Center for Advanced Communications Policy | Archives

Telecom/IT Policy Highlights

October 2002

Microsoft Word version / October, 2002 TiPH (212kB)

Adobe PDF version / October, 2002 TiPH (117kB)

Overview

Legislative Activities

Policy / Regulatory Activities

Judicial Activities

International

Research/ Reports

OTP Bookshelf

Newsletter Info

Overview
With Congress out for most of the month of October for campaign season, there was little legislative news. Before the adjournment a number of bills were introduced related to information technology, but most are unlikely to see any action with the 107th Congress coming to a close soon. Of note are HR 5522, a bill aimed at increasing consumer rights to copyrighted digital media, HR 5628, designed to promote private sector use of the wireless spectrum, and S 3102, a bill that hopes to restore eroded local control of wireless towers. In addition, HR 556, the Unlawful Internet Gambling Funding Prohibition Act, was passed by the House of Representatives. This bill would hold financial institutions accountable for facilitating Internet gambling in the U.S., and would criminalize the taking of payments from Americans by online casinos. Action on this bill by the Senate is uncertain. Also, the House stepped in as negotiations failed over the royalty rate that copyright owners would be paid by broadcasters, passing the Small Webcaster Amendments Act. It provides for a payment scheme that both parties agreed upon but, despite this, the act failed to win Senate approval before the break. With the payment deadline approaching, the two parties agreed to a temporary solution as they await Senate action.

In regulatory news, the FCC blocked a merger between DirecTV and Dish Network, the nation’s two largest satellite television providers, due to anti-competition concerns. They also handed down the largest fine in FCC history, $6 million, in a decision against SBC Communications for blocking competitive access to their networks.

There is a call for comments on Motorola’s proposed changes to E-911 call processing, with comments due Nov. 6 (See item under Regulatory Activities).

The Internet Corporation for Assigned Names and Numbers (ICANN) released its long awaited reform report this month as they complete an internal review process that began in March. Major changes include a much criticized move to do away with the election of board members, replacing that system with an “At-Large” committee that is designed to represent the public interest. Unrelated to the report, ICANN also chose the Internet Society (ISOC) to be the new administrator of the .org domain name after the contract with current operator Verisign expires at the end of this year.

BACK TO TOP OF PAGE
Legislative Activities

Broadband Wireless Subsidization Debated in Senate Hearing
10.03.02 – A group of panelists before a Senate Commerce Committee hearing urged lawmakers to take more proactive efforts in spurring the deployment of high-speed wireless networks. Solutions offered included freeing up more spectrum for wireless broadband and providing government funding to back network deployment. This plan was backed by panelists Craig Mundie (Microsoft), Lawrence Lessig (Stanford University), and former FCC chairman Reed Hundt. Peter Huber, a representative of the Manhattan Institute, however, opposed this idea and argued that this deployment should be a private sector effort. [Source: Medill News Service]

Communication With Constituents Hindered by Campaign Rules, Critics Say
10.14.02 – Rules of the U.S. Senate prohibit any updates to official websites within 60 days of a general election. The rule is designed to prevent any campaigning on the behalf of Senators on government-run websites. This rule, enacted in 1996, is being criticized by groups who claim this is an unneeded restriction on legitimate communication between Senators and citizens. During election season Senator’s offices must resort to other means, such as more faxing and phone calls. [Source: Washington Post]

Digital Consumer Rights Bill Introduced in House
10.02.02 – The Digital Choice and Freedom Act of 2002 (HR 5522) was introduced by Rep. Zoe Lofgren (D-CA). The bill is aimed at promoting “fair use” protections for consumers of electronic media. Fair uses are the way in which a consumer can use a copyrighted material without being in violation of copyright laws. The bill would expand consumer rights to do things such as backup copyrighted works and copy them to other preferred forms of media. It also would limit certain current copyright restrictions, such as non-negotiable contracts. The bill is not expected to see much activity so near the end of the session, but the issue will likely be raised again in the near future. [Source: CNET News]

