As you may know, the merger process at the FCC and DoJ is a mess.  In fact, some believe the entire process is not much different than extortion.  Not only do we have some newly reported shenanigans going on around the AT&T merger – with FCC staff last week playing fast and loose with data in an effort to sink the merger once and for all – now we have this gem.

To fulfill part of its merger “penance” with the FCC from earlier this year, Comcast / NBC-U announced the other day it has entered into agreements that:

…create new and innovative cooperative news gathering and reporting arrangements with a series of locally-focused, non-profit news organizations.

The partnerships are with ProPublica, which will work with all ten owned stations, serving the following markets: New York, Los Angeles, Chicago, Philadelphia, San Francisco Bay Area, Dallas-Fort Worth, Washington, D.C., Miami, San Diego and Connecticut; The Chicago Reporter which will work with NBC 5 Chicago; WHYY which will partner with NBC 10 Philadelphia; and KPCC which work with NBC4 LA. (Emphasis and links added)

As I wrote about previously on these pages, the Comcast Merger Order “voluntarily” commits the new company to foster local journalism via the “Voice of San Diego Model,” a socially progressive news organization.  ProPublica, The Chicago Reporter, and KPCC make good on this promise.  They are archetypical liberal media outlets, which are supported in large measure by the usual suspects among America’s top progressive foundations (like Soros, Ford, MacArthur, Knight, Pew, etc.).

What’s amazing is it’s happening as I had predicted – coming just in time to boost progressive messaging for the 2012 elections, all in key urban cities that are vital to Obama maintaining the White House.

Quite a “voluntarily agreed to” platform, huh?  And, go figure, a progressive one at that.  Hmm…

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You know, this whole FCC torpedoing AT&T’s planned T-Mobile merger is nonsense.  As I have written about often, I think the merger’s a mini jobs stimulus plan which can inject jobs into the economy far beyond anything that may happen at the company post-merger.

We sorely need that here in America.  This privately borne proposal is just one such plan, one which would provide some needed fuel for new American jobs.  Up to 96,000 by AT&T’s estimation.

Yet the FCC’s got the company by the proverbial short hairs, firmly believing that its judgment is better than those who are taking the risk and making investments needed to build out new broadband facilities for Americans.  Consequently, as one industry observer dryly noted:

“This is central planning at its most repugnant.”

Yes it is.  And, it’s got some powerful cheerleaders from the media-Marxist crowd jumping up and down with profound excitement.

Leading this pack is the holier-than-thou radicals at Free Press.

Holier-than-thou because, though they claim AT&T’s Washington money has corrupted communications policy, it is they who have raked in millions from murky “progressive” foundations – the latter actively working this past decade to corrupt and “transform” America by laundering – often from hidden / non-transparent sources – approximately $100 million to kneecap telephone, cable and media companies with new rules, regulations and costly proscriptions.

Not surprisingly, Free Press sits atop the list of “media reform” foundation grantees.

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Reuters ran a story last week that attempted to paint George Soros and his foundation’s donations as an organizing element of the Occupy Wall Street (OWS) demonstrations.  As much as this may be red meat to the right, I have to say that the story’s math was thin.

Here’s the equation: Soros’ Open Society Institute gave $3.5 million from 2007-2009 to the Tides Center.  In that same period, Tides gave $26,000 to Adbusters, the group that proclaims to have initiated the Wall Street occupation.

Sure, Soros has been said to be sympathetic to the “cause,” but is he orchestrating the demonstrations?  Probably not.  At least not in a coordinated, marching-order sense.

However, there are some interesting connections.

In the media reform space, which I follow closely, Soros and Tides, among others, have spent over $100 million this past decade funding the efforts of radical groups like Free Press (surprisingly, sitting atop of this pyramid is not George Soros; rather, it’s the Ford Foundation, which has given over $12 million to media reform activists in the last ten years alone).

One name that stands out among the “media reformers” as they’re connected to the OWS movement is Free Press’s Tim Karr.   To be sure, there is a firm connection between Soros and Tides to Karr’s employer.  Since 2003, Free Press has received $1.26 million from Soros’ Open Society Institute; and from 2005-2007, nearly $215,000 from Tides. (more…)

As acting Department of Justice antitrust head, Sharis Pozen, said a couple of weeks ago, one of the DoJ’s main goals in working to block the AT&T / T-Mobile merger was to promote competition, not competitors.

