Once again, the topic of municipal broadband is raising hackles as availability of federal stimulus funds reignites a long-standing dispute. By assigning local government the same eligibility it gave states, nonprofits, public/private partnerships and companies pursuing stimulus money, Congress thrilled those who see government as some Americans’ last, best hope to get online. But free marketeers say the worst, last place for government of any sort is in broadband. Earlier efforts at municipal broadband saw 15 states ban municipalities from the telecom business.
Notable CROSS rulings
The three judges considering FCC cable ownership limits (CD April 24 p11) voiced some skepticism about their constitutionality, methodology or utility, given competition from direct broadcast satellite services. Friday in Comcast vs. FCC, the members of the U.S. Appeals Court for the District of Columbia Circuit asked the commission’s lawyer many pointed questions. They asked Comcast’s attorney questions on how the regulator in 2007 arrived at the limit of 30 percent of the number of pay-TV subscribers any cable operator can serve, but voiced some deeper concerns. Analysts who watched the oral arguments told us Comcast appeared likely to win.
The court overseeing appeals of an FCC cross-ownership order agreed to put off the cases while the agency reconsiders (CD April 6 p8) the rules on common ownership of a daily newspaper and a radio or TV station in the same market. A Tuesday order from the 3rd U.S. Circuit Court of Appeals in Philadelphia agreed to hold the cases in abeyance. It gave involved parties 21 days to show why its earlier stay in Prometheus Radio Project vs. FCC shouldn’t be lifted.
Tribune’s plan for a merger involving two Connecticut TV stations and a daily newspaper that it owns (CD March 31 p8) drew fire from the state’s attorney general as possibly violating FCC rules. But the commission seems to have little basis for investigating because the stations, WTIC-TV Hartford and WTTX Waterbury, have no license renewals pending, FCC and industry officials said.
The FCC withdrew a recent request that an appeals court go ahead with deciding challenges to an order loosening some restrictions on when a company can own a daily newspaper and a broadcast station in a city (CD Dec 19/07 p1). In a notice of withdrawal of opposition filed Thursday with the 3rd U.S. Circuit Court of Appals in Philadelphia, the commission reversed the position of its previous leadership. Commissioner Robert McDowell wrote the court Friday to say he “respectfully disagreed” with last week’s filing and still supports the FCC’s January request for the case to go forward.
It’s important for the FCC to provide public notice of requests for waivers of rules on owning a broadcast station and a daily newspaper in the same city, acting Chairman Michael Copps was told by opponents of media consolidation. Those taking part in a meeting included representatives of Georgetown University’s Institute for Public Representation and the Media Access Project, said an ex parte filing last week. Also discussed was the status of lawsuits against the FCC over its 2008 cross-ownership order.
The FCC extended for at least a third time the deadline for five companies to amend waiver requests (CD Dec 30 p8) from the newspaper/broadcast cross-ownership rule or to change renewal applications, said a Media Bureau order released Monday. The bureau’s action, “on its own motion,” affects Bonneville, Calvary Inc., Cox Enterprises, Morris Communications and Scranton Times. The new deadline is April 10.
A Paris appeals court upheld a ruling cancelling Apple’s exclusive iPhone deal with France Telecom/Orange. The December decision by the Competition Commission criticized the agreement for going too far in the name of “distribution control,” said Christophe Roquilly, director of the LegalEDHEC Research Center at EDHEC Business School in Nice, France. The contract barred retailers chosen by Apple for the French market from selling the iPhone without Orange mobile services, he told us. They could sell “naked” iPhones free of phone providers, but their SIM cards would be locked onto Orange’s network, he said. That prevented rivals SFR and Bouygues Telecom from distributing the iPhone in their stores because they couldn’t offer Orange telecom services, he said. The deal also required Orange to buy iPhones from Apple, and allowed Orange to sell the devices to customers in other parts of the European Economic Space unless Apple had given itself or another retailer exclusive distribution rights there, he said. Dealers selected by Apple to sell iPhones in France could buy the devices only from Orange, he said. The agreement had vertical restrictions with negative effects for consumers, he said. The competition watchdog criticised the ban on cross- resales as well as the five-year exclusivity period, Roquilly said. The decision of the Paris Court of Appeal, which hears all challenges to Competition Commission orders, isn’t surprising given the hardcore restrictions in the contracts, especially those barring active and passive sales, he said. The court stressed that while Orange invested over 16 million euros ($20.6 million) in order to distribute and provide network services for 2G and 3G iPhones, it made a profit of 139 million euros, he said. The mobile operator’s risk was small because the Apple and iPhone brands are well known and because iPhone is so successful in the U.S., he said. Knowing its agreement with Apple was legally risky, “Orange probably planned this scenario” to turn a profit before competitors filed legal action, he said. Now it must figure out how to hang on to its competitive advantage knowing its rivals are going to sell the iPhone as well, he said. The competition watchdog’s decision isn’t bad for Apple because it allows more iPhones to be distributed by more partners, he said. Orange is taking its case to the Court of Cassation, the country’s highest tribunal, he added.
The Council of Europe moved closer Tuesday to updating its European Convention on Transfrontier Television for the Digital Age. Lawmakers supported recommendations by Andrew McIntosh from the U.K. and the Socialist Group to ask to council’s member governments to approve aligning the treaty as closely as possible with the EU’s audiovisual media services directive. Commercial broadcasters have one concern about the proposal but support it otherwise, said Ross Biggam, director general of the Association of Commercial Broadcasters in Europe.
Sen. Jay Rockefeller, D-W.Va., the chairman of the Senate Commerce Committee, Tuesday welcomed the expected nomination of Julius Genachowski to become the chairman of the FCC. The nomination of the Obama campaign insider is expected to be announced Wednesday or Thursday, probably with that of a federal chief technology officer, said a person familiar with transition planning. Genachowski “has the experience and credentials to successfully reinvigorate the FCC as Chair,” Rockefeller said.