The FCC should ease radio ownership caps and eliminate the newspaper/broadcast cross ownership rule, Senate Telecom Subcommittee Chmn. Upton (R-Mich.) urged Thurs. Speaking at a Media Institute lunch, Upton said he made his requests in letters sent last week to the FCC asking for a rulemaking on radio ownership. He'd prefer no ownership caps, except in small markets, but compromised in his overture to the FCC because he’s a “pragmatist,” Upton said.
Notable CROSS rulings
The NAB wants the FCC to relax newspaper-TV station cross-ownership limits as part of media deregulation. NAB Pres. David Rehr also wrote FCC Chmn. Martin that he wants the Commission to allow a company to own more than a single TV station in more places than it does now. The letter cited “severe financial pressures” on broadcasters in “medium and small markets.” Analysts expect the Commission to reconsider media rules once Robert McDowell is confirmed as the 5th commissioner.
The Tex. Supreme Court said state law gives the PUC the power to investigate alleged anticompetitive effects from switched access rates, but not to order reductions to protect the long distance market. The court was ruling on a dispute arising from a Sept. 2000 PUC complaint case between the former AT&T Communications and former SBC. AT&T alleged SBC was indirectly subsidizing intrastate long distance service of a subsidiary and sought reductions in its intrastate access charges to remedy the situation. Lower courts ruled the PUC had no authority to review access rates after they had been approved, even in the face of allegations of intracorporate cross-subsidies. But the Supreme Court said that while the PUC can’t cut approved access rates to remedy a competition situation, it has an obligation to ensure fair telecom competition. The court (Case 03-0789) said the PUC may have remedies other than access rate cuts to ensure fair competition and should be allowed to explore them.
Municipal utilities offer “streamlined” decision- making for BPL deployments with relatively simple regulation, said Walter Adams, vp of Communications Technologies (ComTeK), the operator of city-owned BPL system in Manassas, Va. But investor-owned utilities (IOUs) offer a larger scale of deployments and tend to have much stronger telecom infrastructure that a BPL operator can exploit, he said in an interview. Manassas, the first citywide BPL deployment in the U.S., passes 12,000 homes and has almost 1,000 customers, he said. ComTeK is negotiating for substantial deployments but no announcements are due right away, because IOUs take their time on decisions, Adams said. Advantages of BPL operations with municipalities include “clear” rights-of-way and a single set of franchising rules, taxes and easement regulations, he said: “It is a single regulatory environment.” Many IOUs cross state boundaries, in addition to passing various towns, so “they have more masters to please with different regulatory philosophies.” Facing a “dynamic pricing environment,” ComTeK has begun to roll back prices in Manassas to compete with cable and DSL, Adams said. The company is weighing VoIP and video services, he said, but is constrained in providing voice services to residential customers because of bandwidth limitations of its first generation Main.net equipment. So voice services will be first rolled out to businesses until residential equipment is beefed up. He said the tussle with ham radio operators over interference complaints is mainly an “administrative irritant” and a distraction; it hasn’t affected the firm’s ability to add customers. Ubiquitous BPL deployment is needed to provide utility applications such as automatic meter reading, he said. Otherwise, power companies will have to support 2 infrastructures. Having built out in Manassas, ComTeK is teaming with another company to provide distributed power and voltage quality monitoring at various places in the grid with advanced optical sensing, he added.
Verizon Airfone met with International Bureau and Wireless Bureau staff to discuss progress on cross-border agreements with Canada and Mexico when the U.S. begins to permit broadband on commercial flights following the May air-to-ground auction. Verizon is the ATG incumbent and will continue to offer services using a 1 MHz license. The company also plans to bid aggressively for the spectrum licenses being offered at auction. “As Airfone noted in previous meetings with the staff, timely negotiations of new cross-border agreements with Canada and Mexico is extremely important to the provision of broadband air-ground services,” the company said. “In addition, it is critical to enable Airfone to meet its obligation under the new rules adopted by the Commission, i.e., to reconfigure its current narrowband system -- such that it uses just 1 MHz of spectrum -- within 24 months of the grant of new licenses.”
Colleagues of former Tenn. regulator Deborah Tate described the FCC’s newest commissioner as a mediator, problem solver and consensus builder who prefers to settle matters through voluntary agreements among conflicting parties.
Network and data security, including squelching spam, will be a key European issue this year. Austria, which took the European Presidency Jan. 1, listed spam among 4 telecom areas on which it will focus. Austria and Finland, to head the Presidency as of July, said they'll pay “particular attention” to beefier network security. EU presidencies rotate every 6 months.
