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Telecom
FCC Order Helps Small Wireless Firms On 'Roaming' Deals
by David Hatch
The FCC on Tuesday took steps to expand the reach of small and rural wireless phone services by permitting their calls to automatically "roam" on the networks of dominant mobile carriers.
In new rules adopted by a 5-0 vote, the FCC concluded that automatic roaming is a "common carrier" obligation that must be permitted on a "just, reasonable and non-discriminatory basis."
The agency will continue to permit wireless customers to roam "manually" on other networks by providing a credit card number. The regulations cover voice service, text messaging and "Push-to-Talk," which allows for instant calling, but don't extend to wireless high-speed Internet services, including e-mail and Internet-based phone calls.
Those limitations were a concern to the agency's two Democrats, Michael Copps and Jonathan Adelstein, though they hailed the overall item as beneficial. "Consumers rely on their mobile handsets these days for a dizzying array of data services, going well beyond those that we cover in today's item," Copps complained at an FCC meeting. "The public interest would be much better served if we were to consider how to best frame the roaming requirement to include broadband," Adelstein echoed.
But the agency's three Republicans applauded the light regulatory touch. "Consumers increasingly expect that their mobile phones will function where they work, where they play, and where they travel," FCC Chairman Kevin Martin said. "Automatic roaming fulfills these expectations in a manner that is seamless and transparent to the consumer," he added.
While Martin is "sympathetic" to his colleagues' concerns, he warned that extending automatic roaming to broadband data could undermine the plans of some companies to provide wholesale high-speed Internet capacity to wireless carriers.
Commissioner Deborah Taylor Tate said the new rules "strike a balance" between safeguarding consumers and allowing market forces to prevail. She also was pleased that the roaming rules don't tamper with the FCC's previous classification of wireless broadband as a moderately regulated information service, rather than a heavily regulated telecom offering. Robert McDowell said he was encouraged that the regulations do not impose negotiation mandates, set rates, create a new class of carriers or require investigations of roaming practices.
CTIA, the wireless industry's main trade association, which represents large and small carriers with divergent views on this subject, had no comment.
"We thank the commission for taking this long-awaited step in requiring automatic roaming," said Joe Davis, spokesman for the Alliance for Fair Roaming Access, in a statement. "Until we have the opportunity to review the text of today's order, we don't know what additional steps, if any, will be required to ensure that consumers fully realize that promise," he added.
The alliance is made up of several rural carriers and associations representing such companies including the National Telecommunications Cooperative Association, Organization for Promotion and Advancement of Small Telecommunications Companies, and Rural Telecommunications Group.
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Antitrust
NAB Blasts A La Carte Plan From Sirius, XM
by Andrew Noyes
The powerful trade group that represents thousands of over-the-air radio and television stations on Tuesday slammed a proposal by satellite radio providers Sirius and XM to offer a la carte programming if regulators approve the rivals' merger plans.
The National Association of Broadcasters, which has led the opposition to the estimated $13 billion pairing between XM and Sirius, planned to present its detailed analysis to FCC staff late in the day and forwarded the document to Justice Department antitrust officials.
Sirius CEO Mel Karmazin announced last month that the a la carte offering would give customers the power to select satellite radio packages, "channel by channel to suit their tastes and their budgets." Pricing would start at $6.99 a month, with the priciest plan at $16.99. The services' existing base subscription rate is $12.95.
But NAB's review shows that under every package within an a la carte scheme, subscribers would be charged more per-channel than they currently pay. The price-per-channel increases under a merged XM-Sirius would range from 40 percent to 188 percent, according to the analysis.
Additionally, the packages described by Karmazin during his July 23 keynote at the National Press Club would include "onerous restrictions and limitations preventing consumers from enjoying true a la carte choice," NAB said in a press release.
The so-called "best of both worlds" offer, a 100-channel a la carte plan for either Sirius or XM programming, would provide only a pre-selected sampling of the other service. That option would require subscribers to buy a new radio at an undetermined price, NAB said.
"If 'a la carte' is intended to mean more choice and lower prices, XM and Sirius fail the test," NAB spokesman Dennis Wharton said. "Only in a monopolist's world are 50-channel minimums, higher prices, interoperability restrictions and a required hardware upgrade considered a consumer benefit."
