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October 7, 2012

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[Commentary] On October 2, we first read confirmed reports that Deutsche Telekom was in talks with MetroPCS Wireless on a possible deal to combine T-Mobile USA with MetroPCS. MetroPCS sells flat-rate monthly plans and has 9.3 million subscribers, including about 700,000 customers on its LTE network. The MetroPCS network covers 102 million people in the U.S. MetroPCS's 3G network uses CDMA, a different technology from T-Mobile's GSM-based system. Deutsche Telekom, based in Germany, is the parent company of T-Mobile USA, the fourth-largest U.S. mobile operator. Federal regulators, Headlines readers well know, blocked AT&T’s attempt to acquire T-Mobile last year saying it was anti-competitive. A breakup deal gave T-Mobile $3 billion cash and spectrum licenses in 128 markets. This new deal puts T-Mobile on stabler ground, and could be seen as vindication for the regulators' decision that T-Mobile could compete on its own.

When Is Wireless Consolidation Good for Consumers?

October 7, 2012

Source

Fortune

Author

Michael Fitzpatrick

Coverage Type

Lauren Frayer

At the beginning of this week, a law passed in June that made it illegal to download certain copyrighted media without permission received fangs in the shape of a potential two-year jail stretch or a fine of 2 million yen (about $25,500) for offenders. The draconian move signals an end to the country's largely laissez-faire approach to the internet and possibly to a culture where downloading for free has long overtaken paid for media.

Law comes to one of the Internet's Wild Wests

October 7, 2012

Source

Wall Street Journal

Author

Eliot Brown

Coverage Type

Lauren Frayer

Amazon has agreed to buy a large chunk of its Seattle headquarters for $1.2 billion from an investment firm owned by Microsoft co-founder Paul Allen. Vulcan had been marketing the 11-building campus, which it built over the past half-decade for the online retailer, seeking one or more buyers for the buildings. Amazon has been leasing the space. At $644 per square foot for the 1.8 million-square-foot complex, the sale could arguably be the richest office deal in Seattle's history.

Amazon to Buy Headquarter Buildings for $1.2 Billion Amazon gobbles up campus for $1 billion (Seattle Times)

Submitted on October 5, 2012

On October 2, we first read confirmed reports that Deutsche Telekom was in talks with MetroPCS Wireless on a possible deal to combine T-Mobile USA with MetroPCS. MetroPCS sells flat-rate monthly plans and has 9.3 million subscribers, including about 700,000 customers on its LTE network. The MetroPCS network covers 102 million people in the U.S. MetroPCS's 3G network uses CDMA, a different technology from T-Mobile's GSM-based system. Deutsche Telekom, based in Germany, is the parent company of T-Mobile USA, the fourth-largest U.S. mobile operator. Federal regulators, Headlines readers well know, blocked AT&T’s attempt to acquire T-Mobile last year saying it was anti-competitive. A breakup deal gave T-Mobile $3 billion cash and spectrum licenses in 128 markets. This new deal puts T-Mobile on stabler ground, and could be seen as vindication for the regulators' decision that T-Mobile could compete on its own.

Although the Oct 2 reports indicted talks may not end in a deal, the official announcement that the companies would combine was released the next day. The boards of both companies agreed to a transaction structured as a recapitalization, in which MetroPCS will declare a 1 for 2 reverse stock split, make a cash payment of $1.5 billion to its shareholders and acquire all of T-Mobile’s capital stock by issuing to Deutsche Telekom 74% of MetroPCS’ common stock on a pro forma basis. Deutsche Telekom also agreed to roll its existing intercompany debt into new $15 billion senior unsecured notes of the combined company, provide the combined company with a $500 million unsecured revolving credit facility and provide a $5.5 billion backstop commitment for certain MetroPCS third-party financing transactions. Rough translation: The deal is structured as a reverse merger, meaning MetroPCS in effect will swallow its larger rival. That approach will give T-Mobile a publicly traded stock, which would give T-Mobile parent Deutsche Telekom AG a new route to raise capital for its U.S. subsidiary, as well as a path to pare down its investment in the U.S. over time. (see also With merger, Deutsche Telekom finally has viable plan for US market)

The combined company would have:

approximately 42.5 million subscribers,
$24.8 billion of revenue,
$6.3 billion of adjusted income before interest and taxes and depreciation and amortization have been subtracted (EBITDA),
$4.2 billion of capital expenditures, and
$2.1 billion of free cash flow (defined as EBITDA less capital expenditures) in 2012.

