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Telecom/IT Policy Highlights


December 2002 – January 2003

Microsoft Word version / December 2002 – January 2003 TiPH (211kB)

Adobe PDF version / December 2002 – January 2003 TiPH (116kB)

Contents:
Overview
Legislative Activities
Policy / Regulatory Activities
Judicial Activities
Other Activities and Items of Interest
Research/ Reports
OTP/GCATT Activities
Newsletter Info
  • Overview

    Due to the holiday season, this issue of OTP’s Telecom/IT Policy Highlights (TIPH) is released as a combined December 2002/January 2003 publication.

    Before the 108th Congress convened in January of 2003, President Bush signed a number of bills into law that relate to information security. Notable among them was HR.2458, the E-Government Act of 2002. It creates a national Office of Information within the Office of Management and Budget which will be headed by a federal chief information officer (CIO). The goal of this new department will be to manage federal IT initiatives in an effort to improve the delivery of government services. The president also signed a bill approving a price settlement between Internet radio broadcasters and the recording industry [H.R.5469] and one establishing a “dot-kids” domain name for child-friendly websites [H.R.3883].

    In the past two months the Federal Communications Commission (FCC) and Congress had major clashes on the issues of wireless broadband, local telephone competition and media ownership.

    First, in December, a bill was introduced in the Senate that stands in opposition to the FCC’s proposed plan for expanding high-speed wireless Internet, or Wi-Fi. Senators George Allen (R-VA) and Barbra Boxer (D-CA) introduced the Jumpstart Broadband Act [S.159] which directs the FCC to free up more spectrum for specific use by wireless broadband devices. The FCC is planning to seek agreements with broadcasters to use some of their idle spectrum for Wi-Fi use.

    In January the Senate Committee on Commerce, Science and Transportation held a hearing on proposed regulation changes by the FCC. The rule changes included loosening regulations on incumbent telephone service providers and media companies. The plans were criticized by many Senators on both sides of the aisle, including outgoing committee chairman Sen. Ernest Hollings (D-SC) and his replacement Sen. John McCain (R-AZ). They argued that the changes would weaken measures in the 1996 Telecom Act designed to promote competition among telecommunication service providers and would foster the creation of even more monopolies in the media industry. Changes are still planned by the FCC, but after the hearing they are expected to be more limited than originally proposed.


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  • Legislative Activities

    DOT-KIDS Bill Signed by President
    12.04.02 – The Dot Kids Implementation and Efficiency Act [HR.3883] was signed by President Bush, creating a “kid friendly” zone on the Internet. The domain will contain sites that adhere to standards set by Congress. For example, sites within kids.us are not allowed to link to locations outside that domain. The domain operator, NeuStar, will be in charge of compliance [see: http://www.neustar.us/kids/]. The White House release can be found at: http://www.whitehouse.gov/news/releases/2002/12/20021204-1.html.
    [Source: Washington Post]

    E-Government Bill Gets President’s Signature
    12.17.02 – President Bush signed into law the E-Government Act of 2002 [H.R.2458] [http://www.whitehouse.gov/news/releases/2002/12/20021217-5.html]. The bill creates an Office of Information (headed by a federal chief information officer) within the Office of Management and Budget [http://www.whitehouse.gov/omb/inforeg/infopoltech.html]. This new office is charged with coordinating and directing federal government information services. The goal is to better use information technology for delivery of government services. The office has appropriations of $45 million for 2003, increasing to $150 million by 2006. [Source: CNET News.com]

    FCC Deregulation Plan Blasted by Senators
    01.14.03 – Senators from the Commerce, Science and Transportation Committee expressed concerns regarding proposed FCC rules designed to be a major restructuring of telecommunications regulation. The plan proposed by FCC Chairman Michael Powell includes weakening rules that require major service providers to share their networks with competitors as well as rules that maintain division of ownership in the media industry.

    Senators claimed the rules were a product of the influence of special interests, specifically the Regional Bell Operating Companies (RBOCs). Outgoing committee chairman, Sen. Ernest Hollings (D-SC), criticized the plan as a boon to incumbent providers at the expense of the goals of the 1996 Telecom Act. Sen. John McCain (R-AZ), the new Commerce Committee chairman, criticized the Telecom Act itself for creating excessive regulation, litigation and expense. Sen. Ron Wyden (D-OR) pointed to possible changes in media rules that would encourage monopoly in a field that already has but a few major players. These rule changes have received criticism from groups such as the Center for Digital Democracy (CDD) as well.

