FCC denied petition by Operator Communications (Oncor) for forbearance of rule requiring that contributions to federal universal service fund be based on carrier revenue from prior year. Oncor contended that basing contributions on prior-year revenue harmed carriers with declining revenue. It asked FCC to forbear from assessing revenues for years 1998-2000 and then reassess contribution based on actual revenue for those years. Commission said requested action would give unfair advantage to carriers with declining revenue. FCC Comr. Furchtgott-Roth issued statement agreeing with FCC’s denial but emphasizing that problem raised by Oncor was serious: “Because carriers contribute to the universal service fund based on the prior year’s revenues, those carriers whose revenues have declined find themselves paying a higher percentage of their current revenues… than do carriers with stable or increasing revenues.” He said end-user surcharges could be “promising solution.”
Three-judge panel of Cal. Court of Appeals ruled that nothing in federal law or FCC policy preempted state courts from awarding damages in false advertising lawsuit against 2 Southern Cal. cellular providers. Appeals Court dismissed claims by cellular carrier industry that federal law barring state rate regulation of wireless services also denied state courts jurisdiction over anything that might directly affect wireless rates, such as civil damage awards. Ruling grew out of 1998 lawsuit in Cal. Superior Court, L.A., (Marcia Spielhotz et al. v. Los Angeles Cellular/AT&T Wireless) in which plaintiffs accused cellular carriers of false advertising and breach of contract because they claimed to have seamless coverage across Southern Cal. but failed to disclose dead zones within their coverage area where phones wouldn’t work. Lower court dismissed case on ground it lacked jurisdiction to award damages. Appeals Court Judges Walter Croskey, Joan Klein and Pattie Kitching in Case B-131655 directed lower court to vacate its order disclaiming jurisdiction and to schedule case for hearing. Appeals Court addressed only where case should be heard, not merits. Current FCC policy says there’s no blanket preemption in federal law to preclude state court damage awards against cellular companies in lawsuits over consumer protection, misrepresentation and contracts, but facts of each individual case would determine whether state damage awards were permitted.
Planned review of Canadian telecom regulator Canadian Radio- TV & Telecom Commission (CRTC) will examine whether parts of media and telecom industries can be deregulated and how regulatory process can be streamlined, senior govt. official said. “There used to be neat, tidy compartments between computers and broadcasting and telecommunications. That’s no longer the case. It’s time to take a look at this,” he said.
CTIA Pres. Thomas Wheeler said Tues. that wireless carriers were eyeing 1.7 GHz spectrum occupied by military users as “first choice” for obtaining more spectrum for 3rd-generation services. He and former FCC Chmn. Reed Hundt, now senior adviser with McKinsey & Co., spoke at New America Foundation lunch on wireless spectrum shortage. Turning to 1755-1850 MHz band would add to “global harmonization” of wireless bands used beyond U.S., Wheeler said, and 2500-2690 MHz band occupied by Multichannel Multipoint Distribution Service operators would be “2nd choice.” FCC and NTIA are looking at both bands as potential source of additional spectrum for next-generation services such as 3G.
Potential sale of DirecTV to News Corp. has fueled speculation among top industry officials and analysts that other satellite mergers and sales were likely. “It looks like the only way some companies can survive,” one analyst said. DirecTV rival EchoStar is among companies said to be looking for strategic partner to face merged competitor. “That’s going to be a $75 million gorilla breathing down your neck,” analyst said. “It’s going to take money and lots of it for EchoStar or any other satellite company to survive.”
OpenTV said its interactive TV software was installed in another 2.8 million satellite, cable and other TV set-top boxes in 4th quarter, raising its worldwide installation base to 13.9 million. OpenTV said EchoStar in U.S., BSkyB in U.K., Digiturk in Turkey and Viasat in Scandinavian countries drove most of company’s customer growth in latest quarter. Separately, OpenTV announced new agreements with Viasat and MIH to expand company’s distribution in Scandinavia, Africa, Mediterranean and Asia. Company also announced deal with MiniSat to develop interactive TV classified ads.
Promotions at Space Systems/Loral: Patrick DeWitt advanced to exec. vp; Christopher Hoeber moves up to senior vp-business development & strategy; Neil Barberis promoted to senior vp- spacecraft programs; Robert Owiesny advanced to senior vp- engineering and manufacturing; Ronald Haley moves up to senior vp-finance and administration… Joshua Paul, ex-Cowan, Leibowitz & Latman, named partner, Morgan, Lewis & Bockius… Vaikunth Gupta, Wisor, joins FCC’s Packet Switching Data Reporting and Analysis Focus Group… Cynthia Miller promoted to vp-human resources and administration, Showtime Networks… Changes at Cox: Lamis Hossain, ex-Coca-Cola, named CIMedia in-house counsel; Glenn McLaren advanced to city site mgr. of San Antonio Web site sa360.com… Susan Fox, ex-FCC, named vp-govt. relations, Disney… Changes at Harmonic: Michael Moone, ex-Cisco, appointed COO; Yaron Simler moves up to pres.-Convergent Systems Div… James McLoughlin, ex-HBO, named vp-affiliate sales, WorldGate… Gary LeJeune, ex-Equant, appointed vp-sales, NTT America… Marc Smith, ex-Phillips Business Information, named senior dir.- communications, NCTA… Rob Glaser, chmn.-CEO of RealNetworks, will keynote April 23 TV lunch during NAB convention in Las Vegas at which ABC Nightline host Ted Koppel will be inducted into Bcstg. Hall of Fame, and retiring MSTV Pres. Margita White will receive NAB Spirit of Bcstg. Award.
France Telecom floated IPO of 15% of shares of its wireless subsidiary Orange, which ended day on Paris Stock Exchange below lower end of planned offering range of $8.84. Orange shares fell 1.5% on first day of trading Tues. to $8.65. Last week, France Telecom lowered price range for international offering to $8.84- $10.23 range from earlier $11.50-$13.50. Separately, France Telecom reported consolidated operating revenue of $30.9 billion in 2000, 23.7% growth over 1999. Excluding effects of changes in consolidation, revenue climbed 8.1% in year, led by gains in wireless and Internet services. Orange ended year with 30.5 million customers.
Courses on Internet and E-commerce have been added to 2001 curriculum of U.S. Telecom Training Institute (USTTI), nonprofit group that brings telecom entrepreneurs and regulators from 162 developing countries to U.S. for free training. USTTI will offer 93 courses this year, up from 73 in 2000, starting in late March and running through Nov. Institute, with budget of $4 million provided by U.S. govt., World Bank and private corporations and foundations, has graduated 5,817 since its founding 19 years ago. In 2000, USTTI received 6,885 applicants for 789 available training slots and already has more than 3,000 seeking to take this year’s courses. Upon completion of training in U.S. -- which is conducted at various govt. facilities, TV stations and networks, labs and studios -- participants must return to their home countries. “USTTI will continue to aggressively provide the communications training that empowers women and men to bring modern, competitive communications services to consumers throughout the developing world,” said Institute founder-Chmn. Michael Gardner.
Buying up cash-strapped CLECs is “cheaper, more effective way” for utilities to build or expand telecom networks, said White Paper published by United Telecom Council (UTC), which represents electric companies, pipelines and other utilities. CLEC Distress: Potential Opportunity for Utilities? is available through UTC www.utc.org or 202-872-0030.