Jimm Phillips

AT&T believes it can attract new customers -- and keep its existing ones -- because of its Mobile Share shared-data plans, as well as new opportunities in home automation and connected car services, said AT&T Mobility Chief Financial Officer Pete Ritcher Wednesday at a Deutsche Bank investor conference. More than two-thirds of the carrier’s smartphone subscribers -- 31.7 million -- are on tiered data plans like Mobile Share, he said. AT&T said 6.6 million subscribers were on Mobile Share plans as of Q4 (CD Jan 28 p19). Subscribers on Mobile Share plans will likely “buy bigger buckets” of data over time, Ritcher said. “As the usage grows on those devices … then we have an ability to build and sort of capitalize and grow our data revenues that are associated with that,” he said. AT&T hopes to increase revenue from each user on those plans as they begin to upgrade from smartphones using 3G technology to ones that utilize LTE, Ritcher said.

Internet stakeholders will need to participate in the debate over this Congress’s Internet policies if they want to win on issues like e-commerce sales taxes and cybersecurity, Sen. Ron Wyden, D-Ore., said Tuesday at an Internet Association event. Grassroots opposition to the Stop Online Piracy Act (SOPA) and the PROTECT IP Act (PIPA) was a turning point in the dialogue on Capitol Hill over Internet-related issues, Wyden said. “For the first time, the technology sector had beaten the middle man,” he said. “We've got to find a way to build on that, and that’s why your work is so incredibly important today.” Regulators and other lawmakers also outlined how upcoming policy discussions would involve the Internet community.

More operating system and device competition should mean lower smartphone subsidies across the industry over the next two to three years, said Verizon Chief Financial Officer Fran Shammo Monday at a Deutsche Bank investor conference. The move of two new major operating system entrants into the market -- Windows Phone and BlackBerry 10 -- is a good thing because “the more operating systems you have in the ecosystem, inherently the more competitive that system becomes,” he said. “I am a true believer that as these operating systems start to really take hold … then you are going to start to see more competition which leads to lower prices. So I think it is going to follow the same way that I watched the basic phones come over time. I think smartphones will do the same thing."

Prices in FCC spectrum auctions have been on the rise since the mid-2000s, but factors beyond the tradeoff between supply and demand make it difficult to say that rise is evidence of what the government says is a “spectrum crunch,” said Scott Wallsten, senior vice president-research for the Technology Policy Institute (TPI), at a TPI-led event Friday. In a report released Tuesday, Wallsten examined FCC data from the 69,000 spectrum licenses it has sold through auctions since 1996. The agency has been holding spectrum auctions since 1994. The data included in the report shows that while spectrum prices are continuing to rise, “the rate of price increase has probably been slowing” (http://bit.ly/WmcTWk)

Pandora will place users on a 40-hour-per-month limit for free mobile listening, it said. The company made the “very unusual” decision because of the rising royalty rates it has to pay; the rate has increased 25 percent over the past three years and is set to rise up to 16 percent over the next two years, Pandora Founder Tim Westergren said Wednesday in a blog post. “After a close look at our overall listening, a 40-hour-per-month mobile listening limit allows us to manage these escalating costs with minimal listener disruption,” he said. Pandora “will be sure” to alert listeners who near the 40-hour limit, Westergren said. The limit will affect less than 4 percent of Pandora’s more than 65 million customers -- the average customer uses the service only for 20 hours per month over all devices, Westergren said. Customers who hit the 40-hour limit can pay $0.99 for unlimited listening over the rest of the month, or can subscribe to the $36-a-year Pandora One service, which allows unlimited listening and features no advertising. Listeners will also continue to have unlimited access to Pandora on desktop and laptop computers, he said (http://bit.ly/Z0eu0l). Pandora’s decision is not surprising given that the company has been “consistently operating with yearly losses” under the compulsory license regime, Public Knowledge Staff Attorney Jodie Griffin told us. It’s not clear how the decision will impact Pandora and the webcasting business in general, but “if this becomes a trend for webcasters and leads to less online radio listening overall, it’s hard to see how that’s a victory for musicians or audiences,” she said.

Reforms are needed to improve the quality of software-related patents that the U.S. Patent and Trademark Office (PTO) grants, said Suzanne Michel, Google senior patent counsel, Wednesday during a PTO-led forum. PTO held the forum as part of its “Software Partnership,” an effort to gather industry input on ways to improve the quality of patents. Current patent examination practices and rules have resulted in “vague, overbroad and invalid” patents that have driven the boom in litigation abuse led by patent-assertion entities (PAEs), Michel said. Software and Internet-related patents are litigated eight times more often than others, and account for 85 percent of all PAE lawsuits, she said.

Governments need to move away from blunt mechanisms like the “Great Firewall of China” as they consider how to regulate the international flow of data and other aspects of e-commerce, said Jonathan McHale, deputy assistant U.S. Trade Representative (USTR)-Telecom and Electronic Commerce Policy, during a Brookings Institution event Tuesday. Brookings published a report Monday that some governments are restricting the Internet “in ways that reduce the ability of businesses and entrepreneurs to use the Internet as a place for international commerce and limits the access of consumers to goods and services” (http://bit.ly/XW2mLH).

The FTC said HTC America reached a tentative settlement over charges that the company’s failure, until at least November 2011 to take “reasonable steps” to secure the software used on its smartphones and tablets, constituted “unfair or deceptive acts or practices” (http://1.usa.gov/YHPOtt). The agency accused the maker of consumer electronics of not using “well-known and commonly-accepted secure programming practices ... which would have ensured that applications only had access to users’ information with their consent."

Ukraine’s government is implementing the intellectual property rights (IPR) “action plan” it developed in consultation with the U.S. and hopes to fix remaining IP issues through forthcoming legislation, said Serhii Nalyvaiko, head of the State Intellectual Property Service of Ukraine’s control over IP objects use division, during a Special 301 review hearing Wednesday at the Office of the U.S. Trade Representative (USTR). Nalyvaiko’s testimony came as the USTR-led Special 301 Committee considers whether to designate Ukraine as a “priority foreign country” (PFC) under the Special 301 statute.

Unless the U.S. is able to increase the amount of available spectrum, there will be a gap between supply and demand as mobile data use continues to increase, said FCC Wireless Bureau Chief Ruth Milkman Tuesday during a Broadband Breakfast event. Today’s smartphone and app economy “simply did not exist” in 2008; between 2009 and 2012, mobile traffic grew by 1,275 percent, and that level of growth will continue through 2017, she said. That demand is being driven by the proliferation of smartphones, and that “necessitates” the need to increase spectrum availability, Milkman said. The federal government has been engaged in a series of efforts to increase spectrum availability, including the FCC’s considerations of the 3.5 GHz and 5 GHz bands and the ongoing evaluation of the 1755-1850 MHz band. Wireless carriers have responded to the spectrum crunch by increasing their use of data caps to curb customers’ data use. While such caps are controversial, industry experts noted that the industry is changing so rapidly that it is not useful to specifically target the use of caps in the midst of larger competition issues.