October 3, 2012 (Why Give Up on Competition?)
BENTON'S COMMUNICATIONS-RELATED HEADLINES for WEDNESDAY, OCTOBER 3, 2012
FCC’s Advisory Committee on Diversity for Communications in the Digital Age http://benton.org/calendar/2012-10-03/
INTERNET/BROADBAND
From the Desk of Michael Copps: Why Give Up on Competition? - op-ed
We Can’t All Be in Google’s Kansas: A Plan for Winning the Bandwidth Race - op-ed
California Governor Signs Bill Limiting IP Regulations
The EU wants to invest in broadband, but will it?
Senate Republicans: Executive order would solidify divide on cybersecurity [links to web]
National Cybersecurity Awareness Month 2012 - press release [links to web]
States bristle at Sen Reid’s push to legalize online poker in lame-duck session [links to web]
Time Warner Cable to Charge Modem Rental Fee [links to web]
Media groups, Filipinos protest tough cyber law [links to web]
WIRELESS/SPECTRUM
MetroPCS in talks to merge with T-Mobile USA
T-Mobile Redials America - analysis
MEDIA AND ELECTIONS
A Glimmer in the Vast Wasteland - op-ed
Obama Outspending Romney on TV Ads
Crossroads groups swamp airwaves
Free Press Report Finds Electoral Coverage in Denver Doesn’t Offset Lies in Political Ads - press release
The Digital Election: Money Flowing Online, But Not Persuasion Ads [links to web]
Fox News’s Andrea Tantaros: How many people need to die before media gets tough? [links to web]
OWNERSHIP
Internet Companies Diss Old Consumer Protection Laws, New Child Privacy Rules
FCC Seeks Comment on Sirius, Liberty
Samsung asks for new Apple trial
Google withdraws U.S. patent complaint against Apple [links to web]
One quarter of U.S. tech start-ups founded by an immigrant: study [links to web]
PRIVACY
FTC Chairman: Advertisers Backing Away from ‘Do Not Track’ Pledge
Chairman Rockefeller Backs FTC in Do-Not-Track Spat [links to web]
Google Warns of New State-Sponsored Cyberattack Targets
TELECOM
FCC Asked to Penalize Carriers Who Don’t Complete Calls to Rural Areas [links to web]
California Governor Signs Bill Limiting IP Regulations
FCC fines prepaid calling card company $5 million [links to web]
CONTENT
YouTube opens Turkish site, giving government more control [links to web]
Mobile computing wars pose tough choices for Internet publishers [links to web]
Penguin brings e-books back to libraries with distributor 3M [links to web]
MLB Announces New Rights Deals With Fox, Turner [links to web]
ACA Pans MLB Rights Deal [links to web]
Rep Markey Asks FCC to Retain Ban On Exclusive Contracts [links to web]
GOVERNMENT & COMMUNICATIONS
2012 Digital States Survey: Utah, Michigan Stay at the Head of the Class [links to web]
What Makes the Best Government Website? [links to web]
CIVIC ENGAGEMENT
Internet 'Uncaucus' Planned for Iowa [links to web]
MORE ONLINE
FTC hires economist in Google case [links to web]
What Campuses Can Learn From Online Teaching - op-ed [links to web]
Tech wants Kirk to fight India’s buy-local rule [links to web]
INTERNET/BROADBAND
WHY GIVE UP ON COMPETITION?
[SOURCE: Benton Foundation, AUTHOR: Michael Copps]
[Commentary] Go to just about any telecom conference these days, and some industry maven will make the case that restoring competition to the telecom world is so 1990s. Why don’t we all just recognize the inevitable, they ask: telecom is a natural monopoly, competition is a chimera, and the sooner we flash a steady green light for more industry consolidation and less government oversight, the better off we’ll all be. 19 state legislatures have removed regulatory authority from state public service commissions that for years have been trying to protect consumers and preserve competition. The consolidated world of telecom broadband did not evolve from the hand of God, the mysterious workings of natural law, or the inevitability of market-based dynamics. It was enabled by conscious decision-making at the federal level, largely through the abdication of its oversight responsibilities by the Federal Communications Commission over the better part of 30 years. But we can get competition back.