Representatives for Sirius and XM sent an e-mail to reporters late Monday criticizing broadcasters' merger-blocking attempts. They said NAB officials have contradicted their previous statements, "proving once again that the NAB will say anything and do anything to stifle competition with terrestrial radio."
"This is desperation on NAB's part," Public Knowledge President Gigi Sohn added. "The point is that consumers would have the chance to pay less for channels they want."
Meanwhile, FCC Chairman Kevin Martin told reporters on Tuesday that he is "always pleased" when companies give consumers "more control over the content that they're paying for."
Martin said the agency might complete its merger review in the third or fourth quarter, though the timeframe could change. "I have said that [the] merger has a high hurdle, and I think that makes it more difficult" for the FCC to complete its review in the 180-day timeframe that it always aims for, he said.
Technology Daily Senior Writer David Hatch contributed to this report.
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Intelligence
Lawmakers Face Fallout From Spying Bill
by Chris Strohm
Lawmakers are facing political fallout this week for making changes to the Foreign Intelligence Surveillance Act, which culminated during the weekend with Congress voting to give the Bush administration new spying powers.
Perhaps trying to mitigate criticism from privacy and civil liberties groups, Sen. Dianne Feinstein, D-Calif., Tuesday released a letter from Director of National Intelligence Mike McConnell outlining what kind of protections will be used when the administration spies on U.S. citizens. Feinstein has come under fire, along with other lawmakers, for voting for a bill that temporarily amends the 1978 FISA law.
The bill, which President Bush signed into law Sunday, allows McConnell and Attorney General Alberto Gonzales to authorize the surveillance of communications by U.S. citizens without first getting a warrant from the secret FISA court. The authorization could last for up to one year. Feinstein said she asked McConnell to write the letter. In it, McConnell said the intelligence community is still obligated to minimize the acquisition, retention, and dissemination of information concerning U.S. persons.
"These procedures have worked well for decades and eliminate from intelligence reports incidentally acquired information concerning U.S. persons that does not constitute foreign intelligence," he wrote. He said the government also has "extensive training, compliance, and other procedures in place at agencies to ensure our activities are conducted according to law," including audits from inspectors general.
The new law also requires the government to submit its procedures for spying to the secret FISA court for judicial review, McConnell added. "I am committed to keeping the Congress fully and currently informed of how this act has improved the ability of the intelligence community to protect the country and reporting -- and remedying -- any incidents of non-compliance," McConnell wrote.
And, although he did not say it, the new law expires in six months. Feinstein, Chairwoman of the Judiciary Terrorism, Technology and Homeland Security Subcommittee, said she is working to draft "permanent legislation to ensure the effectiveness of our foreign intelligence surveillance program and to ensure that it protects the rights and liberties of all Americans."
On Monday, Citizens for Responsibility and Ethics in Washington asked the Justice Department to investigate whether House Minority Leader John Boehner, R-Ohio, violated the law by leaking classified information about intelligence operations related to FISA. The group cited a July 31 interview that Boehner gave to Fox News in which he said a court ruling "prohibits the ability of our intelligence services and our counterintelligence people from listening in to two terrorists in other parts of the world where the communication could come through the United States."
CREW alleges that Boehner appears to have transmitted information relating to national defense. "By revealing classified information, the minority leader of the House of Representatives appears to have compromised national security for partisan political gain," said Melanie Sloan, executive director of CREW.
A Boehner spokesman shot back, disputing that Boehner leaked anything and saying that his comments were consistent with what the administration, intelligence officials, and news reports have been conveying since January.
"Nice try, but this laughable claim is not only factually inaccurate but it says more about the hyper-partisanship of CREW than it does anything else," the spokesman said. "Mr. Boehner was referring to a FISA court judge's orders in January -- outlined in a publicly available letter from the attorney general to the Congress -- which brought all surveillance operations under the already-outdated and over-burdened FISA system and caused the intelligence gap Republicans fought to close last week."