The merger is between the nation's fourth- and sixth-largest wireless carriers by revenue, but T-Mobile will not move any farther ahead in the list of largest U.S. cell phone companies. The combined company will still be smaller than third-place Sprint both in terms of sales and number of subscribers.

The combined companies have 29.5% of the prepaid market, according to Sanford C. Bernstein. [Consumers who opt for a prepaid mobile phone purchase credit in advance of service use. The purchased credit is used to pay for mobile phone services at the point the service is accessed or consumed.] MetroPCS helped pioneer affordable, no-contract cellphone service in the U.S.

Both companies have been struggling. Though each remains profitable, their smartphone offerings are lackluster (i.e., no iPhone), they are far behind the curve on network technology, and both are shedding customers. “These are not two robust, growing entities that are combining,” said Kevin Smithen, an analyst at Macquarie Securities USA Inc. in New York. “These are two companies that had significant operations issues. We are skeptical.”

Bloomberg was quick to note that the structuring of the agreement reveals how the value of T-Mobile may have dropped by $13 billion amid client losses following the failed sale to AT&T. Deutsche Telekom had agreed to sell T-Mobile for $39 billion to AT&T; now T-Mobile is worth about $26 billion including debt, based on MetroPCS’s share price and analyst estimates.

GigaOm’s Kevin Fitchard wrote that T-Mobile’s aims for merging with MetroPCS are pretty clear: to harvest the regional carrier’s spectrum to bulk up its LTE network in key cities such as New York City, San Francisco and Los Angeles. In the top 25 markets, T-Mobile will see its average spectrum holdings increase from 63 MHz to 76 MHz, and much of those gains will be in the Advanced Wireless Service (AWS) band where both companies are launching LTE. T-Mobile currently has the spectrum to launch a 20 MHz network in half of its metro markets, but it would only be able to support a 10 MHz network in other regions. Metro’s licenses certainly don’t fill in all of those holes, but in 11 major cities the combined company will have more 50 MHz of AWS spectrum, enough for the new T-Mobile to launch a mammoth 40 MHz network. That’s double the size of any 4G network market leaders AT&T and Verizon have today.

The new company plans to deploy a 4G-LTE network that will work across both customer bases. Company executives said they expect all MetroPCS users to be migrated to T-Mobile's network by the end of 2015. But upgrading all customers discontinuing the legacy technologies will be a gradual, multi-year process. That complex migration will be expensive -- unexpected delays and obstacles could wipe out the $6 billion to $7 billion the two companies say they will gain from "cost synergies" -- and is "a major risk for derailing the benefits of the deal," according to Mike Roberts, analyst at Informa Telecoms & Media. (see also T-Mobile, MetroPCS Outline Quick Move to LTE)

One of the unstated benefits of the merger with MetroPCS is one that T-Mobile’s customers have been clamoring over for years: the iPhone. T-Mobile is already on a technology trajectory that will make its network compatible with the iPhone 5’s fickle radios. But tying up with MetroPCS will get T-Mobile there a lot faster.

The proposed deal will allow the combined company to push unlimited data plans, as a counterbalance to the other major carriers’ attempts to charge customers according to their use. “The combination of our complementary spectrum will allow our combined company to drive unlimited as a key differentiator,” T-Mobile President and CEO John Legere told reporters. “That’s a big part of who we are now and who we’ll be in the future.” The decision to compete with major carriers Verizon and AT&T by continuing to offer unlimited data plans addresses what has been a major concern for policymakers.

