10/5. The Federal Communications Commission (FCC) adopted and released an item [146 pages in PDF] that, among other things, allows the exclusive contract prohibition section of the FCC's program access rules to expire.

The FCC unanimously adopted this Report and Order (R&O), Further Notice of Proposed Rulemaking (FNPRM), and Order on Reconsider (OR). It is FCC 12-123. The R&O portion of this item ends the per se prohibition of exclusive contracts (MB Docket No. 12-68). The FNPRM portion of this item seeks comments on establishing several rebuttal presumptions in case by case consideration of exclusive contracts (MB Docket Nos. 07-18 and 05-192). The OR portion of this item is in MB Docket No. 07-29.

The Cable Act of 1992 contained a ten year ban on these exclusive contracts, gave the FCC rulemaking authority, and allowed the FCC to extend the ban if it found that the ban was "necessary to preserve and protect competition and diversity in the distribution of video programming".

The FCC extended the per se ban in 2002 for five years. It again extended the per se ban in 2007. The U.S. Court of Appeals (DCCir) upheld the 2007 extension order, but suggested that it would not do so if the FCC made yet another extension.

The just released item is likely the product for three modes of analysis at the FCC. First, it reflects the FCC's policy and market analysis; that is, the FCC concluded that changes in the multichannel video programming distribution (MVPD) market warranted a change in its rules. Second, this reflects the FCC's consideration of the lobbying and rent seeking activities of organized interests. Third, this item reflects the FCC's recognition that any attempt to further extend the ban would have been an exercise in regulatory futility, because the Court of Appeals suggested in its review of the last extension that it would overturn a further extension.

This R&O ends the FCC's blanket ban, or per se ban, on exclusive contracts. What remains will be FCC case by case analyses of exclusive contracts in complaint proceedings and antitrust merger reviews (nominally license transfer proceedings). That is, MVPDs can still file complaints with the FCC alleging that exclusive contracts violate the 1992 Act.

However, this R&O creates a presumption that an exclusive contract involving a cable affiliated regional sports network (RSN) has the purpose or effect prohibited by the 1992 Act.

See, related story in this issue titled "FCC Adopts Report and Order on Program Access Rules".

The National Cable & Telecommunications Association (NCTA) and large cable operators (Comcast, Time Warner Cable, and Cablevision) have long advocated ending the per se ban, and now oppose creating certain presumptions for future case by case reviews. See for example, NCTA letter to FCC of October 3.

The USTelecom, American Cable Association (ACA), satellite providers (DirecTV and Dish Network), AT&T, National Telecommunications Cooperative Association (NTCA), Western Telecommunications Alliance (WTA) and others support creating certain presumptions.

See for example, Barbara Esbin's (Cinnamom Mueller) October 2 letter and September 26 letter to the FCC on behalf of the ACA, which represents smaller cable companies. See also, William Wiltshire's (Wiltshire Grannis) September 21 letter to the FCC on behalf of DirecTV, and Kevin Rupy's (USTelecom) September 20 letter to the FCC.

Google, which is deploying Google Fiber in the Kansas City area, wants "access to must-have live regional sports programming". See, September 26 letter to the FCC.

The FNPRM portion of this item seeks comments on proposals for rebuttable presumptions advocated by the large cable operators' competitors. See, related story in this issue titled "FCC Adopts NPRM on Case by Case Analysis of Exclusive Contracts".

FCC Chairman Julius Genachowski wrote a two sentence statement to accompany this item. "The FCC is focused on promoting competition and protecting consumers in the evolving video market. Today’s unanimous decision enables the FCC to continue preventing anticompetitive video distribution arrangements through a legally sustainable, expeditious, case-by-case review."

FCC Commissioner Robert McDowell wrote in his statement that "the marketplace has evolved substantially since Congress last spoke on this subject a generation ago. The exclusivity ban served its purpose, but now the facts justifying its existence have changed in favor of consumers. Accordingly, this creaky relic must be shown the door."

However, he added that "vertical integration between cable operators and programmers could raise concerns in certain instances, especially for non-replicable programming, such as regional sports networks", and that the FCC "can perform a case-by-case review of exclusive contracts under the remaining program access rules using established complaint processes to ensure that anticompetitive effects do not occur, consumers are not harmed and the marketplace continues to flourish".

