An FCC administrative law judge ruled that Cablevision CEO James Dolan can be deposed and former executive John Bickham’s documents searched for relevant material in its carriage dispute with Game Show Network. “GSN has made a convincing showing to the Presiding Judge that both Mr. Bickham and Mr. Dolan each have relevant information relating to the issue set for adjudication,” Judge Richard Sippel wrote in an order granting GSN’s motion to compel. “The discovery process is not akin to a game show such as Let’s Make a Deal,” he wrote. “Cablevision cannot force GSN to blindly guess which door leads to relevant documents.” Dolan’s deposition “shall be taken at his reasonable choice date, time and place at his or his attorney’s place of business,” the order said. “But he shall cooperate in answering questions."
A complete buyout of Clearwire by Sprint Nextel would be beneficial for the No. 3 U.S. wireless carrier, two analysts told investors Wednesday. Speculation that the two telcos were in talks prompted Credit Suisse analyst Stefan Anninger and New Street Research analyst Jonathan Chaplin to analyze the effects of a possible deal in separate emails to investors. Shortly after Japanese carrier SoftBank announced a deal in October to buy 70 percent ownership of Sprint, an SEC filing showed Sprint had bought enough Clearwire stock to give it majority control -- nearly 51 percent -- of the company (CD Oct 19 p7). If speculation about a deal to acquire the remaining 49 percent of Clearwire is accurate, the timing would be surprising, Chaplin said. “We got the impression that [management] was focused on closing the SoftBank deal before engaging in any further deals,” he said. The influx of $8 billion in cash into Sprint as a result of the SoftBank deal makes the Clearwire purchase more of a reality, Anninger said. While a Clearwire buyout may bring “baggage,” it’s the right thing to do, he said. “Sprint needs more spectrum in order to launch a robust LTE network and to offer the services & packages that the company (driven by future owners SoftBank & Masayoshi Son) intends to use to grow its business,” Anninger said. “Until it gets its hands on broadcast TV spectrum (which could take 3-5 yrs), Sprint has few attractive spectrum options beyond [Clearwire].” The spectrum that would come Sprint’s way in a Clearwire buyout remains Anninger’s only concern about such a deal. “The propagation characteristics of [Clearwire’s] 2.5 GHz spectrum remains a question mark,” he said. “While appropriate for high density areas, its ability to cover large geographic regions and to penetrate walls, remains limited.” The Clearwire spectrum would give Sprint the opportunity to deploy 40 MHz TD-LTE channels or 20 x 20 FD-LTE channels, Chaplin said. It would also give Sprint capacity to offer pricing and products that competitors would have trouble competing against, along with reducing the carrier’s long-term capacity costs, he said. “The asset would be even more valuable if Sprint acquires [a combined T-Mobile/MetroPCS] (as we expect them to). Furthermore, we don’t think a Clearwire acquisition would prevent or delay” a future T-Mobile/MetroPCS buyout, Chaplin said.
The National Association of Black Owned Broadcasters backed the FCC devising a pathway to promote minority ownership of stations. That’s if NABOB’s preferred approach, that the forthcoming order ending the quadrennial review of ownership do that, isn’t taken. Outside the FCC Wednesday, activists voiced opposition to ownership deregulation, while Sinclair continued (CD Dec 10 p13) seeking changes to the draft Media Bureau order so it doesn’t deem attributable TV joint services agreements (JSAs). The pathway to completing research on barriers to entry faced by people of color and women owning radio and TV stations is also getting attention at the commission (CD Dec 12 p5). “The Commission must, at a bare minimum, provide a clear commitment, complete with a timetable, for completing the necessary studies and for adopting such a policy” on minority ownership, NABOB Executive Director Jim Winston wrote FCC Chairman Julius Genachowski. Seventeen years after the Supreme Court’s Adarand decision on what government agencies must show to adopt rules targeting certain demographic groups, the commission still lacks a minority ownership policy, Winston wrote. He said an order “which continues the long history of dawdling and delay that has characterized the Commission’s approach to creating such a policy will send a very negative message to minority communities” and the 3rd U.S. Circuit Court of Appeals that’s remanded two previous ownership orders. The 3rd Circuit’s 2011 ruling obligates the agency to finish studies before adopting the order, though if the FCC approves new rules it must show the 3rd Circuit it’s “not ignoring this issue or putting it off until some unspecified date in the future,” Winston wrote Tuesday in docket 09-182 (http://xrl.us/bn54r2). Such a commitment should discuss the studies the commission will prepare and have a timetable to complete them and to start a new policy, Winston said. The number of black-owned radio stations fell 10 percent to 225 between 1995 and 2012, and the number of such TV outlets fell 65 percent to eight, he said. “The Commission must take concrete steps to end this loss of voices.” Free Press said its activists and others, gathering outside the commission, distributed fliers opposing ownership deregulation. The headline of the mock-up newspaper Free Press said “OBAMA OPPOSES CROSS-OWNERSHIP,” a reference to then-Sen. Barack Obama, D-Ill. (http://xrl.us/bn54rs). A bureau spokeswoman had no comment. Sinclair CEO David Smith met Commissioner Mignon Clyburn to oppose attributing TV JSAs, which have “nothing to do with the control” of TV programming, the company said in a filing in the docket (http://xrl.us/bn54sn). It said cost savings from the arrangements “are vital to the financial health of both stations” in a JSA.