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Trade
Bush Administration Upholds ITC Import Ban
by Winter Casey
The Bush administration said Monday it would uphold a U.S. International Trade Commission decision to bar the import of new cellular telephone models that include certain chips made abroad by Qualcomm.
"While we recognize legitimate concerns that certain market participants and others have expressed regarding the potential effects of these orders, we believe that steps are being taken to address those concerns," said U.S. Trade Representative Susan Schwab in a statement. "We have consulted closely with the Department of Homeland Security and other public safety agencies ... DHS has advised that it does not believe there are public safety risks sufficient to justify disapproval" of the ITC's order.
In reaching the decision not to protest the ITC's analysis, Schwab said she used the government's authority to protest with "restraint."
The ITC imposed the ban in June after Qualcomm was found guilty of violating a Broadcom patent on technology that helps cell phones conserve battery power when outside network range.
The case has attracted the attention of lawmakers, industry and public safety officials. Some industry officials and others have warned that the ITC decision could have negative consequences for the U.S. economy and emergency communications.
A spokesman for Alltel, a company that uses Qualcomm chips, said his company is closely monitoring the events related to the case along with the rest of wireless industry.
David Dull, Broadcom's general counsel, said in a July statement that the company would freely license its patent to imported "cellular phones for use in public health, safety and emergency-response applications." Broadcom also said it has entered into a licensing agreement that allows the importation and sale by Verizon Wireless of mobile devices that would have been affected by the ITC's decision.
The Department of Homeland Security said Broadcom's recent moves will "ameliorate to a significant degree concerns regarding the order's potential effect on public safety wireless broadband systems" and third generation network deployment, Schwab said.
Former ITC Vice Chairman Ronald Cass said he expects more licensing agreements and deals will be struck between Broadcom and other companies to allow the use of the technology in exchange for royalty payments. Cass also predicted that the USTR's decision will not be devastating to the U.S. economy or public safety officials and "industry will move on."
Schwab said "other market participants are investigating the use of a non-infringing software work-around." Schwab urged the "U.S. Customs and Border Protection to develop and apply procedures that would minimize the burden on importers of downstream products and non-infringing products."
Dull said USTR's decision strengthens the intellectual property rights of all U.S. companies and encourages a market-based solution to patent issues.
But Qualcomm said it will appeal and renew its request with the Federal Circuit Court of Appeals to delay the ITC's decision. Qualcomm also said it is pursuing all technical options and working closely with its customers on the implementation of new software to minimize the impact of the ITC order.
Broadcom said a federal judge in San Diego ruled Monday in a separate patent dispute between the two companies that Qualcomm engaged in "aggravated litigation misconduct and standards abuse with respect to two Qualcomm patents that relate to digital video technology."
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E-Government
Industry Group Condemns Test On E-Voting Security
by Michael Martinez
BOSTON -- A trade association representing the nation's largest e-voting manufacturers on Tuesday condemned a recent effort by California's top election official to test the security of the voting machines used in her state.
David Beirne, the executive director of the Election Technology Council, told a group of state lawmakers at the National Conference of State Legislatures' annual meeting here that a top-to-bottom e-voting security review completed last month by California Secretary of State Debra Bowen was not conducted in a fair way to the e-voting industry.
Bowen's review, which concluded that several of her state's platforms are susceptible to cyber attacks, has made nationwide headlines. She moved last week to impose new security precautions for those systems and decertified the machines used in Los Angeles County.
According to Beirne, whose organization represents Diebold Election Systems, Election Systems & Software, Sequoia Voting Systems and several other companies, Bowen's security review was not conducted under "real world" conditions. He also said that local officials and vendors were shut out the process and defended the security and reliability of e-voting machines.
"Electronic voting systems, by themselves, are much more secure than paper ballots have ever been," he said.
More than two dozen states already require e-voting machines to be backed up by paper audit trails. Legislation also has been introduced in both chambers of Congress to impose a nationwide paper-trail mandate.
Many state and local officials tried to move away from paper-based systems altogether in the wake of the disastrous presidential election in 2000, when problems with "hanging chads" and antiquated machines prompted a controversial recount process in Florida.
Congress passed a sweeping election overhaul bill in 2002 that required states to upgrade their voting systems so that similar situations would be avoided in the future. But attempts to move paper trail legislation during the 108th and 109th Congresses failed to get much traction.