    Some committee members, such as Sen. Sam Brownback (R-KS) voiced support for easing some rules, specifically taking some items off the list of what RBOCs must lease to competitors at regulated rates. Powell pointed to the fact that the FCC has been unable to defend many existing regulations in court, thereby signaling the need for change. Some changes are still expected from the FCC, though a major overhaul may not occur. Statements from the hearing can be found at: http://hollings.senate.gov/~commerce/press/03/2003113311.html. [Sources: Washington Post, CNET News.com, Eweek, CDD)

    New Internet Tax Ban Proposed
    01.08.03 – In the latest chapter in the debate over online taxation, the Internet Tax Non-Discrimination Act was introduced by Rep. Chris Cox (R-CA) in the House and Sen. Ron Wyden (D-OR) in the Senate [H.R.49 and S.52]. The bill would create a permanent ban on sales taxes for products ordered online. Currently there is a moratorium on such taxes, originally passed in 1998 and extended in 2001. That ban, also authored by Rep. Cox and Rep. Wyden, is set to expire in November 2003. The Representatives rationale is that e-commerce needs time to grow and flourish without the burden of sales taxes, especially given the weak technology sector. State officials have complained that billions of dollars in potential tax revenue is going unrecognized as a result of the ban. Currently states can collect taxes on sales that occur between buyers and sellers within one state, but when it occurs over state lines they can not force remittance of sales taxes. [Source: CNET News.com]

    Rural Internet Initiative Pushed by President
    01.29.03 – President Bush wants $196 million of the US Department of Agriculture’s 2004 budget aimed at expanding rural Internet access through loans to telecommunication providers. The USDA is already starting a $1.4 billion loan program for that purpose, part of a 2002 Farm Bill. The President also wants $177 million to upgrade the USDA’s County Service Centers, facilities that farmers and ranchers use to obtain useful land data via sources such as satellite. The announcement was made by Ann Veneman, Secretary of Agriculture. [Source: Yahoo News]

    Webcaster Settlement Bill Becomes Law
    12.04.02 – With the president’s signature on the Small Webcaster Settlement Act of 2002 [H.R.5469], the dispute between Internet radio stations and the recording industry was effectively ended. The new law empowers SoundExchange [www.soundexchange.com], the primary royalty collector for the music industry, to enter into separate payment contracts with individual webcasters. Last June the Library of Congress set a royalty rate that neither online broadcasters nor the copyright owners were satisfied with. Congress stepped in and passed this bill, which allows for small Internet radio stations to have their own pricing structure for royalty payments to record labels, separate from that used for other broadcasters. Had this agreement not been reached, small webcasters claimed that most of them would be forced to shut down due to the overwhelming cost.
    [Source: Washington Post]

    Wi-Fi Bill Introduced in Senate
    12.13.02 – In an effort to spur the growth of high-speed wireless Internet (or Wi-Fi) Senators George Allen (R-VA) and Barbra Boxer (D-CA) introduced the Jumpstart Broadband Act [S.159]. The bill would require the Federal Communications Commission to release more spectrum for use by unlicensed wireless devices. This would free up spectrum specifically for Wi-Fi use, a move which goes against the FCC’s current approach. The FCC plan looks for agreements with TV broadcasters and satellite companies that would share unused portions of their spectrum for wireless broadband. Experts say that both plans face significant obstacles. [Source: Wall Street Journal]


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  • Policy / Regulatory Activities

    Closed Captioning Exemptions End
    12.09.02 – The FCC issued a reminder to video program distributors of the expiration of some exemptions to closed-captioning rules on Jan. 1, 2003. These rules approved by the FCC were designed to ensure compliance with the 1996 Telecommunications Act’s requirements on accessible programming for persons with disabilities. Other exemptions still exist, but are set to expire in 2008. For further details see the FCC release at:
    http://hraunfoss.fcc.gov/edocs_public/attachmatch/DA-02-3384A1.doc.