For federal regulators, the deal will solve one problem for regulators by giving industry leaders Verizon Wireless and AT&T more competition. Combining T-Mobile’s and Metro’s spectrum holdings, along with the frequencies T-Mobile won from AT&T when that merger failed, the airwaves T-Mobile gained in a swap with Verizon, will make the new company a more formidable competitor. The merger would strengthen two players that have both struggled against the dominant carriers, analysts said. "If anything, it's improving the competitive landscape," said Phil Marshall of Tolaga Research. But the deal could also create new complications: Fewer competitors at the price-sensitive low end of the market and create an increasingly concentrated prepaid cellphone market. After the deal, three companies -- T-Mobile, Sprint, and América Móvil unit TracFone -- will account for three-quarters of all prepaid cellphone customers, according to data from UBS. And while MetroPCS focuses solely on the prepaid business, the new T-Mobile will need to make sure that its prepaid offerings aren't so attractive that they lead so-called postpaid customers to dump their contracts and end of month bills, which typically are more lucrative for carriers than month to month plans. And T-Mobile's prepaid plans, unlike MetroPCS's, provide high-speed data covering the whole country. But they're significantly more expensive. A month-to-month plan with unlimited talk and text and 2 gigabytes of high-speed data costs $60 at T-Mobile. At MetroPCS, a similar plan with 2.5 gigabytes of high-speed data can be had for $50 a month, while an unlimited talk, text, and data plan is available for $55.

Even before the merger was formally announced, the Communications Workers of America voiced concerns with the deal, saying it could lead to possible job losses. CWA was a big champion of AT&T's bid to buy T-Mobile. AT&T employs 40,000 wireless employees who are members of the CWA. Most of T-Mobile's U.S. workforce is not unionized with the exception of 16 employees in Connecticut and so CWA viewed the merger with AT&T as a way to add more unionized workers. CWA said that both T-Mobile and Metro PCS send a lot of work offshore and the union worries that more jobs will be lost by their merger.

The overall narrative now is that the regulatory concerns this time round appear to be much milder than the proposed deal involving AT&T. Both companies are relatively small, and T-Mobile USA has been losing subscribers for the last two years. http://www.latimes.com/business/la-fi-tmobile-metropcs-20121004,0,765398...

Rep Henry Waxman (D-CA), the Ranking Member on the House Commerce Committee, said “Consumers benefit from strong, vibrant competition in the wireless marketplace. Competition on a national scale can bring innovation, better service, and lower prices to consumers everywhere. The proposed merger between T-Mobile and MetroPCS may have the potential to enhance nationwide wireless competition and benefit consumers throughout the United States. I urge the Department of Justice and the Federal Communications Commission to review the merits of this proposed transaction rigorously but swiftly.”

Rep. Anna Eshoo (D-CA), the top Democrat on the communications subcommittee and a critic of the AT&T deal, said she hopes regulators conduct a "thorough, but swift review." "At a time when two companies continue to dominate the wireless marketplace, the need for a strong national competitor has never been greater," Eshoo said. "The proposed merger of T-Mobile and MetroPCS has the right ingredients to provide consumers with a viable alternative for wireless voice and data service."

Free Press, a consumer advocacy group that lobbied against the AT&T deal, said the marketplace needs stronger competitors to push back against AT&T and Verizon. "But consolidation at the bottom between a regional prepaid carrier and the last-place national carrier is not going to fix all of the problems in our wireless market," Policy Director Matt Wood said. "The FCC is going to have to formulate bold public policies to bring consumers the relief they need."

John Bergmayer, a senior staff attorney at Public Knowledge, said he expected the FCC to examine the deal's impact on the prepaid market as part of its usual review of whether the merger is in the public interest. Bergmayer said, however, that he believed the merger was good for consumers. T-Mobile says it wants to continue to present itself as the better-value alternative to AT&T and Verizon Wireless, and that the merger with MetroPCS will provide added scale to help it compete. "They're not going to become mini-Verizon," Bergmayer said. "I'm not going to be thrilled to see the number of competitors go down, but I think in the context of trying to keep up with AT&T and Verizon it actually makes a lot of sense."

Los Angeles consumer columnist David Lazarus wrote that consumers would normally shake their heads in dismay at news of yet another market-shrinking telecom merger. But T-Mobile USA gobbling up rival MetroPCS is one of those rare examples of a corporate roll in the hay actually being in consumers' best interest — at least for a while. Short term, a revitalized T-Mobile helps prevent the near-duopoly of Verizon and AT&T from owning the entire wireless market. Longer term, however, all this merger does is set the table for even more consolidation. The most likely scenario: A few years down the road, Sprint and T-Mobile will say they need to merge to compete with the two heavyweights. He warns that AT&T and Verizon, with their seemingly bottomless pockets, are buying their way to wireless dominance, rather than competing toe-to-toe on pricing or pumping big bucks into technological advances. He fears that this will leave less coverage available for Sprint and T-Mobile, which will inevitably conclude that yet another merger will be the only way they can remain viable. Regulators, in turn, will be forced to say that having three players is better than two.