A bill by Rep. Rush Holt, D-N.J., was approved by the House Administration Committee in May. More than 200 lawmakers have endorsed the proposal, but Democratic leaders have kept it from the floor to settle concerns about how much it may cost states, as well as how it may affect the accessibility of voting systems.
Susan Parnas Frederick, a senior committee director at NCSL, said that House lawmakers on Capitol Hill have not done enough to include state and local officials in negotiations about the proposal. But she lauded efforts by Majority Leader Steny Hoyer, D-Md., to slow down the bill's progress and ensure that state and local concerns are addressed.
Electionline.org Executive Director Doug Chapin said it is becoming increasingly unlikely that any federal election overhaul bill will be enacted and implemented before the 2008 presidential election. He also said California's e-voting review is going to have nationwide consequences because so many other states use the same technologies.
"The effect of that ripples far beyond their borders," he said.
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Privacy
State Lawmakers Urge Peers To Reject REAL ID
by Michael Martinez
BOSTON -- State lawmakers who saw they have seen enough of a sweeping federal identity security law urged some of their colleagues here on Tuesday to join their growing rebellion against the mandate.
The authors of state legislation rejecting the so-called REAL ID Act, which imposes nationwide standards for driver's licenses, told their peers at the annual meeting of the National Conference of State Legislatures that it also is in their best interest to refuse to comply with the law.
Nearly two dozen states decided this year that they will not follow REAL ID. Opponents of the law have called it a massive unfunded federal mandate on the states as well as a gateway for an invasive national ID system. The U.S. Homeland Security Department estimated earlier this year that it will costs states as much as $23 billion to implement it.
Montana state Rep. Brady Wiseman, a computer programmer, said the REAL ID law was dishonestly marketed to Congress as a national security and anti-terrorism tool. Weisman, whose anti-REAL ID bill sailed through the Montana Legislature earlier this year, encouraged legislators from other states to "just say no."
"At its core, REAL ID is an information problem," he said. "The simple precise, honest and clear truth about REAL ID is that it will not stop illegal immigration and that it will not protect you from terrorists."
State lawmakers at the conference staged a reenactment of the Boston Tea Party earlier this week in protest of REAL ID and other federal laws they consider to be unfunded mandates. They boarded a schooner in Boston Harbor and pretended to throw crates symbolizing such laws into the water.
Multiple bills have been introduced at the federal level to either repeal REAL ID altogether or delay its implementation. Last month, senators rejected a proposal to include funding for REAL ID compliance in the homeland security spending bill for fiscal 2008.
Maine state Sen. Libby Mitchell, the author of the first anti-REAL ID bill to pass at the state level this year, said she does not expect the federal government will follow through on some of the threatening provisions of the law. As written, driver's licenses that are not compliant with the statute will no longer be accepted for federal purposes after May 2008, which include boarding airplanes, accessing Social Security and entering federal buildings.
"We're feeling a little rebellious here," she said.
The revolt may get a little more interesting on Wednesday when Homeland Security Secretary Michael Chertoff is scheduled to address the conference.
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Courts
Samsung, Rambus Back In Court Over Ruling
by Andrew Noyes
Attorneys for electronics giant Samsung and computer memory chip maker Rambus returned to the Federal Circuit Court of Appeals on Tuesday to bicker over a controversial decision by a federal district judge in Virginia last year.
U.S. District Judge Robert Payne ruled that establishing a corporate document retention policy in the midst of litigation does not necessarily result in spoliation of evidence. But he did hold that Rambus, which reportedly organized a "shred day" to destroy millions of documents in a related case, was guilty of the practice.
Despite Samsung's win, the firm was not awarded attorneys' fees and the case, which has bounced back and forth from the district court, landed in the Federal Circuit's lap again. "We've done this before, haven't we?" Judge Randall Rader joked as the hearing began.
Rader cut through rhetoric from Rambus attorney Richard Taranto and Samsung counsel David Healey to arrive at what he believed was the core issue -- Rambus is trying to prevent the case from being sent back to Payne's court and Samsung wants it there.
