April 2016

Weekly Digest

Telecom Policy Potpourri

You’re reading the Benton Foundation’s Weekly Round-up, a recap of the biggest (or most overlooked) telecommunications stories of the week. The round-up is delivered via e-mail each Friday; to get your own copy, subscribe at www.benton.org/user/register

Robbie’s Round-Up for the Week of April 25-29, 2016

Digital TV company Rovi is buying TiVo in $1.1 billion deal

Digital TV listing company Rovi is buying TiVo in a cash-and-stock deal valued at about $1.1 billion. Rovi Corp. said it will pay $10.70 in cash and stock for each TiVo Inc. share. Rovi will pay $2.75 per share in cash, or about $277 million. The rest, $7.95 per share, will be paid in stock. Once the deal closes, the combined business will use the TiVo name.

Rovi CEO Tom Carson will serve as chief executive of the new company. He said in a written statement that the buyout will help to extend services across platforms and expand its customer base. The transaction will add more than 10 million TiVo-served households to Rovi's current customer base of about 18 million households using its guides globally.

Crossing the New Digital Divide: Connecting to Mobile Economic Empowerment

A new nationwide poll, “,” identifies a significant gap between African-Americans’ enthusiastic embrace of mobile technology as consumers and the community’s ability to recognize and capitalize on mobile technology as a vital tool for economic empowerment. The survey, conducted for Mobile Future by Cornell Belcher, president of brilliant corners Research & Strategies, surveyed 800 African-Americans nationwide to gain an understanding of why this gap exists and how to create future opportunities for diverse communities.

Some of the survey's findings:

  • Progress on Access: 72% say they live in households with three or more connected devices.
  • Engaged consumers. A full 79% of respondents say mobile technology makes their lives easier. And, 68% say they use their smartphones frequently—either multiple times a day (43%) or multiple times an hour (25%).
  • Lack of Skills/Awareness: A majority (53%) identify lack of skills and low awareness of mobile tech economic opportunities as the biggest barriers to participation.
  • Local, Affordable Training Can Help: Low-cost training (47%) offered in communities (31%) and schools (26%) would increase interest in mobile tech careers.
  • Significant Gender Gap: African-American women were far less likely to be interested in mobile tech jobs. For example, while 45% of men expressed interest in becoming mobile app developers, just 31% of women said the same.

How You’re Making Facebook a Money Machine

In such moments you are most likely checking Facebook. More of you will be doing that than tweeting, searching on Google, checking stock prices on Yahoo or reading articles like this. And that constant lure, a fix you can easily satisfy both on a phone and a desktop computer, explains why Facebook is pulling ahead of every other large technology company right now. Your addiction is making Facebook astonishingly profitable. Put a little more kindly, your emotional and intellectual interactions on the social network are creating a great place for companies to advertise. What this means in dollars and cents for Facebook can be seen in numbers contained in its first-quarter financial results.

For the United States and Canada, Facebook pulled in $11.86 in advertising revenue per user in the first quarter. That’s what advertisers are willing to pay to catch your attention as you argue with your friends and relatives over Donald Trump or coo over baby pictures or both. Facebook’s revenue was up over 50 percent from a year earlier, while its net income soared nearly 200 percent. Its stock leapt as the wider market fell.

Former Montana Sen Conrad Burns dies

Former Montana Sen Conrad Burns (R-MT), a former cattle auctioneer whose folksy demeanor and political acumen earned him three terms and the bitter disdain of his opponents, died April 28. He was 81. Burns died of natural causes at his home in Billings (MT).

As a Republican senator, Burns used his influence on the powerful Appropriations committee to set the course on energy development and public lands management across the rural West. But he was ousted from office in 2006 under the specter of scandal after developing close ties to “super-lobbyist” Jack Abramoff, who was later jailed for conspiracy and fraud. No charges were ever filed against Burns, who dismissed criticism over the affairs as “old political hooey.” After working as a livestock auctioneer, Burns in 1975 moved into broadcast radio, founding four stations known as the Northern Ag Network. The network eventually grew to serve 31 radio and TV stations across Montana and Wyoming, offering agricultural news to rural areas. He sold the network in 1985 and — capitalizing on his name recognition — made his first foray into politics a year later, when he was elected commissioner for Yellowstone County in south-central Montana.

