NorthPoint Communications announced Fri. it pulled out of VersaPoint, joint venture with European broadband operator VersaTel, as part of its effort to reduce spending. NorthPoint sold its 50% share of venture to VersaTel which will relieve NorthPoint of capital commitment worth about $23.2 million, assume VersaPoint liabilities and pay NorthPoint about $6.5 million in cash. VersaPoint began commercial service in summer, offering retail DSL services in VersaTel’s core market of Benelux area and northwest Germany. “Under the circumstances, we do not have the resources to support this venture,” NorthPoint Chmn. Michael Malaga. Verizon, which had planned to combine its DSL business with NorthPoint’s, cited “deterioration” in NorthPoint’s business operations and financial condition as reasons for ending venture.
FCC would be taking “serious misstep” if it delegated reciprocal compensation and LEC-wireless interconnection decisions to state regulators, CTIA said in letter sent to Commission Fri. FCC has indicated it may take that route but “such a decision would be contrary to law” and would run counter to agency’s previous position in regulating commercial mobile radio service (CMRS), CTIA Gen. Counsel Michael Altschul wrote. “At issue is the fundamental question of the Commission’s jurisdiction -- over CMRS providers in general and LEC-CMRS interconnection specifically -- and its decision to abandon its regulatory responsibilities and delegate them to the various states,” letter said. “One certain fact has resulted from the extensive litigation surrounding the Commission’s implementation of the interconnection provisions found in the Act,” Altschul wrote: “The FCC has the sole authority to establish the terms of and to review LEC-CMRS interconnection agreements.”
Cyclone-3 rocket carrying 6 Russian communications satellites failed after launch Thurs., resulting in loss of all 6 spacecraft. Spokesman for Strategic Missile Forces said first and 2nd stages of rocket functioned normally, but 3rd failed. Launch failure from Plesetsk cosmodrome in Russian Arctic is 2nd in 2 months for agency, as EarthWatch lost satellite in Nov. 21 launch on Cosmos-3 from Plesetsk (CD Nov. 24 p4). Satellites burned up after re- entry into atmosphere, scattering debris into Arctic Ocean, but officials said debris caused no damage. Russian Aerospace Agency suspended launches on Cyclone-3 rockets until agency can determine cause of failed launch, agency spokesman said. Similar failure nearly cost agency 6 Strela military satellites 2 years ago, but agency saved them.
Kan. Corp. Commission said its 2000 Lifeline public awareness campaign, which ran from June through Oct., was success. Agency said campaign boosted Lifeline enrollment with Southwestern Bell Telephone and Sprint/United by 50%. Program uses federal and state universal service resources to provide $10.50 discount on monthly local service charges.
Ga. PSC said number of residential customers on state “No Call” telemarketing list topped 200,000 in Dec. Customers must pay $5 every 2 years to keep their name on list, which began taking names in Jan. 1999. Current total is 204,032 names. Telemarketers who call names on list can face fine of up to $2,000 per call. PSC said over 1,600 telemarketers from U.S., Canada and Carribean have accessed no-call database since its inception.
Motorola said Fri. it will unveil its iRadio satellite car radio system at Consumer Electronics Show at Las Vegas Convention Center this week. New car radio system is one of many digital radios that companies are planning to compete with XM and Sirius Satellite Radio for customers, industry officials said. IRadio, developed by Motorola Telematics Unit is expected to offer satellite services and interact with Internet through digital cellular networks which are primarily used for voice calls. Company is hoping to integrate iRadio with satellite navigation systems and emergency service products that are standard in many cars and trucks. CES is being used to showcase prototype with hopes of attracting manufacturer of car audio products, firm said. Motorola believes “right company” could have products ready for introduction to marketplace in one year, spokesman said.
FCC Common Carrier Div. asked for comments on request by Elastic Networks for waiver to permit registration of its EtherLoop Modem, trade named Stormport 400. Elastic Network said modem conforms to all Part 68 requirements except signal power limitations. Company said waiver would further public interest by giving consumers more choices for advanced telecom services, particularly in rural areas that don’t have ADSL service. Comments are due Jan. 22, replies Jan. 29. Comments should refer to file number NSD-L-00-254.
After a year of tough negotiations and numerous retransmission consent extensions, Comcast and Disney announced Fri. agreement in principle on carriage of over-the-air signals of ABC owned stations in MSO’s markets. Spokeswomen for companies declined to divulge terms of agreement, citing confidentiality. Agreement covers Disney products and services including ESPN, ESPN2, ESPN Classic, ESPN News, Disney Channel, Toon Disney, SoapNet and retransmission consent for ABC-owned stations in Philadelphia, N.Y., L.A., Chicago, Flint, Mich., and Toledo, Ohio. Current ESPN and Disney Channel programming agreements were set to expire Dec. 31, 2000. Latest in series of retransmission consent extensions was also due to expire Dec. 31 (CD Dec 7 p9). Characterizing agreement as “important” one, Disney Pres. Robert Iger said it’s “clearly in the best interests of our viewers on all the Comcast systems.”
Indicating more cautious approach to bad customer debt, Lucent nearly doubled funds it set aside for “doubtful” accounts in fiscal 2000, according to SEC filing. Lucent boosted reserve by 58% to $501 million in fiscal year that ended Sept. 30. Company, which had set aside $318 million in 1999, added $252 million to that this year. Despite extra cushion, Lucent wrote off only $69 million for bad debt, compared with $112 million in 1999. Heftier debt reserve is seen as way to make Lucent less vulnerable in future to uncollected bills and defaults by customers to which it has extended credit. Manufacturers such as Lucent extend fairly generous credit terms to new telecom companies such as CLECs to encourage them to buy equipment as they grow. However, in recent times CLECs have begun facing financial trouble, making manufacturers vulnerable to debt collection problems.
Last recession year for TV advertising was 1991, and “it appears the industry is heading that way again in 2001” in terms of national spot, prominent stock analyst predicted last week in face of broad indications of major cutbacks by largest TV advertisers. First quarter of year looks particularly bad for TV stations, he and others predicted. Radio on other hand will show ad growth of 7.5-8% next year, according to Gary Fries, pres. of Radio Ad Bureau. “Radio is 80% a local business with revenue sources that defy national trends,” he said.