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FCC Greenlights USF Reform

Jeff Baumgartner
10/28/2011

Big, but expected, news on the regulatory front kicks off the T.G.I.F. edition of the cable news roundup.

  • The Federal Communications Commission (FCC) , as expected, approved its proposal to reform the Universal Service Fund (USF) on Thursday, moving ahead a plan to steer subsidies toward the broader reach of broadband services in rural areas. But National Cable & Telecommunications Association (NCTA) President Michael Powell said the organization was "disappointed" to learn that the proposal had inserted a right of first refusal element that favors incumbent telcos, giving that group "an unwarranted advantage for broadband support." The proposal includes a Connect America Fund with an annual budget not to exceed $4.5 billion budget for wired broadband subsidies. The FCC claims that about 500,000 jobs will be created over the next six years by expanding broadband access to 7 million more Americans living in rural areas and a five-year transition period for the new competitive process. (See Why USF Reform Matters .)

  • MobiTV Inc. is pitching MSOs, satellite TV and IPTV service providers with a TV Everywhere package that bakes in its content encoding and ingestion systems along with the integration of more than 375 connected mobile devices. MobiTV said it will leverage its cloud-based video distribution platform for phones to pipe on-demand and live programming to customers who are on the go. The company has yet to announce any customers, but MobiTV believes its approach will speed time to market and reduce costs for service providers with TV Everywhere ambitions.

  • Harmonic Inc. (Nasdaq: HLIT) posted third-quarter earnings of 8 cents per share, beating Wall Street's expected 6 cents, on sales of $138.9 million, up 3.6 percent year-on-year, thanks to strong video processing revenues. Harmonic noted that fourth-quarter revenues could see a $2 million hit due to recent flooding in Thailand, notes Jefferies & Company Inc. analyst George Notter. For now, Harmonic is forecasting fourth-quarter revenues of $135 million to $145 million. (See Thailand's Floods Will Affect Optical Sales.)



  • Verizon Communications Inc. (NYSE: VZ) has ISP bragging rights following J.D. Power and Associates 's new customer satisfaction survey. Verizon was tops in two U.S. regions -- the East and South -- while WideOpenWest Holdings LLC (WOW) took the North Central, and Cox Communications Inc. was the best in the West. The study, J.D. Powers's 14th, said just 14 percent of those surveyed believed that their Internet speeds were below expectations.

  • Netflix Inc. (Nasdaq: NFLX) has rapidly morphed from a media darling to whipping boy in just a few weeks, with every little misstep now coming under the microscope. The latest? Bloomberg reports that Netflix eliminated a whopping 15 jobs, mostly in the area of human resources, after losing 800,000 subs in the third quarter. Netflix had 2,180 employees at the end of 2010.

    — Jeff Baumgartner, Site Editor, Light Reading Cable



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    msilbey
    msilbey
    12/5/2012 | 4:50:21 PM
    re: FCC Greenlights USF Reform


    MobiTV has a compelling pitch for cable. It already powers mobile TV apps for the major telco players, and it's already been successful with some major live streaming events - like the Women's World Cup final this year. On the one hand, the MSOs probably want control over the network. On the other hand, national (not to mention global) delivery of live mobile video is no mean feat. Offloading some of that effort to an independent player like MobiTV should have its appeal. 

    msilbey
    msilbey
    12/5/2012 | 4:50:20 PM
    re: FCC Greenlights USF Reform


    Very curious to read the follow-up, particularly any information about network integration. Also, even though I'd lean toward Tier 2/3 cablecos first as likely targets, I wonder how many Tier 1s would also be interested if MobiTV could act just as an extension to their existing networks beyond their regional footprints. 

    Jeff Baumgartner
    Jeff Baumgartner
    12/5/2012 | 4:50:20 PM
    re: FCC Greenlights USF Reform


    Yes, it is intersting to see them join the fun, and I'll be interested to see how their technical model can be applied and tweaked to work with pay-TV service providers. The control question is a good one, so i'll be interested to see where they are going to concentrate their fire -- perhaps tier 2/3s will be okay with giving up some of that control if it gets them into the game more rapidly and, as MobiTV claims, for less cost.  anyway, I'm supposed to get some additional details from them today and will be doing a follow up on what they have in mind and how far along they are on this front. JB


     

    Jeff Baumgartner
    Jeff Baumgartner
    12/5/2012 | 4:50:15 PM
    re: FCC Greenlights USF Reform


    Some but not a bunch of new light shed on MobiTV's plans but they're in a quiet period with the IPO coming, so they can't even comment on whether (or when) trials and deployments will begin, though they will be go after service providers of all sizes.  But have to agree with their notion that the timing is pretty good for them to jump in since operators are just getting TVE off the ground or developing their deployment plans.  The live TV aspects are interesting, but even they acknowledge that rights are the tricky part. JB

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