But would its suit really accomplish that?

I wonder.

By attempting to stop the AT&T merger, the DoJ may actually work to impose a “tax hike” of sorts, one designed not to benefit consumers and workers through lower prices and more innovation, but one which would tamp down market dynamics, thus insulating competitors from increased competition instead.

Let me explain.

By most any measure, the wireless market is exceptionally vibrant and competitive.  Service offerings and technological innovation abound, as prices remain at or below the CPI.  In short, customers are getting a good deal for what they buy.

But companies are always on the lookout for “ruinous competition,” such that it forces prices downward, which in turn squeezes profits to uncomfortable levels.

AT&T rival, Sprint, seems particularly concerned about this.  With its profit margins about half of the industry leaders’ (though still healthy), the company has got an apparent bugaboo about the deleterious effects of increased competition.

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Politics makes strange bedfellows.  Witness the latest liaison, with Cellular South’s CEO, Hu Meena, and his new partnership with the NoTakeOver Project – a coalition of professional misanthropes that wants to stop the AT&T / T-Mobile merger at any cost.

Meena’s company is the nation’s largest privately-owned wireless carrier.  Meena testified with other NoTakeOver members at a Senate hearing last week, strenuously urging that the merger be killed by the FCC and DoJ.  Getting there, he had to paint a dire picture – that consumers would suffer, jobs would diminish, Internet innovation would end, and the wireless industry would tank – if the merger gets the official OK from regulators.

His relationship with NoTakeOver is particularly odd in that his new friends – especially those at New America Foundation, Public Knowledge and Media Access Project – want to crush companies like his with “light touch” Net Neutrality regulations recently imposed by the FCC.

From the moment those Internet regulations got announced last December, New America Foundation, Public Knowledge and Media Access Project started grumbling like petulant children who didn’t get exactly what they asked for on their birthday.  “Sure,” they huffed, “the rules are better than nothing.  But we demand more.  FCC, you’ve come up short!”

In their view, the only way to ensure that the Internet remains “open” is through 19^th Century rules that check the sure-to-be “evilness” of network providers…like Cellular South.

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This Wednesday, Congress will have its first chance to look under the hood of the proposed $39 billion acquisition of T-Mobile by AT&T. The Senate will hold a hearing on the deal, featuring representatives from AT&T, T-Mobile, Sprint, Cellular South, the Communications Workers of America, and Public Knowledge.

The hearing is a kabuki dance of sorts because, though the Congress plays an important oversight role, it has no formal part in approving (or not) the acquisition.  That job rests with the FCC and DoJ.

While no one knows if, when, or in what form the resulting approval will look like (if approval in fact occurs), the hearing will help all sides begin to put forward their best PR case to the American public.

I believe that the acquisition – though complex and challenging for policymakers – will benefit the public interest.  Yes, it will pare the market down by one, resulting in three major nationwide providers.  But the market will remain effectively competitive.  Consumers will benefit through the roll out of new and better mobile broadband services from a stronger AT&T.  And this will in turn spur direct competition from the major and regional wireless players, as well as in services that are considered substitutes.

But, as the existence of the hearing reveals, the acquisition is not a done deal.  Many questions abound, which Congress and the American public have a right to know about.

So, if I were a Senator sitting up on the dais – one who could see consumer benefit as a result of this acquisition – what top five questions would I want answered?

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Late last week, the U.S. House passed a Joint Resolution disapproving of the FCC’s Net Neutrality regulations, which were issued by the agency late last December.  Such a Resolution through the Congressional Review Act (CRA) works to nullify actions by agencies through a streamlined procedure, which keeps amendments off, and requires only simple majorities in each body of Congress, plus the President’s signature, to take effect.

The CRA Resolution has doubtless been a contentious process.  The new Congress, with its conservative majority in the House and a stronger conservative minority in the Senate, has enabled the legislative branch to become more assertive when it comes to agency activities.  The CRA tactic reflects that change in approach.

