Matt Daneman

Alibaba's Taobao.com mobile commerce site, the Pacific Mall in Markham, Ontario, and online sites like Convert2mp3.net and ThePirateBay.org are among prominent physical and virtual marketplaces that facilitate or ignore rampant piracy and counterfeiting, the Office of the U.S. Trade Representative (USTR) said Friday in its annual notorious markets report. Citing growth of illicit streaming devices globally, USTR added several apps and portals that link such devices to illicit content -- TVPlus, TVBrowser and Kuaikan -- to the list. It said closer cooperation between governments and stakeholders is needed to tackle such video streaming piracy. Alibaba and mall management didn't comment.

The nonprofit Sports Fans Coalition (SFC) launched an over-the-top translator service in the New York area Thursday that aims to allow watching live streams of local broadcasters online. But broadcast experts see the Locast.org service raising copyright, retransmission consent and programming contract questions. "We are kind of in uncharted territory," said SFC founder David Goodfriend, a lobbyist and lawyer. "I'm not naive enough to think" there won't possibly be legal challenges, he said.

DOJ and AT&T have big motivations for settling the agency's lawsuit to stop the takeover of Time Warner, and doing so could depend on Justice flexibility, antitrust experts told us. Whether the sides are still discussing a settlement isn't clear as neither commented, with no consensus among antitrust experts about the likelihood. Meanwhile, the Brookings Institution Friday recommended antitrust enforcement reforms.

Having closed Thursday on its $1.4 billion MetroCast acquisition, Atlantic Broadband is considering additional mergers and acquisitions. "We have an appetitive for more" once the MetroCast integration is complete, President Dave Isenberg told us Thursday. He said Canadian pension fund Caisse de dépôt et placement du Québec is a co-investor in the MetroCast deal, with the idea of future acquisitions. "They see this as a platform for growth," Isenberg said, saying opportunities range from cable operators to regional fiber networks perhaps contiguous to Atlantic Broadband service areas. The MetroCast deal was announced in July (see 1707100040). Atlantic owner Cogeco Communications said it now operates in 11 states. It said MetroCast will keep its existing brand and will offer a variety of enhanced services under the Atlantic Broadband brand starting in the spring. Isenberg said Atlantic will use the same strategy with the rest of MetroCast that it employed with its 2015 takeover of MetroCast operations in Connecticut (see 1508210008): a variety of new products and services aimed both at residential customers, like gigabit Internet speeds and Atlantic's TiVo-based video platform, and at enterprise customers, such as hosted private branch exchange services. He said Atlantic continues to see broadband growth, and doesn't anticipate incoming 5G services providing significant competition to its wireline services in the near future since the company largely focuses on suburban and rural territories. It "will be an incredibly long time" before a wireless solution replicates terrestrial service, he said. Programmers increasingly are open to skinnier cable bundles, though there's not consensus among programmers, Isenberg said. "We're not at an inflection point, but the trend is clear," he said. He said video remains profitable and an Atlantic priority, and the Connecticut territory went from losing video customers at faster than industry averages to adding customers profitably.

AT&T's bid for Time Warner and Disney's quest for Fox likely will lead to even more video industry mergers and acquisitions in 2018, particularly as mid-sized programmers and distributors look to scale up or get assets that will let them compete in an increasingly direct-to-consumer (DTC) marketplace, experts said. "If you're a Viacom or a Discovery or an AMC, you have to look at [the consolidation trends] and say, 'Wow, we're becoming more fringe than core,'" said Andre James, head of Bain & Co.'s Americas media and entertainment practice.

Comcast/NBCUniversal likely doesn't have much to fear about the looming expiration of conditions on that 2010 deal, with it being unlikely either the DOJ or FCC will seek behavioral or structural conditions beyond that time, experts told us. But there's disagreement whether Justice's bid to block AT&T's buy of Time Warner (TW) (see 1711210005) indicates the agency should be doing something on Comcast/NBCU. The FCC conditions expire Jan. 20, and DOJ conditions expire in September. Public Knowledge (PK) on Friday became the latest party to call for Justice action on the expiring conditions.