    Georgia’s $1.8 Billion Telecom Project Down to 1 Bidder, Task Force Formed
    01.30.03 – Declining to cite any reasons, IBM, one of only two groups vying for Georgia’s massive $1.8 billion, 10 –year Converged Communications Outsourcing Project (CCOP), pulled out of the bidding process. CCOP is designed to upgrade state government information and communication technology, including telephone, wireless and high-speed Internet. The state agency in charge of the project, the Georgia Technology Authority, speculated that it was due to the current telecommunications and e-government market. The IBM-led team included other major technology companies such as Sprint. The remaining bidder is a team known as GeorgiaConnect and is led by EDS. It includes Cingular, AT&T and BellSouth, among others.


    As a result of this development, Governor Sonny Perdue formed a task force to explore the state’s options in this matter. The team, composed of 15 experts from the public and private sector, is charged with “reassessing” state information technology needs. The CCOP Task Force, led by Georgia Institute of Technology president Wayne Clough, will report to the governor within 60 days.
    Details at: http://gta.georgia.gov/00/article/0,2145,1070969_0_2194206,00.html.
    [Source: Governing.com, GTA]


    New .ORG Operator Chosen by ICANN 12.27.02 – The final agreement to transfer administration of the .ORG top-level domain space was approved by ICANN and signed by its president, Stuart Lynn, on Dec. 3, 2002. The contract was awarded to a new subsidiary of the Internet Society (ISOC), a non-profit international organization [www.isoc.org]. Control of .ORG will be transferred to the subsidiary, the Public Internet Registry (PIR), from Verisign, the Internet’s largest registrar. Verisign and ICANN reached the agreement to transfer .ORG in exchange for Verisign receiving a larger stake in the more profitable .COM and .NET registries. With over 2.6 million registries, .ORG is the 3rd largest domain on the Internet. Originally slated for Jan. 1, 2003, the transition was delayed until Jan. 25 to allow for .ORG-selling companies time to comply with the agreement. For more information visit: http://www.internic.net/faqs/org-transition.html.
    [Sources: ICANN, InterNIC, CNET News.com]


    National “Do Not Call” List Planned by FTC, Congress Approves 01.30.03 – In December the Federal Trade Commission announced plans to create a national “Do Not Call” list where consumers could register to avoid telemarketing calls. [http://www.ftc.gov/bcp/conline/edcams/donotcall/index.html ] They received around 64,000 public comments on the issue. Initially Rep. Bill Tauzin (R-LA), chairman of the House Energy and Commerce Committee, was wary of the proposal and doubted the FTC’s authority to undertake the proposal on its own. There is a great deal of resistance form the Direct Marketing Association, the primary group representing telemarketers. Rep. Tauzin, however, reversed his position and the House committee has now approved the “Do Not Call” Implementation Act to back the plan. [Sources: Washington Post, FTC]


    Wireless Providers to Pay Greater Percentage of Universal Service Fund 12.16.02 – The FCC has approved interim rules that would increase the portion of the Universal Service Fund (USF) contributed by wireless carriers. The USF is designed to subsidize telecommunication services to rural and low-income customers, as well as high-cost areas and school and library facilities. Currently wireless provides 15 percent of the USF, while long-distance companies pay 59 percent and local phone companies pay 26 percent. The wireless portion would change to 28.5 percent under the rules, based on the fact that more users are using wireless phones as a substitute for traditional services such as long distance. The change could increase consumer cell phone bills by approximately $1.50 a month. [Sources: Bloomberg, AP, USA Today]


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  • Judicial Activities

    Copyright Extension Upheld by Supreme Court
    01.16.03 – In a closely watched case, the U.S. Supreme Court voted 7-2 that the Sonny Bono Copyright Term Extension Act (CTEA) was constitutional. The 1998 law extends the terms of copyrights by 20 years. The suit was brought by Eric Eldred, operator of a website that provides access to many works of literature for free. Some of the works he published were affected by the CTEA because their copyright terms were set to expire before the extension. Opponents argued that Congress exceeded their authority by extending copyrights beyond the “limited times” that the Constitution directs. The court said that what Congress did was within their power. Publishers, the motion picture industry and other copyright holders applauded the decision, saying that it constituted proper compensation for authors and protected many works that were close to losing their protection. The first copyright law, passed in 1790 allowed for 14 years. The CTEA allows for the life of the author plus 70 years. The Supreme Court’s opinion can be found at: http://www.supremecourtus.gov/opinions/02pdf/01-618.pdf.
    [Source: Wall Street Journal, Wired News]

