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.
Largest AT&T affiliate TeleCorp PCS said it added 145,231 customers in quarter ended Dec. 31. TeleCorp PCS was created last year after merger of TeleCorp Wireless, which added 95,656 subscribers in 4th quarter, and Tritel, which added 49,575. Combined entity had year-end subscriber base of 666,425. Tritel said it expected to take premerger one-time charge related to reductions in roaming revenue. TeleCorp PCS said that was likely to mean $4 million reduction in roaming revenue guidance for quarter for Tritel.
Sweden’s Telia plans to ask that country’s court system to suspend decision by National Post and Telecommunications (PTS) Agency to award 3G licenses. PTS last month awarded 4 Universal Mobile Telecommunications Service licenses, in process in which Telia failed to win 3G spectrum. Telia, which is country’s largest carrier, said it is asking county administrative court system in Sweden to freeze PTS decision until it has processed company’s appeal. Telia appeal contends that PTS: (1) Made incorrect technical applications in license award process. (2) Failed to comply with its regulations, including not evaluating “commercial viability” of applications. (3) Ignored Swedish law which requires that license allocations be made at lowest possible cost to national economy. Telia charged that PTS awarded licenses in process that reflected public procurement proceeding and not license allocation procedure. Other issues raised in Telia appeal include concerns about role of external consultant hired by Swedish govt. to help process applications. Telia contends that consultants added “important information” to examination of applications which PTS, in alleged violation of administrative law, didn’t inform Telia about. Telia also said it wasn’t informed about questions on its application that consultants asked and that PTS didn’t refer to company for consideration. “The law states that private individuals are to have access to efficient telecommunications at the lowest possible cost,” said Telia Pres.- CEO Marianne Nivert. “But the PTS has certainly taken no law into consideration.”
CWA and IBEW members ratified 2-year extension of existing collective bargaining agreement with Qwest. Contract, negotiated in 4th quarter last year, covers wage and pension increases, including 3.5% wage hike effective Aug. 19. Original CWA contract, covering most Qwest union employees, was signed in Sept. 1998 following 3-week strike. Agreement was to expire Aug. 16, with extension now keeping it in place until Aug. 16, 2003. Other provisions include: (1) 5% wage increase that takes effect Aug. 18, 2002. (2) 6% pension increase effective July 1, 2002. (3) 10% pension raise July 1, 2003. IBEW extension with Dex directory unit provides similar increases with different timelines depending on contract schedules, Qwest said. Contract extension between Qwest Dex management and CWA has been tentatively ratified and must be approved by union members, Qwest said. Company said it expected to be informed of Dex vote results next month. “The union membership voted 98% in favor of ratification,” said Peter Pusateri, business mgr. of IBEW Local 1269.
While CLEC industry is far from strong overall, upbeat news from McLeod and XO Communications shows CLECs with good management and business plans are persevering, analysts said Fri. McLeod announced bond offering and better-than-expected financial expectations Thurs. while XO announced Fri. it is selling $450 million of 5.75% convertible subordinated notes in private placement. Lehman Bros. analyst Daniel Zito said successful market transactions “should alleviate some pressure on the better names which have been cast away with everything else in the sector downdraft.” It shows “funding is still available at reasonable terms for the better management teams,” he said.
Michael Kennedy moves up to dir.-global relations, Motorola… Betsy Kulick, ex-Motient, named dir.-external relations, Final Analysis… John Fiorini, ex-Gardner, Carton & Douglas, appointed partner, Wiley, Rein & Fielding… Nicole Buie, advanced to dir.-research and education, CableRep Adv…Stephen Parker, ex-Russell Reynolds, named managing dir.-information systems and e-commerce, Hailes & Assoc… Jack Zwaska to receive career achievement award to be named after him by Bcst. Cable Financial Management Assn. Jan. 10… Adam Singer, Telewest, appointed non-exec. member of board, QXL ricardo… Jeffrey Liberman advanced to pres.-Radio Div., Entravision Communications, replacing Amador Bustos, who resigned as executive but remains with company… Kay Jackson promoted to dir.-regulatory affairs, Cox Communications… Travis Rutherford, ex-ememories.com, named senior vp, MGM Consumer Products and MGM Interactive, replacing Doug Gleason, resigned… Richard O'Brien, ex-Special Olympics, appointed exec. vp-dir.-govt. relations, American Assn. of Advertising Agencies… Changes at Prodigy Communications: Added to board: Robert McClane, Joseph McKinney and Randall Stephenson; resigned from board: Marc Goldberg and Arturo Elias… Vicki Livingston, ex-Telecorp PCS, named dir.-mktg., Universal Wireless Communications Consortium… William Carey, advanced to pres.- Southwest Tex. Div., Time Warner Cable, replacing Jeffrey King… Peter Uhlmann promoted to chief of staff for Rep. Cox (R-Cal.) from legislative dir., but will continue as principal adviser on Internet and telecom issues.
