Author: Harold

700 MHz Update: FCC Severs D Block, Refers Cyren Call Allegations To Inspector General.

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The FCC can certainly move fast when it wants to — and when it has had a few weeks to get used to the idea. The FCC just released a public notice that it will “de-link” the D Block from Auction 73, and will release the names of the winners as soon as the Commission collects the payments (ten days after it issues the official notice that the auction is over and that parties now need to file “long forms” and pay up).

Also of importance, Chairman Martin has referred the question of whether Cyren Call made all manner of demands of Frontline, and did this break any rules to the Office of the Inspector General. This extremely important detail was buried in this somewhat less than stellar Washington Post article about our letter to the FCC calling for an investigation. I say “less than stellar” because, in addition to “burying the lead” big time, the reporters did not trouble themselves to contact me despite that fact that (a) I broke this story in the first place (only narrowly beating out Dow Jones’ Cory Boles); (b) I drafted the friggin’ letter. I therefore recommend this far superior article in eWeek (i.e., it mentions me and links to the relevant blog entry — a clear mark of superior journalistic skills).

A bit more analysis below . . .

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Yo Google! Your Lawyers Are So Stupid, They Copy AT&T!

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I had an unfortunate head desk moment this morning on reading that Google Ads (such as the ones to the right on your screen) reserves the right to pull their service if you engage in “any action or practice that reflects poorly on Google or otherwise disparages or devalues Google’s reputation or goodwill.” This looks suspiciously like the terms of service my fellow travelers on net neutrality slagged AT&T for using.

In both cases, I expect that the intent is not to yank people who say nasty things about the parent company, but to reserve the right to yank the service when someone does something revolting. “Look, NAMBLA uses Google Ads, Google supports pederasts.” or “Look, the worlds worst spammers have AT&T connections, they support spam.” By why can’t my lawyer colleagues just say so, instead of writing something so broad that it covers even general criticism? Yes, “tarnish” is one of those words of art that all us legal folks understand has a very specific meaning. But it doesn’t do a damn bit of good when folks who are trying to understand the terms of service are not lawyers, which — outside of DC — covers most of the user population.

I have no doubt that the usual suspects will be out baying for blood and denunciations like the staff of the Clinton and Obama campaigns after a rival campaign staffer sneezes funny. So even though I did not give a rat’s patootie on the AT&T terms of service (being a lawyer and understanding what it meant), I shall now both condemn Google for being so stupid and test their policy by making several derogatory comments about GoogleAds.

[Begin OUTRAGEOUS accent]
Hey, GoogleAds! I fart in your general direction! I wave my very naughty bits at you! You are so lame, you copy terms of service from AT&T!

Now change your TOS to something sensible or I shall taunt you some more.
[end OUTRAGEOUS accent]

Did the ads on the screen disappear? No. Good. Can we consider this settled and actually get back to real policy?

Keep this up and I shall need to make a major speech about “Terms of Service In America” and invite us all together for some major healing.

Stay tuned . . . .

Quick 700 MHz Updates

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First, we at PISC have sent a letter to the FCC asking the FCC to sever the D Block issues, announce the winners of the rest of the auction, and thoroughly investigate the allegations around Cyren Call and its pre-auction discussion with Frontline. (Martin has apparently already circulated something that severs D Block, so they can announce results as soon as the other Commissioners vote and the wireless bureau finishes the necessary housekeeping.)

Perhaps more importantly for the long run, we ask that the FCC take a hard look at whether to try to fix the public/private partnership or possibly do something else. The FCC has a lot of options here. And with the auction clearing over $19 Billion and the statutory requirement to start an auction before January 28, 2008 fulfilled, the money pressure and time pressure are off. We have time to have a public process and do it right.

Second, here is Kevin Martin’s official statement explaining why the auction was a huge success (and, by implication, why he did a bang up job getting this done). Martin, sensitive to the grumblings from folks who say that different rules could have gotten more revenue, included this handy chart showing that, on a pure revenue basis, the 700 MHz auction is the most successful FCC auction ever.

(In the reading the tea leaves department, I note that the chart subtracts out the D Block bid. And indication the FCC won’t just pass off the D Block to the lone low bidder? Maybe, but no surprise if that turns out to be the case.)

You can find Tate’s statement here. I have not seen official statements from any of the other offices.

Stay tuned . . . .

That's It! The 700 MHz Auction Is Ovah ! On to Tasting And Judgment . . . .

