FCC took steps at its meeting Thurs. to make it easier for public safety agencies to communicate with one another on emergency scenes, including setting rules for interoperability channels in 700 MHz public safety band. In unanimously approved report and order, agency adopted standard for interoperability channels as recommended by Public Safety National Coordination Committee (NCC) chaired by Kathleen Wallman. For general use channels in 24 MHz designated for public safety in 700 MHz band, FCC adopted notice of proposed rulemaking (NPRM) seeking comments on migration path to more efficient standard. But to encourage early use of 700 MHz, some of which still is occupied by analog broadcasters, order indicated Commission wouldn’t mandate use of that more efficient technology before 2006.
Small Business in Telecommunications (SBT) told 3-judge panel of U.S. Appeals Court, D.C., Thurs., that many small businesses chose not to participate in 1997 800 MHz specialized radio auctions because of financial uncertainty and because FCC definition of small business was unclear at time of auction. However, when questioned by judges, SBT counsel Robert Schwaninger was unable to name single entity that claimed to have suffered from what SBT termed “uncertainty.” SBT was defending petition for review it filed on 2 FCC orders rejecting company’s petitions for reconsideration of its 800 MHz lower channel report and order and its upper channel report and order. Court said it had no jurisdiction on upper channel appeal since it wasn’t mentioned in SBT’s petition for review. Lower channel appeal dealt chiefly with issue of Small Business Administration approval of small business definition. Judge David Tatel questioned SBT attorney repeatedly, trying to establish, among other things, where in SBT pleadings certain claims made in its petition for review could to be found. All 3 judges said they were unable to find several assertions in SBT’s petition in proceeding’s earlier record.
Motorola reported 41% drop in earnings to $335 million for quarter ended Dec. 31 but said Thurs. that sales rose 11% to $10.1 billion. Company warned last month that quarterly sales and earnings would be lower than expected, in part because of disappointing efforts to curb costs of wireless phone production. COO Robert Growney said company planned to take “further steps” to return to earnings growth this year. In conference call, company said handset sales were expected to lag into first half of 2001. Overall sales for 2000 were $37.56 billion, up from $32 billion in 1999, while earnings hit $1.9 billion, up from $1.4 billion. Personal communications sales edged up 1% to $3.5 billion for quarter, with orders of $2.9 billion down 20%. As result of “increased manufacturing costs,” profits for segment dropped to $76 million from $242 million year ago. While wireless phone sales were up significantly in Asia, “orders were down very significantly” in Europe, Motorola said. Telecom sales rose 19% to $2.1 billion in quarter. Broadband communications segment, which includes cable modems, saw sales climb 52% to $1.1 billion.
Citing weakness in fixed wireless industry, equipment manufacturers Adaptive Broadband and Western Multiplex called off planned merger Thurs. “From a stock market point of view, fixed wireless specifically and telecommunications stocks in general, have really taken a beating, making it very difficult to put a monetary valuation on this transaction at this time,” said Adaptive Broadband Pres. Daniel Scharre. Adaptive recently lowered revenue forecast for quarter ended Dec. 31 to $8 million from $31 million. Company said it was “evaluating its financial model” for fiscal 2001, “especially the potential impact of customer issues” involving CLECs, which are its main U.S. market.
“Robust discussion” of results of latest DTV testing followed presentation of results to more than 150 broadcasters in Washington Thurs., we're told. Closed-door meeting reportedly was told that VSB standard out-performed COFDM on 30-ft. outdoor antennas, COFDM did better on 6-ft. outdoor antennas and neither did very well on indoor antennas, as expected (CD Jan 11 p2, Jan 10 p2). Broadcasters also were told that COFDM would make DTV available to about 6% fewer households and same power level would give stations 14% smaller viewing area. Officials of COFDM supporter Sinclair Bcst. reportedly repeatedly made their claim that testing was flawed because it used COFDM receiver without needed filter. Broadcasters also were said to have repeatedly criticized cable and set-makers for not accelerating DTV rollout. Boards of NAB and MSTV are to meet Jan. 14-16 to decide what to recommend to FCC based on test results.