McDowell also criticized the FNPRM's inquiry into whether the FCC should create certain rebuttable presumptions, and suggested that they are a "back-handed attempt to resurrect the exclusivity ban for certain exclusive contracts".

He also argued that the presumption regarding access to RSNs may be an unconstitutional content based regulation of speech.

FCC Commissioner Jessica Rosenworcel (at right) wrote in her statement that the FCC "must keep a watchful eye on the evolving marketplace and be ready to take action if the processes we adopt today do not provide consumers with the safeguards they need and deserve."

FCC Commissioner Ajit Pai wrote in his statement that "Some have expressed concern that cable operators may use exclusive contracts to harm competition and impede entry into video distribution markets. However, as cable’s market share has fallen, cable-affiliated programmers are earning an ever-larger share of revenues from licensing content to non-cable MVPDs. This reduces their incentives to forgo licensing fees for programming in the hope of inducing rivals' customers to switch providers. In short, there just won't be a business case for many cable-affiliated programmers to withhold content."

Pai added that "More significantly, exclusivity can promote competition. It can provide non-cable MVPDs with the incentive to develop content to compete with cable, just as it enhances cable operators' incentive to further develop their programming."

10/5. The Federal Communications Commission (FCC) adopted and released an item [146 pages in PDF] that, among other things, allows the exclusive contract prohibition section of the FCC's program access rules to expire.

The R&O portion of this item amends Part 76 of the FCC's rules, which are codified at 47 C.F.R. §§ 76.1000 et seq. to remove the per se ban on exclusive contracts.

The FCC will continue to conduct proceedings on complaints filed by multichannel video programming distributors (MVPD) that allege that exclusive contracts violate the Cable Act of 1992 and the FCC's rules. This R&O also provides a shot clock to ensure timely resolution of these complaints.

This R&O creates a presumption that an exclusive contract involving a cable affiliated regional sports network (RSN) has the purpose or effect prohibited by the 1992 Act.

The FCC will also maintain the ability to regulate exclusive contracts via conditions imposed during merger reviews.

The FCC adopted and released its Notice of Proposed Rulemaking (NPRM) [108 pages in PDF] on March 20, 2012. See, story titled "FCC Adopts NPRM on Exclusive Contract Prohibition of Program Access Rules" in TLJ Daily E-Mail Alert No. 2,352, March 21, 2012.

The FCC's regulations banned cable operators from entering into exclusive contracts with cable affiliated programming vendors that deliver their programming to cable operators via satellite.

These rules were a forced sharing mandate that compelled cable video programming networks to share their content with all video programming distributors. They were based upon a bottleneck monopoly rationale, underlying the Cable Television Consumer Protection and Competition Act of 1992 (aka Cable Act of 1992), that the FCC now recognizes is outdated by changes in the marketplace.

Section 628 of the Communications Act was enacted by the Cable Act of 1992. It is codified at 47 U.S.C. § 548. It requires that the FCC write regulations "to promote the public interest, convenience, and necessity by increasing competition and diversity in the multichannel video programming market and the continuing development of communications technologies".

Subsection (c)(2)(D) provides that these regulations "shall ... with respect to distribution to persons in areas served by a cable operator, prohibit exclusive contracts for satellite cable programming or satellite broadcast programming between a cable operator and a satellite cable programming vendor in which a cable operator has an attributable interest or a satellite broadcast programming vendor in which a cable operator has an attributable interest, unless the Commission determines (in accordance with paragraph (4)) that such contract is in the public interest". (Parentheses in original.)

The 1992 Act also provided a ten year sunset, but allowed the FCC to extend its rules. The FCC extended its program access rules in 2002.

FCC extended its rules again in 2007. The FCC adopted a Report and Order and NPRM on September 11, 2007, which it released on October 1, 2007, that concluded that the exclusive contract prohibition is still necessary. That order also contained a sunset of October 5, 2012.

That item was FCC 07-169 in MB Docket Nos. 07-29 and 07-198. See also, FCC release, and story titled "FCC Adopts R&O and NPRM Regarding Program Access Rules" in TLJ Daily E-Mail Alert No. 1,640, September 17, 2007.

