Verizon boosted top transmission speeds for an HD video service almost 6-fold, to 1.49 Gbps from 270 Mbps. The rise came July 1, when the FCC cleared Verizon to sell the product, which uses Verizon’s fiber network, said Project Mgr. Brian Wilson. It wasn’t publicized until this week (CD Aug 16 p12). The product lets broadcasters send video short distances with no compression, he told us. That prevents picture quality degradation, avoids the need for compression gear and limits chances of transmission delay, Wilson said: “Anytime you do a compression on the video, you are going to lose some of the quality of that signal.” The faster service costs about 10% more than the 270 Mbps product, he said.

Cable operators are unlikely to get the FCC to change retransmission consent rules, since Chmn. Martin and other officials there think the issue is one for Congress, industry lawyers said. Cable wants to discourage broadcasters from charging for carriage and force them to carry affiliated non- broadcast channels in exchange for carrying over-the-air signals, Howard Barr, American Cable Assn. (ACA) COO Robert Shema and other attorneys said.

The cable industry began its first ad campaign against net neutrality, which it called a “clever… scheme.” A 30- sec. spot asks: “Are you google-eyed with confusion over net neutrality?” and advises viewers to “forget all of their mumbo jumbo. Net neutrality simply means you pay.” NCTA distributed the ad to member cable companies, said Senior Vp Communications & Public Affairs Rob Stoddard. Operators are expected to air the spot several hundred thousand times. The timing isn’t pegged to specific developments; it will run until after Congress returns in Sept., he said. Google didn’t respond to requests for comment. The NCTA spots aren’t likely to influence viewers much, because most are unaware of the net neutrality debate, said Jefferies & Co. telecom analyst Jonathan Schildkraut. The spots may work slightly better with members of Congress, he said: “We're going to find that Congress spends more time getting up to speed on this issue as it plays out, [and] ads like this will have less impact.” Itsournet.org -- a coalition of net neutrality supporters including Google -- is keeping mum about whether it plans ads, a spokesman said: “We haven’t done much advertising at all. I am not going to signal to the other side what we're going to do.”

The FCC stepped up a video news release (VNR) probe, issuing letters of inquiry to 77 TV stations fingered by a media advocacy group as airing promotional tapes without disclosing their origins. Broadcasters risk $32,500 in fines for each violation, said Comr. Adelstein in a statement. The inquiries, sent to 42 firms that own the stations, address Center for Media & Democracy allegations (CD April 7 p5), a person familiar with the probe said. An author of the April VNR report, Diane Farsetta, told us she also understood that all the stations singled out by the Center for Media & Democracy had received FCC letters. An FCC spokesman declined comment, referring to previous FCC statements that “the Commission will investigate and take appropriate enforcement action against entities found to be in violation of its rules.” Stations in the inquiry are owned by CBS, Clear Channel, News Corp., Tribune and others, said a source. An NAB official declined comment. The Center for Media & Democracy will publicize further use of VNRs, said Farsetta, declining to be more specific. “The current evidence we have is that [VNR rules] are not taken seriously,” she said.

FCC Chmn. Martin put off a long-awaited vote on radio multicasting (CD Aug 11 p10) amid concern by Comrs. Adelstein and Copps that a current draft order is weak on public interest obligations, agency sources said. The delay could set the stage for 8th floor talks on obligating broadcasters to disclose how they use multiple channels, FCC sources and Benton Foundation Pres. Gloria Tristani said.

FCC Media Bureau senior staffers William Johnson and Deborah Klein will move to the Public Safety & Homeland Security Bureau, Commission sources said. Johnson, currently a deputy chief, will become assoc. chief of the new bureau’s policy division, we're told. His boss will be Dana Shaffer, now an aide to Comr. McDowell. She’s expected to be named policy division chief. Klein, also a Media Bureau deputy chief, will become special counsel in the new bureau, sources said. An FCC spokesman declined to comment. The transfers could take place within a month, we're told. A Homeland Security Bureau chief hasn’t been chosen, a source said. Two Media Bureau officials and one at the Office of Managing Dir. had been notified they will become deputy chiefs (CD July 20 p2).