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At long last, the FCC went three rounds without any new bids and declared Auction 73 (better known as Battle 700 MHz) closed. You can see the final provisional winning bids on the FCC’s Auction 73 page here.

Of course, we are all waiting to see who won what licenses, particularly C Block. But we have some preliminaries to go through first. Most importantly, the FCC has to make a decision on whether to sever the D Block from the Auction so that it can investigate what happened, especially the allegations around Cyren Call and Morgan O’Brien.

Even with the information available, Auction 73 has clearly succeeded on a number of key fronts. Unsurprisingly, I am inclined to credit anonymous bidding with the enormous surge in value for the licenses. Even if incumbents ended up walking away with the lion’s share of the licenses, at least they paid market value for a change (as opposed to the AWs auction, where they picked them up dirt cheap). I also note that at the end of the day, the FCC has only 8 unclaimed licenses (compared with 35 for AWS). As Greg Rose observed previously on his blog, there is good reason to believe we saw a lot of new people bidding.

It remains to be seen, however, whether the auction brought in new competitors or if, as the conventional wisdom predicted, AT&T and Verizon walked off with the big prizes. In particular, we all wait with baited breath on who won C Block.

Finally, two points on D Block. First, even if the experiment failed, that did not make it a dumb move. Babe Ruth used to lead the league in home runs and strike outs, because you can’t hit home runs unless you swing at a lot of pitches. With the FCC trying to satisfy the mandate of Congress to promote a national interoperable public safety network, but with insufficient spectrum allocated and with insufficient funds to build it. So the Commission tried to think outside the box and took a chance. turns out — for reasons still unknown — it did not work out.

Always punish innovators if things don’t go exactly right and you run out of innovators damn quick. Anonymous bidding was also an innovation. So is the open device condition. Before folks rush out to buy stink bombs to lob at Martin and the other Commissioners over D Block, consider if we want the next FCC reduced to such political timidity that we always get the same auction rules again and again and again, because the price of innovating is too high.

Second point: the FCC has a silver lining here. With the auction over, the FCC has fulfilled its statutory obligation to hold an auction commencing by January 28. Not only can the FCC take the time it needs to consider what to do, it can also consider other solutions besides trying to fix up D Block or even auctioning it off the highest bidder. That could include non-exclusive licenses, real time auctions, or even an unlicensed commons — if that would best serve the public interest.

I’m not saying what the best solution for D Block is, because we don’t know enough yet. It will depend on a lot of factors, such as who won the other licenses and how much stomach the FCC has to innovate. But I’m hoping that the FCC and others, when assessing Auction 73, will consider the successes as well as the D Block failure. Otherwise, they will vote to do the politically safest thing. Not a result I’d like to see.

stay tuned . . . .

SCOTUS Gets Down & Dirty with Indecency!

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The Supreme Court just agreed to hear the FCC’s appeal on the indecency case. This case involves whether the FCC acted correctly when it changed previous precedent and held that even a “fleeting utterance” of certain words (in this case, the “F-word”) can qualify as “indecent.” Previously, the FCC had a rule that it would take the entire context of the use of an obscenity into account, and that a mere “fleeting utterance” in the context of live television (especially of a newsworthy event) would not constitute indecency.

What’s at stake? See below . . .

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Telco Sock Puppet Picks Clinton As Best of Bad Field, Worries That Martin Has “Lost His Way.”

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Occasionally, folks at industry trade conferences make the mistake of forgetting that press are there and say what they are actually thinking. In fairness, most of these guys probably figure that trade press isn’t really press and who the heck reads Communications Daily anyway? After all, it’s not available online.

Heh heh heh.

I cannot provide an internet link or copy the entire relevant section without violating copyright. Nor would I want to do so. The folks at Comm Daily do good reporting, and if they chose not to make this stuff available online, so be it. Happily, however, principles of fair use allow me to report here a rather interesting story from the Wednesday March 12, 2008 edition (pages 7-8). David McClure, President of the United States Internet Industry Association, addressed his fellow telecom industry buddies at a conference in Monterey Califonia, where he had some very interesting things to say (for me at least) about his personal pick for the White House in 2008 (hint: It’s not Obama) and his opinions about Kevin Martin — the supposedly wholly owned telco asset.

More below . . . .

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A Clarification From George Ou and Richard Bennett.

