Northpoint received support from 26 members of Tex. House delegation, who wrote letter to FCC Chmn. Powell asking him to take final action on license request. Spearheaded by Austin Rep. Lamar Smith (R) and Lloyd Doggett (D), delegation said Texans could receive few, if any, local channels from DBS carriers, many were unable to get broadband access to Internet and those who did paid high rates. Members expressed concern about lengthy licensing process, saying “Northpoint’s system could have been fully deployed in all 210 local TV markets.” Letter also said Commission shouldn’t force auction: “An auction would not hasten service to the public, but delay it, perhaps indefinitely.” Northpoint investor and founding principal is from Tex.
Consumer electronics makers are exaggerating cost of adding DTV tuners to analog sets, broadcasters said Mon. in joint reply comments on FCC’s DTV rulemaking (00-39). Instead of $200 per set additional cost suggested by manufacturers, broadcasters said economies of scale could reduce premium to $50 per set by 2006: “Broadcasters, of course, would not advocate a requirement that would raise television set prices beyond consumers’ means.” MSTV and NAB have hired consulting firm to conduct 8-week study on effects of DTV tuner requirement, and they, along with ALTV, said FCC shouldn’t decide on DTV tuner until results were available: “There should be no question, however, that a DTV tuner requirement is necessary to promote the transition.”
FCC is seeking comments on waiving sponsorship ID rules for broadcasters, as requested by Ad Council (DA 01-1169). Council seeks FCC clarification that White House Office of National Drug Control Policy doesn’t have to be identified as sponsor of PSAs being broadcast by stations. Comments are due May 29, replies June 8.
U.S. Appeals Court, D.C., rejected petition by public interest groups for full court to reconsider its earlier decision striking down 30% cable ownership cap. In order received Mon. by Media Access Project, which represented consumer groups, D.C. Circuit turned down request to review March cap decision by 3- judge panel. Media Access Project Pres. Andrew Schwartzman said groups probably would file appeal of decision at U.S. Supreme Court, even though FCC Chmn. Powell had indicated that he probably would not go that route.
Even though majority of FCC commissioners appeared willing to open rulemaking on eliminating broadcast-newspaper cross-ownership rules, FCC was forced to withdraw item from Thurs. agenda because majority couldn’t agree on text of rulemaking, we're told. FCC spokesman would say only that item wasn’t ready for final action. Action almost certainly means broadcast-newspaper cross-ownership rulemaking won’t be started until after new commissioners take office, officials inside and outside agency said.
FTC cleared merger of Univision Communications and USA Networks, companies said Tues. Univision bid $1.1 billion for USA’s 13 owned and 4 partly owned stations (CD Dec 8 p9), plans to convert them to Spanish-language programming. Companies said FTC granted request for early termination of Hart-Scott-Rodino antitrust review. Deal still is subject to FCC approval, but companies said they expected it to close in 2nd quarter.
Amended version of Bell deregulatory legislation introduced by House Commerce Committee Chmn. Tauzin (R-La.) and ranking Democrat Dingell (Mich.) would require ILECs to provide competitive carriers with access to network elements previously mandated by FCC, move that some CLECs said would leave intact legislation that would be harmful to competition but otherwise was positive step. However, manager’s amendment to HR-1542 wouldn’t change bill’s exception to FCC line-sharing order, which avoids placing mandate on ILECs to “provide [CLECs with] unbundled access to the high frequency portion of the loop at a local terminal.”
Paxson Communications asked FCC to delay May 14 deadline for comments on reallocating TV Ch. 52-59 ("lower 700 MHz band") until after auctions are held for Ch. 60-69 ("upper MHz band"), now scheduled Sept. 12 -- but request is pending to delay that until Jan. In alternative, Paxson said, deadline should be postponed until Commission rules on petitions to reconsider reallocation of Ch. 60-69 to nonbroadcast services. Before it “even attempts to establish [new] rules and policies” for Ch. 52-59, FCC “should gain the experience of auctioning the upper 700 MHz spectrum” because 2 bands are “closely intertwined,” Paxson said.
Satellite Bcstg. & Communications Assn. (SBCA) said it “strongly objects” to experimental license FCC gave to MDS America (CD May 7 p7) to test proposed terrestrial wireless service similar to Northpoint in 12.2-12.7 GHz band reserved for DBS companies. SBCA said Mitre report issued by Commission showed spectrum sharing could cause “significant interference” and MDS America experimental license was “extremely inopportune and ill- advised.” Bottom line, SBCA said, is that Commission “should never have treated MDS America’s application as another routine request for an experimental license.” Commission had obligation to put issue out to public comment, SBCA said.
Federal court decision last week on ILEC access charges has ramifications for other proceedings such as FCC’s attempts to overhaul access charge and universal service regimes for rural telcos, industry observers said Mon. Fifth U.S. Appeals Court, New Orleans, ruled May 3 that ILECs couldn’t recover their Universal Service Fund (USF) contributions through access charges levied on long distance companies. Court, which remanded FCC regulations for 2nd time on this issue, said such action constituted implicit subsidy, which is barred by Telecom Act. At issue are contributions that all carriers must make to USF. Long distance companies, for example, recover those contributions directly from their customers. FCC in 1997 ordered ILECs to recover their costs from long distance companies as part of access charges. Fifth Circuit remanded that rule in 1999 because of implicit subsidy problem. Commission rewrote rule and said ILECs no longer were required to recover costs from access charges but were permitted to do so if they wished. FCC said it interpreted court’s decision to mean it couldn’t require contributions through access charges but instead had to give ILECs choice of how they recovered contributions. In latest ruling, court said FCC interpretation was wrong. It said ILECs couldn’t recover universal service contributions from access charges, period: “The distinction the agency draws between ‘require’ and ‘permit’ is one without a difference.” Court said its original ruling “turned on the recovery method per se, not whether the Commission permitted or mandated it.” AT&T Vp Joel Lubin said he was cheered by strong language court used in defining access charge recovery as implicit subsidy. Lubin said court’s ruling could affect decision FCC is expected to make Thurs. on rural universal service. At very least, proposals under study by FCC, such as one proposed by Multi-Assn. Group, should be revised to eliminate implicit USF subsidies in access charges, he said. AT&T and several other carriers proposed such action to FCC last month, Lubin said, so court’s ruling was pleasant coincidence. Appeals Court ruling doesn’t have as much effect on large price-cap-regulated ILECs because FCC directed them last year to stop recovering USF contributions through access charges. Action was taken as part of Commission’s adoption of CALLS proposal. Lubin said court’s strong statements barring implicit subsidies in access charges applied to other industry practices as well. Among them, he said, is practice of pooling carrier common line (CCL) charges for rural carriers. Because National Exchange Carrier Assn. (NECA) pools those charges, by nature they are not cost-based, he said. Pooling access charges discourages competition, he said. Competitors such as Western Wireless can’t share in that subsidy because it’s “buried in the pool,” he said. Judge Emilio Garza wrote decision. Also on panel were Judges Eugene Davis and Donald Pogue. Pogue concurred because he disagreed with 1999 decision, saying it might have gone too far