Loral said it had amended exchange offer for preferred stock and extended deadline until Oct 8. Under new offer, Loral will exchange $1.92 in cash and 6.54 shares, 4 shares more than original offer, of Loral common stock for each share of its Series C and Series D preferred. Loral said it didn’t expect any more changes in offer. If all of preferred shares participate, Loral will exchange $22 million in cash and 75.1 million common shares for preferred that has liquidation preference of $574 million, company said.
Country of origin cases
SBC/Ameritech in Mich. said real test of whether its operation support systems (OSS) met Sec. 271 requirements was how they were performing in real world, “not in the virtual world of testing.” Ameritech was reacting to draft report on incomplete OSS testing process filed by KPMG Consulting that said OSS was deficient at this stage. KPMG report showed Ameritech passed on just 26 performance metrics test points, with 133 metrics test points grading unsatisfactory and 117 graded as incomplete. Ameritech fared best in systems process testing, passing on 270 test points and getting unsatisfactory grade on just 3, with 9 incompletes. On transaction validation and verification portion, Ameritech passed on 158 test points, got unsatisfactory on 26 and incomplete on 8. Adding up all 3 major testing areas shows Ameritech received passing grade on 60% of 750 total test points and unsatisfactory or incomplete on 40%. Ameritech said it undeniably had opened its local markets to competition, and in real world its OSS successfully handled more than 25,000 CLEC orders and inquiries every business day. It proposed that performance metrics testing by KPMG continue while PSC evaluated other evidence in Ameritech’s interLATA long distance entry case (U-12320). SBC said favorable draft OSS test results for critical processing and transaction functions provided support for its contention that its OSS was meeting day-to-day demands of CLECs. Ameritech said FCC approved BellSouth Sec. 271 applications for Ga. and La. while performance metrics audits were continuing. But AT&T said that while Ameritech claimed local marketplace was giving it “A” on OSS readiness, “it appears that KPMG is giving the company an ‘F’ on the quality of its OSS.” OSS testing originally was to have been completed in May, but has been delayed several times and now is tentatively set for completion in Nov. PSC, at Ameritech’s request, asked KPMG to file report on current OSS testing status. PSC will hold workshops on report Oct. 14-15 and hearings Nov. 25 and Ameritech plans further comment once it has studied entire 1,000-page KPMG draft.
ABC and its ESPN are significantly expanding HDTV rollout, they said Wed. ESPN said it would deliver HDTV simulcast of its regular program network beginning in April. Pres. George Bodenheimer said it would include at least 100 live HDTV broadcasts of games in its first year, calling it “a significant commitment to spur the growth of high- definition television.” Programming will be delivered in 720P, with programming that doesn’t originate in high definition upconverted. ABC TV said it would air Super Bowl, NBA finals and Stanley Cup in HDTV in 2003-2004 season. ABC already transmits most of its prime-time schedule in HDTV, sponsored by Zenith.
In 11th-hour filing, NextWave told U.S. Supreme Court that in recent brief at high court and in public notice, FCC had reversed course on some of original arguments it made in case. NextWave said justifications in FCC’s public notice, in which Commission considered options for letting re-auction winners bow out of their bid obligations, “contradict the FCC’s central themes in this case.” NextWave told high court in supplemental brief: “As recently as its opening brief in this case, the FCC had insisted that the principle of ‘auction integrity’ required the winning bidders at the re- auction of NextWave’s licenses to ‘pay the full amount of their winning bids or be subject to default payments.'” Supreme Court is to hear oral argument Oct. 8 in govt. challenge to U.S. Appeals Court, D.C., ruling that had reversed FCC’s decision to cancel NextWave’s licenses for missed payment.
House Judiciary Committee Chmn. Sensenbrenner (R-Wis.) introduced “comprehensive child abduction prevention bill” that includes Amber Alert legislation originally offered by Reps. Dunn (R-Wash.) and Frost (D-Tex.). House Judiciary Crime, Terrorism & Homeland Security Subcommittee will hold hearing and markup on bill Sept. 26.
BEVERLY HILLS -- Govt.-mandated protection standards for digital content will create more problems than they will solve, said technologists participating in lively Digital Hollywood panel here late Mon. Donald Whiteside, Intel vp- legal and govt. affairs, took direct aim at legislators’ lack of foresight: “The Hollings bill said any device capable of digital copying should have technology that would prevent such copying. Well, that would include scanners and digital copiers. That’s why we need the industries to solve the problems so that asinine legislation such as the Hollings bill isn’t foisted on us… The government shouldn’t use legislation to stifle innovation.”