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During the VonTV Debate, I stated that I was “sensitive to the arguments of George Ou and Richard Bennett that mandatory disclosure might allow people to circumvent network management tools, but I believe we can strike a balance.” I received an email from George Ou stating that he believed I misrepresented his and Bennett’s position.

Certianly it was not my intention to misstate anyone’s position. I therefore asked both George Ou and Richard Bennett to provide me with a statement of their position to reprint on my blog. They are reproduced below in their entirety.

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I Debate The Would-Be Vulcans

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So Marvin and I had our debate with Ken Ferree and Lawrence Spiwak. On the whole, I thought we mixed it up pretty thoroughly and civilly — although you can all judge for yourselves by watching the archive here (free registration required).

The issues won’t surprise anyone, but I want to address one meta-issue on framing. Perhaps not surprisingly, the anti-NN folks repeatedly seek to claim the mantle of reason, relegating us pro-NN types with our emotional commitment to romantic ideas like democracy and free speech to the status of irrational and unreasonable fanatics.

Ah, de ja vu all over again. I can remember when I heard similar sentiments from Ken Ferree and his former boss Michael Powell during the fights over media ownership reform in 2002-04. Of course, these were the same “logical,” “rational,” purportedly proof driven folks who developed the “diversity index” which weighted the Dutches County Community Television station as having the same media power as the New York Times, and inspired the Third Circuit to observe that believing this “scientific” approach reflected reality “would require us to take leave of our senses.” But, undeterred by the fact that the Third Circuit considered his previous efforts at “scientific reality building” to be either a bad joke or an excellent parody, Ken is quite prepared to rely exclusively on the view from “Ferree Land” and denigrate the rest of as emotional hysterics who listen to voices from the past.

My beef with Lawrence Spiwak is rather different. Unlike Ferree, Spiwak is actually living in the real world. My complaint is not that he lives in fantasy land or ignores evidence. My complaint is that he wishes to define the terms of the debate in a rather narrow way — i.e., only economic analysis and only University of Chicago-type analysis at that. All else is mere “rhetoric” and “emotion,” and only a proper grounding in rational analysis (aka economic analysis by economists of the Chicago School) can properly frame things. (I should point out the Spiwak’s colleague from Phoenix Center, George Ford, took a similar line at the Federal Trade Commission broadband competition hearing last year, chastising Tim Wu and myself for meddling in economic matters in which we were not competent to express an opinion.)

As one might expect, I find the attempts of the would-be Vulcans to define the terms of the debate unpersuasive. To see me do unto them as Kirk did unto the M5, Landru, and the other would be uber-rational computers, see below . . .

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Comcast to Illinois: I loves Me The Market Power!

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As reported on BroadbandReports.com, Comcast has greeted former Insight customers transferred to Comcast as part of unwinding a partnership with a 6% rate hike. Thanks to all the delightful cover given to Comcast by Congressional Republicans, who declare that all is “A OTAY” in Cableland, the Comcast guys are no longer even pretending that the rise in rates has anything to do with cost. Rather, as Comcast rep Libbie Steh told the Springfield Journal Register in a rare attack of honesty: “increased costs are not a factor this year.” Rather:

“Comcast periodically reviews prices and adjusts them to reflect what’s in the marketplace,” Stehn said.

More below . . . .

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And Now for Something Completely Different . . . .

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The Onion explains the FCC’s indecency rules.


FCC Okays Nudity On TV If Itâs Alyson Hannigan

It should be noted, of course, that the inquiry is very fact specific. For example, a sex scene between Alyson Hannigan (“Willow”) and Amber Benson (“Tara”) would have strong artistic merit — especially if it included Sarah Michelle Gellar (“Buffy”). By contrast, if it took place during Seventh Season and featured Hannigan and Iyari Limon (“Kennedy”), it would merit a significant fine because Kennedy was a really stupid character and the entire relationship between Willow and Kennedy made absolutely no sense. In fact, even without the indecency, the FCC should have fined UPN for pretty much the entire second half of the seventh season.

By contrast, J. Michael Strazynsky should be fined for not making it profoundly unambiguous whether or not Susan Ivanova (Claudia Christian) and Talia Winters (Andrea Thompson) got it on in Divided Loyalties.

Such artistic programming can not only help avoid indecency fines, but it can be a serious assist next time you need a merger waiver. nudge nudge wink wink.

Finally, if any of the South Park characters appear nude, not only should the FCC fine every cable system in the country, but millions are likely to go blind.

Stay tuned . . . .