Tex. PUC Comr. Judy Walsh resigns to take position with President-elect Bush’s energy policy development team; she will stay on until Tex. Gov. Rick Perry (R) appoints replacement to fill remaining 3 years of her term. Walsh was first appointed to PUC in 1995 by then Gov. Bush… WorldCom names Donna Sorgi, northern region public policy vp, to head its Washington-based federal regulatory group… Rosemary Kimball moves from FCC Office of Media Relations to press liaison at agency’s Consumer Information Bureau… Douglas Hanson, CEO, Internet Commerce & Communications, named CompTel chmn., replacing Global Crossing’s Anthony Cassara, who stepped down… Named partners in Wiley, Rein & Fielding law firm: Mary Borja, John Burgett, Tanja Hens, Scott McCaleb and Suzanne Yelen; named of counsel to firm are Christopher Kelly, ex-U.S. Patent & Trademark Office, and David Southall, ex-Information Management Consultants.
Four major MSOs swapped or purchased cable systems from one another as new year began, furthering trend toward industry consolidation that has snowballed in last 3 years. Adelphia, AT&T Broadband, Comcast and Mediacom all announced system exchanges or acquisitions that would result in 2.4 million subscribers, or more than 3% of all U.S. cable customers, changing corporate hands overnight. Transactions will create even bigger cable clusters in such large markets as N.Y.C., L.A., Washington, Chicago, Detroit, Philadelphia, Atlanta, southeastern Fla. But some industry observers said deals, concluded as FCC continued to weigh final govt. approval of AOL’s pending purchase of Time Warner (TW), would lead to even more as scale became ever more important. “Cable consolidation is not over,” ABN AMRO analyst John Martin said.
MPAA filed several major objections to CableLabs’ full final draft of its anticopying technology license for advanced digital cable set-top boxes, signaling that fight over controversial encryption technology wasn’t over (CD Dec 29 p1). In comments submitted to FCC late last month, MPAA said it was “concerned with a number” of provisions in POD Host Interface License Agreement (PHILA) and was “uncertain as to how some of these and other provisions will work in practice.” Group said its concerns included technology’s: (1) “Apparent ineffective protection against unauthorized Internet retransmission of all content, including broadcast.” (2) “Unprotected high-resolution output of most categories of content from those devices.” (3) “Copying and permanent storage in those devices of all content, including high- value content, which individual copyright owners and cable operators may have voluntarily negotiated to treat as ‘copy never.'” To ease such concerns, MPAA said “the only alternative” for cable operators would be to “turn off the OpenCable box” and prevent DTV programming from reaching consumers. It said such result “would have a negative effect on consumer expectations, particularly if they were not given adequate notice from equipment manufacturers.” MPAA said it would continue to work through those and other issues with CableLabs and 5C companies “in a prompt, good-faith and constructive manner.”
With FCC overdue to act on reciprocal compensation, Bell companies and CLECs competed Wed. to present their positions to Commission and news media just in case agency schedules vote on issue at its Jan. 11 agenda meeting. If item is placed on next week’s agenda, all lobbying will have to stop tonight (Jan. 4) under agency’s “sunshine” rules. FCC hasn’t said whether it will take up reciprocal compensation at meeting, but it originally planned to vote on issue by year’s end and then deal with broader proceeding on intercarrier compensation soon afterward. “It’s ripe for decision,” industry source said.
FCC is considering proposed rulemaking that would regulate interactive TV (ITV) services carried by all cable operators, knowledgeable sources confirmed Tues. Proposed regulations would be likely to ban all cable systems offering interactive services from blocking ITV triggers from rival content providers, similar to ITV conditions that FTC recently imposed on AOL’s pending purchase of Time Warner (TW). But sources said FCC rules could go further than FTC merger conditions, prohibiting cable operators from favoring their own content by caching it on local servers or sending it at higher data speeds than content from unaffiliated providers. “I'm sure they're talking about all sorts of things,” said source who declined to be identified.
FCC told Congress in report Tues. it wouldn’t make recommendations on specific measures to facilitate provision of local signals to subscribers in rural markets by direct-to-home (DTH) satellite and multichannel video programming operators because licensing process hadn’t been completed and it would be premature to make recommendations before licensing. Under requirement of Rural Local Broadcast Signal Act, Commission must inform Congress of ways its licensing and authorizations have helped provide local signals to satellite TV subscribers in remote areas.
National Exchange Carrier Assn. (NECA) files revisions in its average schedule formulas that will result in combined increase of 2.49% in common line and traffic-sensitive settlements. Those “settlements” are like interstate access charges for small rate- of-return carriers that don’t conduct their own cost studies. NECA said new formulas would go into effect July 1 if FCC approved them.
Rep. Tauzin’s (R-La.) selection as next chmn. of House Commerce Committee was all but official Tues., well-placed sources told us, after House Rules Committee released long-rumored proposal to create expanded Financial Services Committee. New panel is expected to be headed by Rep. Oxley (R-O.), Tauzin’s rival to succeed former Commerce Committee Chmn. Bliley (R-Va.). Full House will vote today (Wed.) on committee changes, and Republican leadership will choose committee heads Thurs.
CompTel said it was considering legislative campaign to urge structural separation on Bell companies in return for broadband LATA freedom. “This is not a wild-eyed theory,” CompTel Pres. Russell Frisby said at Tues. news briefing. Think of it as “return to the MFJ era,” he said, referring to Modified Final Judgment that laid ground rules for 1984 AT&T divestiture. Frisby said trade association hadn’t decided whether to recommend separation idea to Congress but idea would be to follow what Pa. PUC had required of Verizon -- separation of retail and wholesale operations. In return, Bells’ retail units would receive permission to offer data services across LATA lines without gaining Sec. 271 approval from FCC, Frisby said: “My sense is there are some people on the Hill who would be interested.”
FCC was poised at our deadline to release proposed frequencies that carriers could use for new 3rd-generation (3G) services. Agency source said Commission already had approved notice of proposed rulemaking but hadn’t released it. White House had asked FCC to make proposal by end of year. Item is expected to look at several potential bands including 2 in 1700-MHz and 2400-MHz that NTIA also is looking at as part of President Clinton’s 3G initiative. Clinton urged FCC and NTIA to work with wireless industry to select frequencies as quickly as possible so U.S. wouldn’t lose its edge.