Cable operators challenged the 2007 order. The U.S. Court of Appeals (DCCir) upheld the order in a divided opinion. However, even the majority suggested that it would not uphold a further extension of these rules. See, opinion in Cablevision Systems v. FCC, 597 F.3d 1306. See also, story titled "Commentary: Cablevision I and the Exclusivity Rule" in TLJ Daily E-Mail Alert No. 2,352, March 21, 2012.

The just released R&O states that "We find that a preemptive prohibition on exclusive contracts is no longer “necessary to preserve and protect competition and diversity in the distribution of video programming” considering that a case-by-case process will remain in place after the prohibition expires to assess the impact of individual exclusive contracts." (Footnote omitted.)

10/5. The Federal Communications Commission (FCC) adopted and released an item [146 pages in PDF] regarding its program access rules. The Report & Order (R&O) portion of this item lets expire the per se ban on exclusive contracts. The FCC will henceforth review exclusive contracts on a case by case basis. However, the R&O leaves unresolved several questions regarding how the FCC will conduct these reviews. The Further Notice of Proposed Rulemaking (FNPRM) portion of this item seeks comments on establishing presumptions.

The FNRM seeks comment on whether to establish certain rebuttable presumptions that were proposed by other other multichannel video programming distributors (MVPD), including telcos, smaller cable companies, and satellite MVPDs.

First, the FNPRM asks if the FCC should establish "a rebuttable presumption that an exclusive contract for a cable-affiliated RSN (regardless of whether it is terrestrially delivered or satellite-delivered) is an “unfair act” under Section 628(b)". (Parentheses in original.)

Second, should the FCC establish a "a rebuttable presumption that a complainant challenging an exclusive contract involving a cable-affiliated RSN (regardless of whether it is terrestrially delivered or satellite-delivered) is entitled to a standstill of an existing programming contract during the pendency of a complaint". (Parentheses in original.)

Third, should the FCC establish a "rebuttable presumptions with respect to the “unfair act” element and/or the “significant hindrance” element of a Section 628(b) claim challenging an exclusive contract involving a cable-affiliated “national sports network” (regardless of whether it is terrestrially delivered or satellite-delivered)". (Parentheses in original.)

Fourth, should the FCC establish a "a rebuttable presumption that, once a complainant succeeds in demonstrating that an exclusive contract involving a cable-affiliated network (regardless of whether it is terrestrially delivered or satellite-delivered) violates Section 628(b) (or, potentially, Section 628(c)(2)(B)), any other exclusive contract involving the same network violates Section 628(b) (or Section 628(c)(2)(B))." (Parentheses in original.)

This FNPRM also seeks comments on revisions to the program access rules to ensure that buying groups utilized by small and medium-sized MVPDs can avail themselves of these rules.

Initial comments in response to this FNPRM will be due within 30 of publication of a notice in the Federal Register (FR). Reply comments will be due within 45 days of such publication. As of the October 5, 2012 issue of the FR this notice had not yet been published.

10/5. The following is an overview of reaction to the Federal Communications Commission's (FCC) October 5, 2012  item [146 pages in PDF] regarding its program access rules.

Sen. John Rockefeller (D-WV), Chairman of the Senate Commerce Committee (SCC), stated in a release that "I am reviewing the FCC's action today very carefully. As recent hearings in the Commerce Committee have demonstrated, consumers still face ever-escalating rates and little power to address them. The program access rules were an integral part of Congress's attempt to promote competition and consumer choice in the 1992 Cable Act. I appreciate that the FCC has put into place a process by which individual complaints can be brought against cable companies that lock up their programming. But if this new process does not deter anticompetitive behavior that harms consumers, Congress will need to consider whether it should restore appropriate safeguards."

Walter McCormick, head of the USTelecom, stated in a release that "While we appreciate the commission's willingness to make some changes to this order, today's action is likely to make it more difficult to build and operate broadband networks, especially in rural communities where revenues from offering competitive video services are essential in order to make a business case for broadband deployment."

USTelecom's members include AT&T, which provides U-Verse TV, and Verizon, which provides Fios TV. USTelecom is also a member of the Coalition for Competitive Access to Content.

