Despite the FBI’s request for delay because of CALEA concerns, the FCC may go ahead and release a VoIP notice of proposed rulemaking (NPRM) at its Feb. 12 agenda meeting, although it may back off acting on related petitions, sources said Wed. The FCC will release the meeting agenda late today (Thurs.). The FBI, Dept. of Justice and Drug Enforcement Administration have asked the FCC to deal with concerns about CALEA compliance before acting on the VoIP rulemaking or petitions (CD Feb. 2 p1). Law enforcement agencies are concerned about the technical and regulatory problems of imposing CALEA wiretap requirements on broadband services such as VoIP.
and Establishment of ACE Broker Accounts
Take-Two Interactive reduced sales and income estimates for its first quarter and revised estimates for its 2nd quarter and fiscal year ending Oct. 31. The company said it now expected to report sales of $385 million and 70? in diluted income per share in the first quarter, down from $412 million in sales and $1.10 diluted income per share expected earlier. Although Take-Two said it now expected slightly higher sales in the 2nd quarter and the full fiscal year, it lowered its profit forecasts for both periods. For the 2nd quarter, it said it now expected $220 million in sales and 39? diluted income per share vs. the prior estimate of $218 million and 41? diluted income per share. For the year, Take-Two said it now expected $1.22 billion in sales and $2.45 in diluted income per share rather than the $1.18 billion and $2.60 previously estimated. Take-Two also said that, “as previously announced, [it] is revising its revenue recognition policies by adopting a new methodology for recording reserves for price concessions.” It said the revision in revenue recognition policies would “result in a restatement of previously issued financial statements, generally reflecting an earlier recognition of reserves for price concessions, [and] the restatement will affect changes in reported revenue and earnings, and related balance sheet amounts, on both a current and historical basis.” It said “the restatement will affect [its] financial results” as far back as the fiscal year ended Oct. 31, 1999, and it was “also conducting a further review of certain transactions involving sales of products to retailers in fiscal 2000 and the first 3 quarters of fiscal 2001.” Take-Two warned that “if the review of these additional transactions requires restatement, it will result in a shift in the timing of the recognition of revenue and product costs, with a corresponding effect on the company’s financial position and results of operations.” In a filing with the SEC, Take-Two said it “could not complete” its annual 10-K report “in a timely basis due to issues raised in the previously disclosed investigation by the staff of the SEC’s Division of Enforcement into certain accounting matters relating to the company’s financial statements.” In separate research notes Mon., Southwest Securities and RBC Capital Markets analysts Arvind Bhatia and Stewart Halpern expressed cautious optimism that the revelations by Take-Two could mean the publisher’s problems with the SEC could be winding down at last. Investors apparently felt that that could be the case as -- despite the mostly downbeat news it reported -- Take-Two shares were up Mon. in late afternoon trading. The company said it had slashed its first-quarter forecast because of: (1) Shifting the release of the game Mafia for Xbox and “the majority of the European shipments of Mafia for PlayStation 2 from the first fiscal quarter to the 2nd fiscal quarter.” (2) “Unanticipated weakness in the company’s North American publishing business during the holiday season and extending into January, with continued disappointing sales of Max Payne 2: The Fall of Max Payne.” (3) “The impact of the change in the company’s methodology for recording price concession reserves.” (4) “Bad debt expense incurred as a result of the Chapter 11 bankruptcy filing of KB Toys.” (5) “Expenses related to the cancellation of 2 products in development.” But it said “the shortfall was partially offset by the strength of the company’s Jack of All Games distribution business.”
On October 27, 2003, the State Department published a final rule which amended the International Traffic in Arms Regulations (ITAR) to indicate that exporters that are required to report shippers export information of U.S. Munitions List (USML) articles must use the Automated Export System (AES).
U.S. Customs and Border Protection (CBP) has issued a notice which invites the general public and other Federal agencies to comment on information collection requirements concerning the U.S.-Caribbean Basin Trade Partnership Act (CBTPA) non-textile Certificate of Origin (Form CBP-450).
Foreign telecom carriers vigorously disputed allegations CompTel/Ascent Alliance and AT&T filed in comments (CD Jan 8 p2) to the U.S. Trade Representative (USTR) this month. The comments were part of USTR’s annual review of the operation and effectiveness of all U.S. trade agreements on telecom products and services. The foreign operators complained U.S. commenters in many cases had used outdated data and hadn’t said anything new. “We do not feel that CompTel/Ascent has added new material arguments to its prior allegations,” Deutsche Telekom (DT) said.
Wireless experts said the FCC’s new secondary markets rules for spectrum move in the right direction for opening up leasing arrangements. But at an FCBA Wireless Committee seminar late Wed., lawyers and top brass of spectrum trading companies said the Commission still must work out issues such as how designated entities would be treated and how lessees could be protected against bankruptcy.
According to Journal of Commerce Online, as part of the Democratic response to President Bush's State of the Union address, House Minority Leader Pelosi called for the physical inspection of all ocean containers entering the U.S., charging that the Bush administration's inspection standard is too low to protect the U.S. from terrorism. (JoC Online, 01/21/04, www.joc.com )
The idea of compulsory licenses to compensate copyright holders for file downloads appears to be losing steam. On a panel hosted by the National Journal Fri., Public Knowledge Pres. Gigi Sohn said she now opposed the idea: “I used to be a fan of compulsory licenses, but now I'm worried about getting the government involved… Who would pay these fees?” CEA Pres. Gary Shapiro said the idea was a “nonstarter.” Sohn said similar efforts were failing as levies on digital media in Europe hadn’t worked and had doubled prices.
The idea of compulsory licenses to compensate copyright holders for file downloads appears to be losing steam. On a panel hosted Fri. by the National Journal, Public Knowledge Pres. Gigi Sohn said she now opposed the idea: “I used to be a fan of compulsory licenses, but now I'm worried about getting the government involved… Who would pay these fees?” CEA Pres. Gary Shapiro said the idea was a “nonstarter.” Sohn said similar efforts were failing as levies on digital media in Europe hadn’t worked and had doubled prices.