The FCC is “at a turning point” in its mobile broadband testing program, and is looking to scale up the number of participants testing its smartphone app, officials told the measurement working group Thursday. The commission’s goal is to get more diversity of handsets and locales. Carrier testing has proven the stability of the app, said CEO Alex Salter of SamKnows, which the agency has contracted with to conduct the tests. The next phase will be a 2-3 week period of testing by carrier employees, he said. The data collected during this phase will not be used for reporting speed measurements, but only for planning and development of the program toward its official launch. FCC Geographic Information Officer Michael Byrne gave a presentation on how to properly present the mobile data. “We want to create and publish things that are easily consumable,” he said, using browser-based interactive utilities. Anyone should be able to interact with the data simply and with no barriers to access, he said: The plan is to have an “ecology” around this data, which will be shared on GitHub, a Web-based hosting service for software development.
The U.S. initiated a Special 301 investigation of Ukraine over concerns about the country’s treatment of intellectual property rights, Acting U.S. Trade Representative Miriam Sapiro said Thursday. Ukraine was named a priority foreign country in USTR’s Special 301 report, an annual look at intellectual property rights protection and enforcement. It cited problems with Ukraine’s use of pirated software, online piracy enforcement and opaque and unfair administration and operation of copyright collecting societies. The USTR will hold a public hearing on July 18 as part of the investigation, and will publish a future Federal Register notice with procedures for participating. Sapiro said the U.S. will consult with Ukraine’s government on the “serious concerns” the U.S. has with intellectual property rights in the country. Priority foreign countries are trading partners whose “onerous or egregious acts, policies, or practices” have the greatest adverse impact on relevant U.S. products, while also not entering into negotiations or making significant progress in negotiations to address those problems. Ukraine was the first priority foreign country the U.S. has named in seven years. RIAA wants the Ukrainian government to “move quickly to address the causes that lead to this investigation in the first place and avert possible sanctions,” Executive Vice President-International Neil Turkewitz said separately.
Americans spend an average of 58 minutes per day on their smartphones, said Experian Marketing Services’ Simmons Connect Thursday, in the results of a new study. About 26 percent of that time is used for voice calls, while another 20 percent is devoted to texting, Experian said. Americans spend about 16 percent of their smartphone time using social media apps, 14 percent for Web browsing, 9 percent emailing, 8 percent playing games, and a combined 4 percent using the phone’s camera and GPS, Experian said. The study found iPhone users spend 26 more minutes on their smartphones than do users on Android-powered phones. Android users spend 28 percent of their smartphone time making voice calls, while iPhone users spend 22 percent of their time doing the same (http://ex.pn/15gept9).
Federal officials seized equipment they allege was used for a pirate radio station in the Boston area, the FCC said Thursday. The May 21 seizure in Roslindale came after the station allegedly broadcast on 88.5 MHz without an FCC license, the agency said in a news release. The unauthorized transmissions were from the roof of a building, said the arrest warrant. We couldn’t reach the man listed at that address in the warrant. Bureau officials have worked with other U.S. attorney’s offices to seize so-called pirate radio equipment in other states (CD Sept 28/11 p4).