http://benton.org/node/136047
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A PLAN FOR WINNING THE BANDWIDTH RACE
[SOURCE: Wired, AUTHOR: Susan Crawford]
[Commentary] Even though America is in a “global bandwidth race” and our “nation’s future economic security is tied to frictionless and speedy access to information,” according to Federal Communications Commission Chairman Julius Genachowski’s latest speech – we don’t have a plan for winning that race. And our current incumbent providers are not going to help. They’re not going to be the ones rolling out the fiber-to-the-home networks that could provide this speedy access to information. Why? They have no incentive to do so. Because they never enter one another’s territories, they don’t face the competition that might spur such expansion. Instead, incumbent internet access providers such as Comcast and Time Warner (for wired access) and AT&T and Verizon (for complementary wireless access) are in “harvesting” mode. They’re raising average revenue per user through special pricing for planned “specialized services” and usage-based billing, which allows the incumbents to constrain demand. The ecosystem these companies have built is never under stress, because consumers do their best to avoid heavy charges for using more data than they’re supposed to. Where users have no expectation of abundance, there’s no need to build fiber on the wired side of the business or build small cells fed by fiber on the wireless side. If we wanted ultra-high-speed connectivity in the U.S., we could:
Provide loan guarantees for building basic competitive fiber infrastructure;
Preempt state laws that make it difficult (or impossible) for municipalities to commission their own fiber networks;
Require wholesale providers to build open, non-discriminatory networks as a condition of getting access to rights-of-way; and
Require separation between content and transport providers to avoid the risk of harvesting.
benton.org/node/136115 | Wired | Genachowski speech
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LIMITING IP REGULATIONS
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
Gov. Jerry Brown (D-CA) has signed a bill that limits the regulatory authority of the state's Public Utilities Commission over Voice over Internet Protocol (VoIP) and IP-enabled services (voice, data, or video) there until 2020. In a letter to members of the California Senate, he said that consumer safeguards remained in place, that the bill would spur the growth of "innovative services that have become a hallmark of our state." Gov Brown pointed out that VoIP providers will continue to contribute to the Universal Service Fund, provide e911 access, were still subject to consumer protection laws as well as PUC oversight of pole attachments. But the bill does prevent PUC's from regulating IP video, voice and data services on their own initiative, limiting them to actions expressly delegated by Federal law or directed by statute.
benton.org/node/136081 | Broadcasting&Cable
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WILL EU INVEST IN BROADBAND?
[SOURCE: GigaOm, AUTHOR: Stacey Higginbotham]
European Commission vice president Neelie Kroes has long advocated faster broadband’s economic benefits. Now she is preparing to ask the EU to endorse a package that could free up to €100 billion ($128.65 billion) in broadband infrastructure investment. Voting on the proposal is due by the European Parliament and ministers of member states at the end of this month. As part of a conference supporting the initiative, Kroes presented detailed plans to key industry stakeholders for the first time. Her argument is that the fund’s €9.2 billion in government loans can unlock between €50 billion and €100 billion in actual broadband spending over the six years of the program. Kroes is selling it with strong language that paints broadband as the gateway for communities and organizations to the 21st century.
benton.org/node/136080 | GigaOm
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WIRELESS/SPECTRUM
METROPCS/T-MOBILE
[SOURCE: IDG News Service, AUTHOR: Stephen Lawson]
Deutsche Telekom is in talks with MetroPCS Wireless on a possible deal to combine T-Mobile USA with that carrier. MetroPCS said the talks might not result in a deal. The negotiations had been widely reported, following reports over the past two weeks that T-Mobile might tie up with MetroPCS, Sprint Nextel or satellite TV operator Dish Network. Deutsche Telekom, based in Germany, is the parent company of T-Mobile USA. A deal with MetroPCS would add scale but create all kinds of logistical challenges for the two carriers as they tried to merge distinct sales approaches, corporate cultures and network technologies.
benton.org/node/136117 | IDG News Service | WSJ
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T-MOBILE REDIALS AMERICA
[SOURCE: Wall Street Journal, AUTHOR: Miriam Gottfried]
When you are in a hole, you usually stop digging. And yet struggling T-Mobile USA, after failing to sell itself to AT&T, may be about to dig even deeper into the U.S. market: It is in talks to purchase prepaid mobile carrier MetroPCS PCS. In many ways, it actually makes sense for T-Mobile's parent, Deutsche Telekom, to bulk up in the U.S. with the deal. It would eliminate a low-cost competitor and give the combined companies 29.5% of the prepaid market, according to Sanford C. Bernstein. Total subscribers would be 42.5 million, against 56 million for Sprint, 111 million for Verizon Wireless and 105 million for AT&T, as of the second quarter. If T-Mobile were to structure the deal as a reverse merger, as some analysts have suggested, it would give the company a U.S. stock listing. That would allow it to finance itself separately and let Deutsche Telekom sell down its exposure over time. MetroPCS's spectrum holdings are geographically complementary with T-Mobile's. And a deal would significantly bolster the latter's presence in the top 100 markets, as well as giving it crucial bandwidth to build a next-generation LTE network. One key opportunity is for T-Mobile to move subscribers off MetroPCS's network, which uses a different technology, and eventually to turn it off. That would both free up spectrum and allow the combined company to save money by merging cell sites, among other things. But it can be a painful process.
