Despite a strong push from the telecom industry for “price discrimination” in various online services, chances are good that the Internet’s open architecture will survive, the head of the U. of Minn.’s Digital Technology Center said in a preliminary paper posted Tues. Seeking ways out of its slump, the telecom industry is proposing remedies -- such as restricting VoIP -- that will lead to new Internet architectures and give carriers greater control, said mathematics prof. Andrew Odlyzko. While historical precedents from the telecom arena don’t bode well for the introduction of differentiated prices and sophisticated charging regimes on the Internet, he said, incentives to price-discriminate have increased on the transportation side. That may be prompting telcos to try to break with tradition and follow the lead of the transportation industry, Odlyzko said. Price discrimination has been practiced in both industries for a long time, he said, and it now has popped up in the current controversy over VoIP. VoIP’s biggest advantage is said to be its greater efficiency in the use of network resources, Odlyzko said, but it arguably is less efficient in the use of basic transmission services than traditional telephony. Most existing VoIP implementations don’t compress voice signals to provide higher quality, Odlyzko said, and because of the current structure of the industry, most U.S. VoIP calls travel over extremely long distances while telephone long distance calls mostly are shorter. Current VoIP technologies “find few savings,” he said, leading to slow uptake. In the long run, VoIP “is bound to win” because it will offer new features as well as the advantage of not having to run a separate network, he said. Now, however, the main incentive for VoIP comes from its ability to get out of the “elaborate maze of cross- subsidies, discriminatory pricing policies and taxes that are built into the current telecom system.” The question, Odlyzko said, is whether the telecom industry can survive in the broadband era without another maze of cross-subsidies and price differentials. “That the Internet has thus far developed with an open architecture and simple pricing does not mean that it can do so in the future,” he said. Incentives to price-discriminate are growing as fixed costs increase and marginal costs drop, Odlyzko said. At the same time, he said, the ability to price-discriminate also is being pushed by the development of digital rights management tools and the increased use of licensing rather than outright sales. The telecom industry views the Internet as a major cause of its slump, Odlyzko said: Services such as e-mail, search engines and Napster “are all great but appear not to provide any direct revenues for carriers.” Moreover, he said, the introduction of artificial restrictions on the Internet -- such as the Digital Millennium Copyright Act and the broadcast flag -- is forcing the entire information technology industry to restrict what users can do online. But there are countervailing factors to the increased threats to the Internet’s architecture, Odlyzko said, including: (1) Public policy concerns about stifling the Internet’s tremendous power to spark innovation and economic growth. (2) Govts. can take a hands-off approach or promote closed architecture, but “content is not king” and there’s far more money in providing basic connectivity. (3) The increasing heterogeneity of the telecom network means users will be able to mitigate restrictions by bypassing service providers and using their own networks. But, Odlyzko said, perhaps the most powerful limitation on proposed new Internet architectures and associated discriminatory practices is that “people react extremely negatively to price discrimination.”
On December 30, 2003, the U.S. Department of Agriculture (USDA) issued a news release which details several additional protection measures that are intended to further strengthen protections against Bovine Spongiform Encephalopathy (BSE), also known as mad cow disease.
The International Trade Administration (ITA) has issued its final results of the antidumping (AD) duty new shipper review of certain non-frozen apple juice concentrate (apple juice concentrate) from China for the period of June 1, 2002 through November 30, 2002. The ITA states that this review concerns Yantai Golden Tide Fruits & Vegetable Food Co. Ltd. (Golden Tide).
The International Trade Administration (ITA) has issued its preliminary results of the following antidumping (AD) and countervailing (CV) duty administrative reviews
The House Commerce Committee is expected to schedule a hearing on broadcast decency after it returns Jan. 20, industry and House sources said. A House source said the hearing hadn’t been scheduled formally but was expected in the 2nd session of the 108th Congress. The hearing follows a preliminary FCC decision not to fine several NBC affiliates for profanity uttered during the Golden Globe Awards show that drew the ire of several members and led to their introduction of legislation.
Rural telecom companies are uniquely positioned to provide wireless services in the vast majority of rural areas, parties said in comments filed with the FCC. They urged the Commission to adopt rules and policies that would provide opportunities for rural telephone companies and eliminate outmoded barriers to deployment of wireless broadband service. The comments came in response to a rulemaking the Commission began in Sept. (CD Sept 11 p6) asking how to promote spectrum-based services in rural areas.