    Council Member E-Mails Violated Sunshine Laws, Judge Says
    12.13.02 – A Virginia circuit court ruled that three members of the Fredericksburg City Council, including Mayor Bill Beck, are guilty of violating the state’s “Freedom of Information” law by e-mailing information that should have been discussed in an open meeting. The judge said that because the e-mails, sent last summer, were designed to reach a consensus they were something that should be done in an open forum. They were deciding on an appointee to a library commission. Essentially, the e-mails were said to constitute an illegal meeting. Other councilmembers were party to the e-mails, but were not found guilty because they were using them for informational purposes, not consensus-building. The city is divided over the issue with some supporting Gordon Shelton, the veteran former councilman who filed the suit, and those who are siding with his replacements. Initially named in the suit were five new councilmembers who ran opposing Shelton’s pro-growth policies. Shelton stepped down, but his hand-picked successor was defeated in the election.

    There was no sanction imposed by the judge, saying they couldn’t have known they were breaking the law, but the defendant’s legal fees topped $90,000. The three convicted councilmembers plan to appeal. Observers point to possible national implications based on the precedent this case sets. [Source: The Free-Lance Star, Washington Post]

    Microsoft Anti-Trust Case Continues as Massachusetts, West Virginia Appeal
    12.17.02 –Massachusetts and West Virginia, the last remaining hold-outs in the anti-trust case against Microsoft, rejected the latest settlement reached between the Justice Department and the software giant. The settlement requires Microsoft to avoid specific anti-competitive business arrangements as well as releasing some technical information and allowing manufacturers and consumers to remove certain Microsoft features from their computers. The states accepting the deal – California, Connecticut, Florida, Iowa, Kansas, Minnesota and Utah – agreed to halt their appeals in exchange for Microsoft paying $25 million for legal fees incurred by the states, much more than was actually spent. While these states say they will focus on Microsoft’s compliance with the sanctions imposed by the federal court, Massachusetts and West Virginia are arguing for tougher penalties, and are seeking payment of $2.3 million in legal expenses from Microsoft, but asked the judge to delay that matter so that it will not distract from the core case. At one point 21 states were involved in the suit. [Sources: USA Today, SiliconValley.com]


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  • Other Activities and Items of Interest

    Anti-Spam Laws Favored by Users
    01.03.03 – 75 percent of online users would like to see spam made illegal, according to a poll by Harris Interactive. 96 percent of those polled found spam annoying, with 80 percent saying they found spam “very annoying,” a 31 percent increase in the past 2 years. Pornography, mortgage, real estate and investment ads topped the list of most annoying types of spam. Anti-spam company Brightmail says spam itself is on the rise, composing 40 percent of e-mail traffic in Nov. 2002, compared to 13 percent in Nov. 2001. The results can be viewed at: http://www.harrisinteractive.com/harris_poll/index.asp?PID=348 [Source: Wall Street Journal]

    Nationwide Wi-Fi Network Planned by Major IT Companies
    12.05.02 – AT&T, IBM and Intel announced the creation of a new company, Cometa Networks, to deploy a nationwide high-speed wireless network. The ambitious project seeks to provide significant coverage in the 50 largest metropolitan areas in the US, with broadband Internet connectivity comparable to today’s Cable Modem and DSL speeds by the end of 2004. The plan is to build a network of 20,000 wireless access points (WAPs) and then provide that service to cellular, landline and Internet Service Providers to sell to consumers, beginning in 2003. By not providing the service directly to consumers, Cometa says that it will allow for the new wireless network to be complemented by technologies such as 3G wireless that other companies provide. [Source: NY Times]

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  • Research/ Reports

    “Digital State” Survey Released, Washington Wins Long-Term Award
    Jan. 2003 – The Annual Digital State Survey conducted by the Progress and Freedom Foundation (PFF) rates state governments for their use of Internet technology for government service. The results show that this year’s top five are, respectively, Arizona, Michigan, Washington, Illinois and Wisconsin. Rankings are based upon information technology use in the following: business regulation, taxation, social services, law enforcement, democracy efforts, administration, education and GIS/Transportation. The PFF, in conjunction with the Center for Digital Government (CDG) also names Washington as the winner of the “Sustained Leadership” award for their top overall performance in the first 5 years of the survey. The release can be found at: http://www.centerdigitalgov.com/center/02sustained.php.
    The 2002 report can be found (in PDF form only) at: http://www.pff.org/publications/DS2002FINAL.pdf