Internet Gambling Ban Passes House, Awaits Senate Action
10.02.02 – HR 556, the Unlawful Internet Gambling Funding Prohibition Act, was passed by the House of Representatives by a voice vote. It would prevent Internet casinos from taking payments from persons in the United States and prohibit banks from allowing credit cards to be used for gambling purposes. While some federal and state laws already prohibit Internet gambling, the bill’s sponsor, Rep. James Leach (R-IA), says that no enforcement mechanism exists so this bill is needed. The majority of Internet casinos operate overseas, so they would not be subject to criminal penalties. It is not clear if the Senate will take action before the close of the 107th Congress. [Source: NY Times]

Local Control of Broadcast Towers Act Introduced in Senate
10.10.02 – S 3102, the Local Control of Broadcast Towers Act, was introduced by Sen. Patrick Leahy (D-VT) and Sen. Patti Murray (D-WA). The bill seeks to restrain federal encroachment on the powers of local governments in overseeing the deployment of wireless towers. The Senators argue that a loophole in 1996 Telecom Act has allowed the FCC to exert undue influence in this matter. Companion bills in the House were introduced by Rep. Bernie Sanders (D-VT). [Source: EMR Network]

Spectrum Reallocation Bill Introduced
10.10.02 – Representatives Billy Tauzin (R-LA) and Fred Upton (R-MI) introduced a bill designed to ease the financial burden of shifting government use spectrum to the private sector. HR 5628, the Commercial Spectrum Enhancement Act, provides for use of the Spectrum Reallocation Fund to pay for cost incurred in the transition from federal to commercial use. The bill has been referred to both the House Energy and Commerce Committee and the House Budget Committee. [Source: Reuters]

Web Radio Gets Temporary Solution, Awaits Senate Decision
10.18.02 – The House of Representatives passed HR 5469, the Small Webcaster Amendments Act of 2002. This is designed to create a compromise in the current debate between internet radio stations and the recording industry. Instead of a rate charged per listener (estimated to average out at about $92 a year under the earlier plan), stations would pay a percentage of their overall revenue or expenses (in the 8-12% range). While both sides agreed to the bill, is failed to win Senate approval before they adjourned for election season. Sen. Jesse Helms (R-TX) blocked the bill because he claims the bill does not account for those who were not included in the debate, such as traditional radio stations and larger webcasters. Many webcasters then were faced with a looming deadline under a current agreement, the Oct. 20 due date for fees dating back to 1998. In light of the Congressional delay, however, SoundExchange, the group taking the payments on behalf of the recording industry, was able to broker a deal that would delay full payment while Congress takes up the matter.

The Internet radio royalty debate (see June, August Telecom/IT Highlights) is part of the ongoing struggle over copyright available online. While the recording industry claims that artists are being vastly undercompensated for the content broadcasted online, Internet radio stations, especially smaller operations, claim that the fees sought would put most stations out of business. In June the Librarian of Congress set the rate at 7 cents per one hundred listeners, per song. Neither side was satisfied with that decision, and both appealed to arbitration, and now Congress. The Senate is set to take up the issue when they return Nov. 12. [Source: USA Today, CNET News, Radio and Internet Newsletter]

BACK TO TOP OF PAGE
Policy / Regulatory Activities

Digital Over Analog Radio Standard Approved by FCC
10.11.02 – In a unanimous vote the FCC approved a new technology that allows the simultaneous transmission of digital and analog signals over standard radio channels. (See FCC order: ). The technology is owned and patented by iBiquity Digital, backed financially by the nation’s largest radio providers. Stations will now be able to broadcast digital and analog over the same channel, with listeners using advanced equipment being able to receive the higher quality signal. Concerns were voiced from non-profit and smaller stations that have lower-power signals and might not be able to purchase the additional equipment needed. They claim this move may make it harder for their broadcasts to be heard because the spectrum will be more saturated with the signals from bigger stations. Still, proponents of the technology say that this will improve the overall quality of radio broadcasts, brining FM to digital quality and AM to FM quality. [Source: NY Times]