benton.org/node/136138 | Wall Street Journal | Bloomberg
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MEDIA AND ELECTIONS
A GLIMMER IN THE WASTELAND
[SOURCE: New York Times, AUTHOR: Newton Minow]
[Commentary] The debates are an institution now, and among the most watched television events in America. They are one place in the modern campaign — perhaps the only place — where the voter is treated with respect. They are the one time when the major candidates appear together side by side under conditions they do not control. They are a relief from the nasty commercials that dominate the campaign, fed by donations that are effectively unlimited and anonymous. Broadcasters provide the television time for the debates, without commercials, as a rare public service. I have been privileged to participate in some form in all 27 presidential and 8 vice presidential debates so far. In 1960, I helped my boss, the former Illinois governor and presidential candidate Adlai E. Stevenson, persuade Congress to exempt debates from the equal-time law, making it possible for broadcasters to cover them without having to include every candidate for the presidency, no matter how marginal. (Congress failed to provide the same exemption in 1964, 1968 and 1972, so there were no debates those years.) After the Federal Communications Commission acted to exempt the debates from the equal-time law, the League of Women Voters revived the debates, in 1976, and asked me to help.
Let me suggest that after you watch the debate, you turn off your television set and do your best to avoid the spin that will follow. Talk about what you saw and heard with your family, your friends, your neighbors, your co-workers. You are smarter than the spinners. It’s your decision that matters on Nov. 6, not theirs.
benton.org/node/136146 | New York Times
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OBAMA OUTSPENDING ROMNEY
[SOURCE: New York Times, AUTHOR: Jim Rutenberg, Jeremy Peters]
For every five commercials Mitt Romney and his allies ran in Colorado in the last two weeks of September, President Barack Obama and Democrats ran seven, accusing Romney of having a “tough luck” attitude toward the middle class and asserting that President Obama has brought the economy back from the brink. In Florida, the disparity was greater. The number of pro-Obama ads outnumbered pro-Romney ads by almost 50 percent — some 13,000 of them accusing Romney of outsourcing jobs to China, trying to gut Medicare and hiding his tax returns from the public. The story was the same in most of most of the other battlegrounds. In Ohio and in Iowa, in Norfolk (VA) and on the Boston stations that feed New Hampshire, President Obama out-advertised his rival after the parties’ nominating conventions, according to data compiled by the political advertising monitoring firm Kantar Media/CMAG. Obama’s continued advantage on the airwaves, which counters Democratic predictions that he would be far outgunned by Romney and his allied “super PACS” by now, may help explain why polls in most of the competitive states have shifted in his direction over the last month.
benton.org/node/136145 | New York Times
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CROSSROADS SWAMPS AIRWAVES
[SOURCE: Politico, AUTHOR: Dave Levinthal]
The Karl Rove-backed American Crossroads super PAC and Crossroads GPS non-profit group spent more than $20 million in late September on TV and radio ads attacking President Barack Obama and congressional Democrats. The Crossroads ad buys are part of a wave of spending from conservative groups in the second half of September that swamped liberal outfits, a POLITICO analysis of federal data indicates. And they’re not slowing down. The two groups are about to launch a week-long advertising campaign in key battleground states worth $16 million. That includes $11 million on a spot focusing on the stimulus bill and the unemployment rate. Top-spending liberal organizations such as House Majority PAC and Priorities USA Action simply couldn’t compete last month, as has been the case for most of the 2012 campaign. Of the 10 groups spending the most in late September to directly support or oppose federal candidates, $47.4 million came from identifiably conservative entities while liberal groups spent $21.8 million, records show.
benton.org/node/136132 | Politico
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POLITICAL ADS VS POLITICAL COVERAGE IN DENVER
[SOURCE: Free Press, AUTHOR: Press release]
This report takes an in-depth look at political coverage on Denver’s local ABC, CBS, Fox and NBC affiliates and asks whether newscasts are doing enough to investigate the claims made in ads produced by American Crossroads/Crossroads GPS, Americans for Prosperity, House Majority PAC, Priorities USA Action and Restore Our Future. Since August, these five groups have signed contracts with Denver’s affiliates to air 4,954 ads in the local market, paying more than $6.5 million to secure the spots. And yet these stations devoted only 10 minutes and 45 seconds to fact-checking ads from these groups. That’s a ratio of 1 minute of news for every 162 minutes of political ads. The report also found that stations kept airing ads even after their own journalists found that the groups were spreading false or misleading information. Local television stations are legally required to air federal candidates’ ads, whether they’re accurate or not. However, this requirement does not apply to ads from “non-candidate” groups like the Super PACs and tax-exempt 501(c)(4)s that are the focus of the Free Press report.