McCormick continued that "There is near universal agreement in the record in support of continuing the commission’s long-standing prohibition on the ability of large cable companies to withhold critical programming as a tool for suppressing the ability of alternative providers to compete -- including support from small cable companies, rural telephone companies, satellite providers and public interest groups."

Matthew Polka, head of the American Cable Association (ACA), stated in a release that the "ACA is disappointed that the FCC decided to permit the prohibition on exclusive contracts to sunset, but it appreciates the FCC's willingness to adopt some modifications to the Section 628(b) unfair practices complaint process to make it less burdensome for multichannel video programming distributors (MVPDs)."

However, he praised this item for establishing a rebuttable presumption with respect to regional sports networks (RSN), and for making "clear that a selective refusal to deal, particularly with regard to cable overbuilders and new entrants, can be a violation of the program access rules' prohibition on discrimination." He also praised the Further Notice of Proposed Rulemaking (FNPRM) portion of this item.

John Bergermeyer of the Public Knowledge (PK) stated in a release that "The FCC's program access rules have been vital in bringing some competition to the video marketplace. Without them, satellite providers like DirecTV, telco video like AT&T's U-Verse TV, and smaller cable systems would not have been able to get off the ground and provide customers the programming they demand. They are still needed to preserve the progress we've made toward video competition."

"What's more, the program access rules are an important part of broadband competition. Even fiber-to-the-home providers like Google Fiber and Verizon FiOS need to offer a video service alongside their fast broadband to be appealing to consumers. By making it harder to compete in the video marketplace, the FCC has made it harder to provide competitive broadband, as well."

The Free Press's Matt Wood stated in a release that "This decision suggests that the competitive landscape has changed since the program access rules were adopted. That's true to some extent, but the choices we have in the market today emerged as a result of these very same rules. Getting rid of them or weakening them threatens to undermine that landscape, especially at a time when incumbent cable operators wield so much power over traditional pay-television services and online video options."

He added that "We hope there will be some continued protection for cable sports programming and other must-have shows, which cable companies have so often denied to satellite customers in cities from Philadelphia to Portland. We also hope the Commission will use its general authority to prevent unfair practices by big cable when abuses inevitably crop up."

Day one of a four day event hosted by George Mason University School of Law and the American Bar Association's (ABA) Section of Antitrust titled "Antitrust Law and Economics Institute for Judges". See, notice and agenda. Location: GMU law school, 3301 Fairfax Drive, Arlington, VA.

Columbus Day. This is a federal holiday. See, OPM list of 2012 federal holidays.

The House will not meet.

The Senate will not meet.

Day two of a four day event hosted by George Mason University School of Law and the American Bar Association's (ABA) Section of Antitrust titled "Antitrust Law and Economics Institute for Judges". See, notice and agenda. Location: GMU law school, 3301 Fairfax Drive, Arlington, VA.

The House will meet at 11:00 AM in pro forma session. It is in recess, except for pro forma sessions, until after the November elections.

The Senate will meet at 11:00 AM in pro forma session. It is in recess, except for pro forma sessions, until November 13, 2012.

Day three of a four day event hosted by George Mason University School of Law and the American Bar Association's (ABA) Section of Antitrust titled "Antitrust Law and Economics Institute for Judges". See, notice and agenda. Location: GMU law school, 3301 Fairfax Drive, Arlington, VA.

12:15 - 1:45 PM. The New America Foundation (NAF) will host a panel discussion titled "It's Science and Technology Policy, Stupid". The speakers will be Stacy Cline (Republican staff, Senate Health, Education, Labor, and Pensions Committee), Sheri Fink (NAF), Konstantin Kakaes (NAF), Amanda Ripley (NAF), and Robert Wright (NAF). Free. Open to the public. See, notice. Location: NAF, 1899 L St., NW.

1:00 - 2:00 PM. The American Bar Association (ABA) will host a webcast and teleconferenced panel discussion titled "Privacy and Information Security Update". The speakers will be Alysa Hutnik, Christopher Loeffler, Sharon Schiavetti and Kristin McPartland (all of Kelley Drye). Free. No CLE credits. See, notice.

