LCC International said it revised contract with XM Satellite Radio to include engineering support, initial operating and maintenance services and construction of smaller number of repeater sites due to shift to more tower-site-based network. LCC also will provide network monitoring and project management. Financial terms weren’t disclosed, but LCC said change would have $5 million negative impact 4th-quarter earnings.
Although she hasn’t formally announced her resignation, FCC Cable Bureau Chief Deborah Lathen confirmed she planned to leave Commission soon after its new Republican chairman took over. Lathen, who has run Cable Bureau since spring 1998 and presided over further deregulation of cable industry, told us Fri. that she hadn’t decided on departure date but “will ensure a smooth transition” to next bureau chief. She said she also hadn’t decided what she would do next. At Western Cable Show in L.A. in late Nov., Lathen said her plan was to complete AOL- Time Warner merger review and then “wiggle my toes in the sand.” She brushed off questions about her legacy, saying she wasn’t focusing on that and considered it “the height of arrogance” to spin others about one’s record of accomplishments. “The way you live your life is your legacy,” she said. “Everyone in Washington is always talking about their legacies… I've tried to have broader aspirations.”
U.S. Appeals Court, D.C., again overturned FCC’s broadcast EEO rules, this time saying both minority-based and gender-based rules “put official pressure upon broadcasters to recruit minority candidates, thus creating a race-based classification that is not narrowly tailored to support a compelling governmental interest.” Court ruled only on constitutionality of 2nd option (Option B) for broadcasters to meet EEO requirement, but said Option B wasn’t severable from first option so it threw out entire rule (CD Oct 2 p6, Jan 21/00 p1). FCC Chmn. Kennard called decision “a defeat for diversity. At a time when many Americans are outraged at the lack of minorities in prime time and in the boardrooms of America, the broadcasters have once again used the courts to strike down even a modest outreach effort.”
U.S. Dist. Court, Denver, ruled it was unlawful for Internet telephony companies to use dial-around long distance services for completing calls to or from persons without Internet computers unless they paid interstate and intrastate access charges. U.S. Dist. Judge Michael Mullins issued ruling Fri. in suit brought by Qwest against Englewood, Colo.-based Internet telephony provider IP Services (IPS). Court ordered IPS to pay access charges to Qwest at same rate required of other long distance companies when they connect to Qwest network, currently about 4 cents per min. Mullins said that when Internet telephony company used public switched phone network for completing calls, it was functioning as long distance carrier and therefore had obligation to pay every other carrier involved in completing call. If IPS doesn’t pay access charges, judge ruled, it would be engaging in illegal call bridging. IPS uses dial-around services of ICG Communications in Colo. and WorldCom for interstate calls. It provides service to 5,000 Colo. customers, with most calls being intrastate. Court dismissed IPS argument that it was exempt from access charges because its calls were routed via Internet backbone and therefore were enhanced service. IPS said Colo. PUC exempted enhanced services from intrastate access charges. IPS is startup with of only about $1.5 million in 2000.
Qwest said it’s buying back 22.22 million shares of its stock from BellSouth for $1 billion ($45 per share). That will leave BellSouth with 51.8 million Qwest shares -- 3.1% of those outstanding. BellSouth also agreed to buy $250 million in services from Qwest over 5 years. BellSouth will pay for those services in Qwest stock over 4-year period. Qwest said it would continue its business relationship with BellSouth, which was developed to help both companies more effectively provide large business customers with complete packages of business services. Qwest said it agreed to repurchase its shares because it thought “Qwest stock is a good value at $45 per share.” BellSouth said funds would go toward its data and wireless operations.
Research firm Telephia said survey found 18% of wireless customers switched carriers in last year, not counting 10% of subscribers who dropped service altogether. Telephia surveyed 24,000 wireless voice subscribers in 28 markets. It said 44% of survey respondents indicated they planned to drop their current service in next year.
Verizon is installing more than 3,600 telecom circuits to help news media and govt. agencies handle Jan. 20 Inauguration in Washington. Facilities will range from standard voice lines to special video circuits for TV networks, company said. Verizon said it had received orders for more than 2,000 voice lines, 200 special video circuits, 12 audio circuits, 25 high-speed DS-1 data lines, more than 1,400 ISDN lines. Orders have come from domestic and international broadcasters, print media outlets, numerous govt. agencies including Secret Service. Fiber lines are being installed on Capitol grounds and Mall, including fiber circuit strung from bottom to top of Washington Monument for use by several broadcast outlets. Company installed temporary payphones at Lincoln Memorial for media. Verizon said that, like other participants, company was strapped for time because it couldn’t start taking orders and installing circuits until winner of election had been decided.
Tom Paro, 77, pres. of MSTV 1979-1988, died Jan. 11 at Suburban Hospital near Washington, D.C., of Parkinson’s disease and pneumonia. Before his stint at MSTV, Paro was an NBC vp and gen. mgr. of WRC-TV Washington. Survivors include his wife, 3 children, 2 stepchildren, brother, 8 grandchildren.
PanAmSat said it had record $1.02 billion revenue and $694 million in earnings before interest expense, income taxes, depreciation and amortization (EBITDA) of 2000, up from $810.6 million revenue and EBITDA of $618.8 million last year. Net income edged up to $125.5 million from $122.2 million in 1999. Company said 4th-quarter earnings were $202.9 million, with $136.2 million in EBITDA. Company said it also signed $400 million in new long-term service agreements in 4th quarter. PanAmSat also projected total revenue of $1 billion for 2001, including $205-$210 million for first quarter.
SANTA CLARA, Cal. -- Current market conditions will force telecom businesses to return to “traditional business models” when seeking funding from venture capital firms, said a panel of financial analysts and venture capital partners at Executive Forum workshop Mon. at Telecom Industry Assn. (TIA) Supernet conference here. Valuations of telecom companies are coming “back to earth,” so having a fully funded business plan and cash flow is critical to obtaining venture capital funding, said Bart Schachter, founding gen. partner of Blueprint Ventures. Onset Ventures partner Susan Mason said telecom enterprises need to return to fundamental business models where “cash is king.”