Clearwire said it’s reviewing a revised bid by Dish Network for at least 25 percent of its stock. The target had not yet confirmed at our deadline whether it would postpone a shareholder vote scheduled for Friday on rival bidder Sprint Nextel’s offer to buy out the company. A Clearwire special committee “has not made any determination to change its recommendation of the current Sprint transaction,” the company said in a statement. Dish made a tender offer of $4.40 per share for the Clearwire stock Wednesday. The offer expires June 28 unless it’s extended (http://bit.ly/18wWzqf). Dish said its revised offer is 29 percent higher than the initial offer of $3.30 per share it made in early January, and a full dollar higher than Sprint Nextel’s “best and final offer” of $3.40 per share for the minority share of the company it doesn’t already own. Dish’s bid also includes up to $800 million in interim financing for Clearwire. Sprint is “reviewing Dish’s actions both as to our interest in Clearwire and Dish’s proposal to acquire Sprint,” a spokesman said. Dish has also made a counteroffer for control of Sprint, and continued to argue Wednesday that a purchase of the carrier by rival bidder SoftBank would be a national security risk. Crest Financial, Clearwire’s largest minority shareholder, urged Clearwire’s board Thursday to reverse its earlier recommendation of Sprint’s bid in light of Dish’s revised offer and pursue an “open and competitive bidding process.” Clearwire’s board “has a fiduciary obligation to give full consideration to Dish’s offer, which is clearly actionable, and any other eventual offers that would trump the Dish offer,” said David Schumacher, Crest’s general counsel, in a letter to Clearwire (http://on.mktw.net/12RPWst). Dish’s revised bid “seriously complicates Sprint’s bid for Clearwire,” and Clearwire’s minority shareholders would likely cheer the news because of concerns about Sprint’s offer, New Street Research analyst Jonathan Chaplin wrote investors Thursday. Dish is in a “difficult spot strategically” given the looming buildout deadlines on its spectrum, which the FCC extended through a terrestrial waiver in December, wrote Stifel Nicolaus’s Christopher King. “It needs a wireless partner, and it needs one quickly -- despite the very slow organic growth in the industry."
Lawmakers should use the 2014 reauthorization of the Satellite Television Extension and Localism Act (STELA) as an opportunity to “fully examine the current video services marketplace and update specific outdated provisions of the 1992 Cable Act,” said Independent Telephone and Telecommunications Alliance President Genevieve Morelli in a news release Thursday. The comments addressed recent remarks by House Communications Subcommittee Chairman Greg Walden, R-Ore., who said he believed Congress will pass a “clean” reauthorization of the law (CD May 24 p3). Morelli said Walden should use “any and all opportunities, including the STELA reauthorization process, to legislate policy that will reflect today’s video technology and marketplace,” said the news release. In particular, Morelli said Congress must address the increasing prices that consumers pay for video content: “Each year, unbalanced retransmission consent negotiations increasingly subject consumers to possible blackout situations. Most of the resulting agreements are forced on video service providers by broadcasters who maintain all of the negotiating leverage which represents a fundamental market failure. Ultimately, the result is higher video rates to consumers that are necessary to cover the significant increases in retransmission consent fees imposed by broadcasters.”
Microsoft confirmed Thursday it has agreed to settle Vringo subsidiary I/P Engine’s patent infringement lawsuit. I/P Engine claimed in the lawsuit that Microsoft had infringed two of its patents on search relevance filtering technology (http://bit.ly/115pR6M). The Vringo subsidiary had successfully asserted its claim on the two patents in a lawsuit against AOL, Google and IAC/InterActiveCorp-owned IAC Search & Media last year (CD Feb 1 p10). Vringo said Thursday that Microsoft has agreed to pay $1 million up front and an additional 5 percent of the amount Google pays to use the I/P Engine patents. That amount is capped at a certain amount, but it will not go into effect “unless the amounts received from Google substantially exceed the judgment previously awarded,” Vringo said in a filing with the SEC. Microsoft will also transfer ownership of six patents to I/P Engine that relate to “telecommunications, data management, and other technology areas,” Vringo said (http://bit.ly/12RWqrm). A Microsoft spokeswoman confirmed the settlement details Vringo outlined in the SEC filing, but said the company had no further comment.