2:00 - 3:30 PM. The Department of Justice's (DOJ) Antitrust Division's (AD) Economic Analysis Group (EAG) will host a presentation titled "vGUPPI: Scoring Unilateral Pricing Incentives in Vertical Mergers". The speaker will be Steve Salop (Georgetown University Law Center). See, paper with the same title by Salop and Serge Moresi (Charles River Associates). For more information, contact Gloria Sheu at gloria dot sheu at usdoj dot gov or 202-532-4932 or Nathan Miller at nathan dot miller at usdoj dot gov or 202-307-3773. Free. Open to the public. Location: Liberty Square Building, EAG conference room, LSB 9429, 450 5th St., NW.

3:00 - 5:00 PM. The New America Foundation (NAF) will host a panel discussion titled "Tech for the Social Good". The on site event is closed to the public, but the NAF will webcast this event live. See, notice. Location: NAF, Suite 400, 1899 L St., NW.

Deadline to submit initial comments to the Federal Communications Commission (FCC) regarding the Government Accountability Office's (GAO) report [51 pages in PDF] titled "Federal Communications Commission: Regulatory Fee Process Needs To Be Updated", and released on September 10, 2012. See, notice in the Federal Register, Vol. 77, No. 193, October 4, 2012, at Pages 60666-60667.

Day four of a four day event hosted by George Mason University School of Law and the American Bar Association's (ABA) Section of Antitrust titled "Antitrust Law and Economics Institute for Judges". See, notice and agenda. Location: GMU law school, 3301 Fairfax Drive, Arlington, VA.

8:00 AM - 5:00 PM. Day one of a three day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). See, notice in the Federal Register, Vol. 77, No. 186, September 25, 2012, at Pages 58980-58981. Location: Courtyard Washington Embassy Row, General Scott Room, 1600 Rhode Island Ave., NW.

9:30 AM - 4:00 PM. The Department of Commerce's (DOC) National Telecommunications and Information Administration (NTIA) will hold one in a series of meetings regarding consumer data privacy in the context of mobile applications. See, notice in the Federal Register, Vol. 77, No. 149, Thursday, August 2, 2012, Pages 46067-46068. Location: Auditorium, DOC, Hoover Building, 14th Street and Constitution Ave., NW.

12:00 NOON. The World Wide Web Consortium's (W3C) Tracking Protection Working Group will meet by teleconference. The call in number is 1-617-761-6200. The passcode is TRACK (87225).

12:15 - 1:30  PM. The Federal Communications Bar Association's (FCBA) Transactional Practice Committee will host a brown bag lunch titled "Issues in the Negotiating and Drafting of Media Transaction Contracts". The speakers will be Howard Weiss (Fletcher Heald & Hildreth), Michael Basile (Dow Lohnes), Steve Lovelady (Fletcher Heald & Hildreth). Location: Drinker Biddle & Reath, Conference Room 11-C., 1500 K St., NW.

6:00 - 8:00 PM. The Federal Communications Bar Association's (FCBA) Legislative and Young Lawyers Committee will host an event titled "Happy Hour". For more information, contact Justin Faulb at JFaulb at eckertseamans dot com or Marc Paul at Marc dot Paul at fcclaw dot com. Location: Johnny's Half Shell, 400 North Capitol St., NW.

Deadline to submit reply comments to the Federal Communications Commission (FCC) in response to its Notice of Inquiry [29 pages in PDF] that requests information to assist it in preparing its next video competition report. This NOI is FCC 12-80 in MB Docket No. 12-203. See, story titled "FCC Releases Video Competition Report" in TLJ Daily E-Mail Alert No. 2,411, July 25, 2012. See also, notice in the Federal Register, Vol. 77, No. 153, August 8, 2012, at Pages 47383-47392.

Deadline to submit comments to the National Institute of Standards and Technology's (NIST) Computer Security Division (CSD) regarding its draft SP 800-152 [26 pages in PDF] titled "A Profile for U. S. Federal Cryptographic Key Management Systems (CKMS)".

Deadline to submit initial comments to the Federal Communications Commission (FCC) in response to its Public Notice (DA 12-1411) regarding the auction of certain FM broadcast construction permits scheduled to commence on March 26, 2013, and the competitive bidding procedures for Auction 94. See, notice in the Federal Register, Vol. 77, No. 193, October 4, 2012, at Pages 60690-60695.