As we did with the failed AT&T/T-Mobile deal, and Verizon’s successful purchase of spectrum from cable companies, Benton will be tracking the review of this deal by regulators. Check here for updates. And we’ll see you in the Headlines.

October 5, 2012 (FCC on track for 2015 spectrum goal)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for FRIDAY, OCTOBER 5, 2012

Today: Innovation Economics: The Race for Global Advantage and Riding the Mobile Wave: The Future of Mobile Computing http://benton.org/calendar/2012-10-05/

WIRELESS/SPECTRUM
   FCC on track for 2015 spectrum goal
   Sprint Said to Eye MetroPCS Bid to Rival T-Mobile Offer
   With merger, Deutsche Telekom finally has viable plan for US market - analysis
   A Bird’s Eye View of a Combined T-Mobile/MetroPCS - analysis [links to web]
   T-Mobile USA Deal Shows $13 Billion Value Drop Since AT&T [links to web]

ELECTIONS AND MEDIA
   FCC database misses huge chunk of ads - research
   The Twitter spin room: What happens when politics goes real time - analysis
   Twitter: Romney's 'Big Bird' reference explodes online
   Rep Markey Comes to Defense of Big Bird [links to web]
   PBS CEO: Romney's Big Bird Moment 'Unbelievable' [links to web]
   Jim Henson Co.'s Schube: Romney 'Looks Stupid' [links to web]
   APTS, Rep. Blumenthal Take Up for Big Bird [links to web]
   Presidential Debate Drew More Than 70 Million Viewers [links to web]
   Plouffe: Press wanted ‘the Romney comeback story’ [links to web]
   Political Ad Tracker: Campaigns Spending More On the Ground Than Online - op-ed [links to web]
   Steal That Idea: 5 Smart Ways Presidential Candidates Mine Big Data [links to web]
   The Ad Wars: From every source, a different number - analysis [links to web]
   Social media fails the ‘47 percent’ video taper

PRIVACY
Privacy Advocates and Advertisers at Odds Over Web Tracking
Gotcha! Group uncovers privacy lies in websites' fine print [links to web]

CONTENT
   Google Settles Copyright Case With Publishers
   States Modify Payouts and Credits in E-Book Pricing Settlement [links to web]
   Social media fails the ‘47 percent’ video taper
   Citi Won't Sleep on Customer Tweets [links to web]

TELEVISION
FCC NRPM Includes Potential Revision of Buying Group Definition [links to web]
PTC Seeks Formal Complaint About 'American Dad' [links to web]

JOURNALISM
Americans turn to established media for breaking news, mobile [links to web]

CYBERSECURITY
Republicans: Report shows DHS not up to cybersecurity challenge [links to web]
House Intelligence chairman reveals new wave of cyberattacks, calls for legislative push [links to web]

LABOR/OWNERSHIP
When Job-Creation Engines Stop at Just One
Google Says Motorola Cuts Will Cost More Than Expected [links to web]

HEALTH
House GOP Leaders Express Concern that Nearly $10 Billion in Health IT Spending May Have Been Wasted - press release [links to web]

ADVERTISING
   Why the Ad Tech Guys Are Going Nuts About Facebook Exchange, and Why That Matters [links to web]
   Women and the Changing Face of the Advertising Industry [links to web]
   Your Facebook Fans are Hiding Your Posts at an Alarming Rate [links to web]

COMPANY NEWS
Facebook Tops 1 Billion Active Users
The real power of Facebook lies in controlling connected identity

POLICYMAKERS
Former FCC wireless chief joins broadcaster lobbying group [links to web]

STORIES FROM ABROAD
In Brazil, Google is in the middle of a battle over free speech
Media watchdog accuses Iran of intimidating journalists