Dot Org Domain Administrator Named by ICANN
10.14.02 –The contract for the administration of the .org domain, between ICANN and Verisign, the world largest Internet registrar, will expire on Dec. 31, 2002. The Board of Directors of ICANN voted to make the Internet Society (ISOC) the new overseer of the domain. The .org registries will me managed by a new non-profit known as the Public Internet Registries (PIR), created by ISOC. Verisign, who also administers .com and .net, the largest and most profitable domains, is giving up control of .org in exchange for continued control these domains. There was a large outcry for .org, viewed as a space for free speech and non-commercial activity, to be placed under the control of a not-for-profit entity that will work for the public interest. ISOC states it has planned efforts such as a push to bring offline non-profit organizations onto the Internet. The ICANN announcement can be viewed at: http://www.icann.org/announcements/announcement-14oct02.htm. [Source: CNET News]

FCC Chairman Urges Telecom Purchases
10.21.02 – In a speech this month FCC Chairman Michael Powell stressed the need for Telecom providers to keep purchasing equipment from companies such as Cisco, Lucent and Nortel as they face bankruptcy. These technology providers are necessary, he said, for the ultimate recovery of the industry because they are the major suppliers of technological innovation. Many in industry disagree, as they see these vendors as simply scaling back their product lines and producing the standard equipment they always have. They suggest that innovation will be slowed for a while, but these companies can focus on transforming and upgrading the vast networks they installed in the 1990’s. [Source: NY Times]

FCC Releases Fifth Order and Report on TRS
10.25.02: Title IV (section 225) of the Americans with Disabilities Act (ADA), mandates that the Federal Communications Commission (FCC) ensure that interstate and intrastate telecommunications relay services (TRS) are available to individuals with disabilities. Title IV mandates that TRS providers be able to handle any type of call, including coin sent-paid calls from public payphones. However, TRS providers have had difficulty in handling these coin sent-paid calls, and equal functionality does not require that these calls be supported. In response to these difficulties, the Fifth Order and Report eliminates the coin sent-paid requirement and encourages specific outreach and education programs to inform TRS users of their options when placing calls from payphones. [http://hraunfoss.fcc.gov/edocs_public/attachmatch/FCC-02-269A1.doc]

FCC Seeks Comment on Motorola’s Proposal to Change Wireless E-911 Processing Methods
10.22.02: The FCC requirement to improve E-911 call completion with wireless handsets (Section 22.921 of the Wireless E911 Second Report and Order) took effect on February 13, 2000. On September 20, 2002, Motorola filed a request to modify the approved E-911 call processing method. The proposed modification would only affect the processing of E-911 calls that were prematurely terminated without action by the caller or call-taker, i.e., due to signal loss. The proposed method would keep the cellular phone on the paging channel of the wireless carrier that last served the call for five minutes, thereby enabling the call center to reinitiate contact with the phone. The new method would not prevent the caller from placing additional E-911 calls during that five minute period. Comments are due on November 6, 2002. More information about the proposed change and on how to file a comment is available at: http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-02-2762A1.doc.

FCC Seeks Comment on TRS Certification Renewal Applications
10.22.02: The FCC released a public notice that 30 states have applied for renewal applications for their TRS programs, under Title IV of the ADA. Applicants must demonstrate that their state is compliant with the ADA mandate. The public notice is available at http://www.fcc.gov/cgb/dro/headlines.html. Comments on these applications are due December 16, 2002, and reply comments are due December 31, 2002.

ICANN Reform Report is Released
10.02.02 – ICANN, the international body charged with overseeing the Internet’s addressing and numbering system, published its final reform report this month. The Final Implementation Report and Recommendations of the Committee on ICANN Evolution and Reform was released after continued discussions that began in March 2002. The debate began after a call for reform of ICANN’s processes by the president, Stuart Lynn. The main component of the reform, and main source of recent ICANN criticism, is the elimination of the global elections by Internet users for some board members. This mechanism has been replaced by an “At-Large Advisory Committee” that is designed to represent the interests of Internet users. The reform also increases the role of national governments in the ICANN process. The report can be found at: http://www.icann.org/committees/evol-reform/final-implementation-report-02oct02.htm.

