The widespread rollout of usage-based broadband pricing for broadband would be good news for cable industry investors, Credit Suisse analyst Stefan Anninger wrote in a note to investors last week. Comcast’s announcement that it will test some ways to implement a usage-based pricing plan (CD May 18 p3) is an important positive step, he said. The move probably won’t affect Comcast’s average revenue per broadband subscribe in the near term because the 300 GB monthly threshold still allows for “hours of internet video viewing,” he said. But the move is a “natural hedge against the threat of pay-TV substation by OTT video,” he said. “Today’s announcement should help the entire cable industry move in the direction of employing consumption-based billing for” broadband, he said.
XO Communications agrees that the Universal Service Administrative Co. applied an incorrect standard in the PaeTec audit, it said in FCC comments supporting PaeTec’s reversal of a decision reclassifying the jurisdiction of its private line service revenues from intrastate to interstate (http://xrl.us/bm8i56). “USAC has misapplied this standard for years,” XO said, referencing its own appeal of a USAC decision pending since December 2010. “The recurrence of this issue illustrates USAC’s continued misunderstanding and misapplication of the Commission’s 10-percent Rule when determining the jurisdiction of private line service revenues and underscores the need for prompt Commission action in these appeals."
Philips Healthcare is concerned about delays inherent in the FCC’s proposed procedures to appoint a medical body area networks spectrum coordinator, it told advisers to Chairman Julius Genachowski and Commissioner Mignon Clyburn Thursday, an ex parte filing said (http://xrl.us/bm8i49). The commission should “articulate clear self-imposed deadlines” for resolving this and subsequent appointments, Philips said.
Q1 sales for the terrestrial radio industry increased 1 percent from a year earlier to $3.814 billion, the Radio Ad Bureau said. Higher digital ad sales, network sales and off-air revenue helped results, it said. Comcast was the largest buyer of local radio spots during the quarter, laying out $89.7 million, RAB said. Verizon Wireless spent $48.5 million and AT&T $45.5 million. T-Mobile spent $41.7 million and the Fox TV network spent $39.6 million.
The eight largest incumbent cable operators have committed to make low-cost set-top boxes available to certain customers if the so-called “viewability” DTV carriage rules are allowed to expire next month, NCTA said in a letter filed with the FCC (http://xrl.us/bm8i25). On hybrid systems, operators that would stop carrying a must-carry station’s signal in analog will “make available to analog-only households, upon request, low-cost set-top devices capable of displaying basic service tier signals on analog television sets,” the letter said. The operators also committed to give subscribers at least 30 days notice before making any such change, the letter said. “As a practical matter, the cable industry has a strong interest in ensuring that any changes in its carriage line-ups cause the least disruption to consumers,” it said. Some cable operators have already begun delivering some non-broadcast basic-tier programming in digital only and have taken similar steps to make sure analog-only customers can still view that programming, it said. Meanwhile, the Fox Affiliates urged the commission to extend the viewability rules. “Expiration of the viewability rules would be a disaster” for the 22 percent of cable households that continue to obtain analog or hybrid cable service, it said last week (http://xrl.us/bm8i3u). “More than 12 million households would risk losing access to local television signals unless they were willing to pay their cable operator higher rates for additional equipment,” it said. The affiliates are also concerned about stations that rely on retransmission consent for carriage, they said. “If the rule were to go away, cable operators likely would insist that they have no obligation to ensure retransmission consent signals are available to all subscribers,” they said. Bright House Networks lawyers met with an aide to FCC Chairman Julius Genachowski last week to discuss what would happen if the rule, which it and other cable operators often refer to as “Dual Carriage,” expires, an ex parte notice shows (http://xrl.us/bm8i25). “BHN is committed to minimizing any adverse consumer consequences,” it said. “We also emphasized that BHN already makes digital converters available to customers subscribing to the basic service tier for just $1 per month."
Correcting the rule for calculation of the baseline for the phase-down of competitive eligible telecom carrier support will “avoid discrimination and prevent the phase-out of CETC support from disadvantaging T-Mobile and its customers relative to other wireless carriers,” T-Mobile USA told FCC Wireline Bureau officials Tuesday, according to an ex parte filing (http://xrl.us/bm8i34). The USF-intercarrier compensation order intended a monthly baseline measure for phase-down to approximate what CETCs would currently receive, had the identical support rule been retained, but the rule for calculating the monthly baseline support amount is “fundamentally inconsistent” with the order on this issue and should be revised, T-Mobile said.
The government must embrace an “all hands on deck” approach to freeing up spectrum, said Thomas Power, the deputy chief technology officer for the White House Office of Science and Technology Policy. NTIA must sit down with the agencies “to go system by system to see what makes sense,” he said Friday during an event hosted by the Georgetown Center for Business and Public Policy. Now is the time to “really roll up our sleeves.” Power said he was encouraged by FCC Commissioner Robert McDowell’s recent calls for the administration to spur government action on federal spectrum reallocation (CD May 18 p1). “I take it as encouragement and I welcome the encouragement and I'm optimistic,” he said. But Power warned that spectrum relocation is “complicated,” particularly with the systems in the 1755-1780 MHz band that defense jets use to communicate with each other. “This is not a simple change. You can’t send a technician up to make a change” to a defense satellite, he said. The government should focus on clearing and reallocating actionable spectrum first, he added. “Industry was concerned that focusing on the whole band would take too long and costs would be too high. I don’t consider that to be crazy talk ... It is a labor-intensive effort on the federal side so we have to keep the focus on identifying the systems that can be moved.” McDowell’s comments on spectrum, shown on C-SPAN’s the Communicators this weekend, are at http://xrl.us/bm8jdj.
Boxee General Counsel Melissa Marks discussed potential ways to deliver “a comparable alternative” to Clear QAM to consumer electronics devices during a teleconference with Media Bureau Chief Bill Lake and other bureau officials, an ex parte notice shows (http://xrl.us/bm8iy5).
Motorola said Time Warner Cable will use its Medios system for multi-screen content delivery security. The terms weren’t disclosed. The system uses an adaptive streaming protocol to deliver secure linear and VOD programming to a variety of devices, Motorola said. It will have the system on display at The Cable Show in Boston, it said.
Stock analysts wondered who might buy BSkyB (BSY) if News Corp. (NWSA) is forced to divest all or part of its stake as a result of U.K. phone hacking investigation. “While we are not legal experts, it is safe to conclude there is some non-zero chance that Ofcom will effectively force News Corp to divest all or part of its stake,” Bernstein analysts Claudio Aspesi and Todd Juenger wrote in a note to investors. The options don’t look good, they concluded. “We believe that almost any scenario (or combination of scenarios) … would likely result in consideration to News Corp below current market value, destroying Enterprise Value for NWSA and BSY shareholders alike,” they wrote. And even if News Corp. retains is stake in BSkyB, the News Corp. shareholders may suffer, they said. “News Corp professes belief someday they will be allowed to resume the process to acquire control,” the analysts wrote. “We view the chances of that happening in the next decade, politically, to be extremely remote."