Manager to ensure sound financial management and human resource=20
practices for our growing organization. This position is also based in the=
=20
Northampton, MA office.
http://www.freepress.net/content/opportunities
ONLINE CLASSES OFFER VIRTUAL DISSECTION, BUT GYM STILL TAKES SWEAT
Yes, it is August, not April. You can now take gym class online.
[SOURCE: New York Times, AUTHOR: Sam Dillon]
http://www.nytimes.com/2005/08/02/education/02gym.html
(requires registration)
--------------------------------------------------------------
Communications-related Headlines is a free online news summary service=20
provided by the Benton Foundation (www.benton.org). Posted Monday through=
=20
Friday, this service provides updates on important industry developments,=
=20
policy issues, and other related news events. While the summaries are=20
factually accurate, their often informal tone does not always represent the=
=20
tone of the original articles. Headlines are compiled by Kevin Taglang=20
(headlines( at )benton.org) -- we welcome your comments.
--------------------------------------------------------------