Google Executive Chairman Eric Schmidt discussed the patent system, regulatory and cybersecurity concerns at the New York Times Dealbook conference in New York Wednesday (http://xrl.us/bn54ty). Patents “make sense for small inventors,” he said, but “they become strategic weapons” for large corporations who are able to profit off of innovation more quickly and easily than individual inventors. “We've had no choice” but to engage in the patent wars, he said: “But we've used them defensively, not offensively.” Schmidt said a major problem with the U.S. patent system is that it’s difficult to determine which technologies are already patented and who owns those patents. It’s illegal for inventors to “crowdsource” this by asking Internet users if certain technologies are patented, he said: “We suggested it.” Schmidt said lawmakers should “make sure that regulations allow for new entrants” and don’t favor incumbents. He said the federal government should be more transparent with the data it collects and uses. If the government were to “make the stuff transparent,” he said, innovators could take the data and find a way to more efficiently provide needed services while making a profit. Though he’s not worried about system failures, Schmidt said he’s concerned about a “super militarized attack,” citing a 2010 attack on Google traced to China that sought to steal intellectual property. “Our systems are getting better at dealing with this,” he said, but he worries about what will happen when “really evil terrorists will find really evil programmers."
Akamai Technologies appears “bullish on the long-term potential” of its recent partnership with AT&T on content delivery network (CDN) solutions for companies, Wells Fargo analyst Gray Powell wrote investors Wednesday after meeting with Akamai Chief Financial Officer James Benson. Under the deal, announced last week, AT&T will transfer its own CDN operations to Akamai next year (CD Dec 7 p19). While the deal is only likely to generate a small increase in revenue, “winning a marquee customer like [AT&T] demonstrates [Akamai’s] best-in-class CDN capabilities … which serves as a good proof point for other potential carrier deals,” Powell wrote. Demand for Akamai’s Kona Site Defender product is also strong in the wake of recent high-profile distributed denial of service attacks, Powell said. Akamai’s security business revenue has more than doubled in the last nine months, he said.
Governments should consider reducing “discriminatory and burdensome” taxes on telecom goods and services because that would help drive adoption and use of broadband and other telecom services, the International Chamber of Commerce said Wednesday. Some governments continue to tax certain goods and services within the telecom industry at higher rates than in other sectors, the ICC said in a discussion paper. It noted cases in Honduras, India, Malawi, Mexico, Montenegro and Slovakia in which such “discriminatory” taxes are in place. Such taxes are harming the long-term development of the information and communications technology (ICT) sector, since raising consumer prices stifles the adoption and use of telecom services, the ICC said. While cutting these taxes would reduce revenue in the short term, the economic growth caused by increased competitiveness and broadband penetration would outweigh that loss, the ICC said. “The ICT sector brings the building blocks of opportunity to the global information based economy,” Eric Loeb, chair of the ICC Commission on the Digital Economy’s Task Force on Internet and Telecommunications, said in a news release (http://xrl.us/bn54eh).
Intelsat requested a 60-day extension of special temporary authority for its Intelsat 702 satellite. Intelsat wants an extension from Dec. 19 to Feb. 16 to drift the satellite from 47.5 degrees east to 33 degrees east “and to operate it at that location in inclined orbit in the C- and Ku-bands,” the satellite company said in its application to the FCC International Bureau (http://xrl.us/bn54e4). Intelsat also requested a 30-day extension of an STA previously granted to utilize a 9.2m Ka-band antenna at its Riverside, Calif., teleport “for testing with the Intelsat Galaxy 28 satellite” at 89 degrees west, it said in a separate application (http://xrl.us/bn54fg).
State regulator Larry Landis is still worried about the FCC’s quantile regression analysis, the method by which the FCC determines telcos’ high-cost support. The Indiana Utility Regulatory Commissioner told FCC Commissioner Jessica Rosenworcel in a Tuesday letter (http://xrl.us/bn54am) that he fears the analysis “unnecessarily places too many rural carriers on a trajectory toward severe financial hardship that will result in some carriers being unable to continue to provide telecommunication service to the extent their rural customers deserve and have come to expect, or worse still, being unable to provide service at all.” Landis was responsible for the summer National Association of Regulatory Utility Commissioners resolution (CD July 25 p8) slamming the method and calling for its suspension. He fears “irreparable harm in rural communities” and hopes for “increased collaboration” between the FCC and states to resolve any concerns, his letter said.
CLEC Alpheus Communications bought Net Star Telecommunications, a network and data center services provider that’s also based in the Houston area. The purchase will broaden Alpheus’s Texas customer base -- Net Star customers will gain access to a broader range of network services as Alpheus absorbs Net Star’s operations, Alpheus said Wednesday. Net Star services will migrate over time to Alpheus-owned network and data center facilities, Alpheus said (http://xrl.us/bn5384).
Intelsat donated satellite distribution services for the “12-12-12” Hurricane Sandy relief concert in New York City. It provided capacity with its Galaxy 17, Intelsat 11 and Intelsat 805 satellites, “enabling viewership across North America and South America,” it said in a news release (http://xrl.us/bn538w). Eutelsat provided capacity to broadcast the show across Europe using Eutelsat 12 West A, it said (http://xrl.us/bn539r). The concert was to be broadcast live Wednesday night.