This announcement is the latest in the continuing debate over the control and structure of ICANN. To many, ICANN represents the closest embodiment there is of an Internet government. The DNS and IP systems, administered by ICANN, are a backbone of Internet communication. While ICANN is an international body, they still fall under the control of the U.S. government. ICANN, created in 1998, operates under an agreement with the U.S. Department of Commerce, which was recently renewed for another year (see September Telecom/IT Policy Highlights). This fact is a subject of criticism from abroad, as other nations see ICANN as a mechanism of U.S. control of the Internet. ICANN has also seen criticism from the U.S. this year, with Congress holding hearings and threatening action against them, due to policies such as the elimination of ICANN elections.

Satellite Merger Blocked by FCC
10.10.02 – The Federal Communications Commission denied a request for merger approval made by EchoStar and Hughes, operators of the popular Dish Network and DirecTV satellite systems. These two satellite networks are the largest in the U.S. The FCC stated that such a merger would erode most of the competition in the satellite television market, replacing it with the need for price regulation, which goes against the federal law and FCC policy. [www.fcc.gov/Daily_Releases/Daily_Business/2002/db1010/DOC-227263A1.doc]

SBC Communications Ordered to Pay $6 Million Fine to FCC
10.09.02 – SBC Communications was assessed the maximum fine by the FCC for violations of an agreement made as part of the 1999 SBC-Ameritech merger. The company was found to have “willfully and repeatedly” denied competitive access to telecommunications services. This forced competitors to spend time and money filing lawsuits forcing SBC to comply with their obligations. The $6 million penalty was the highest ever imposed by the FCC. [www.fcc.gov/Daily_Releases/Daily_Business/2002/db1010/DOC-227223A1.doc]

BACK TO TOP OF PAGE
Judicial Activities

Copyright Extension Act Challenged Before Supreme Court
10.09.02 – The United States Supreme Court heard oral arguments for a constitutional challenge to a law that adds 20 years to existing copyrights. In 1998 Congress passed the Copyright Term Extension Act, which extends copyright protection to 70 years for individuals after they die and 95 years for corporations. The case was originally brought by Eric Eldred, who sought to publish poems by Robert Frost online, but was prevented from doing so by the act. Stanford University law professor Lawrence Lessig argued that Congress has exceeded the “limited” term of copyright provided in the Constitution. The original copyright law provided 14 years of protection. U.S. Solicitor Theodore Olsen argued that a proper balance was reached by lawmakers in 1998 for encouraging new creative works. A decision is expected by July of next year. [Source: NY Times, Washington Post]

Internet Jurisdiction Decision Handed Down by Circuit Court
10.09.2002 – The 9th Circuit Court issued a decision in Northwest Healthcare Alliance v. Healthgrades.com. The case was brought by a Washington home health care provider against a health care ratings Internet site for alleged defamation and violation of a Washington state consumer protection law. The court found that Washington’s jurisdiction could extend to the website operator, even though they have no presence in the state. This was found to be the case due to application of the “Effects” test, whereby the defendant was found to have placed itself inside the state’s jurisdiction due to the act of aiming its ratings specifically at the state and knowing the effect of those ratings over consumers. [Source: LegalMind.org]

Spectrum Case Heard by Supreme Court
10.08.02 – The Supreme Court heard arguments in FCC v. Nextwave, a dispute over an auction of licensed spectrum by the FCC in 1996, purchased by NextWave Communication for $4.7 billion. Soon after, however, NextWave entered Chapter 11 bankruptcy and defaulted on its payment to the FCC. The licenses were later sold for $15.8 billion to larger providers such as Cingular and Verizon. The FCC stated before the court that they have interests, not only as a regulator, but as a creditor. Their inability to pay served as a “proxy” for their inability to use the spectrum in a publicly beneficial way, argued the FCC. NextWave cited federal law which prohibits the reclaiming of purchased spectrum due to bankruptcy proceedings. Nextwave won their case in the D.C. Appeals Court, but the FCC brought the dispute to the Supreme Court after that June 2001 decision. [Source: Washington Post]