    E-Mail Not Overloading Users, Pew Internet Study Says
    12.07.02 – The Pew Internet and American Life Project gives evidence that, contrary to some assumptions, American workers are not being hindered by massive amounts of e-mail. The results show that 60 percent of workers receive fewer than 10 e-mails per day, and 78 percent send fewer than 10 e-mails per day. 73 percent report spending less than one hour per day dealing with e-mails. Roughly half of users say the amount of e-mail has increased in the past year. The study also found that about 20 percent of e-mailers, primarily in large work environments such as corporations and government, engage in more intense e-mail practices. Of these, 72 percent get more than 20 e-mails per day, 40 percent send more than 20 e-mails per day and 68 percent spend over 2 hours each day on e-mail tasks. http://www.pewinternet.org/reports/toc.asp?Report=79

    Intellectual Property Issues Surveyed by WIPO
    Dec. 2002 – The World Intellectual Property Organization (WIPO), an international body devoted to issues of intellectual property (IP), released a report surveying the Internet and IP issues. The report, entitled Intellectual Property on the Internet: A Survey of Issues, examines the development of the Internet and the myriad of IP debates that have risen to the forefront as a result. The full report (202 pages) can be found at http://ecommerce.wipo.int/survey/doc/survey.doc.

    Top “Digital Cities” Include Honolulu, Tampa, Des Moines, Roanoke
    Jan. 2003 - Government Technology magazine has named their 2002 “Top 15 Digital Cites.” There are three lists, for different city sizes. Honolulu and Tampa topped the 250,000+ population list, Des Moines topped the 125,000-250,000 list and Roanoke headed the 75,000-125,000 list. The cities on the lists are chosen for e-government services, infrastructure and technology policy. Macon was the only Georgia city to be named in the survey. The summary article can be found at: http://www.govtech.net/magazine/story.phtml?id=39186. [Source: Govtech.net]

    Wireless Networks Studied in NYC
    12.12.02 – A study of New York City’s Wi-Fi adoption offers some interesting findings. First of all, more than 14,000 wireless Internet networks were found to be in operation in Manhattan. Of these, almost 70 percent were discovered to be lacking in security, allowing any user in its coverage area to view data flowing on the network or make use of the Internet bandwidth provided by the network. Additionally, 92 percent of the nodes were below 96th street, meaning the lower-income and minority neighborhoods of the north side of Manhattan lag far behind in wireless connectivity. The study was conducted by the Public Internet Project and can be found, along with a detailed NYC Wi-Fi map, at www.publicinternetproject.org. [Source: NY Times]


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  • OTP/GCATT Activities

    Municipal Advanced Telecommunication Infrastructure Project (MuniTIP)
    The Municipal Advanced Telecommunication Infrastructure research project examines the possible roles of municipal governments in the deployment of advanced telecommunications infrastructure, and will generate a set of metrics and assessment tools for assisting stakeholders and policy makers at all levels to make logistically, technologically and financially informed decisions, taking into account local as well as overriding regulatory and market factors. The policy white paper and assessment tools are designed to aid local governments in navigating the most appropriate course between the private monopoly, public monopoly, public/private or public/public partnership alternatives. For further information on the MuniTIP Project, contact Kelly Thomas at kelly.thomas@gcatt.gatech.edu.

    Wireless RERC Industry Forum
    The Wireless RERC will be holding its annual Industry Forum meeting in conjunction with CTIA Wireless, the leading wireless technology conference, in New Orleans on March 17th. An educational session with speakers from the RERC and industry is planned from 11 AM to 1:30 PM, followed by one hour of interactive discussion among current and new industry members. Attendance is free, but you must preregister for a free Platinum Pass from CTIA by March 10th, 2003. Registration is available online at www.ctiashow.com/freepass.


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  • Newsletter Info

    Center for Advanced Communications Policy
    Telecom/IT Policy Highlights
    December 2002 – January 2003

    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.
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