Not surprisingly, however, its progress has broken primarily across party lines, with Republicans supporting it because they generally feel the FCC lacks the congressional authority to issue its Net Neutrality regulations in the first place; and Democrats moving against it because by and large they believe in the FCC’s regulations, no matter how they’re arrived at.

The vote passed 240-to-179.  Beyond the House vote, its progress in the Senate, and at the President’s desk – if it gets that far – remains uncertain.  Regardless, this has not stopped detractors of the Resolution to use it as yet another public forum to voice support for the FCC’s likely illegal, new regulations.

Of late, two of the louder voices against the Resolution have been former Speaker of the House, Nancy Pelosi, and Internet millionaire turned Colorado Congressman, Jared Polis.

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The other day it was announced that a well known, mega-company discovered a new way to destroy antibiotic resistant bacteria, such as MRSA.  Using nanoparticle technology – which is 50,000 times smaller than a hair’s width – the company’s researchers were able to target an electrical charge on the bacteria’s surface, bursting the membrane open to bring about its demise.

According to the Wall Street Journal, “if successful, [the discovery] would offer a fresh strategy against a worrisome public-health problem of possibly deadly bacteria evolving to become impervious to antibiotics.”   Nearly 19,000 people in the U.S. each year die from drug-resistant MRSA.  Needless to say, this could be a big breakthrough.

Was it Pfizer, Bayer, Merck / Schering-Plough or one of the other great pharmaceutical companies that made the huge discovery?

No.

It was Big Blue – IBM – one of the world’s largest IT firms.

So what, you might say.

Well, we talk a lot about innovation and discovery like it’s just simple math.  And when we see the results, we say, “Oh, yeah, I see.  It’s obvious how ‘x’ could be.”   Yet, when it gets down to it, a lot of discovery is art, accidental, and non-linear.

IBM makes mainframes, software, and provides IT services to individuals and companies across the globe. Though the company has been working on nanotechnology for years, who could have predicted they’d be combating MRSA?  It’s not a drug company.  But, today, it looks like it is (or certainly could be).

This non-linear, man-bites-dog discoverer – IBM as pharma company – holds an important lesson for regulators of technology.

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As you may have read, just the other day AT&T announced its intended purchase of T-Mobile for $39 billion.  With the move, AT&T will be the largest mobile carrier in the nation, serving about 130 million Americans.

Many factors likely hastened the acquisition.  Chief among them is the lack of spectrum and related infrastructure for AT&T at a time when wireless broadband use is exploding (you may be reading this story on one such wireless broadband device – a smartphone or tablet).

The move is not a done deal, of course.  It needs regulatory approval from the FCC and DOJ.  And, this is where the horse-trading comes in.  There will be concessions. The trick for the company is to limit them, ensuring they’re narrowly tailored to the acquisition at hand.  The game for policymakers and anti-private property activists is to make them as expansive as possible, addressing policy considerations and other giveaways that could not be obtained in the legislative and regulatory arenas.

One area that will find increased scrutiny is the newly created Net Neutrality regulations – rules which were, many feel, strong-armed by the FCC onto the previously regulation-free Internet.  Notes Bruce Gottlieb, ex-Chief Counsel to FCC Chairman, Julius Genachowski:

[T]he FCC’s recent network neutrality decision created less restrictive rule for mobile Internet access service, as compared to wired service, in part due to assumptions about competition in wireless. Expect calls to revisit this decision, as well.

This is not to suggest that the acquisition is bad for consumers.  In fact, I think it help them. They’ll benefit from a stronger company, which will more quickly be able to roll out the next generation of spectrum-guzzling, wireless broadband services we crave.  It will also spur direct competition, and competition in adjacent markets, such as landline broadband. The ecosystem for devices, applications and services will explode, too.  And prices – which have been below the CPI – will likely remain low and affordable (especially considering the added value of more bandwidth, enabling ever-more powerful tools on the network).

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Seems in this weekend’s House deficit-cutting exercise, public media got a haircut – federal subsidies for PBS will end if the House budget holds sway.  Not surprisingly, PBS (and all its supporters in the media, blogosphere, twittersphere and on Capitol Hill), were freaking out.

