CenturyLink and Windstream Q2 profits were lower year-over-year. CenturyLink’s Q2 profit fell 36 percent to $74 million. Operating revenue rose 4.5 percent to $4.6 billion. CenturyLink said its drop in profit stemmed from higher operating expenses and lower operating margins. Wells Fargo analyst Jennifer Fritzsche referred to CenturyLink Thursday as a “tortoise” of the bank’s coverage list, saying the company’s growth would remain “slow and steady (wins the race!).” Windstream’s profit dropped 44 percent to $54 million. Like CenturyLink, Windstream’s operating revenue also rose despite the drop in profit -- rising 50 percent to $1.5 billion. Windstream said its profit margin took a hit as a result of $18 million in merger and restructuring costs associated with its acquisition of Paetec (CD Nov 23 p9). Windstream CEO Jeff Gardner said during a conference call Thursday he expects the company’s revenue will improve for the rest of the year, particularly in Q4. Windstream shares fell 7.5 percent Thursday to close at $9.30.
Comcast sought a stay of the FCC’s recent Tennis Channel carriage order, pending its appeal, court filings show. The cable operator asked the U.S. Court of Appeals for the D.C. Circuit to block the agency from enforcing the order until it hears the case. “If the Order is not stayed pending review, Comcast’s First Amendment rights will be incurably infringed, as its ability to speak through its own networks will be conditioned on broader distribution of Tennis Channel,” it said. A stay will also avoid harming Comcast’s subscribers “who may be inconvenienced and confused, particularly if Comcast’s distribution of Tennis Channel changes twice within a short time period,” it said. The FCC has until Aug. 16 at noon to respond to the stay motion, a court order said. Comcast’s reply is due Aug. 21 at noon. A frequent foe of telecom regulation opposed the FCC order granting Tennis Channel’s program carriage complaint against Comcast (CD July 26 p5). The 3-2 ruling was a “further erosion by the FCC of the freedom to contract, and hence property rights protection,” Institute for Policy Innovation Policy Counsel Bartlett Cleland wrote separately Thursday (http://xrl.us/bnj3re). “In this case, where the government has chosen to step in for the owners of Comcast and dictate how to operate the business, specifically to dictate what channels must be included in what product offerings, consumer prices will be artificially increased because of the action of government."
Q2 sales at Cumulus Media fell 2.7 percent from a year earlier, to $292 million, when factoring the effect of revenue from Cumulus Media Partners and Citadel Broadcast Corp., the radio broadcaster said. Excluding those transactions, and the pending sale of some stations, revenue increased 352 percent from a year earlier to $218.8 million. Profit increased 507 percent to $8.14 million.
Sen. Susan Collins, R-Maine, said she would not advocate the White House’s use of a cybersecurity executive order to help secure networks from attack, in an email sent Wednesday. Collins, a sponsor of the Cybersecurity Act (S-3414), said that despite the failure of the Senate to vote on her bill, issuing an executive order “could send the unintended signal that congressional action is not urgently needed.” On Wednesday, John Brennan, the assistant to the president for homeland security and counter-terrorism, suggested that the White House was considering such an option (CD Aug 8 p3). A spokesman for Sen. Lisa Murkowski, R-Alaska, separately called Brennan’s comments nothing more than “election year posturing,” in an phone interview Thursday. “There is not a member that doesn’t want to take action on cybersecurity. The problem is the approach. There is not broad agreement on the best approach,” the spokesman said. “This is a real propaganda war. It’s election year stuff.” Murkowski is a sponsor of an alternate Senate cybersecurity bill, the SECURE IT Act (S-2151) which aims to increase cyberthreat information sharing between the public and private sectors. SECURE IT co-sponsor Sen. Dan Coats, R-Ind., said that rather than taking “unilateral steps” to regulate cybersecurity, the president “should be focused on finding common ground with Congress, where there is broad, bipartisan agreement that cybersecurity legislation must be addressed this year.” House Intelligence Committee Ranking Member Dutch Ruppersberger, D-Md., said: “There is no substitute for thoughtful legislation that addresses our country’s cybersecurity needs,” in an email Thursday. Ruppersberger, who sponsored the House-passed Cyber Intelligence Sharing and Protection Act (HR-3523), urged the Senate to “regroup, focus on areas where there is agreement and pass the cyber legislation that our country so critically needs."
