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August 8, 2007

What Does Eddie Vedder Think of Net Neutrality?

A really interesting donnybrook has occurred that answers the eternal question: what does Eddie Vedder think of net neutrality? Vedder’s band Pearl Jam has this post today on the group’s website that accuses AT&T of censoring Pearl Jam’s performance of “Don’t Call Me Daughter” at Lollapalooza on Sunday.

It’s not really clear but it sounds like AT&T, a sponsor of the bandfest, cut out of a live webcast only those parts of the performance that were critical of George Bush.

During the performance of “Daughter” the following lyrics were sung to the tune of Pink Floyd’s “Another Brick in the Wall” but were cut from the webcast:

- “George Bush, leave this world alone.” (the second time it was sung); and

- “George Bush find yourself another home.”

AT&T apparently has admitted to deleting the selected phrases but says its “content monitor had made a mistake.”

That’s not the best part. The best part is how eloquent Pearl Jam is on the issue of media concentration of ownership and network neutrality.

This, of course, troubles us as artists but also as citizens concerned with the issue of censorship and the increasingly consolidated control of the media.

AT&T’s actions strike at the heart of the public’s concerns over the power that corporations have when it comes to determining what the public sees and hears through communications media.

Aspects of censorship, consolidation, and preferential treatment of the internet are now being debated under the umbrella of “Net Neutrality.”

Now, if this were any other band, I might be tempted to categorically conclude that Pearl Jam is being used as a puppet, nothing more than a prop, by pro-net neutrality advocates looking to score points about the need for new regulations. What better horror story to wave about than showing how AT&T actually censored political speech. If the telco would do that, you’d better believe it would discriminate against commercial competitors in a heartbeat.

I think it’s a possibility that Pearl Jam’s complaint has been politically manufactured to achieve a purpose. What makes me suspicious is how quickly Public Knowledge has spread the word about the Pearl Jam incident. In a statement, PK President Gigi Sohn said

The admitted censoring of a Pearl Jam performance is just one more reason why content should be protected against the actions of a company looking out for itself, rather than for consumers and the free flow of information over the Internet.

But Vedder has always been politically active, progressive and smart, so it’s possible that things have transpired the other way around. Pearl Jam complained about what it perceived as censorship and Public Knowledge seized upon the opportunity.

Whatever the case may be, only an idiotic communications company would edit out political comments from a performance. I don’t think AT&T is idiotic. This was probably a giant mistake or overzealous editing by an errant employee. Let’s hope so anyway.

Update: I just got a phone call from an AT&T spokeswoman, Tiffany Nels, who confirmed that the editing out of the anti-Bush comments “was a total mistake.” It was, in fact, an error by the editor and “we don’t edit performances” she said, except in regards to profanity (“just like a broadcaster”) because the website is open to anybody of any age. AT&T is working with Pearl Jam to put the full, unedited performance up on the website.

Update: PK’s Art Brodsky has this item on the Huffington Post and he’s not buying the “blame the junior staffer” excuse. I see his point, but still, they’re not stupid over there at AT&T. Shrewd, wily, out to gain an upper hand, maybe, just like any other giant business with one half of a duopoly pipe into the home. Dumb they are not.

Posted by Cynthia Brumfield at 4:44 PM | Print | Comments (0)

August 8, 2007

Cablevision Starts to Wilt Under Verizon's Heat

Verizon is gunning for the lucrative NYC-Long Island market that has been Cablevision Systems’ to win or lose. Based on the cable operator’s Q2 07 earnings report issued this morning, the once-unshakeable operator, who tops the industry’s charts in almost every metric, is feeling the competitive heat from the telco’s fiber-based FiOS high-speed and TV services.

For the first quarter since Q1 04, Cablevision failed to gain any net new basic subscribers and the company is ratcheting down its growth prospects for the year as a consequence. During Q2 07, Cablevision’s basic customer count stayed flat at 3.239 million.

Worse, every other high-growth category went soft during the quarter. Net digital subscriber additions were only 39,000, down 73% year-over-year and 39% sequentially. High-speed data subscriptions advanced by only a net 50,000, down 41% year-over-year and 37% sequentially.

Even Optimum Voice, Cablevision’s VoIP service, went south in terms of growth. Cablevision added 81,000 net new telephony customers during the quarter, a run-rate 34% below Q2 06 levels and 26% below Q1 07’s performance.

During the analysts’ call, Cablevision execs were at a loss to explain the sudden stop-short results. “It’s hard for me to tell what the macro environment is exactly because we don’t have much of a trend,” COO Tom Rutledge said.

Of course the elephant in the room is Verizon’s aggressive deployment of fiber-to-the-home technology throughout Cablevision’s service area, although Rutledge said that the competition was in line with expectations. FiOS only passes 750,000 homes in Cablevision’s 4.7 million-homes passed territory, but Verizon is aggressively trying to peel away customers.

Rutledge said that Verizon is spending $80 million to $100 million in advertising just for those 750,000 homes, which will force Cablevision to up its own marketing budget. “We have upped our marketing spend just so that our position in the marketplace is not drowned out by that kind of marketing.”