Both firms "have unclean hands," Rader said. He accused Taranto of "forum shopping" to get a favorable ruling from U.S. District Judge Robert Whyte in California or U.S. District Judge Sue Robinson of Delaware.
In recent years, Rambus has been tied up in litigation in several courts with other tech firms, including Hynix Semiconductor, Infineon and Micron. The FTC also ruled in 2006 that the Los Altos, Calif.-based Rambus had illegally monopolized markets for its devices.
Payne previously dismissed patent infringement claims Rambus brought against Infineon and Taranto acknowledged that his client was "trying to avoid" the judge because of his "strongly voiced views" in the other case.
Rader had equally harsh words for Healey: "You got exactly what you wanted, now why are you still here?" Healey said that the lower court's denial of attorneys' fees amounted to a sanction, which harmed Samsung's reputation. He also claimed that the "integrity of the judicial process" was at stake.
But Judge Alvin Schall tried putting the case in perspective and questioned whether the tech firms' executives really even "got that upset" about Payne's order. Big tobacco and oil companies routinely take legal hits and their businesses still thrive, he pointed out.
The appeals court also heard an oral argument on Tuesday in U.S. Philips Corp. v. Iwasaki Electric Co., a patent dispute involving high pressure mercury vapor discharge lamps used in projection televisions and digital projectors.
Electronics manufacturer Philips accused its Japanese rival of infringing on a trio of patents but a New York federal court ruled in favor of the defendant, finding that Iwasaki did not infringe on the key patent in question.
Iwasaki asserted that it had not manufactured or sold lamps that directly infringe on the so-called 181 patent since first receiving notice of the patent. Philips appealed the decision to the Federal Circuit last December.
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Competitiveness
Study Compares Congressional, Bush R&D Funding
by Heather Greenfield
The competitiveness legislation awaiting President Bush's signature would authorize the addition of billions of dollars in federal research and development. The American Association for the Advancement of Science released a new report Tuesday looking at where those funding authorizations exceed the president's budget requests.
The president's proposed budget for fiscal 2008 would have cut overall basic and applied research for the fourth straight year, according to the AAAS report. Congress's budget authorization in H.R. 2272, which cleared Congress last week, would increase research budgets at every major non-defense R&D agency.
The AAAS report found the biggest policy direction changes in the proposed congressional budget involve the National Institutes of Health, environmental and energy research.
Both the House and Senate would increase the NIH budget by $1 billion over the president's request, turning a cut of less than 1 percent of its budget into an increase.
Congress also would turn steep cuts in environmental research programs requested by Bush into budget increases -- especially in the area of climate change. Instead of a 3 percent cut in environmental research at the U.S. Geological Survey, National Oceanic and Atmospheric Administration and the Environmental Protection Agency, House appropriators would give these agencies about a 9.2 percent increase.
Energy research, especially targeted at alternative energy, also would rise sharply if Congress gets its way. The Bush administration has requested cuts, while the House is proposing boosting Department of Energy research by 18.2 percent and the Senate would increase it 29 percent to $2 billion.
"Congress and the president always have different priorities regardless of party control," said Kei Koizumi, an AAAS researcher and author of the report. He said it shows Congress is hoping "to get more appropriations in general and wants to make a clear break from the administration's priorities."
The difficulty will be getting the funds Congress authorized into spending bills and past a veto threat the president has issued for domestic programs exceeding his budget request. Koizumi said the first step will be "getting the president and Congress to agree on a total appropriations figure."
The White House has not said whether Bush will sign the competitiveness bill, but some Republicans said they expect he will.
Overall there is a $21 billion difference in the funds Congress has authorized in various legislation compared to the president's budget. The gap in proposed R&D spending is about $3 billion.
"The president hasn't put forth too many disagreements over the (R&D) priorities," Koizumi said. "The primary interest is the bottom line."
The good news, perhaps, he said is there is agreement on basic research spending increases for the National Science Foundation, National Institute of Standards and Technology and Energy Department's science office. Bush proposed doubling R&D funding over 10 years to these agencies and Congress proposed doubling it in seven years.
