Benton RSS Feed
Dish Network’s merger talks with Sprint Nextel collapsed after a series of disagreements, including Sprint demanding a $3 billion reverse-breakup fee, people familiar with the matter said, leaving the satellite-TV company with just a week to regroup and try again.
Dish had countered with a $1 billion reverse-breakup fee, which would be paid if the takeover didn’t win regulatory approval, said one of the people, who asked not to be identified because the discussions were private. Sprint announced that Dish failed to produce an “actionable” bid, leading the carrier to endorse a sweetened $21.6 billion offer from SoftBank, which originally agreed to acquire Sprint in October. Dish, the satellite-TV provider controlled by billionaire Charlie Ergen, now faces a June 18 deadline to submit what Sprint has described as a “best and final” fully financed counteroffer. Dish said this week that it continues to view Sprint as holding “tremendous value” and is considering its strategic options.
Dish-Sprint Talks Said to Falter in Part Over Breakup Fee
Since it was first accused of conspiring to raise the prices of e-books, Apple has maintained it didn’t care what sort of deals publishers arranged with other retailers, as long as they honored the terms of their agreement to sell books on its iTunes store. Apple’s lead counsel Orin Snyder claimed as much in his opening arguments in the Department of Justice’s e-book antitrust case against the company last week. “The negotiations make clear that the interests of the publishers and Apple were not aligned,” Snyder said. “Apple wanted lower prices on its own book store, and was indifferent to prices throughout the rest of the industry.”
But a new document entered into evidence June 12 by the DOJ suggests that Apple may not have been quite as indifferent to publishers’ deals with Amazon as it professes to be. It’s a Jan. 14, 2010, message from Steve Jobs to Eddy Cue, his point man for e-book negotiations, and in it he says he wants publishers to push Amazon to an agency pricing model where publishers, not retailers, set prices. “I can live with this as long as they move Amazon to the agent model too for new releases for the first year,” Jobs wrote. “If not, I’m not sure we can be competitive …” A smoking gun?
Is Steve Jobs Message a Smoking Gun in Apple E-Book Case?
[Commentary] As the world waits to see if Yahoo will succeed in bringing Hulu into the Sunnyvale fold, it’s worth asking a long-term question about Yahoo and video. That question is this: Could Yahoo ever become the next major TV network — alongside ABC, CBS, Fox, and NBC? I think the answer is yes.
And it’s especially likely when you throw Tumblr and Yahoo’s potential big mobile acquisitions into the mix. We are heading into a world where the Web and TV basically merge into a single premium video channel — or, at the very least, into two channels that overlap and interact tremendously.
Two kinds of businesses today are poised to do well in that new world:
- The current TV giants — which, if they manage things right, can keep hold of their advertiser relationships into the future of TV.
- The online companies whose businesses already closely mirror TV — and who can grow strong TV-like online ad sales businesses into bona fide next-gen TV businesses.
In that second category, Yahoo is clearly the winner.
[Wise is CEO of Mediaocean]
Why Yahoo Could Become the Next Major TV Network
In the 60 years that television watching has dominated Americans' leisurely pursuits, the picture has twice been transformed: first from black and white to color; then from dull resolution to high definition.
Significantly, the change from conventional to HD resolution was accompanied by the switch from analog to digital delivery. On the occasion of the fourth anniversary of the demise of analog TV broadcasting, it's fitting to compare how we responded to these key transitions. According to the Consumer Electronics Association, the first year that household penetration rates reached more than 50% was 1973 for color television and 2009 for HDTV. If you consider that color standards were agreed to and limited color broadcasting began in the mid-1950s and HDTV standards and limited broadcasts began in the late 1990s, it appears that Americans' embrace of color was a slow dance that took roughly two decades vs. just one for HDTV.
The major difference between the two transitions is that the shift to HDTV was mandated by the government and backed by a deadline, which though twice postponed, culminated in most television stations turning off their analog transmitters on June 12, 2009. Color broadcasting, on the other hand, was downwardly compatible. There was no need to get rid of your black and white TV or, as in the case decades later of owners of analog TV sets who wanted to receive over-the-air programs, buy a converter box.
Switch to HDTV went quicker than to color TV
More than one-third of all House members are supporting bipartisan legislation that would ban new state and local cellphone taxes for five years.
The Wireless Tax Fairness Act is a response to rising state and local taxes on cellphones that many members of Congress feel are excessive. Rep. Zoe Lofgren (D-CA), the lead sponsor of the bill this year and in the last Congress, has said wireless customers pay an average tax of nearly 17 percent. She has also warned that some cities around the country are piling on with other taxes that bring the total burden to more than 20 percent. Lofgren, Rep. Trent Franks (R-AZ) and other supporters of the bill say there is a risk that states and localities could tax wireless service out of business. The bill, H.R. 2309, would ban new taxes on cellphone services for five years, which they hope will give state and federal government representatives and the wireless industry a chance to discuss what level of taxation is best for wireless services.
House members try again to ban new cellphone taxes
[Commentary] I was disappointed to see that former Federal Communications Commission Chairman Reed Hundt has joined forces with opponents of the Commission's longstanding cross-ownership rules.
