U.S. Appeals Court, D.C., in decision Tues., remanded FCC’s TV station local ownership limits to Commission for reconsideration of its decision not to include newspapers, cable and other media outlets in its definition of “voices.” However, court refused to overturn rules entirely, rejecting arguments by Sinclair Bcst. that they violated First Amendment and that requirement for 8 independent voices in market was arbitrary. FCC officials said only that they still were studying decision. NAB Pres. Edward Fritts said same thing.
Notable CROSS rulings
SAN JOSE -- Silicon Valley officials urged high-tech industries to lead consumer revolt to roll back Hollywood’s court and Congressional momentum in favor of expansive content protections. Intel Chmn. Andrew Grove and Stanford law Prof. Lawrence Lessig said at forum here Mon. night called “Is the Information Revolution Dead?” that judicial rulings and Capitol Hill moves to protect digital intellectual property went far beyond traditional copyright law and if not stopped would kill technology innovation and the economic development it spurred. “The real question is, ‘Is the information revolution murdered?'” Lessig asked. House and Senate Commerce and Judiciary committees are examining nexus of broadband deployment and digital rights management. Senate Commerce Committee Chmn. Hollings (D- S.C.) has proposed legislation to require IT and CE companies to insert software and hardware copyright protection in all digital CE devices, but Senate Judiciary Committee Chmn. Leahy (D-Vt.) has vowed such bill wouldn’t pass this year (CED March 18 p1). Intel and AOL Time Warner also released a “joint statement of principles” Tues. on digital rights management that called for “narrowly focused government measures.”
ORLANDO -- FCC Chmn. Powell told CTIA Wireless 2002 conference here Tues. that while Commission viewed wireless industry as “poster child” for competitive markets, increased substitution of mobile telephony for wireline services meant increased pressure from consumer expectations. “Wireless is an extraordinary success,” Powell said: “In some sense, the period that it’s entering into now is managing the fruits of its success.” But maturation of service doesn’t necessarily mean more regulation, Powell said: “That’s a reluctant trigger, not an affirmative one.” In Q&A with CTIA Pres. Tom Wheeler, Powell disagreed with suggestion that industry had been “castigated” for taking proactive steps in areas such as E911 and wireless priority access service (PAS).
Congressional pressure or pressure from ballot box is needed to slow trend toward media consolidation, consumer advocates said at Consumer Federation of America (CFA) conference in Washington. Mark Cooper, CFA research dir., and Gene Kimmelman, Consumers Union (CU) Washington office co-dir., expressed concerns about media consolidation that they said were likely to result from several proposed rule changes before FCC, including allowing cross-ownership of newspapers and TV stations and raising the media cross- ownership cap. Kimmelman said rule changes proposed by FCC Chmn. Powell went against intentions of Congress and Supreme Court rulings. Congressional decrees pushed FCC into making rules, he said, and courts had shown that First Amendment concerns elevated media consolidation beyond standard economic issues. “The chairman of the FCC doesn’t see the use for the rules,” Kimmelman said: “But that’s not what Congress believes.” He said recent announcement that Senate Commerce Committee would review merger review agreement between FTC and Justice Dept. (DoJ), which gave DoJ review authority over media mergers, showed Capitol Hill still was willing to scrutinize media merger issues. Cooper compared recent population trends with media ownership and said ownership rules are more necessary than ever despite Powell’s argument more TV channels and Internet access make ownership rules ineffective. Cooper said since the population has become more diverse, but TV programming hasn’t necessarily followed suite, a more diverse media ownership structure is more relevant now than in the 1970s when ownership rules were first enacted. “We need the rules more than ever,” Cooper said. “In fact, we need more rules, not fewer.” Relaxation of rules would create a “merger wave,” Cooper said. “If you let them, they will merge,” he said. Total ownership of TV and newspapers already had dropped to 600 now from 1,500 in 1965 and Cooper said it would fall to 400 if TV-newspaper cross-ownership were allowed. He said 6 companies, ABC, AOL, AT&T-Liberty, CBS, NBC and Fox already controlled nearly 2/3 of all TV. Cooper said Internet shouldn’t be treated as mass media because its reach was much more limited than many believed, adding that 57% of people in country didn’t have Internet in home while only 2% didn’t have TV. Cooper said high-speed Internet access service was highly concentrated market, leaving little room for competition. He said 50% of Internet content came from 4 companies.
