To no one’s great surprise, cable TV remains dominant technology for delivering video programming to consumers, according to 7th annual video competition report adopted last week and released by FCC Mon. Commission found that cable industry totaled 67.7 million subscribers in June 2000, up one million (1.5%) from 66.7 million in June 1999. But DBS continued to make steady inroads in cable’s market share, adding almost 3 million subscribers over same period to reach nearly 13 million last June, up 29% from year earlier. Largely as result, cable operators now control 80% of burgeoning pay-TV market, down from 82% year earlier, while DBS providers now command growing 15.4%.
PASADENA -- Threatened strike against TV networks this spring by Writers Guild of America (WGA) and other unions (see separate item, this issue) was a major topic of conversation here as Pax TV, UPN and WB kicked off semiannual round of questions and answers with TV critics. “Everyone that’s involved on both sides says there’s going to be a strike,” WB CEO Jamie Kellner said. “I have no involvement whatsoever, so I say there’s not going to be a strike. I think there’s going to be a lot of reasons to avoid a strike.” He and UPN executives said they had contingency plans in place in case there was strike, including at least 4 “reality” programs under development by WB, plus advantage of being able to add movie night by using affiliate Turner Bcstg.’s huge library of films.
White House formally renominated FCC Comr. Ness again for new term, throwing her bid to stay on Commission back to Senate Commerce Committee for consideration. Ness was renominated last year, but Committee Chmn. McCain (R-Ariz.) never scheduled confirmation vote, and she currently functions under recess appointment that expires as soon as another commissioner is appointed. If cleared by Committee, Ness’s 5-year term would start from July 1, 1999, expiration of her last one. However, Commerce Committee spokeswoman said panel would concentrate on confirming Bush cabinet members before considering Ness’s situation.
LAS VEGAS -- FCC Comr. Powell endorsed free market vs. govt. regulation, pleasing consumer electronics officials at the CES here Sat. But reaction was more muted when he also indicated reluctance for govt. to move aggressively to spur DTV transition. Powell, who is widely rumored to become next chmn. of FCC, was interviewed one-on-one by CEA Pres. Gary Shapiro, also rumored to be candidate for position in new Bush Administration, despite recently signing new 10-year contract with CEA.
Satellite digital radio rivals used Las Vegas Consumer Electronics Show (CES) to flex their promotional muscle in advance of commercial debuts later this year. Sirius Satellite Radio told news conference it had signed “multifaceted” marketing and programming partnership with House of Blues that “will introduce service to millions of music fans” attending House of Blues events throughout U.S. Sirius also announced programming carriage agreements with A&E TV Networks, Discovery Channel, Weather Channel. Mktg. Vp Doug Wilsterman said first Sirius receivers should arrive for sale by midyear at $300-$400. Sirius also plans to market FM modulator for adapting existing car audio equipment for use with Sirius satellite receiver. It demonstrated what Wilsterman called “absolutely true” satellite reception in Las Vegas Convention Center. He said that for demonstration purposes, Sirius had turned off its Las Vegas terrestrial repeater. Responding to questioner, Wilsterman said Sirius and rival XM Satellite Radio were committed to “honoring” FCC mandate that receivers marketed by both services be made interoperable. He said Sirius and XM were working very hard to achieve interoperability under “unified standard” agreement they signed last year. But he estimated that first interoperable receivers wouldn’t be available in marketplace for 4 years. Meanwhile, at Fri. Las Vegas news conference set for past our deadline, XM planned to demonstrate first-time live broadcasts to Convention Center from company’s Washington studio. On eve of CES, XM said it scored big promotional coup, announcing it had signed 2,200- store Sears to promote XM radio products and services at retail nationally.
Month after postponing consideration of thorny DTV transition issues, FCC intends to tackle at least some DTV matters at its Jan. 11 open meeting. Well-placed sources said Commission was likely to approve bid by new DTV-only station to gain cable must- carry status and require consumer electronics manufacturers to put digital tuners in all new TV sets by date certain, among other less controversial items. But what’s not clear was whether agency would tackle core issue of whether cable operators and DBS providers should carry broadcasters’ analog and digital signals during current DTV transition. Action on dual-carriage issue, which has been hanging over federal regulators for more than 2 years, has been postponed repeatedly by Commission.
As it continues to weigh imposing additional regulatory conditions on AOL’s pending purchase of Time Warner (TW), FCC is seeking help from group of small and midsized ISPs. Commission has asked coalition of smaller ISPs and state associations to draft definitions of local and regional ISPs that agency might use in setting tougher open access requirement on AOL-TW combination. Proposed requirement reportedly would force AOL-TW to carry at least one local and one regional ISP on every TW cable system, in addition to national EarthLink service that MSO already has committed to carry. That would go beyond open access provision stipulated by FTC, which would require AOL-TW to open its high- speed cable lines to at least 3 unaffiliated ISPS, including EarthLink, when it added AOL as offering. Speaking for ISP coalition, NorthNet Mktg. Dir. Stephen Heins said group also was pressing FCC to set open access mandates for business users in smaller and rural areas. He said group planned to submit its proposal to Commission by today (Jan. 8) at latest.
First order of business for new House Commerce Committee Chmn. Tauzin (R-La.) is examination of “the networks’ blown coverage of the Presidential election,” his spokesman Ken Johnson told us. In early Feb., Tauzin will chair hearing by full Committee on issue, Johnson said: “It’s not designed to be confrontational. We simply want to find out why the networks dropped the ball and how we can prevent this from happening again.” He said other early priorities would include FCC reauthorization and reform, giving Bell companies authority to provide advanced services across LATA boundaries, resolution of reciprocal compensation controversy and “long hard look at online privacy.”
Effectiveness of U.S.-Europe safe harbor agreement on Internet privacy is in question for telecom carriers because FCC hasn’t agreed to enforce U.S.-Europe privacy agreement, source in Commerce Dept. (DoC) told us. DoC is in talks with Commission in effort to bring it aboard safe harbor agreement, although some sources said European Union (EU) wouldn’t recognize FCC as legitimate enforcement agency. Telecom and common carriers can join safe harbor agreement, but only as it relates to functions outside realm of common carriers, sources said. Agreement reconciles strong European privacy rules with U.S.’s self- regulatory stance, guaranteeing that U.S. companies can do business in Europe.
FCC asked Fri. whether it should adopt access charge reform plan for rural carriers in its entirety, as proposed by Multi- Assn. Group (MAG), or whether certain parts should be adopted or incorporated into other proceedings. Plan was developed by coalition of groups representing rural telcos -- National Telephone Cooperative Assn., National Rural Telecom Assn., OPASTCO, USTA. Comments will be due 30 days from publication in Federal Register, with replies due 15 days later. Federal Register publication generally occurs within days after item is released by FCC.