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WIRELESS/SPECTRUM

FCC ON TRACK FOR SPECTRUM GOAL
[SOURCE: The Hill, AUTHOR: Brendan Sasso]
Federal Communications Commission Chairman Julius Genachowski announced that his agency is on track to meet its goal of freeing up 300 MHz of spectrum for mobile broadband by 2015. He said that to hit its target, the FCC is pursuing auctions, spectrum re-designation, moving government users and spectrum sharing. Although he said he supports "innovative" proposals to share spectrum bands with multiple users, he said clearing remains a "core" policy goal. He pushed back against criticism from the Republican commissioners that the FCC should focus less on unlicensed spectrum. "As innovation opportunities and demand for unlicensed uses continue to grow, and Wi-Fi networks get more and more congested – have you tried using Wi-Fi in a busy airport recently? – we need to ensure unlicensed spectrum opportunities keep pace," Genachowski said.
benton.org/node/136373 | Hill, The | read the speech | Broadcasting&Cable
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SPRINT AND METROPCS?
[SOURCE: Bloomberg, AUTHOR: Aaron Kirchfeld, Serena Saitto, Scott Moritz]
Sprint Nextel, the third- largest U.S. mobile-phone carrier, is in the early stages of evaluating a counter offer for MetroPCS Communications to top Deutsche Telekom’s bid to combine it with T-Mobile USA, said three people familiar with the matter. Sprint is crunching the numbers and holding talks with its advisers to weigh the feasibility of a higher offer, said the people, who asked not to be identified because the talks are private. The Overland Park, Kansas-based company could decide as early as next week whether to pursue an offer, two of the people said.
benton.org/node/136343 | Bloomberg | GigaOm
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DT HAS VIABLE US PLAN
[SOURCE: ars technica, AUTHOR: Cyrus Farivar]
With the new announced merger with MetroPCS, analysts say that Deutsche Telekom has given itself a much better path to higher profits in the United States one way or the other. The specifics of the deal are that MetroPCS will declare a 1-for-2 reverse split, thereby cutting the existing level of stock in half. MetroPCS—the first company in America to launch LTE—will also pay $1.5 billion to its shareholders and acquire all of T-Mobile’s stock. However, Deutsche Telekom will still retain 74 percent ownership in the new company. In other words, the deal has injected the new company (which will still be called T-Mobile) with viability, but provides Telekom with a chance to make a nice profit should the company want to sell its large stake. "A complete exit is probably an overstatement, but this gives [Deutsche Telekom] a relatively simple mechanism for dialing back their exposure in the US market," said Craig Moffett, an analyst with Bernstein Research. "They’ve made no secret of the fact that they’ve been willing to sell it, they’ve talked about IPOing it. You have to take this at face value that this is not an exit from the US market. It is an incremental investment in a stronger US asset, albeit one that has a built-in exit door."
benton.org/node/136312 | Ars Technica
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ELECTIONS AND MEDIA