It was a repeat performance for videogames from Electronic Arts (EA), Atari and Activision as the 5 top-rented titles in the week ended Dec. 21 were the same as a week ago, Rentrak’s preliminary Home Video Essentials data showed. PS2 again dominated the chart as every game in the top 10 was for Sony Computer Entertainment’s console. Universal Home Video’s Seabiscuit was the top-rented DVD in its first full week of availability.
Electronic Arts (EA) again had the top 2 rented videogames in the U.S., Rentrak’s preliminary Home Video Essentials data for the week ended Dec. 14 showed. The chart again was dominated by PS2 games -- this time, every game in the top 10 was for Sony Computer Entertainment’s console. Rentrak said EA’s Need for Speed: Underground again was #1, earning an additional $395,472 in the week for total rental earnings of $1.60 million to date. EA’s Medal of Honor: Rising Sun was again #2 ($370,136 and $2.83 million). One other EA title made the top 10: Madden NFL 2004 at #6, up 4 places after earning an additional $220,891 in the week for a total of $4.82 million in rental earnings. Activision and Take-Two Interactive each had 2 games in the top 10. Activision’s were True Crime: Streets of L.A. at #4 (down one with $303,013 and $2.05 million) and Tony Hawk’s Underground at #5 (down one also with $268,598 and $2.56 million). Take-Two’s games were Max Payne 2: The Fall of Max Payne at #9 (up 13 with $200,551 and $327,997) and Manhunt at #10 (down 5 with $172,125 and $849,934). Rounding out the top 10 were Atari’s Dragon Ball Z: Budokai 2 at #3 (up 12 , $315,066 and $488,482), THQ’s WWE Smackdown! Here Comes the Pain at #7 again ($205,369 and $1.71 million), Sony’s SOCOM II: U.S. Navy SEALs at #8 (down 2, $203,965 and $1.59 million). Separately, Rentrak said it signed a multiyear revenue sharing deal with Hip Interactive that it said “will allow gamers to rent new videogame titles from Xicat, Arush, CDV and Groove from more than 6,000 video store locations served by Rentrak’s… revenue-sharing program.” Hip plans to use Rentrak’s Video Game Essentials to track and analyze performance of their titles, as well as administer royalties and associated payments to both retail stores and the individual game publishers, the companies said. Hip Games Vp Pete Young said: “Our agreement with Rentrak enables us to penetrate the videogame market to a greater extent than ever before. Allowing consumers to view our games -- and those of the publishers we distribute -- represents a unique opportunity for increased brand recognition and market share.”
For the 2nd straight week, Disney’s Pirates of the Caribbean: The Curse of the Black Pearl was the #1-rented DVD in the U.S., Rentrak’s preliminary Home Video Essentials data for the week ended Dec. 14 showed. Rentrak said the title earned an additional $6.74 million in the week on DVD for total rental earnings of $16.22 million to date. Combined DVD and VHS rental earnings in the week for the title were $10.11 million and total combined earnings to date were $23.18 million. There were 3 new DVDs in the combined DVD/VHS top 10: Columbia TriStar’s Bad Boys II at #2 ($9.71 million in the week and $9.93 million to date), Warner’s How To Deal at #6 ($2.66 million and $2.73 million), Columbia TriStar’s box-office bomb Gigli at #8 ($2.11 million and $2.18 million).
U.S. Commerce Dept. investigators are meeting TV manufacturers in China in an effort to check production costs at local factories, China Daily reported. Commerce officials were expected to meet with Sichuan Changhong Electric, Xiamen Overseas Chinese Electronic (Xoceco), Konka Group and TCL Holdings as a follow-up to the department’s decision in Nov. to impose antidumping duties of up to 47% on TV sets imported from China. Commerce selected 4 companies of the original 12 named in a complaint filed by Five Rivers Electronic Innovations in May because it lacked the resources to visit all the companies involved in the case, China Daily said. “They are coming to us to check some original data to see whether or not their calculations are right,” an unidentified spokesman at one of the companies being visited by Commerce investigators told the newspaper. Commerce is asking the companies to furnish documents certifying production costs, commodity prices and staff salaries, the spokesman said. Commerce officials weren’t available for comment. Chinese TV manufacturers were fully prepared for the investigation, a spokesman said. “We expect this trip can help change their preliminary ruling on our costs, which is entirely unjustified,” the spokesman said, saying that his company’s costs were lower than those of Funai, whose plant in Malaysia was named in the complaint. Commerce’s preliminary decision imposed a 0.03% duty on Funai’s imports. It’s expected to issue its final decision in the case April 12.