Taxes
Congress Clears Tax-Cut Bill That Revives R&D Credit
     Congress this week cleared a bill that includes language to revive an expired tax credit for research and development. The lawmakers agreed to add the R&D language to a broader bill for extending various tax cuts. The conference committee agreed to include the House-passed version of the R&D credit, which would extend it as is from July 2004, when it expired, to December 2005. The Senate-passed version, which many in the technology industry preferred because it included an "alternative simplified credit" designed for companies in industries that experience drastic swings in investment, will be up for negotiation in a separate bill that focuses on a tax break for U.S. exporters. The Information Technology Industry Council said it would include the vote for the R&D extension in its high-tech voting guide.

Digital Television
Senate Panel Weakens Firm Deadline For Digital Transition
     The Senate Commerce Committee approved legislation that would fix Jan. 1, 2008, as the date by which broadcasters must vacate seven television channels for public-safety officials. But the approval came only after a broadcaster-supported amendment weakened the firm deadline in the bill. The measure would require broadcasters to relinquish their analog frequencies by the 2008 deadline and to move to digital broadcasting -- thereby freeing the analog spectrum for radio use by "first responders" and other emergency personnel. Bill sponsor John McCain blasted the broadcasters for pushing the language to weaken the legislation. Key technology industry players, meanwhile, have mobilized to challenge the broadcasters over the issue. The lobbyists argue that the spectrum would aid public safety and further boost the availability of low-cost, high-speed Internet access.

Telecom
Senate Committee Backs Revised Formula For Telecom Aid
     The Senate Commerce Committee approved legislation to change the way the FCC allocates money to states from a fund designed to ensure universal telephone service. Under current rules, only 10 states receive the $277 million allocated from the universal service fund to support high-cost areas, and 90 percent of the funds go to just five states -- Mississippi, Alabama, West Virginia, Montana and Kentucky. The formula is based on whether the average of state telephone bills is more than 133 percent of the nation's average bill. "It is a gross inequity," said bill sponsor, Sen. Gordon Smith, R-Ore. Under his measure, the funds would be distributed based on the average cost of a phone line in a particular "wire center" and whether it exceeded the nation's average phone bill by a given amount. The measure would not specify that amount but leaves that to the FCC.

Education
Lack Of Oversight Blamed For Abuse Of E-Rate Program
     A key House lawmaker questioned whether the federal government's e-rate program aimed at wiring schools and libraries to the Internet should be suspended until a better procurement and auditing system is implemented. Joe Barton, R-Texas, posed the question during a hearing on waste, fraud and abuse within the e-rate program. "The failure to take the right steps at the beginning of the process" has created problems at the front-end of the program, Barton said. The panel cited fundamental flaws in the program's competitive bidding and self-certification process, concerns echoed by FCC Inspector General H. Walker Feaster.

Telecom
Verizon Wireless Says it Opposes Wireless Telephone Directory
     The head of the nation's largest wireless carrier does not support the creation of a wireless telephone directory because of its potentially negative impact on customer privacy. "A wireless telephone directory would be a terrible idea, and we will not publish our customers' cell-phone numbers or otherwise participate in the plan you have heard about today," Dennis Strigl, CEO of Verizon Wireless, said in written testimony to the Senate Commerce Committee. Verizon also will change its contracts with customers to state that the company does not provide their numbers to any directories, he said. The companies supporting the creation of the database include Alltel, AT&T Wireless, Cingular Wireless, Nextel Communications, Sprint and T-Mobile.

Campaigns
'Fair Use' Copyright Advocates Concerned About Kerry Adviser
     Word that the Clinton administration's point man on intellectual property is advising Democratic presidential nominee John Kerry on copyright issues is causing concern among some advocates for the "fair use" rights of consumers to copy materials. Bruce Lehman, the former aide, played an influential role in shaping the controversial Digital Millennium Copyright Act, which seeks to safeguard digital works. Critics argue that the law severely restricts the copying of digital music and movies for personal use and provides companies with justification to block legitimate competitors. "In the scheme of extremists, few are more extreme," Stanford University law professor Lawrence Lessig wrote of Lehman. "It's really sad -- pretty sad -- to hear something like that," Lehman responded, adding that Lessig and groups such as the Electronic Frontier Foundation try to "demonize" proponents of the DMCA.

Campaigns
Status Of Online Political Ads In Question After Court Ruling
     Political advertisements on the Internet could be regulated under a federal district-court decision that overturned a series of rules by the Federal Election Commission (FEC). Judge Colleen Kollar-Kotelly held that the FEC improperly weakened a 2002 campaign finance law. The law does not regulate campaign ads online, either before or after the beginning of the law's electioneering window that begins 30 days before primaries or 60 days before general elections. Citing that legislative record, the FEC declined to extend the ban to the Internet. "The commission's exclusion of Internet communications from the ... regulation severely undermines [the law's] purposes and therefore violates" judicial precedents, Kollar-Kotelly wrote.

Intellectual Property
Industry Urges Government Reforms Aimed At Global Piracy
     U.S. copyright industry groups have called for reforms in the way the federal government handles rampant overseas theft of U.S. intellectual property. Industry representatives are seeking the creation of distinct offices for intellectual property issues within the Office of the U.S. Trade Representative (USTR) and the State Department. They also told the House Government Reform Committee that increased funds are needed for the Justice Department and Homeland Security Department's Customs and Border Protection Bureau. Witnesses said the changes are needed given the increasing importance of intellectual property to the U.S. economy and runaway global piracy and counterfeiting.

Intellectual Property
Piracy Hinders Russia's WTO Accession, U.S. Official Says
     Increasing piracy of U.S. movies, music and software in Russia is impacting progress in that nation's negotiation with the United States to join the World Trade Organization, according to the top U.S. official for WTO negotiations. Russia's lack of enforcement against piracy is "operating as a drag on the accession negotiations," said Dorothy Dwoskin, assistant U.S. Trade Representative for WTO and multilateral affairs. "Intellectual property rights protection and enforcement has grown to be one of our most serious trade concerns with the Russians." The House, meanwhile, passed legislation that aims to prevent and punish the counterfeiting of software, movies, music and other copyrighted materials. The bill would impose penalties on those who traffic in stolen or counterfeit authentication labels used on copyrighted works to distinguish them as genuine goods.