Netflix original programming will consume 10-15 percent of its annual content costs by 2016, up from 5 percent, as output doubles to 14-20 series, Chief Content Officer Ted Sarandos said Thursday at the Nomura Securities investor conference in New York. The goal will be to have a new series start every three weeks, with original programming increasingly taking a larger share of Netflix’s TV content business, Sarandos told us. TV-related programs account for about 66 percent of Netflix’s catalog, driven largely by Internet streaming, while movies are the remainder, Sarandos said. Netflix has pledged to spend $200 million annually on original content. But while House of Cards, which first aired in February, gained a wide audience, the more recent horror series Hemlock Grove had a narrower audience. Arrested Development, with a built-in fan base, popped up on various file-sharing websites shortly after first airing and was downloaded 100,000 times within the first 24 hours, analysts have said. Netflix also is expected to launch in December Turbo: F.A.S.T. (Fast Action Stunt Team), a children’s series developed with DreamWorks Animation, which is releasing a film version on July 19. “The outcome so far as we have added each series, it has grown the total audience” and hasn’t cut into viewing of Netflix’s other movies and TV programming, Sarandos said: “With 20 shows annually” by 2016, “figure on watching a new show every three weeks and our model can support that.” Netflix also signed an agreement in December with Disney to be exclusive subscription service for it starting in 2016 and will release Orange Is the New Black on July 11. Netflix is largely releasing original programming in the international market at the same time it’s available in the U.S., Sarandos said. Among the exceptions is Ricky Gervais’s Derek, which originally premiered on U.K. TV’s Channel 4 in April 2012 and will be streamed in the U.S. on Sept. 12 as seven half-hour episodes. Netflix also offered the Lilyhammer series in February 2012, a month after it premiered on Norway’s NRK1-TV. Eighteen percent, or 6.3 million Netflix subscribers, are in international markets and an equal number have been accessing the original programming, Sarandos said. Netflix added a net 1 million international streaming subscribers in Q1 as revenue rose to $142 million from $42.4 million. In North America, Netflix added a net 2 million streaming subscribers to end Q1 with 27.9 million paid customers, up from 22 million a year earlier. North American sales grew to $638.6 million from $506.6 million a year earlier. In the North American DVD-by-mail business, Netflix lost a net 241,000 subscribers, ending Q1 with 7.8 million, down from 9.9 million last year. Netflix ended Q1 with $5.67 billion in streaming content obligations, including $1.3 billion that were listed as “current,” the company said. Another $3.3 billion in content-related “obligations” weren’t listed on the company’s Q1 balance sheet since they didn’t yet meet criteria for being recognized as assets, Netflix said. Meanwhile, Netflix is continuing discussions with Viacom on potentially renewing a distribution agreement that expired this month, Sarandos said. While Netflix lost access to Nickelodeon, MTV and BET programming, it has since added Disney Jr.’s Jake and the Neverland Pirates and Cartoon Network’s Adventure Time. “At the end of the day, it is what is the most relevant content for our subscribers and I feel like that was the right tradeoff,” Sarandos said. Netflix also has no plans to add sports programming, he said. “Our focus really is on things with a really long shelf life and that is where we do best.”
Microsoft leads the Internet Protocol TV industry in video-on-demand software for both North America and Europe, the Multimedia Research Group said in a Thursday release that highlighted the results of its IPTV market leader report (http://bit.ly/141bF3M). The company is the only IPTV provider to lead in two categories, it said. The report tracks IPTV systems’ offerings in access systems, video headend systems, VOD server software, set-top boxes, middleware and content protection, it said.
The New Hampshire Public Utilities Commission still sees the fixed VoIP of Comcast as a utility service, said the PUC in an order Tuesday (http://1.usa.gov/11DR5r3), reaffirming its 2011 decision. “Our fundamental state-law determinations remain unaffected by [Senate Bill] 48,” the PUC said, referring to a June 2012 law that revamped the state’s telecom laws. “We continue to find that Comcast’s fixed-IP enabled cable voice services constitute the conveyance of telephone messages, and that Comcast is therefore a public utility” under certain aspects of state law, the agency said. State “regulation of these voice services is neither explicitly nor implicitly preempted by federal law,” it said. The PUC changed its determination that Comcast was a CLEC and instead judged it an ELEC, standing for excepted local exchange carrier. It declined to discuss the obligations of such ELECs and pointed to proceedings under way, with stakeholders weighing in.