CTIA told N.Y.C. Council Consumer Affairs Committee Chmn. Phillip Reed that ban panel was considering on cellphone use in “places of public performance” such as theaters wasn’t necessary. “The inconsiderate use of wireless technologies can best be addressed without resort to ineffective governmental mandates,” CTIA Pres. Tom Wheeler said in Sept. 20 letter: “Wireless devices need not be disruptive in public settings.” Legislation that committee is considering taking up, subject of hearing Tues., is designed to keep wireless phones from being used in public spaces such as theaters. CTIA said enforcement of proposal would be difficult, requiring theater staff or patrons to summon police to write citation, “a process which we know from sporting events is much more disruptive than the original altercation or act of rudeness.” Such logistical problems make enforcement “effectively unenforceable,” group said. CTIA said theater patrons could set phones to vibrate rather than ring so as to not disrupt surrounding audience. It said proposed ordinance didn’t make distinction between wireless phone use during quieter events such as concerts or sporting events, when cellphone conversation might be indistinguishable from surrounding din. Matters of etiquette and enforcement “are best left to individuals and the managers of public establishments,” Wheeler said.
Ninth U.S. Appeals Court, San Francisco, reversed lower court Mon. and ruled that FCC regulations that took effect after Ariz. Corporation Commission (ACC) arbitrated interconnection agreements must be applied to those agreements. Court then applied those new regulations to numerous provisions of the ACC interconnection agreements, addressing disputes over such things as cable sheath mileage, 4-wire loop price, conditions for access to subloops. Appeals court affirmed District Court on most of those issues but remanded or reversed a few. U S West began negotiating agreements with CLECs in Ariz. in spring of 1996, shortly after Telecom Act was passed. Agreement wasn’t reached with any CLECs so ACC began arbitration in late 1996, with last decisions coming in early 1998. Changes in FCC regulations occurred after 8th U.S. Appeals Court, St. Louis, in 2000 vacated several FCC regulations, including some pricing rules, some of which were reversed by U.S. Supreme Court in 2001. Ninth Circuit had delayed action on U S West v. Jennings (99-16247) until high court ruled. Originally, both U S West and CLECs appealed to 9th Circuit. U S West dropped its appeal, so Mon. ruling was on remaining CLEC cross- appeals. Court concluded: “Because the role of the federal courts is to determine whether the agreements comply with the Act, and because the FCC properly has exercised its authority to implement the Act by means of promulgating regulations, we conclude that we must ensure that the interconnection agreements comply with current FCC regulations, regardless of whether those regulations were in effect when the ACC approved the agreements.”
Critics of plan filed by Nextel, private wireless and public safety groups to mitigate public safety interference at 800 MHz expressed concern about coalition’s compromise rebanding proposal at FCC this week, including lack of full funding. Numerous mobile wireless, satellite, public safety and utility companies took issue with coalition’s description of rebanding blueprint as representing “consensus” proposal. City of N.Y. said plan crafted by Nextel and others outlined general framework for relocating public safety operations, but it still had concerns that funding, beyond $500 million already pledged by Nextel be identified up-front. AT&T Wireless, Boeing and Verizon Wireless were among commenters lining up against Nextel plan. Meanwhile, backers of compromise proposal told FCC they would fill in details of their funding arrangements by Oct. 23.
Loral doesn’t have to use Chinese Long March rocket to launch Asia-Pacific Telecom (APT) Apstar 5 satellite if U.S. govt. doesn’t approve export license by Sept. 30, under terms of new $110 million contract with APT Satellite of Hong Kong, Loral announced Mon. APT has decided to allow Loral to break agreement to use Chinese booster in exchange for purchase of half of 54 transponders on Apstar 5 along with sharing $230 million cost of building, launching and insuring satellite, companies said. Loral will retain 50% ownership of satellite regardless of launch site, under contract signed Sept. 20. APT and Loral will select new launcher jointly if State Dept. fails to approve license, companies said. Loral’s capacity on Apstar 5 will be designated Telstar 14. Satellite is scheduled for launch in 3rd quarter next year, Loral said.