As one series of highly organized “grassroots” tweets trilled:

RT @jcstearns: New House budget will NOT fund #pubmedia, #netneutrality, #epa but WILL fund gov sponsorship of Nascar http://nyti.ms/eOEgNk via @aschweig

The DoD’s NASCAR recruiting and marketing campaigns – at about $15 million in all – survives, but PBS’ $430 million gets axed.  “Say, what?!!!”  That just isn’t right, Free Press’ Josh Stearns seemingly tweet-claims.

Perhaps Josh is on to something – that is, what’s right.  Putting on my class warfare hat for a moment, how is it right that the rich have had this subsidy for so long?

Many American’s have long-known PBS’ upper-crust focus.  Inside the beltway, it’s kind of a perennial joke (or thorn in one’s side, depending on your point of view).  The $430 million in annual federal funding – representing about 15% of PBS’ budget (they get most of their support from private sources) – is just one of those subsidies that the media and intellectuals endlessly admonish the rest of us to stop worrying about.  At $1.50 per American, per year, it’s a steal.  And besides, it helps kids, the disadvantaged, minorities, etc.

Yet, when you look at who’s actually watching PBS, and the shows they air, another picture emerges.  According to this document, 73% of the audience watching any given PBS show makes household income of $75,000 or more (with 37% of the audience actually making more than $125,000).  In comparison, Census Bureau statistics show median household income in America is just shy of $50,000.

Of course, if you’re wanting for a diversity of PBS / NPR programming on states’ rights, or the right to bear arms, or the constitutional conflict to our liberties presented by the new healthcare law – you’d be hard-pressed to find much of that there.  I guess that’s what Fox is for.

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When I look at the picture of the horrifically tortured Khaled Said I am sickened.  A government willing to do this – perhaps to thousands of “disappeared” Egyptians over the past 30 years – to silence dissenting voice, to kill humanity, deserves to be reviled by the world.

Technology brought Said’s (and Egypt’s) horror to our eyes.  It exposed what “stability” means there.  No God-fearing person can support this terror.  Nothing justifies that.

I must confess that I was initially torn by what was happening in Egypt, especially as it pertains to the use of Internet technologies to foment the uprising.  I still harbor apprehensions on what lies on the other side of the wall.  To defeat one atrocious regime only to have it possibly replaced with one bent on our destruction unsettles me greatly.

Yet, the default for humanity must be to let voices flourish, and lives to be lived in liberty, over the tyranny of “stability.”  This may sound naïve, even offensive to some, in light of our post 9-11 world.  I cannot, however, reconcile Said with American exceptionalism.

Doubtless, much work and hard choices remain for Egypt, her people, and the region.  The rest of world’s democracies must become involved, too.  As former Prime Minster of Spain, Jose Maria Aznar, put it in his recent WSJ piece, “The Arab World’s 1989?”:

Today, those of us who believe in open societies, in democracy and in freedom, have the obligation to help see that the changes unfolding in the region head in the right direction. In the direction that leads to the rejection of jihad as a political instrument. In the direction that leads to religious freedom, to pluralist democracy, to the acceptance of international law, to an opening to the world, and to respect for universal human rights.

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Though Free Press outwardly expressed condemnation at the approval of the Comcast-NBC Merger earlier this month, they really got a lot of what they bargained for.  After their extensive lobbying blitz – with approximately 35 different FCC communiqués, including over 20 individual meetings with FCC Commissioners and their staff – it’s clear they helped shape many of the agreement’s “voluntary” commitments.

Merger decrees represent a feeding trough of sorts for the public interest group (PIG) community.  Appendix G of the Order reveals the length at which these PIGs sup, stretching nearly 60 pages of the 279 –page Order.

Appendix G wasn’t just slopped together, though.  PIGs are an organized lot.  Witness one such effort – a Free Press-attended, “funding community” event last summer, with participants there brainstorming on what they could demand from Comcast in order for the merger to go through.

Taken from published notes at that meeting, the participants wondered aloud:

…NBC/Universal is going to merge with Comcast. Can we require rules around this merger? When Comcast and Universal come together, it will diminish the incentives for the owner of that infrastructure to do local news. *What should we be asking for? A $300 million fund to incentivize public media? Trade groups to protect jobs in journalism?* We have to fight now and not look back and wonder what we should have done.