Companies bid $897.8 million in the FCC’s 2nd round AWS spectrum auction late Wed., an 18% increase from the first batch earlier in the day. Wireless DBS, a DirecTV and EchoStar joint venture, emerged as one of the largest participants, boosting its high bids to $282.4 million, from about $31 million in the first round. The satellite firms probably want spectrum to build a nationwide wireless broadband network to compete with cable and telcos (CD Aug 7 p 2). T-Mobile, the largest participant in the first round, saw its high bids decrease by about 2/3 to $121.7 million in the 2nd round. T-Mobile is expected to be active because it’s bandwidth starved. With bidding far from complete, 2 analysts told us it’s too soon to predict the outcome. “As the auction continues to progress, we expect the rounds to progress in frequency and become more competitive in the price,” said Medley Global Advisors’ Jessica Zufolo: “These early rounds don’t really provide much guidance… other than all those who were expected to be aggressive bidders are indeed showing up and actively participating.” Cablevision’s controlling family bid $88.9 million for Long Island, N.Y., and other Northeast U.S. spectrum. Dolan Family Holdings, which is separate from the cable operator, is expected to use any spectrum it acquires to offer wireless services over home IP networks. Cingular $44.6 million in high bids. Auction 66 bidding is scheduled to reopen around 10 a.m. Eastern time today (Wed.).

RCN will sell 4 Hispanic programming packages in a step toward a la carte, letting customers buy as many as 30 channels. The cable overbuilder thinks customers will prefer themed bundles of channels over buying them individually, Senior Vp Richard Ramlall told us: “A channel-by-channel a la carte menu would be highly confusing.” RCN’s approach coincides with a la carte recommendations by FCC Chmn. Martin. The company will start selling the tiers Sept. 1 in all markets except in Cal., RCN said late Tues. The company is likely to unveil plans to sell L.A. and San Francisco systems within 4 weeks for $50 million, wrote Oppenheimer & Co. analyst Ian Zaffino. Last quarter’s $157 million in revenue, an 11% increase from a year earlier, exceeded Zaffino’s estimate. Broadband customers rose 12% to 257,000. Video and phone customers, including VoIP subscribers, declined.

BALTIMORE -- Verizon won a round in a legal battle against Montgomery County, Md., with an order subjecting the video franchise dispute (CD July 3 p3) to mediation. U.S. Dist. Judge Marvin Garbis, Baltimore, said he'll appoint a magistrate to coax the parties to hammer out deals on a variety of disputes on the telco’s quest to sell the FiOS TV product and avoid a 5% tax on broadband and phone revenue. Garbis told a hearing here he'll consider later the merits of Verizon’s claim the county broke FCC rules in trying to impose the fees.

The Media Bureau denied Time Warner Cable’s (TW) petition to reconsider an order forcing it to restore NFL Network carriage, as expected (CD Aug 7 p6). The bureau slammed TW for an “inconsistent” approach to requirements that customers get 30 days’ notice of channel changes. In an earlier and unrelated waiver request, the agency noted, Time Warner said it needed time to notify customers of channel changes related to the Adelphia deal. But TW provided no such warning to 1.2 million customers when it stopped carrying NFL Network, Media Bureau Chief Donna Gregg’s order said: “Time Warner thus obtained regulatory relief from the Commission less than two weeks ago based upon an interpretation… that it does not apply to channel changes made to newly acquired systems that is flatly inconsistent with the interpretation Time Warner offers now. We will not countenance such behavior from parties seeking relief from the Commission.” TW failed to make a strong case that the FCC action hurt customers, Gregg wrote, contrasting its impact with dropping the NFL Network, which spurred nearly 30,000 subscriber complaints to the firms. In defying the FCC, TW may sour its relations with Martin and risk causing trouble for other cable operators, a pay TV executive and another lawyer said. “We are reviewing the decision and considering our options,” said a TW press release. Options for TW “might involve a lawsuit, but we haven’t decided on what avenue we are going to pursue,” Mark Harrad, senior vp- communications, told us.