Bidding in FCC’s C- and F-block auction slowed Fri., but reached $13.07 billion, with Verizon Wireless maintaining wide lead of $5.52 billion in net high bids. Other top bidders include AT&T Wireless-backed Alaska Native Wireless with $2.75 billion and Cingular Wireless-backed Salmon PCS with $1.94 billion. AT&T Wireless doesn’t appear in list of top 15 bidders, and Cingular isn’t competing as standalone entity. In all, top 15 bidders now include 13 designated entities, most of which have links to larger carriers. While Verizon is by far highest bidder, $2.26 billion of its total is in bids for 2 N.Y.C. licenses at $1.17 billion and $1.1 billion. Alaska Native Wireless bid $758 million for 3rd license in that market. After 31 rounds, Verizon had highest bids on licenses in Washington, Boston, L.A., Chicago, San Francisco, Philadelphia. Alaska Native Wireless had high bids for spectrum in L.A. and Atlanta and Salmon PCS in Dallas license. Dobson Communications DCC PCS edged into upper echelon of bidders, placing 4th with $957.68 million, followed by VoiceStream with $540.12 million, affiliated Cook Inlet with $348.69 million, Leap Wireless with $293.47 million. Last week marked exit of several large carriers, including Sprint PCS and Alltel. Of 87 bidders who qualified at Dec. 12 start of auction, 49 remained as of late Fri. SVC BidCo, designated entity in which Sprint has 60% noncontrolling investment, still was in auction. Other bidders who have left auction include Nextel, Sprint affiliate Alamosa PCS, Nextel-affiliated designated entity Connectbid, Cincinnati Bell Wireless.
Qualcomm signed royalty-bearing CDMA infrastructure equipment license agreement with GBase Communications, terms not disclosed. Agreement licenses certain Qualcomm patents and agreements to GBase to develop and manufacture wireless infrastructure equipment for in-building or campus network applications. Pact covers cdmaOne, cdma2000, cdma2000 1xEV.
Coalition of major broadcasters, cable networks, movie studios, record companies, sports leagues and other content owners lobbied FCC for strong copy protection technology for advanced digital cable set-top boxes. In joint 4-page letter to FCC Chmn. Kennard Thurs., ABC, BMI, CBS, ESPN, Fox, Minor League Baseball, MPAA, NBC and RIAA argued that “cable interface devices must include the capability to protect certain high-value content against unauthorized copy and Internet retransmission” because of “the economics of producing and distributing high-value programming.” Responding to letter by House Telecom Subcommittee member Boucher (D-Va.) to Kennard last month, group also contended that advanced digital set-tops must be capable of providing some level of content protection “so consumers that purchase such devices will be able to receive the widest variety of program choices, including high-value programs that may be made available only if content protections are in place.” It said “alternative is to introduce devices in the marketplace that cannot provide content protection, and therefore cannot receive certain types of high-value programming.” Content owners also disputed Boucher’s contention that “freely broadcast programming should remain freely copyable,” contending that local broadcasters would be relegated to “the position of ‘low-value’ content distributors.” They questioned whether there was any public interest “in allowing consumers to make multiple copies of broadcast programming, or to retransmit broadcast programs over the Internet.”
FCC unanimously adopted notice of proposed rulemaking (NPRM) that eyes frequencies, including those now occupied by military users, for 3rd-generation and other advanced wireless services. Commission also denied petition by Satellite Industry Assn. (SIA) seeking additional spectrum for mobile satellite services (MSS), move that Multichannel Multipoint Distribution Service (MMDS) licensees opposed (CD Aug 30 p1). FCC adopted notice Dec. 29, meeting White House’s year-end deadline for approving item, although text hadn’t been released by our deadline.