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Communications-Related Headlines for March 17, 2000

TELEPHONY

FCC TO EASE SHORTAGE OF PHONE NUMBERS
Issue: Telephone Regulation
The Federal Communications Commission is expected to address the severe shortage of phone numbers today with a new regulation that will give states the right to reclaim telephone numbers that were assigned to carriers, but are not in use. Some 2 billion phone numbers have been assigned to telephone companies, but only between 500 and 700 million are in use. Giving states the right to reassign unused numbers will allow the unused numbers to be given to customers before new ones are created. "The numbers are being wasted," complained Thomas J. Dunleavy, a New York Public Service Commissioner. "We're burning a finite resource." The proliferation of fax machines, mobile phones, and lines dedicated to computers, has eaten up phone numbers at an alarming rate. As all the possible 7-digit combinations are used up within a particular area code, new area codes must be added. When the North American Numbering Plan was established in the 1950's, 46 area codes were enough to serve the entirety of the U.S., Canada, and several Caribbean nations, in 1998, there were 200 could barely serve the U.S. alone. [SOURCE: The Washington Post (E1), AUTHOR: Peter S. Goodman]

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POLITICAL DISCOURSE

INTEREST GROUPS CRANK UP 'ISSUE ADS'
Issue: Political Discourse/Advertising
Advocacy groups are turning up the volume on TV advertising to influence this year's elections. Ten major lobbying groups plan to spend at least $40 million through the fall elections. "All the issue groups will be there. The gun guys, the enviros, pro- and anti-abortion folks," says Frank Coleman of the U.S. Chamber of Commerce, which plans to spend $5 million to help pro-business candidates in close congressional races. This election season, more than $114 million already has been spent or budgeted for "issue ads": ads run by political parties, labor unions and interest groups that escape regulation by stopping short of asking for votes for a candidate. The tally of spending so far is from a report released Thursday by the University of Pennsylvania's Annenberg Public Policy Center in Washington. [SOURCE: USAToday (8A), AUTHOR: Martha T. Moore and Jim Drinkard]

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MERGERS

CHRIS-CRAFT'S MOVE TO BLOCK PURCHASE OF CBS BY VIACOM IS DENIED IN COURT
Issue: Mergers
New York State Supreme Court Judge Herman Cahn ruled yesterday that Viacom's pending deal to acquire CBS does not violate it's partnership with Chist-Crat's to jointly own and operate the United Paramount Network. The Judge also ruled that Chris-Craft has until Monday to decide whether to buy Viacom out for $5 million or sell its stake in the network to Viacom for the same price. Viacom Chairman and Chief Executive Sumner Redstone issued a statement saying, "We are pleased that Judge Cahn has ruled in our favor and look forward to resolving the ownership of UPN." Current Federal Communications Commission regulations prohibit one company from owning two broadcast networks, but Viacom has sought government permission to continue to own UPN after it acquires CBS. [SOURCE: Wall Street Journal (B6), AUTHOR: Joe Flint]

BERTELSMANN IS EXPECTED TO SELL ITS STAKE IN VENTURES WITH AOL
Issue: Mergers
Germany's Bertelsmann has announced that it will sell its 50% stake in AOL Europe to America Online in a deal that could be valued at more than $8 billion. In getting out of the joint venture, a move that has been expected since AOL bought Bertelsmann rival Time Warner, Bertelsmann is signaling a shift in its strategy. The company is moving away from the Internet service provider business and concentrating instead on selling its media products online, and on building a Web presence through portals. In a separate transaction, AOL has agreed to make Bertelsmann a "preferred partner" to AOL Europe, giving Bertelsmann's products prominence on its site. In return for this, Bertelsmann will help to market AOL Europe to its customer base. [SOURCE: The Wall Street Journal (A3), AUTHOR: Axel Postinett and William Boston.]

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INTERNET

LOCAL MUSIC ONLINE GETS A SCRATCHY RECEPTION
Issue: Internet
The Internet is helping independent records labels make up for some of the disadvantages they face competing with the giants of the music business. "Indies" can offer downloadable singles, either for sale or free, at low costs. The Internet also lets independents stay in touch with fans everywhere and gives labels a new way to release singles. But despite the potential, the revolution has not yet happened in online music. The songs still take too long to download, Indie Web sites are often difficult to navigate, and they don't always offer easy ways to buy the CDs. Few sites allow visitors a way to buy music and download it directly to their hard drive. For instance, 48th/49th Records, a D.C. rap label, offers a "Sounds" link to the music downloads, but the RealAudio tracks are samples, not full songs, and the sound quality of RealAudio falls short of an MP3 download. "There are a lot of people out there on the street who can rap," said Alfhonso Gallmon, the founder of 48th/49th. "I want to use the label to help them get their music out." [SOURCE: The Washington Post (E1), AUTHOR: Robert Thomason]