FCC AD DATABASE
[SOURCE: Sunlight Foundation, AUTHOR: Jake Harper]
In key battleground states, huge numbers of presidential ads are airing on television stations that are not required to post to the Federal Communications Commission's online political ad database, new data released by the Wesleyan Media Project shows. In four of the nine states considered key in this year's general election -- Colorado, Florida, Virginia, Ohio, Nevada, New Hampshire, North Carolina, Virginia and Wisconsin -- less than half of presidential ads would be disclosed on the FCC database, a Sunlight analysis reveals.
Based on ads that ran from Sept. 9 through Sept. 30:
Iowa saw 17,000 presidential ads; none of its eight television markets are covered by the FCC order.
In Wisconsin, 70 percent of the ads recorded aired outside of the top 50 markets. Only the four Milwaukee network affiliates are required to post to the FCC online database. Spending in the state has increased dramatically over the last month.
Fifty-five percent of ads in Colorado would not be disclosed to the FCC.
Of New Hampshire's 7,000 ads, slightly more than half have been run in uncovered markets.
benton.org/node/136364 | Sunlight Foundation
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TWITTER SPIN ROOM
[SOURCE: GigaOm, AUTHOR: Mathew Ingram]
The debate between President Obama and Mitt Romney was the most tweeted-about event in U.S. political history — but is the kind of real-time commentary and instant analysis that Twitter provides a good thing or a bad thing for the political process or society as a whole? Some would argue the political process is something of a circus anyway, and that carefully stage-managed events like the debates are already a sideshow with little political value — and therefore the additional theatrical element added by real-time commentary isn’t going to have much effect. An optimist would say there is something very real to be gained by having people watch such debates for any reason — even if it’s just to follow along with the wisecracks on Twitter — because then at least there is a chance they might accidentally become more informed about political issues. The rise of Twitter as a political force has definitely accelerated the metabolism of a campaign by orders of magnitude, to the point where political analysts now talk about a news cycle that is measured in minutes or hours instead of days or weeks.
benton.org/node/136335 | GigaOm
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TWEETING BIG BIRD
[SOURCE: The Hill, AUTHOR: Alicia Cohn]
Mitt Romney's Big Bird shout-out, about halfway through the first presidential debate, was one of the debate's most popular moments so far, according to viewers on Twitter. "Big Bird" and "PBS" each earned 17,000 tweets per minute, Twitter reports. The debate was driving the majority of Twitter traffic. Romney's campaign owns the top trending topic on the microblogging service, but half of the other top ten topics on Twitter were also about the debate. One popular hashtag in heavy rotation during the debate is #zinger, referring to a report in The New York Times last week that Romney's team "has concluded that debates are about creating moments and has equipped him with a series of zingers that he has memorized and has been practicing on aides since August." Many Twitter users were looking to identify which parts of Romney's debate response were the "zingers" he had pre-planned.
benton.org/node/136318 | Hill, The
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SOCIAL MEDIA AND 47 PERCENT TAPE
[SOURCE: Columbia Journalism Review, AUTHOR: Hazel Sheffield]
When Mother Jones premiered the now-infamous 47 percent video on September 17, it received two million views in 24 hours and rapidly changed the discourse surrounding the campaign. The next morning, some outlets were already asking, “Is Mitt Romney over?” But why did the source of the video go to a news outlet like Mother Jones, instead of distributing it independently? The last decade, after all, has seen a rise in citizen and crowd-sourced journalism. The source tried; a Buzzfeed chronology shows repeated attempts to distribute the material starting two weeks after the May 17 fundraiser. But the story didn’t go viral until David Corn, Washington bureau chief at Mother Jones, convinced the source to give him the whole tape, portions of which were used in Corn’s Sept. 17 story. That four-month process would suggest that civilians can act as civic watchdogs, chronicling events of huge news value, but that journalists are still needed to verify and contextualize the findings before they break as news.
benton.org/node/136307 | Columbia Journalism Review
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PRIVACY

NO PROGRESS AT W3C
[SOURCE: New York Times, AUTHOR: Kevin O’Brien]
An effort to develop an easy way for consumers around the world to avoid being tracked and targeted by Internet advertisers appeared to hit an impasse, as privacy advocates and industry representatives accused each other of scuttling the process. The closed-door meeting organized by W3C, the global standards group that promotes good governance of the Internet, failed to produce a consensus on how to allow consumers to simply and effectively declare their “do not track” preferences on Web sites. The talks foundered on main issues like the extent and types of data that advertisers could continue to collect even after consumers indicated they no longer wanted to be followed. The conference is not expected to produce a final resolution, and other meetings could be scheduled before the end of January, when the group is set to disband. But the stakes for Internet users are high and boil down to who determines the limits and protections of online privacy on the Internet: the businesses running the Web, which is largely the current status quo, or the consumers who use it. For the moment, privacy advocates say the status quo is winning out.
benton.org/node/136381 | New York Times
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CONTENT

GOOGLE AND PUBLISHERS SETTLE
[SOURCE: Wall Street Journal, AUTHOR: Jeffrey Trachtenberg]
The Association of American Publishers has settled a long-running copyright infringement case with Google though the issue of whether Google had the right to digitally reproduce books in copyright is still being hashed out in court. The settlement allows U.S. publishers to remove digitized titles from the Google Library Project if they want. The settlement also "acknowledges the rights and interests of copyright-holders." Court approval isn't necessary. The Authors Guild is still pursuing the legal case.
benton.org/node/136314 | Wall Street Journal | Washington Post | ars technica | paidContent
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LABOR/OWNERSHIP