Comcast's NBCUniversal and three regional sports networks over-the-top offerings undermined Wave's ability to meet existing programming agreement terms, the smaller company said in an FCC unfair competition complaint to have been posted Tuesday. The petition for declaratory ruling said Comcast would settle for only "a Draconian remedy" that made competition against Comcast's MVPD services on the West Coast impossible. It said Comcast -- by increasingly making RSN content available via OTT -- resulted in cord cutting that made it difficult for the cable ISP to continue to meet contractually set penetration levels. It said NBCU and the RSNs in response demanded the RSNs be moved to Wave's Lifeline tier but that would have led to "an avalanche" of other services with tagalong rights also relocating to Lifeline, making it uncompetitive. It said NBCU in July demanded and received $2.7 million, mostly in damages, for the RSNs not being repositioned to Lifeline from the Expanded Basic Tier. It said ongoing talks with NBCU made it clear NBCU didn't actually want the RSN services repositioned but wanted the ongoing breach allegation "to sustain its Machiavellian plot" to block Wave from accessing the commercial arbitration remedy that was part of the Comcast/NBCU consent decree.

Experts see scenarios where major studios may or may not oppose Disney's planned buy of Fox (see 1712140038). Studios won't be happy about the increased competitive power and market share that comes with Disney/Fox, but many might also be looking to do their own mergers and acquisitions in response and don't want to raise too big an objection, said Avri Ravid, Yeshiva University professor of finance and an expert on M&A and the entertainment industry. The deal likely won't need to go through FCC review since no Fox-held FCC licenses central to operations are being transferred, a communications lawyer said.

Whether DOJ would approve a Disney buy of nonbroadcast Fox assets is unsettled among mergers and acquisitions and other experts we talked to. A key question before regulators will be how to define what New Disney is -- a major player in sports content and movie production, or a much smaller content producer in the growing streaming landscape, they said. Disney and Fox reportedly plan to announce a deal as soon as this week. They didn't comment.

Along with luring cord cutters and cord nevers, AT&T's DirecTV Now over-the-top service also is helping it snag customers from rival MVPDs, which make up about half its customer base, Chief Financial Officer John Stephens told investors Tuesday. AT&T said DirecTV Now subscribers surpassed 1 million. The company is beta testing its second-generation platform that will include a cloud DVR and 4K capabilities, pay-per-view events and movies, digital advertising inserts and data insight capabilities, Stephens said. He said DirecTV Now profitability "will get up into very acceptable levels," and though it isn't the same fat profit margin opportunity the traditional linear TV business was, it requires much lower capital expenditures. On FirstNet, any states that don't make a choice automatically will be opted in when the opt-in window closes this month, and many states may go that route, he said. He said the work orders to build the FirstNet network over the next five years will start to be issued in January, with the engineering work already complete. He said FirstNet is "a very good revenue opportunity for us," with the potential of new products and services targeting markets like first responders and smart city initiatives, targeting perhaps 10 million users. Stephens said the company expects to finish this year with 7 million homes passed with fiber, and instead of an earlier prediction of 12.5 million by mid-2019, it's on track to pass more than 14 million homes with fiber by then. Stephens said customers should see "no change" from a rollback of Communications Act Title II regulation of ISPs, with the company continuing its policies of no blocking or advantaging some websites over others. House Communications Subcommittee ranking member Mike Doyle,​ D-Pa., and Chairman Ajit Pai were at odds Tuesday about the likely ramifications of Pai's net neutrality proposal (see 1712050057). Clarity on net neutrality "will bring back an opportunity for more investment," Stephens said. He said the company "look[s] forward to trial" and prevailing in the DOJ lawsuit seeking to block its buy of Time Warner (see 1711200064).