A La. appeals court has until Jan. 5 to rule on BellSouth’s challenge to a Lafayette, La., bond ordinance that’s to raise $125 million for the Lafayette Utilities System’s (LUS) municipal broadband service project. The 3rd La. Court of Appeals held hearings Dec. 29. At issue is a revenue pledge in the bond ordinance that allows LUS to loan the telecom unit funds from general utility revenues to cover payments on the telecom bonds if the telecom unit has insufficient revenues for a payment. A lower court upheld the ordinance but BellSouth appealed. BellSouth argued that under the 2004 La. Local Govt. Fair Competition Act, such revenue-pledge loans are legal only to cover nonrecurring startup expenses, not ongoing debt service costs. BellSouth also said the city’s revenue pledge arrangement isn’t lawful unless the bonds go into default first. It said a revenue pledge that kicks in to cover a bond payment in order to avoid a default is an illegal cross-subsidy. But the city argued that the law allows revenue-pledge loans for any purpose, at any time, so long as the telecom unit repaid the loans with interest at prevailing market rates. The city said state law allows revenue pledges to obtain better interest rates on bonds, and doesn’t require a bond default before a revenue pledge can be activated. The city said the law allows it to engage in any lawful business practice that private companies can, and said revenue transfers among affiliates, with market-rate payback mechanisms, are a common commercial business practice. The city also argued that BellSouth should have challenged the bond proposition, not the implementing ordinance, so its suit wasn’t timely filed. But BellSouth said it had no problems with the ballot proposition, and its dispute lay in the details of the enabling ordinance. Meanwhile, the La. PSC urged the appeals court to remand the matter back to a trial court, saying BellSouth’s appeal of the bond ordinance is a “collateral attack” on the PSC’s rules to level the playing field between the city’s broadband unit and private telecom providers. In those rules, the PSC agreed with the city’s interpretation of state law regarding revenue pledges and said such pledges wouldn’t be an improper cross subsidy. No party, including BellSouth, appealed the PSC rules. The PSC said state law requires that appeals of PSC rules be brought first to the 19th Judicial Circuit Court, and it would strenuously object to any ruling by the state appeals court that would overturn the PSC’s fair-play rules.
A municipal broadband project in Lafayette, La. passed another hurdle as the legal deadline for state court challenges to the PSC’s rules governing the project passed without any appeals filed. The PSC in late Oct. refused to reconsider the rules it adopted to keep the Lafayette Utilities System (LUS) from cross-subsidizing its broadband services with revenue from other utility services, clearing the way for possible state court appeals of the PSC rules. While the PSC rules now are beyond court challenge, a lawsuit seeking to invalidate the city’s $125 million bond issue that’s intended to finance the project is continuing. The 3rd La. Court of Appeals plans hearings Dec. 29 on BellSouth’s suit that alleges the city bond ordinance conflicted with state laws intended to prevent cities from cross-subsidizing utility services. Lower state courts upheld the ordinance. The city said the law allows cities to pledge revenue in order to secure better interest rates, and said the BellSouth lawsuit wasn’t timely filed. It said such challenges must be filed within 60 days of the bond election and BellSouth waited too long.
A European Commission (EC) plan to guard communications data exchanged by police agencies in criminal matters Mon. won qualified approval from Europe’s data protection chief. In Oct., the EC adopted a framework decision aimed at making some existing information -- including phone calls and other communications data -- available more easily to police services in cross-border cases. The EC also wants more safeguards for personal data in law enforcement hands, on grounds that European data protection directives don’t cover them. European Data Protection Supervisor Peter Hustinx said the new framework “will be one of the 3 central pieces of European legislation in the field of data protection… Good law enforcement and good data protection reinforce each other -- so it is in the interest of everyone that the proposal is even further improved before it is adopted.” He urged several changes. The main data protection rules should cover all police and judicial data -- not just information exchanged between member states but also data used within a state, he said. Data on suspects, convicted persons, witnesses, contacts, and victims should be processed under varying safeguards and other conditions. The need for and proportionality of data exchanged should reflect European Court on Human Rights case law. The quality of data received from a non-European Union country must be carefully assessed in the light of human rights and data protection standards before they're used. Finally, Hustinx said, decisions based solely on automated processing of data “should be subject to very strict conditions when they produce effects concerning a person or significantly affect a person.” He recommended the proposal be revised to include specific provisions on such decisions.