To counter the slow-down in new service growth, Cablevision plans to switch “strategies to use the triple-play against our existing customers,” Rutledge said, meaning that it will lower the triple-play bundle prices for current customers to keep them on board. (Competition does lower prices, it seems).

Company forecasts have been revised on the downside. For 2007, Cablevision now expects flat basic subscriber growth, instead of the previous 1% to 2%, RGU additions of 825K to 900K, instead of the earlier 850K to 950K, revenue growth of only 11%, instead of “mid-teens,” and cash flow growth of only 10%, instead of “mid-teens.”

Not that Cablevision is pinning the blame for the reduced expectations on competition. During the call, execs said that the revised growth projections stem from, um, unfair comparisons with stepped-up growth in NYC last year or something like that.

Cablevision Systems Selected Operational Statistics (in mil. except %)
Basic Subscribers and RGUs 2Q06 3Q06 4Q06 1Q07 2Q07
Homes passed 4.52 4.54 4.56 4.59 4.62
Basic subscribers 3.10 3.11 3.13 3.14 3.14
Basic penetration 68.6% 68.5% 68.5% 68.4% 68.0%
Monthly churn 1.7% 2.0% 1.8% 1.7% 2.0%
Total Revenue Generating Units 8.26 8.55 8.83 9.09 9.26
Digital Video 2Q06 3Q06 4Q06 1Q07 2Q07
Digital subscribers 2.27 2.36 2.45 2.51 2.55
Quarterly net sub adds 0.14 0.09 0.08 0.06 0.04
Penetration of total basics 73.2% 76.0% 78.2% 80.0% 81.3%
Monthly churn 2.0% 2.3% 2.0% 1.9% 2.2%
High Speed Data 2Q06 3Q06 4Q06 1Q07 2Q07
Customers 1.89 1.96 2.04 2.12 2.17
Quarterly net adds 0.08 0.07 0.08 0.08 0.05
Penetration of total homes passed 41.9% 43.3% 44.7% 46.1% 46.9%
Monthly churn 2.0% 2.4% 2.1% 2.0% 2.3%
IP Telephony Voice  2Q06 3Q06 4Q06 1Q07 2Q07
Customers 0.99 1.10 1.21 1.32 1.40
Quarterly net adds 0.12 0.11 0.11 0.11 0.08
Penetration of Optimum Voice 21.9% 24.3% 26.5% 28.7% 30.3%
Source:  Emerging Media Dynamics, Inc. analysis of company data © 2007.

Posted by Cynthia Brumfield at 2:05 PM | Print | Comments (0)

Google Loses Mind; Now Accepts News Comments

In a move that can only be called ultra-experimental, Google is now accepting reader comments on its Google News articles. In an apparent bid to juice traffic for the news aggregation service, Google has “built a mechanism for publishing comments from a special subset of readers: those people or organizations who were actual participants in the story in question.”

Google Blogoscoped is kind enough to offer us an example of this new reader comment option, which is good because I couldn’t find any myself. (Item continues after the jump).

google-news-comment-1.png

In the news help section, Google spells out who can and who can’t comment and the guidelines are very vague indeed. Here is Google’s sole criterion for who can post a comment on a news article: “We want to hear from anyone who has been mentioned in a news story.”

Hmm….really, anyone? How about an article that discusses, say, major litigation surrounding who owns the patent for MP3 technology? This article might mention, for example, many entities that lay claim to inventing the technology, including Microsoft, Alcatel-Lucent, AT&T, Thomson, Royal Philips, Fraunhofer Society of Germany and Texas MP3 Technologies.

This article might also mention numerous licensees that could be on the hook for billions in license payments depending on how the litigation turns out including Apple, Motorola, Nokia and Sisvel. OK, so that’s at least eleven companies mentioned in this story.

Will Google allow all of these companies to comment? That’s not clear. Google says participants in the story can comment and “participants are people who are mentioned in the story or are related to organizations in the story.” Interested parties can submit a comment to Google via email and Google will follow up to establish the identities of the interested parties. Google will also solicit comments from selected parties and in that case “If we asked you for a comment and you provide us with one” the comment will get published.

Will Google edit coments? Not really. Aside from correcting typos or misspellings, “we allow them [the commenters] to say whatever they’d like about the story.”

Doesn’t Google have some responsibility for the comments its publishes aside from merely ensuring the identity of the commenter? There are a lot of crazy, mean people out there who hold down responsible jobs and get quoted in news articles and blog items. So, can these people just say what they want after only having met the low threshold of 1. being cited in the article and 2. proving they are who they say they are?

Is this freaking nuts or what? How in the world will Google manage the flood of people trying to comment on news, particularly given that the comments will be not be handled in an automated manner? How can Google justify allowing some comments to get published but not others? That would seem to me to be an editorial function, which suddenly puts Google on the hook for a host of legal liabilities.

All I can say is that Google must have a lot of people standing by to handle this new experiment. It’s possible that so few people will pay attention to this comments function that the effort (and complaints and possible lawsuits) will be minimal. But something tells me that this will be the more likely outcome: Google toys around with this idea for a few weeks or months and then quietly disbands its reader comments options.

Posted by Cynthia Brumfield at 9:55 AM | Print | Comments (0)