JOB-CREATION ENGINES
[SOURCE: New York Times, AUTHOR: Catherine Rampell]
For more than a decade, start-ups have been getting leaner and meaner. In 1999, the typical new business had 7.7 employees; its counterpart in 2011 had 4.7, according to an analysis of Labor Department data by E. J. Reedy at the Kauffman Foundation, a research organization focused on entrepreneurship. The lean model bodes well for companies like Leap2 that hope to become power players with much less manpower. With a work force of contractors, Leap2 could “dial it up and dial it down” as business demanded without having to spend money unless it was necessary, improving the company’s chances of survival. But the implications for the American work force are worrisome, and may help explain why economic output is growing much faster than employers are adding jobs.
benton.org/node/136383 | New York Times
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COMPANY NEWS

FACEBOOK TOPS 1 BILLION
[SOURCE: New York Times, AUTHOR: Nick Bilton]
A million users isn’t cool. You know what’s cool? A billion users. Facebook announced that it had topped one billion active users, meaning users who visited the site within a month. Although a few companies can claim to have had more than a billion customers, Facebook is the first social network to hit that number. Mark Zuckerberg, Facebook’s chief executive and founder, made the announcement in a blog post on the company’s Web site. “If you’re reading this: thank you for giving me and my little team the honor of serving you,” Zuckerberg wrote. “Helping a billion people connect is amazing, humbling and by far the thing I am most proud of in my life.”
People have used the “Like” button more than 1.1 trillion times since it was added in February 2009. There have been more than 140 billion friend connections. And since the fall of 2005, nearly 220 billion photos have been uploaded to the site. Facebook also said it has 600 million mobile users.
benton.org/node/136316 | New York Times | Facebook | Bloomberg | Fast Company | Washington Post | LATimes | GigaOm
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REAL POWER OF FACEBOOK
[SOURCE: GigaOm, AUTHOR: Om Malik]
In 2008, when Facebook introduced Facebook Connect, a way for folks to use their Facebook credentials to other websites and services, it was pretty obvious what Mark Zuckerberg’s long term goal was: controlling the identity infrastructure of the web. Once you do that, then you get access to all sorts of data and you are always relevant. The mobile app revolution has only accelerated the adoption as more and more apps are using Facebook’s connected identity. Just like search is a core infrastructure service of the web, so is Facebook’s connected identity technology. And because they have more data, they’re going to be more valuable and will help new kinds of transactions – whether they are purely social or purely economical. That was essentially what I thought it would be back in 2008. Now let’s see if the future works out according to plan.
benton.org/node/136338 | GigaOm
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STORIES FROM ABROAD

BRAZIL, GOOGLE AND FREE SPEECH
[SOURCE: Washington Post, AUTHOR: Craig Timberg, Paula Moura]
Here’s a quiz: Google received more than 1,900 requests from governments worldwide to remove content from its various services last year. Which country led the planet in this dubious category, with 418 such demands? China? Iran? Syria? No. It was democratic, pluralistic, economically vibrant Brazil. Many Brazilians were mortified last week when a judge detained Google’s top official in the nation over a YouTube video that had stirred ire in a mayoral campaign. But it was no aberration. The struggle over free speech is playing out most vividly today in countries that are America’s friends rather than its enemies, in nations where the right of expression is embraced in concept but often rankles in practice, say analysts. That is particularly true among a group of countries – think India, Thailand and Turkey, as well as Brazil – where fragile democratic institutions are struggling to manage the disruptions caused by increasingly pervasive technology.
benton.org/node/136306 | Washington Post
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IRAN AND JOURNALISM
[SOURCE: Reuters, AUTHOR: Ralph Boulton]
A leading media watchdog has accused Iran of trying to cow journalists into silence and self-censorship, adding to international pressure on Tehran over its treatment of activists and the press.
The New York-based Committee to Protect Journalists (CPJ) said Tehran was also trying to restrict Internet access. "The situation for independent journalists is Iran is worsening by the day," CPJ Deputy Director Rob Mahoney said. "High-profile persecutions and imprisonments are an attempt by the authorities to intimidate the media into silence and self-censorship. The international community must speak out against such actions."
The United Nations human rights office called for the immediate release of prominent activists and journalists arrested or intimidated in what it called an apparent clampdown on critical voices ahead of next year's presidential election.
benton.org/node/136304 | Reuters
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October 5, 2012

Source

New York Times

Author

Catherine Rampell

Coverage Type

Lauren Frayer

For more than a decade, start-ups have been getting leaner and meaner. In 1999, the typical new business had 7.7 employees; its counterpart in 2011 had 4.7, according to an analysis of Labor Department data by E. J. Reedy at the Kauffman Foundation, a research organization focused on entrepreneurship.