8:00 AM - 5:00 PM. Day two of a three day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). See, notice in the Federal Register, Vol. 77, No. 186, September 25, 2012, at Pages 58980-58981. Location: Courtyard Washington Embassy Row, General Scott Room, 1600 Rhode Island Ave., NW.

8:30 AM. The Department of Commerce's (DOC) Bureau of Industry and Security's (BIS) Emerging Technology and Research Advisory Committee will meet. The agenda includes discussion of the Wassenaar regulation regime (Wassenaar Arrangement on Export Controls for Conventional Arms and Dual-Use Goods and Technologies), redefinition of use, dual use technologies, and the deemed export principle. See, notice in the Federal Register, Vol. 77, No. 188, September 27, 2012, Page 59374. Location: DOC, Room 6087B, Hoover Building, 14th Street between Pennsylvania and Constitution Aves., NW.

9:00 AM - 5:00 PM. The U.S. China Economic and Security Review Commission will meet to consider drafts of material for its 2012 annual report to Congress. See, original notice in the Federal Register (FR), Vol. 77, No. 143, July 25, 2012, at Pages 43662-43663, and second notice in the FR, Vol. 77, No. 171, September 4, 2012, at Pages 53965-53966. Location: Hall of the States, Conference Room 231, 444 North Capitol St., NW.

1:00 - 2:00 PM. The American Bar Association (ABA) will host a teleconferenced panel discussion titled "Social Media Series: Latest Developments in Cause Marketing". The speakers will be Kristalyn Loson (Venable), Edward Chansky (Greenberg Traurig), Chris Curry (Gage Marketing), and Lakshmi Ramani (Nature Conservancy). Free. No CLE credits. See, notice.

The Senate will meet at 10:30 AM in pro forma session.

8:00 AM - 12:00 NOON. Day three of a three day meeting of the National Institute of Standards and Technology's (NIST) Information Security and Privacy Advisory Board (ISPAB). See, notice in the Federal Register, Vol. 77, No. 186, September 25, 2012, at Pages 58980-58981. Location: Courtyard Washington Embassy Row, General Scott Room, 1600 Rhode Island Ave., NW.

9:00 AM - 5:00 PM. The U.S. China Economic and Security Review Commission will meet to consider drafts of material for its 2012 annual report to Congress. See, original notice in the Federal Register (FR), Vol. 77, No. 143, July 25, 2012, at Pages 43662-43663, and second notice in the FR, Vol. 77, No. 171, September 4, 2012, at Pages 53965-53966. Location: Hall of the States, Conference Room 231, 444 North Capitol St., NW.

9:00 - 11:00 AM. The New America Foundation (NAF) will host a panel discussion titled "Arms Race vs. Relay Race: What Does Innovation Hold for China?". The speakers will be Yasheng Huang (MIT), Adam Segal (Council on Foreign Relations), Denis Simon (Arizona State University), Yifei Sun (California State University, Northridge), and Steve LeVine (NAF). See, notice. Location: NAF, Suite 400, 1899 L St., NW.

9:30 AM. The U.S. Court of Appeals (DCCir) will hear oral argument in USA v. North American Telecommunications, Inc., App. Ct. No. 10-7176.  Judges Sentelle, Tatel, and Randolph will preside. Location: USCA Courtroom, 5th floor, Prettyman Courthouse, 333 Constitution Ave., NW.

12:30 - 2:00 PM. The Telecommunications Industry Association (TIA) will host a lunch. The speaker will be Ambassador Terry Kramer. He will discuss the International Telecommunications Union's (ITU) World Conference on International Telecommunications (WCIT) that will take place in Dubai in December. See, notice. Location: Occidental Grill, 1475 Pennsylvania Ave., NW.

Statutory deadline for the Executive Office of the President's (EOP) Office of the Intellectual Property Enforcement Coordinator, or IPEC, to release the second version of the "Joint Strategic Plan Against Counterfeiting and Infringement". The IPEC was over eight months late in releasing the first version. See, first version of the plan [65 pages in PDF], and story titled "IPEC Releases Plan on Intellectual Property Enforcement" in TLJ Daily E-Mail Alert No. 2,099, June 22, 2010.