Congress also agrees with the president that NASA will need more development funding to come up with a replacement for the space shuttle, Koizumi said. "So there is agreement upon which policy makers can build."
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Digitocracy Digest
Concerns Over Public TV's Efforts To Go Digital
by Aliya Sternstein
Public television stations face a precarious funding situation as they attempt to go digital.
President Bush's budget proposal for fiscal 2008 would curtail and restructure federal funding for the Corporation for Public Broadcasting, the nonprofit steward of the federal government's investment in public television and radio.
Typically, CPB's annual budget is determined two years in advance for both political and programmatic planning purposes. But Bush's budget request would discontinue this practice and take back $50 million from CPB's already-enacted budget for fiscal 2008.
Meanwhile, congressional Democrats say they are intent on safeguarding public television. The House and Senate bills that provide funding to CPB called for a $420 million advance appropriation for fiscal 2010, as well as $29.7 million for digital conversion in fiscal 2008. House and Senate reports accompanying the bills rejected the Bush administration's proposal to rescind $50 million from CPB's 2008 appropriation.
And both chambers are encouraging CPB to spend a portion of its digital conversion funds to digitally preserve public broadcasting's vast television and radio libraries in a publicly available archive. The House Appropriations Committee's report said the panel "recognizes that a great majority of public broadcasting audio, film and video history sits in collections that are deteriorating, and in their current format, will not be available for use after the digital transition without being preserved."
All TV stations, including public stations, are required by law to convert from analog transmissions to digital transmissions by February 2009. The government mandated the switch to digital, which takes up less airwave space, to save room for newer technologies.
Congress has supported advance appropriations for CPB, since 1976, to insulate the organization from political interference with show content. Then-President Gerald Ford stated that funding CPB with money years before it's used "would eliminate the scrutiny of programming that could be associated with the normal budgetary and appropriations processes of the government. ... I believe that it will assure the independence of noncommercial radio and television programming for our nation."
But Christin Baker, a spokeswoman for the White House Office of Management and Budget, said the administration believes "there is no unique reason why CPB should receive advance appropriations, and that it should be funded on the same appropriations schedule as nearly all other programs that receive federal assistance."
She noted that federal funding comprises only 16 percent of the revenue for public broadcasting. "Diverse funding sources, such as individual, corporate, and foundation donations, are a strength of the public broadcasting system and should continue to be emphasized going forward."
CPB said its television stations have made major progress in converting to digital transmissions, with about 95 percent now broadcasting in digital. But adhering to the government's rules is only a step toward fulfilling the promise of digital television, said David Liroff, CPB's senior vice president for system development and media strategy.
Public broadcasters want to deliver new services to their communities with digital technology, including multiple streams of programming, educational content distributed directly to classrooms, and emergency service notifications relayed to emergency managers, first responders and the general public, Liroff said.
"All of this will require continued support from local, state and federal sources," he added.
The overall cost for public broadcasting's transition is estimated at $1.8 billion. To date, Congress has appropriated more than $450 million for the transition.
Despite the looming 2009 deadline, the Senate Appropriations Committee did not suggest a higher level of funding because public television is close to completing the transition, Senate committee spokeswoman Jenny Thalheimer said. "The committee feels strongly that this level of funding will complete the digital conversion of public television stations, continue to convert public radio stations in anticipation of their deadline and provide a small amount of money to develop a plan to convert the archive."
CPB is now conceptualizing what it calls the "American Archive," which would be a digital repository for public television and radio collections in line with the congressional recommendations.
Rep. Edward Markey, D-Mass., chairman of the House Energy and Commerce Telecommunications and the Internet Subcommittee, recently told the American Association of Public Television Stations: "As issues arise regarding the cost of digitization or intellectual property rights, I am eager to work with public broadcasting to find solutions so that this project can become a success."
Numerous discussions to explore the idea will take place over the next several months, addressing "everything from technology to digital rights to governance issues and will involve representatives from across the public broadcasting system as well as from outside entities," Liroff said.
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Today's Feature:
People Column
Days after the FCC announced rules for the auction of spectrum used in the digital transition, a staff member involved in that issue announced he is leaving to pursue other opportunities.
Every Tuesday, read the People Column by Heather Greenfield.
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