The lean model bodes well for companies like Leap2 that hope to become power players with much less manpower. With a work force of contractors, Leap2 could “dial it up and dial it down” as business demanded without having to spend money unless it was necessary, improving the company’s chances of survival. But the implications for the American work force are worrisome, and may help explain why economic output is growing much faster than employers are adding jobs.

When Job-Creation Engines Stop at Just One

October 5, 2012

Source

Author

Coverage Type

Advertising Women of New York marked the 100th anniversary of its founding, as the League of Advertising Women of New York, with two events: a breakfast, attended by about 200 people, and a luncheon, attended by more than 500. “When AWNY was founded, women could not vote,” Laura Desmond, chief executive of the Starcom MediaVest Group unit of the Publicis Groupe, said in introductory remarks at the breakfast. The organization began in 1912 with 40 members, she said, growing to 550 in 1962 and more than 1,700 now. “I would like to see, 10 years from now, that number double,” Ms. Desmond said, to help AWNY “serve as a catalyst for women in the communications field.” “The legacy, 10 years from now, 25 years from now, is in this room,” she added. “We have to keep paying it forward.” Desmond then joined a panel discussing such questions as whether female executives were more reluctant to take prime roles in industry conferences than their male counterparts.

Women and the Changing Face of the Advertising Industry

October 5, 2012

Source

New York Times

Author

Kevin O’Brien

Coverage Type

Lauren Frayer

An effort to develop an easy way for consumers around the world to avoid being tracked and targeted by Internet advertisers appeared to hit an impasse, as privacy advocates and industry representatives accused each other of scuttling the process.

The closed-door meeting organized by W3C, the global standards group that promotes good governance of the Internet, failed to produce a consensus on how to allow consumers to simply and effectively declare their “do not track” preferences on Web sites. The talks foundered on main issues like the extent and types of data that advertisers could continue to collect even after consumers indicated they no longer wanted to be followed. The conference is not expected to produce a final resolution, and other meetings could be scheduled before the end of January, when the group is set to disband. But the stakes for Internet users are high and boil down to who determines the limits and protections of online privacy on the Internet: the businesses running the Web, which is largely the current status quo, or the consumers who use it. For the moment, privacy advocates say the status quo is winning out.

Privacy Advocates and Advertisers at Odds Over Web Tracking

October 5, 2012

Source

Wall Street Journal

Author

Suzanne Kapner

Coverage Type

Lauren Frayer

Citigroup has been working for two years to overhaul the way it interacts with customers using social-networking sites run by Twitter, Facebook and others.

To be sure, social media are still a tiny category for Citigroup, representing less than 1% of all customer inquiries. But the use of social media are part of a broader effort to use the information gleaned from these sites to speed up decision making and improve customer relations at the No. 3 U.S. lender by assets. Big banks are notoriously bad at keeping their customers happy. Nearly one out of every five customers has a problem with their bank, according to J.D. Power & Associates. Nowhere is that more apparent than on the Web, where mishandled complaints can go viral and wreak havoc with a bank's reputation in minutes. That is one reason why banks are courting customers in the small, but fast-growing space of social media.

Citi Won't Sleep on Customer Tweets

October 5, 2012

Source

Wall Street Journal

Author

Peter Kafka

Coverage Type

Lauren Frayer

A Q&A with Triggit CEO Zach Coelius, an enthusiastic Facebook partner, who tries to explain Facebook’s ad exchange.

Why the Ad Tech Guys Are Going Nuts About Facebook Exchange, and Why That Matters

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October 5, 2012 (FCC on track for 2015 spectrum goal)

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