This is the Federal Communications Commission's (FCC) self imposed deadline to issue a "comprehensive data collection order" to assist it in revising its special access rules. See, Report and Order [107 pages in PDF] adopted on August 15, 2012, which states that this order will be issued within 60 days. See also, story titled "Divided FCC Adopts Special Access Order" in TLJ Daily E-Mail Alert No. 2,435, August 23, 2012.

5/5. On October 3, 2012 Deutsche Telekom and MetroPCS Communications announced that they have signed a definitive agreement to combine T-Mobile USA and MetroPCS. See, story titled "T-Mobile USA and MetroPCS to Merge" in TLJ Daily E-Mail Alert No. 2,457, October 3, 2012.

T-Mobile is 4th largest wireless service provider in the US, when measured by number of customers. MetroPCS is the 5th largest. However, they are much smaller than the two largest providers, Verizon and AT&T. Moreover, the merged entity would still be the 4th largest, behind Verizon, AT&T and Sprint.

However, if the focus of analysis is the market for prepaid services, then it may be significant that T-Mobile USA and MetroPCS are the two leading providers.

Rep. Henry Waxman (D-CA), ranking Democrat on the House Commerce Committee (HCC), stated in a release that "Consumers benefit from strong, vibrant competition in the wireless marketplace. Competition on a national scale can bring innovation, better service, and lower prices to consumers everywhere. The proposed merger between T-Mobile and MetroPCS may have the potential to enhance nationwide wireless competition and benefit consumers throughout the United States. I urge the Department of Justice and the Federal Communications Commission to review the merits of this proposed transaction rigorously but swiftly."

John Bergmayer of the Public Knowledge wrote a short analysis titled "A Stronger T-Mobile Could Keep Verizon and AT&T in Check". He argued that "this is a very different situation from when AT&T tried to buy T-Mobile. That transaction would have gutted nationwide wireless competition. The T-Mobile/Metro PCS deal could improve it."

He wrote that "By combining with Metro PCS, T-Mobile will have more spectrum and more towers, and thus more flexibility. It should be able to offer its lower-cost plans to more consumers, while improving the service of existing Metro PCS and T-Mobile customers."

He added that "on balance, this transaction is likely to be good for value-conscious subscribers, including prepaid customers." Moreover, "a stronger T-Mobile might actually put some pricing pressure on AT&T and Verizon".

10/5. The Federal Communications Commission (FCC) released its first biennial report [68 pages in PDF] to Congress on the "Twenty-First Century Communications and Video Accessibility Act of 2010", which is also known as the CVAA.

10/4. AT&T released a short piece titled "Interference Testing: Slight of Hand, Part Deux", regarding the lower 700 MHz band. The author is AT&T's Joe Marx. See also, AT&T's October 3 filing with the Federal Communications Commission (FCC) in WT Docket No. 12-97.

10/3. The Federal Communications Commission (FCC) concluded Auction 901 on September 27, 2012. This auctioned high cost universal service subsidies through reverse competitive bidding. It is also titled "Mobility Fund Phase I Auction". The FCC stated in a Public Notice (DA 12-1566) on October 3 that "there were a total of 33 winning bidders. The winning bidders are eligible to receive a total of $299,998,632 in one-time Mobility Fund Phase I universal service support to provide 3G or better mobile voice and broadband services covering up to 83,494.23 road miles in 795 biddable geographic areas located in 31 states and 1 territory." Winner bidders must submit FCC Form 680 by 6:00 PM on November 1, 2012. See also, winning bids and FCC release.

10/2. The Federal Communications Commission (FCC) released the text [205 pages in PDF] of the Notice of Proposed Rulemaking (NPRM) that its adopted on September 28, 2012, regarding incentive auctions. See, story titled "FCC Adopts NPRM on Incentive Auctions" in TLJ Daily E-Mail Alert No. 2,455, October 1, 2012. This NPRM discloses comment deadlines. Initial comments are due by December 21, 2012. Reply comments are due by February 19, 2013. This NPRM is FCC 12-118 in GN Docket No. 12-268.

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