Hundt argues that greater media consolidation, including common ownership of newspapers and television stations in the same market, should be permitted "in celebration of our commitment to freedom." Our commitment to freedom rests on informed citizens and a vibrant media. The "freedom to own the means of speech" that Hundt celebrates misses the entire point and purpose of the First Amendment. In my experience, freedom flourishes best when citizens have ready access to multiple sources of news and information, something they'd lose in many areas if Hundt gets his way on the cross-ownership rule.
Allowing ever-more monopolization of our media ecosystem will not celebrate "our commitment to freedom" - it will undermine liberty's staunchest sentinel, a vibrant press. Hundt may want to debate whether it is better to have the Koch Brothers or Rupert Murdoch owning the Tribune newspaper chain. I say neither.
Kochs and Cross-Ownership: Formula for a Weaker Democracy
Time Warner Cable and other pay-TV operators are offering incentives to media companies that agree to withhold content from Web-based entertainment services such as those pursued by Intel and Apple, people with knowledge of the matter said.
The incentives can take the form of higher payments, or they can include threats to drop programming, said the people, who asked not to be identified because the discussions are private. Time Warner Cable has more than 300 contracts, and some of them may bar media outlets from providing content to online pay-TV services, Chief Executive Officer Glenn Britt said yesterday in a meeting with analysts at the National Cable & Telecommunications Association show. “We may well have ones that have that prohibition,” Britt said at the conference in Washington. “This is not a cookie-cutter kind of business.” Some agreements require media companies that license content to Web-based systems to offer the same online rights to Time Warner Cable, Britt said.
Time Warner Cable Content Incentives Thwart New Web TV How big cable uses its muscles to prevent online competition (GigaOm) Time Warner Cable Says It’s Blocking Some Programmers from the Web — But It’s Still Not Holding Up Web TV (WSJ)
[Commentary] It's puzzling to many observers why so many programmers don't make their content more widely available online. It seems like programmers are leaving money on the table. Shows that are available online are talked about more, watched more, and pirated less. Viewers are demanding easier access to shows that is not tethered to their home and does not require a cable subscription, yet the market is not delivering it. Why is this?
There are two big reasons. The giant content companies have a symbiotic relationship with cable. They sell programming exclusively to cable (and satellite) and charge a lot for it. This forces cable companies to raise their bills but, since they're the only source of programming people want, they're able to. There's nowhere to switch to. Only now, as cable bills are reaching unsustainable levels and cable companies are seeing that online video has the technological potential to become a competitor to cable, are some cable companies finally objecting publicly. The second reason is more subtle. Smaller programmers don't have the ability to dictate terms to cable companies the way some large ones do. But cable is their largest customer. If a large cable company tells an independent programmer that it can't distribute its content online, then the programmer has little choice but to comply. These issues highlight how concentrated markets prevent companies from responding to customer's needs. Concentration in the programming market leads to absurd situations like every cable subscriber, even non-sports fans, paying about $5 per month for ESPN. Concentration in the distribution market allows existing distributors to use threats and incentives to hold back the development of alternative distribution channels.
More Confirmation That Incumbents Restrict Online Video
The House Commerce Committee’s Subcommittee on Communications and Technology, chaired by Rep. Greg Walden (R-OR), held the second in its ongoing hearing series this Congress on the satellite television law, portions of which are set to sunset on December 31, 2014.
Members examined whether the law still serves an important function or if it is out of step with today’s video marketplace. Additionally, members discussed whether Congress should reauthorize the law as is, allow it to lapse, or revise it, possibly even tackling non-satellite specific video issues arising from increased competition and evolving technology.
Democrats signaled they would prefer to reauthorize the act rather than bog it down with other issues. As it is, the Judiciary committee has to be involved in the legislation because of the interlocking copyright provision in the law. "We should pursue a clean reauthorization," said Rep. Henry Waxman (D-CA), the ranking member of the House Commerce committee.
At the same time, members on both sides of the aisle saw the hearing as an opportunity to examine whether or not all of the nation's communications laws governing pay TV services and the content they carry have turned into an outdated Rube Goldberg contraption. Or into, in the words of Geoffrey Manne, TechFreedom’s senior fellow and executive director of the International Center for Law and Economics, a house of cards.
House Communications and Technology Subcommittee Continues Examination of Satellite Television Law and Video Marketplace Hearing on Satellite TV Act Turns Into State of Video Hearing (AdWeek)
Chairman John D. (Jay) Rockefeller IV (D-WV), along with Senators Amy Klobuchar (D-MN) and Richard Blumenthal (D-CT), introduced legislation that would prevent telephone companies from “cramming” unauthorized third-party charges onto consumers’ landline phone bills.
Cramming happens when businesses place multiple illegitimate, misleading or deceptive charges on a customer’s telephone bill. According to a Committee investigation, consumers have already lost billions of dollars through mysterious and unauthorized charges for services that they never purchased. In addition to the legislation, Chairman Rockefeller sent letters to several wireless telephone carriers – AT&T, Verizon Wireless, T-Mobile, and Sprint – asking for more information about each company’s policies for safeguarding consumers against cramming. Now that Americans have begun to replace land line phones with wireless phones as their preferred form of telephone communication, Rockefeller is concerned that consumers are vulnerable to cramming on wireless bills as safeguards by wireless carriers to prevent cramming on these bills might not be in place. The Chairman also wants to make sure that consumers are able to confirm authorized third-party charges that appear on their bills.
Senators Introduce Legislation to Stop Cramming on Telephone Bills Democrats' bill targets unwanted phone charges (The Hill)