BACK TO TOP OF PAGE
International

Internet and Cell Phone Usage Jumps in Africa, but Continent Still Lags Behind
10.02.02 – A report released by the United Nations Information and Communication Technologies Task Force find that huge gains are being made for communication technologies in Africa. In the past 18 months there has been a 20 percent increase in the number of dial-up Internet subscribers on the continent. The report also noted that in the past 5 years more cell phones have been activated than the number of regular phone lines connected in the past 100 years. While these numbers represent improvement, the U.N. warns that Africa still lags far behind the rest of the world in this area. While Europe and North America average one Internet user for every two people, in Africa it is one out of 250, save a few nations such as South Africa. [Source: Reuters]

BACK TO TOP OF PAGE
Research/ Reports

Broadband Reaches 21% of Users, but Growth Has Slowed, Says Report
10.17.02 – Jupiter Research reports that the second quarter of 2002 brought 1.3 million new broadband customers. Cable modem service was up 12% and DSL was up 10%. This brings the total number of U.S. subscribers to approximately 13.1 million, on track to reach 15.4 million by year’s end. Despite this, broadband growth rates have slowed and the numbers for 2Q 2002 are lower than that quarter in 2001. Still, this brings the percentage of Internet users connecting via broadband to over 20% for the first time (21%). This does present a problem for broadband providers, though, claims Jupiter, as most early adopters now have broadband and the rest of the market, wary of the higher prices for broadband service, must be broken into. The report, Broadband User Segmentation: Understanding and Targeting the Broadband Audience, is available with a subscription at www.jupitereseach.com. [Source: ISP-Planet]

Local Elected Officials Benefit from Use of Internet, According to Report
10.02.02 – The Pew Internet and American Life Project released a report on its findings, collected in conjunction with the National League of Cities, about the Internet usage of city officials. The report finds that 88% of mayors and city council members nationwide use the Internet and e-mail in the regular performance of their duties. A large majority use the e-mail to communicate with citizens and community groups and use the Internet for research. Still, phone calls, regular mail and personal meetings are cites as more common means of communication. The report, Digital Town Hall: How Local Officials Use the Internet and the Civic Benefits They Cite From Dealing With Constituents Online, can be found (PDF form only) at: www.pewinternet.org/reports/pdfs/PIP_Digital_Town_Hall.pdf.

BACK TO TOP OF PAGE
OTP Bookshelf
1. Frieden, R. Revenge of the Bellheads: How the Netheads lost control of the Internet. Telecommunications Policy, 26 (7-8): 425-444 Aug-Sep 2002.
2. Resende, M; Facanha, L. Privatization and efficiency in Brazilian telecommunications: an empirical study. Applied Economics Letters, 9 (12): 823-826 Oct 2002.
3. Halpin, EF; Simpson, S. Between self-regulation and intervention in the networked economy: the European Union and Internet policy. Journal of Information Science, 28 (4): 285-296 2002.
BACK TO TOP OF PAGE
Newsletter Info

Center for Advanced Communications Policy

Telecom/IT Policy Highlights
October 2002

The focus of this publication is to present legislative, regulatory, legal, and other activities that are germane to technology policy news, events or products. For additional information regarding the information provided in this report, or if there are newsworthy items that should be included in future editions, please feel free to contact , Director of Research and Editor in Chief.
BACK TO TOP OF PAGE

BACK TO Publications

October 2002 Microsoft Word version / October, 2002 TiPH (212kB) Adobe PDF version / October, 2002 TiPH (117kB)

Contents:

October 2002

Microsoft Word version / October, 2002 TiPH (212kB)

Adobe PDF version / October, 2002 TiPH (117kB)