House Telecom Subcommittee will be headed by Rep. Upton (R- Mich.), but Commerce Committee Chmn. Tauzin (R-La.) carved out Trade & Consumer Protection Subcommittee for Rep. Stearns (R- Fla.). Trade Subcommittee will have jurisdiction over privacy, trade and other commercial practices within purview of FTC, while Telecom panel will keep all telecom and other media issues. Rep. Greenwood (R-Pa.) will head Oversight & Investigations Subcommittee. “There’s still some grey area that has be resolved” in terms of jurisdiction, said Committee spokesman Ken Johnson, but now “we have a road map we can follow.”
Use of wireless Web portals is projected to grow to 350 million mobile customers in 2005 from current 4 million, research firm Strategy Analytics said. It said revenue from wireless portals would be determined by ad sales and mobile commerce transactions.
Mercedes Walton, ex-AT&T, appointed pres.-COO, Applied Digital Solutions… James Toupin, ex-U.S. International Trade Commission, named gen. counsel, U.S. Patent & Trademark Office… Larry Beerman, ex-Tellabs, named vp-business development, NexTone Communications… Timothy Kelly, ex-tickets.com, appointed pres., National Consumer Organization, Sprint…Kathy Jia promoted to gen. mgr., MediaWave Advertising… Appointed to e.spire Communications board: Dennis Freely, Telecom Group; Stanton Williams, NTL… Reed Hundt, ex-FCC chmn., elected to Brience board… Andrew Rosen, regional vp-sales, Clear Channel, adds exec. vp-mktg., replacing John Fullam… Robert Gerrard promoted to exec. vp-gen. counsel, Scripps Networks… Promotions at ACT Teleconferencing: Robert Aubry, to regional managing dir.-N. America, replacing Eugene Warren, who was promoted to COO; Mark Kelly to chief technology officer, replacing Iain McKeracher, retired.
Since 9th U.S. Appeals Court, San Francisco, ruling classifying cable modem service as telecom service are “nonbinding dicta,” FCC is free to embrace Cox’s position that it’s pure information service devoid of telecom service component, Cox told Commission in reply comments in open access inquiry. Explaining recent decision to stop paying franchise fees on cable modem service to local govts. in 9th Circuit jurisdiction, Cox said court decision meant it had no choice but to suspend payment and collection of fees pending further clarification of issue by FCC. Recognizing its decision would have adverse financial impact on some local franchise authorities, company said it was in discussion with local govts. “in hopes of reaching a mutually satisfactory resolution.” Referring to criticism by National Assn. of Telecom Officers & Advisers (NATOA) that Cox was refusing to pay franchise fees mandated under Title 6 after declining to contribute to universal service fund and failing to secure necessary state or local certificates required under Sec. 253, company said it continued to pay cable franchise fees on all services that had been deemed Title 6 cable services. It would have continued to pay franchise fees on cable modem services in 9th Circuit jurisdiction states but for Portland decision, Cox said, pointing out it was paying such fees in other states. As for USTA’s charge that Cox hadn’t shown any intent to make payments to universal service fund despite concluding data service was telecom service, company said its telephone subsidiaries in 9th Circuit states paid “significant portion” of revenues into state and federal universal funds. “Far from ‘reasoning’ that its cable services are telecommunications services, as USTA claims,” Cox has “vigorously” and “repeatedly” disputed such suggestion, company said, and not until FCC determines that cable Internet service should be subject to Title 2 common carrier requirements can Cox comply with them.
Financials: Nortel will cut work force by 4,000, although its overall staff level will remain same through new hires in high-growth areas, company announced Thurs. Cuts represent 4% of Nortel’s 94,500 employees… Time Warner Telecom completed acquisition of GST Telecom assets for $690 million. GST filed for Chapter 11 bankruptcy protection in May.