What President Obama and his staff still don’t get about ‘new’ media

[Commentary] President Barack Obama is a 21st century president who does interviews with garage podcasters and has the second most Twitter followers (on two accounts) in the world. But he sometimes seems wistful for a time when the news cycle was slower and the press didn't, as he put it on "The Daily Show" last summer, fixate on "shiny objects" and fail to "focus on the big, tough choices and decisions." Sorry, Mr. President. But that time never actually existed. News didn't always travel as fast as it does today in 140-character dispatches, but the media have always hovered around shiny objects. It's important to point this out because President Obama and his aides like to promote the self-serving idea that they have it harder than pre-meme administrations.

Verizon makes 'last' offer to striking workers

Verizon workers on the East Coast are continuing to strike after the company gave unions what it called its “last, best and final” offer. The drama played out on April 28 weeks into a strike that has been nationally prominent and drawn the attention of Democratic presidential candidates. In videos explaining the offer, the company laid out its proposals on benefits and compensation, among other issues raised by labor leaders. “The company is committed to achieving new labor agreements, and we have put all of our cards on the table,” said Marc Reed, the company’s chief administrative officer. “With the company having provided its last, best, final offer, the ball is now in the hands of the union leaders.”

One of the unions representing the almost 40,000 workers on strike said in response to the offer that the work stoppage was continuing. Leaders with the Communications Workers of America said in a statement that "Verizon workers remain on strike and are standing strong on the picket lines" and that “executives refused to back off of callous proposals that would hurt working families and destroy middle class jobs, including shipping jobs overseas and outsourcing work.” "The union is currently considering its next steps in the bargaining process,” they said.

American Cable Association: Top-Four Tying Is Retransmission 'Good Faith' Violation

Small and midsized cable operators say nothing in the National Association of Broadcasters opposition changes their request that the Federal Communications Commission make certain broadcast retransmission negotiations de facto violations of its good faith standard. The American Cable Association told the FCC back in December that broadcasters with a top-four network affiliate should not be able to tie carriage of must-have programming like a regional sports network to that negotiation but instead negotiated each separately.

The FCC is currently considering, under a congressional directive, what, if any, changes to make to the standard for what constitutes good-faith negotiation, including whether bundling might be a violation. ACA says it is, while the NAB said definitely not in a response to ACA's filing. In an ex parte letter, ACA defended its initial position taking aim at NAB's criticisms, saying they are misleading and no reason to retain the presumption that bundling is consistent with competition. ACA argues that the tying of a top-four affiliate and an RSN with games of a local sports team, both "must-have" programming in a market, cannot be said to be based on "competitive marketplace considerations," as the FCC found was the case for other forms of tying in its earlier good faith order back in 2000.

Rural Operators Could Find Opportunity in CBRS Auction Plans Adopted by FCC

Rural operators could find it easier to obtain spectrum licenses in the citizens broadband radio service (CBRS) band as the result of CBRS auction plans adopted by the Federal Communications Commission at April 28's commission meeting. Previously the FCC had said it would only issue licenses where at least two operators bid on spectrum in the auction. But the commission on April 28 said that licenses will be issued in rural areas even if only a single company bids for a license.

The CBRS band, also known as the 3.5 GHz band, consists of spectrum between 3550-3700 MHz. Previously the FCC determined that licenses in the band would be issued on a census tract basis. That decision may have been driven, at least in part, by the expectation that large national operators would use the spectrum for small cells to augment coverage in high-traffic urban areas. But the small size license areas also could benefit small rural operators by making it more affordable for them to obtain licenses. The most likely business case for the rural carriers may be to support fixed broadband wireless service. Jeff Kohler, a co-founder of rural broadband wireless provider Rise Broadband, who was very enthusiastic about the opportunities that he expects to see as a result of the CBRS auction. Kohler noted that in addition to having potentially more affordable licenses, the CBRS band can support faster broadband speeds than some other spectrum bands.

Amid Media Megamergers, A Mosaic of Community Media Thrives

The business press is all atwitter with merger news, as federal regulators are set to approve a massive deal between cable giants Charter, Time Warner and Bright House Networks. The $78 billion transaction will create the second-largest cable TV/Internet company, dubbed “New Charter,” next to Comcast, and leave just three major cable providers in the US. Meanwhile, the Gannett Company, which owns more than 100 newspapers, including USA Today, is attempting to acquire Tribune Publishing, which owns several major newspapers, including the Los Angeles Times and the Chicago Tribune.

This looming consolidation in the corporate media is happening as we celebrate “Democracy Now!” news hour’s 20th anniversary. We are on a 100-city tour of the United States, going from city to city, hosting fundraisers for community media outlets and broadcasting the news as we travel. Our travels confirm that a thriving, vibrant community media sector exists, serving the public interest, free from the demands to turn a profit at any cost.