benton.org/node/136113 | Free Press | read the report | Free Press blog | Broadcasting&Cable
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OWNERSHIP
INTERNET COMPANIES DISS OLD LAWS
[SOURCE: National Journal, AUTHOR: Josh Smith]
Internet companies are complaining that online tax proposals, outdated consumer protection laws, and child privacy protections are the top threats to Internet services. NetChoice, a coalition that includes top companies like Facebook, AOL, eBay, and Yahoo, released its list of "iAwful" laws that companies see as standing in the way of online innovation. Three of the top six threats on the list--including number one--involve proposals to levy sales taxes on online companies. Congress is considering overturning a Supreme Court case that barred state governments from collecting sales taxes from companies that didn't have a physical presence in their states. States and brick-and-mortar stores say such changes are needed to raise revenue and level the playing field, but online companies have understandably opposed such measures. The other items topping the list, however, may have consumers scratching their heads.
benton.org/node/136097 | National Journal
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FCC SEEKS COMMENT ON SIRIUS, LIBERTY
[SOURCE: Wall Street Journal, AUTHOR: John Jannarone]
The Federal Communications Commission called for public comment on Liberty Media’s application for approval to take control of Sirius XM Radio, a sign the agency is moving forward to evaluate the application. In a public notice issued on Oct 2, the FCC said that parties wishing to comment on Liberty's application need to submit them by Nov. 1 and responses or oppositions to comments must be filed by Nov. 20. After that, the FCC is expected to take several weeks to make a decision. The FCC said that it had decided to evaluate the application even though Sirius had not signed certain forms related to it. The two companies have been wrangling for months over Liberty's desire to exercise control of Sirius.
benton.org/node/136140 | Wall Street Journal
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SAMSUNG ASKS FOR NEW TRIAL
[SOURCE: Financial Times, AUTHOR: Tim Bradshaw]
Samsung has called for a new trial of its high-profile US patent case against Apple, suggesting the foreman of the jury which awarded the US group $1 billion in damages may have been biased by an undisclosed lawsuit of his own. The South Korean company said Velvin Hogan, the San Jose jury foreman, did not tell the court before the trial that he was sued in 1993 for breach of contract by Seagate, the computer storage manufacturer in which Samsung now holds a significant stake. Hogan subsequently filed for personal bankruptcy. “Mr Hogan’s failure to disclose the Seagate suit raises issues of bias that Samsung should have been allowed to explore in questioning,” Samsung said in a filing.
benton.org/node/136131 | Financial Times
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PRIVACY
ADVERTISERS BACKING AWAY FROM DO NOT TRACK
[SOURCE: Wall Street Journal, AUTHOR: Julia Angwin]
In February, the online advertising industry declared that it would agree to honor “Do Not Track” options in Web browsers by the end of the year– a reversal of its previous opposition to the anti-tracking effort. Now, that year-end goal – announced with much fanfare at the White House – is looking less likely. Federal Trade Commission Chairman Jon Leibowitz said that the industry “appears to be backing off from its commitments.” Chairman Leibowitz, who has been leading the crusade for a Do Not Track option in Web browsers, said he still hopes that an agreement can emerge from the Tracking Protection Working Group meeting in Amsterdam this week, where privacy advocates and advertisers are hammering out the details of a Do Not Track button for Web browsers. The sticking point is likely to be the industry’s definition of Do Not Track, which includes an exception for tracking related to market research and product development. Privacy advocates have pushed for limits on how long the industry can keep data for such purposes, and requirements that the data be anonymized after a certain date.
benton.org/node/136137 | Wall Street Journal
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GOOGLE WARNS OF STATE-SPONSORED ATTACKS
[SOURCE: New York Times, AUTHOR: Nicole Perlroth]
In June, many Google users were surprised to see an unusual greeting at the top of their Gmail inbox, Google home page or Chrome browser. “Warning: We believe state-sponsored attackers may be attempting to compromise your account or computer.” On Oct 2, tens of thousands more Google users will begin to see that message. The company said that since it started alerting users to malicious — probably state-sponsored — activity on their computers in June, it has picked up thousands more instances of cyberattacks than it anticipated. Mike Wiacek, a manager on Google’s information security team, said that since Google started to alert users to state-sponsored attacks three months ago, it had gathered new intelligence about attack methods and the groups deploying them. He said the company was using that information to warn “tens of thousands of new users” that they may have been targets
benton.org/node/136126 | New York Times
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