Jimm Phillips

Pandora will place users on a 40-hour-per-month limit for free mobile listening, it said. The company made the “very unusual” decision because of the rising royalty rates it has to pay; the rate has increased 25 percent over the past three years and is set to rise up to 16 percent over the next two years, Pandora Founder Tim Westergren said Wednesday in a blog post. “After a close look at our overall listening, a 40-hour-per-month mobile listening limit allows us to manage these escalating costs with minimal listener disruption,” he said. Pandora “will be sure” to alert listeners who near the 40-hour limit, Westergren said. The limit will affect less than 4 percent of Pandora’s more than 65 million customers -- the average customer uses the service only for 20 hours per month over all devices, Westergren said. Customers who hit the 40-hour limit can pay $0.99 for unlimited listening over the rest of the month, or can subscribe to the $36-a-year Pandora One service, which allows unlimited listening and features no advertising. Listeners will also continue to have unlimited access to Pandora on desktop and laptop computers, he said (http://bit.ly/Z0eu0l). Pandora’s decision is not surprising given that the company has been “consistently operating with yearly losses” under the compulsory license regime, Public Knowledge Staff Attorney Jodie Griffin told us. It’s not clear how the decision will impact Pandora and the webcasting business in general, but “if this becomes a trend for webcasters and leads to less online radio listening overall, it’s hard to see how that’s a victory for musicians or audiences,” she said.

Reforms are needed to improve the quality of software-related patents that the U.S. Patent and Trademark Office (PTO) grants, said Suzanne Michel, Google senior patent counsel, Wednesday during a PTO-led forum. PTO held the forum as part of its “Software Partnership,” an effort to gather industry input on ways to improve the quality of patents. Current patent examination practices and rules have resulted in “vague, overbroad and invalid” patents that have driven the boom in litigation abuse led by patent-assertion entities (PAEs), Michel said. Software and Internet-related patents are litigated eight times more often than others, and account for 85 percent of all PAE lawsuits, she said.

Governments need to move away from blunt mechanisms like the “Great Firewall of China” as they consider how to regulate the international flow of data and other aspects of e-commerce, said Jonathan McHale, deputy assistant U.S. Trade Representative (USTR)-Telecom and Electronic Commerce Policy, during a Brookings Institution event Tuesday. Brookings published a report Monday that some governments are restricting the Internet “in ways that reduce the ability of businesses and entrepreneurs to use the Internet as a place for international commerce and limits the access of consumers to goods and services” (http://bit.ly/XW2mLH).

The FTC said HTC America reached a tentative settlement over charges that the company’s failure, until at least November 2011 to take “reasonable steps” to secure the software used on its smartphones and tablets, constituted “unfair or deceptive acts or practices” (http://1.usa.gov/YHPOtt). The agency accused the maker of consumer electronics of not using “well-known and commonly-accepted secure programming practices ... which would have ensured that applications only had access to users’ information with their consent."

Ukraine’s government is implementing the intellectual property rights (IPR) “action plan” it developed in consultation with the U.S. and hopes to fix remaining IP issues through forthcoming legislation, said Serhii Nalyvaiko, head of the State Intellectual Property Service of Ukraine’s control over IP objects use division, during a Special 301 review hearing Wednesday at the Office of the U.S. Trade Representative (USTR). Nalyvaiko’s testimony came as the USTR-led Special 301 Committee considers whether to designate Ukraine as a “priority foreign country” (PFC) under the Special 301 statute.

Unless the U.S. is able to increase the amount of available spectrum, there will be a gap between supply and demand as mobile data use continues to increase, said FCC Wireless Bureau Chief Ruth Milkman Tuesday during a Broadband Breakfast event. Today’s smartphone and app economy “simply did not exist” in 2008; between 2009 and 2012, mobile traffic grew by 1,275 percent, and that level of growth will continue through 2017, she said. That demand is being driven by the proliferation of smartphones, and that “necessitates” the need to increase spectrum availability, Milkman said. The federal government has been engaged in a series of efforts to increase spectrum availability, including the FCC’s considerations of the 3.5 GHz and 5 GHz bands and the ongoing evaluation of the 1755-1850 MHz band. Wireless carriers have responded to the spectrum crunch by increasing their use of data caps to curb customers’ data use. While such caps are controversial, industry experts noted that the industry is changing so rapidly that it is not useful to specifically target the use of caps in the midst of larger competition issues.

There’s a “very urgent” need to address cybersecurity issues, “but it is also a long-term problem,” said White House Cybersecurity Coordinator Michael Daniel during an event Friday at the Center for Strategic and International Studies. “We didn’t get here overnight, and we're not going to get ourselves out of this situation overnight either,” he said. President Barack Obama signed an executive order on cybersecurity Feb. 12, which he said would help “strengthen our cyberdefenses by increasing information sharing, and developing standards to protect our national security, our jobs, and our privacy.” The order, among other things, directs the National Institute of Standards and Technology to lead an effort in conjunction with other federal agencies and industry stakeholders to develop a Cybersecurity Framework of voluntary best practices and other standards that could be used to strengthen the cybersecurity defenses of critical infrastructure (CD Feb 14 p1).

President Barack Obama touted his executive order on cybersecurity during his State of the Union speech Tuesday as a step to “strengthen our cyberdefenses by increasing information sharing, and developing standards to protect our national security, our jobs, and our privacy,” and urged Congress to pass legislation to further the order’s goals. Enemies of the U.S. are “seeking the ability to sabotage our power grid, our financial institutions, and our air traffic control systems,” he said. “We cannot look back years from now and wonder why we did nothing in the face of real threats to our security and our economy."

Policymakers need to ensure the U.S. maintains its “preeminent position” as the driver of telecom technology innovation by maintaining it as a friendly environment for capital investment, AT&T CEO Randall Stephenson said Sunday during an event at the University of Colorado in Boulder. “What keeps me awake at night is, five years from now, is that still the case?” he said at the Silicon Flatirons event. “Five years from now, are Chinese companies going to be driving the standards, are top Chinese companies going to be driving the technological innovation in this industry? … I think we as a country do not want that."

Spectrum sharing will be necessary to meet the Obama administration’s goal of finding 500 MHz for commercial broadband service, said NTIA Administrator Larry Strickling Monday at the University of Colorado at Boulder. “The old method of clearing spectrum of federal users and then making it available for the exclusive use of commercial providers is not sustainable,” he told the Silicon Flatirons event. “We have moved the systems that are easy to move, and to continue this method of spectrum reallocation simply costs too much and takes too long. And just as important is the fact that the opportunities to find spectrum to which we can move the federal operations are dwindling rapidly."