Assuming FCC will declare Thurs. how cable modem service should be classified, Commission also is poised to adopt Notice of Proposed Rulemaking (NPRM) examining who has jurisdiction to regulate service. Question is important because, if FCC classifies cable modem service as “information service,” as is widely expected, cable operators could be vulnerable to additional demands from local franchising authorities (LFAs) for new taxes, fees, etc., Cable Bureau Chief Kenneth Ferree, who soon will head up new Media Bureau, said in interview Mon. He said NPRM would take “granular” look at implications of particular classification, whether it be as “information service,” “telecom service,” “cable service” or some other animal. He declined to say which it would be, but gave some insight into NPRM that’s expected at FCC’s agenda meeting: “The second step is, well, what does that [classification] mean? What are the implications?” Specifically, NPRM will seek to determine who has jurisdiction and what role FCC and LFAs will have in overseeing cable modem service. Ferree said he would like to see issue resolved before end of 2002.
FCC Comr. Copps will be among participants at Washington news conference March 15 in effort to influence Commission to retain broadcast-newspaper cross-ownership ban. Following Copps, panel members will discuss why they believe ban against same licensee owning TV-radio and newspaper in same market should be kept in place. Many such dual ownerships exist under grandfather clauses and waiver of rule. Panelists include Md. U. Journalism Prof. Douglas Gomery, Mark Cooper of Consumer Federation of America, 6-time Emmy winner Belva Davis, Stephen Kimber, who resigned as columnist for Halifax Daily News (Canada) because of alleged censorship; Wade Henderson of Leadership Conference on Civil Rights, Edward Fouhy of Pew Center on Civic Journalism and former executive of ABC and CBS News. News conference is sponsored by 17 groups, mostly industry-related labor unions, plus Consumers Union, Consumer Federation of America and Center for Digital Democracy.
Sen. Hollings (D-S.C.) and his staffers on Senate Commerce Committee and Commerce, Justice, State and Judiciary (CJS) Appropriations Subcommittee aren’t swayed by recently released statistics on proposed merger review agreement between Justice Dept. (DoJ) and FTC, staff member said. In CJS appropriations hearing Feb. 26, Attorney Gen. (AG) John Ashcroft gave Hollings statistics on number of merger reviews each agency had conducted in past few years, and on Feb. 27 FTC released several documents relating to merger review agreement, including more detailed statistics on number of mergers each agency had reviewed in recent years. But Hollings aide told us statistics were too recent and didn’t necessarily reflect expertise within agency. Hollings told Ashcroft he was particularly concerned about reviews of potential media and entertainment company mergers going to Justice Dept. instead of FTC. FTC release said Justice had conducted 63 enforcement actions and 154 “substantial investigations” in media sector since 1997, while FTC had conducted just 13 enforcement actions and 22 substantial investigations. DoJ also has done all 57 telecom investigations and enforcement actions and traditionally is known to be agency that reviews telecom antitrust issues.
Attorney Gen. John Ashcroft exhorted USTA members March 1 to bolster efforts to develop public-private partnerships for critical infrastructure protection and cybersecurity. USTA Pres. Walter McCormick assured Ashcroft before his Policy Conference breakfast keynote in Washington same day that “our industry is the best partner in the country” for govt. counterterrorism efforts and communications intercepts.
BALTIMORE-- After week of sometimes excruciating technical testimony, both sides in closely-watched cellphone cancer lawsuit wrapped up evidentiary hearing Fri. in U.S. Dist. Court here. Decision by Dist. Judge Catherine Blake isn’t expected for some weeks, although what, if any, scientific evidence, she allows to move forward is crucial to $800 million suit against cellphone industry in which neurologist Chris Newman argued there was link between his use of wireless phone and brain tumor. Blake could rule that all or none of voluminous scientific evidence submitted by Newman’s team was admissible. Newman’s litigation is led by high-powered attorney and Baltimore Orioles owner Peter Angelos, who successfully pursued such product liability litigation against tobacco industry. Another scenario is that Blake may decide to “split the baby,” source said, meaning she could allow some evidence but not other scientific findings. After nearly decade of lawsuits against cellphone industry on allegations of links to brain cancer, carriers and equipment manufacturers have yet to lose a case. But week-long evidentiary hearing marks first time federal court has analyzed issue whether accumulated scientific findings in that area are rigorous enough for court to consider.
“At some point you have to be honest with yourself and say ‘This is not working,'” FCC Chmn. Powell said Wed., reflecting on Commission’s 6-year losing record in federal court on its media ownership rules. Powell told Vienna, Va., breakfast hosted by Northern Va. Technology Council, CapNet and Information Technology Assn. of America that FCC “needs to do an extraordinary study of the media space today.” FCC spokesman told us after speech that agency’s Media Ownership Task Force was determining how that would be done, perhaps through Notice of Inquiry (NoI), but promised proceeding would be open to public comment.