Governments that opt to make more use of social media shouldn’t do so lightly, Jamison Peevyhouse, director of emergency communications in Weakley County, Tenn., warned Thursday during a webinar sponsored by Urgent Communications. “Eighty percent of Americans expect emergency responders to monitor social media sites,” according to a recent study, Peevyhouse said. “That let me know if I'm not constantly putting things out, then they're going to get them from someone else or they're going to miss a very important update that we may have for them.” Peevyhouse said when he saw the numbers on how many people thought public safety routinely monitored social media, “It kind of terrified me.” But Peevyhouse also said by monitoring services like Twitter during natural disasters, government can get help to areas that need it more quickly. “We can check on communities who are cut off,” he said. “If electricity is out, as long as they have some type of [mobile] connection they can get a message outbound and we can get a situational awareness of what’s going on in the community.” But Peevyhouse also said he has found the use of social media is most effective when multiple services are used. “Don’t focus on just Facebook, don’t focus on just Twitter,” he said. “Have multiple feeds ... go to one aggregate location. It’s very simple to do. It’s very cheap to do.” Michael Armstrong, chief information officer with the city of Corpus Christi, said the city is using social media in a variety of ways. The city put out a mobile app, CC Mobile (http://xrl.us/bnj3y8), a problem-reporting app to let the city know about everything from a broken sidewalk to a pothole, Armstrong said. Another app, my-waste (http://xrl.us/bnj3ze), provides reminders of when garbage and recycling is about to be picked up by the city, he said. Police in Corpus Christi use a Citizenobserver app for sending out alerts (http://xrl.us/bnj3zk) and a Tipsubmit app (http://xrl.us/bnj3zx) for those who want to report a crime. “There is a real generational component to this,” Armstrong said. “Folks who are picking up on the mobile applications tend to be a bit younger, though the response has been very positive for all of these.” Armstrong said he had one warning for local governments: “You have to be ready to use the tool if you're going to deploy the tool.”
Senate staffers plan to meet with broadcasters to discuss cellphone radio chips, a spokeswoman for the Senate Homeland Security and Governmental Affairs Committee confirmed Thursday. The discussion is scheduled for Sept. 14, the spokeswoman said, without confirming the participants, timing or location. Committee Chairman Joe Lieberman, I-Conn., is interested in FM radio chips because it is an “emergency issue,” said Emmis Communications Founder Jeff Smulyan, who told us he was invited to the briefing. “It is impossible to alert the public in any other way than radio in a real emergency,” he said. “Carriers will tell you that they send a 90-character text and that solves it. But we know that: A) 90 characters is not enough information in any emergency; and B) when the power grid goes down the cell systems are out and even when the cell system stays up it jams,” Smulyan said. “They make arguments that don’t pass the smirk test. … The level of obfuscation is truly legendary,” he said. “It is confusing because the phone guys have made it confusing. They have done a nice job of confusing the public that if you listen to [Washington, D.C., news station] WTOP, for example, via streaming that is the same thing as getting it over the air. Consumers haven’t noticed that yet because they have all had unlimited data plans. But as data plans are no longer unlimited then the reality is that they are paying for this,” he said. Smulyan said he won’t seek to ask lawmakers for any industry mandates. “We want to have a serious negotiation with the phone industry. We don’t think that’s unreasonable.” Smulyan said there are “some discussions taking place” between carriers and broadcasters, refusing to elaborate. Last month, FCC staffers and executives from the top four U.S. carriers, some makers of consumer electronics and a broadcast CEO and their trade groups met in an FCC-convened meeting (CD July 27 p4). The discussions brought stakeholders no closer to an agreement on whether more mobile devices should include FM chips to receive terrestrial radio transmissions, the participants said afterward. NAB, CEA and CTIA did not comment.