Boy, PIGs get fat, but hogs become bacon.  Yet that doesn’t stop these gluttons.  I love also the hubris of non-government officials saying, “Can we require rules around this merger…” Er, “We require”?  It shows just how corruptible and voluntary-as-a-mugging the whole process is.  Simply amazing stuff, more akin to Egyptian thuggery than American Democracy.

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It looks like the Soros machine isn’t done with Net Neutrality, even after its December coup at the FCC.

Our Soros-supported socialist friends at Free Press just announced that David Saldana will be its new communications director.  If that name doesn’t ring a bell, you evidently haven’t been following Mr. Soros’ funding priorities.

Before joining Free Press, he was with the Soros’ front group, the National Security and Human Rights Campaign.  Think calling it a front group is too strong?  Then just go to its website, which is conveniently located at Soros.org.  The group’s mission is to promote “progressive national security policies,” a term as embedded in contradiction as “French steadfastness.”

Prior to that, Saldana was the Deputy Editorial Director at Media Matters for America, the beneficiary of a seven-figure donation from Mr. Soros’ Open Society Initiative.

Chances are, this means that even last December’s FCC power grab over the web hasn’t gone far enough to satisfy Mr. Soros.  This isn’t surprising.  We can see his fingers in the most obvious places, like the FCC’s Net Neutrality Order, all the way down to the least lit reaches – as in the recent Comcast Merger Order and one of the company’s “voluntary” commitments to boost local journalism via the “Voice of Sand Diego Model,” a socially progressive news organization, which gets funding in part from, you guessed it, George Soros’ Open Society Foundations).

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Word has it that the Internet is on the brink of a takeover.

Egged on by radical interests, the FCC is poised to impose onerous regulations to guide the medium to a more “open” future.  No matter that the Internet is perhaps one of the greatest success stories ever.  And that a key to its success rests in the fact that government has stepped out of the way, letting developers and networks do what they do best – serve Americans with cutting-edge communications tools at affordable prices.

All of this is meaningless, of course, when the whip count and brute bureaucratic force are in your favor.

You see, Washington just learned that a bill, which could stop the FCC’s plans, is in deep jeopardy.  The bill’s sponsor – Representative Henry Waxman – doesn’t have enough Republican support to credibly move the legislation through Congress.  Lacking this, the proposal is basically dead in the water (even before formal introduction), having virtually no practical effect on the rogue FCC.

On any other day I wouldn’t shed a single crocodile tear hearing this news.  Not today, however.  Said Waxman, “If our efforts to find bipartisan consensus fail, the FCC should move forward.”

This will have significant repercussions.

I have long advocated that the Internet does not need regulating.  Technology, marketplace dynamics, consumer education, reputation management, current competition law and industry best practices all work together to make sure that the Internet remains open.  Though the naysayers cry otherwise, the still-unregulated Internet is anything but broken.  With each day, new services come on line, serving more and more Americans with Internet services.

But since the present Administration came to town, radical interests have captured policymakers at the FCC.  Over the past two years, they have enjoyed immense success in peddling the idea that the Internet is in danger of breaking unless Washington comes to the rescue.

How so?

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The Germans have a word called Schadenfreude, which roughly translates into taking pleasure in the misfortune of others.  It’s the feeling most of us had when we read about Paris Hilton’s latest arrest.

Usually you feel a little guilty, but sometimes life brings an example that’s so crazy it becomes almost funny.  In other words, you get Free Press.  This is the Professional Left group founded by the avowed socialist Robert McChesney around the time he called the United States “by any honest account, the leading terrorist institution in the world today.”

This week, Free Press became so hysterical as to be almost unhinged, acting like Jack Nicholson at the end of The Shining.  The organization launched a full-throated “shock and awe” broadside to get the FCC to begin regulating “neutrality” over the Internet.   Along with fellow liberal travelers at Public Knowledge, Free Press posted scathing attacks suggesting that FCC Chairman Julius Genachowski had become a tool of corporate interests and a “toothless bureaucrat.”

As enjoyable as it is to watch these guys work themselves into a frenzy on Net neutrality, it’s even more fun to admire the irony: Free Press is pushing exactly the kind of Executive Branch power-grab that liberals scorned loudly during the Bush years!

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