Rep. Ed Markey, D-Mass., introduced a bill Thursday to require more transparency and privacy restrictions for law enforcement surveillance of mobile devices (http://xrl.us/bnj3u2). The Wireless Surveillance Act aims to force law enforcement agencies to regularly disclose the nature and volume of consumer mobile information requests they make; require narrowly targeted information requests; require signed, sworn statements from law enforcement agencies justifying the need for emergency access of mobile data; urge new FCC regulations to set limits on how long carriers can retain consumer information; and require a judge’s approval for law enforcement agencies to track geolocation information. “The startling number of requests made for the personal information of mobile phone users strongly suggests that clear, consistent rules should be established to protect the privacy of innocent people,” Markey said in an email. Markey recently published letters from nine wireless carriers that said they had received more than 1.3 million federal, state and local law enforcement requests for cellphone records in 2011 (CD July 10 p3). ACLU Legislative Counsel Christopher Calabrese endorsed the bill, which he said would bring “much needed transparency to a very murky area of surveillance law,” in an email Thursday. “We need more information and better controls for these requests -- not only about whom they are targeting but how that information is being stored. We need to ensure that law enforcement no longer has carte blanche to track innocent Americans.” J. Adler, president of the Federal Law Enforcement Officers Association, slammed Markey’s “delusional” legislative proposal, in an email sent Thursday. “The Wireless Surveillance Act of 2012 should be renamed the ‘Cripple Law Enforcement’s Ability to Protect Americans Act of 2012,'” he wrote. “Markey continues to misinterpret the volume of law enforcement requests as a sinister Big Brother theory. What Rep. Markey fails to realize is that criminals are becoming increasingly sophisticated, and are taking advantage of all forms of e-communication. Law enforcement is no longer investigating suspected criminals that employ Flintstonian methods,” he said. “I again encourage Rep. Markey to follow due diligence by contacting some of the Inspector Generals (sic) to discuss any allegations of excessive or abusive inquiries made by law enforcement officers. He will ultimately find that his Big Brother theory is unfounded, and he in fact is advocating for criminals, not innocent Americans."
YourTel and Nexus separately endorsed a TracFone petition asking the FCC to require eligible telecom carriers to retain a copy of the underlying documentation needed to determine program-based Lifeline eligibility. TracFone noted in its reply comments every commenter but one supported its petition (http://xrl.us/bnj3tg). Low-cost carrier YourTel said it has “long supported the retention of proof documentation as part of the Lifeline applicant eligibility process” and “therefore agrees with TracFone’s position that during this interim period (until a national eligibility database can be successfully implemented) the Commission should regard the retention of proof documentation as an improvement to the overall Lifeline enrollment procedure” (http://xrl.us/bnj3sy). “A broad array of ETCs -- including some of the most active ETCs in the Commission’s Lifeline Reform docket, such as Virgin Mobile, Telrite Corporation, and TAG Mobile -- agree that the proposed rule change is necessary to reduce economic incentives to squander Lifeline funds and to eliminate the regulatory uncertainty inherent in the current system,” Nexus said (http://xrl.us/bnj3s4). “The TracFone Petition itself, bolstered by a strong consensus of opinion among large and small ETCs presents a solid record in support of the proposed rule change.”
Global LTE subscriptions will reach 802.2 million by 2017, a new Pyramid Research report predicts. At that point, LTE will make up almost 10 percent of global mobile subscriptions, the firm said in a news release Thursday. LTE’s growth will occur because of subscriber demand for additional data, along with operator demand for more efficient management of rising data traffic, Pyramid said (http://xrl.us/bnj3q4).
Only five of the 53 short-form applications submitted to the FCC for Auction 901, to award up to $300 million in one-time Mobility Fund Phase I support, have been deemed to be “complete,” the Wireline and Wireless bureaus said in a public notice (http://xrl.us/bnj3q6). The auction is to get under way Sept. 27. Commnet Four Corners, Commnet of Nevada, NEP Cellcorp, Pine Cellular and Pinpoint Wireless filed complete applications. Others will have to wait for approval from the commission and must submit required information to the agency by Aug. 27. The notice reminded potential bidders they are not to discuss their bids before the auction is complete. “Examples of communications raising concern, given the anonymous bidding procedures in effect for Auction 901, would include an applicant’s statement to the press that it is or is not interested in bidding in the auction,” the notice said.