A Supreme Court decision saying administrative law judges are subject to the Appointments Clause of the Constitution and can be appointed by only the president, courts or heads of departments is "an additional reason -- among many" the FCC should "dump" the ALJ process, Commissioner Mike O'Rielly tweeted Friday. Lucia v. SEC released Thursday, ruled on the appointment of an SEC ALJ. The FCC said ALJ Richard Sippel was appointed by the commissioners. O'Rielly said the FCC should work with Congress on sunsetting or rolling back ALJ duties (see 1707130046).

The many virtual MVPD introductions last year, including AT&T's DirecTV Now and rival services from Hulu and YouTube, were to blame for an accelerated drop-off in AT&T's video subscriber base, CEO Randall Stephenson said at an investor conference. He said the decline rate should be more typical this year, as pricing is being rationalized between virtual MVPDs and the traditional market. He said between DirecTV and DirecTV Now, AT&T has about the same 25 million subscriber base that the company had when it bought DirecTV, and the introduction last week of its WatchTV skinny bundle streaming service (see 1806210037) could help further increase video subs. Stephenson said AT&T's aim with its Time Warner buy was "a modern media company" that has premium content, high-speed network capabilities, advertising technology and direct-to-consumer relationships. "The days of wholesaling content [via MVPDs] isn't a sustainable business model anymore," he said. AT&T plans within 24 months to build a real-time exchange for premium video ad content that it envisions outside parties also taking part in, he said (summary here). Chief Financial Officer John Stephens said AT&T anticipates getting back to "more normal historical levels" of debt by 2023. The executives said Thursday the move to 5G for AT&T will be akin to a software upgrade and not require extensive capital spending because of investments the company already is making, with the carrier equipping cellsites for 5G as part of the FirstNet rollout. Stephens said its fiber network now reaches about 9 million locations and should reach 14 million by this time next year. The company said its FirstNet buildout should be halfway completed within a year. American Enterprise Institute visiting scholar Mark Jamison blogged Friday that vertical mergers like AT&T/TW are motivated by network operators' huge capital spending in recent years and that they're facing having to do more for 5G. He said with network firms borrowing to finance expansion, while downstream firms generate cash off those networks, vertical mergers let network operators access that cash, leading to better innovation and company finances.

Rural telcos opposed FCC elimination of the two remaining rural call completion duties of providers covered by a 2013 RCC order, a proposal that received much industry support in initial comments (see 1806050043). The data recording and retention rules helped reduce the number of "dropped and otherwise deliberately non-completed calls," replied WTA this week in docket 13-39. "Sunsetting the rules without a suitable alternative monitoring and enforcement mechanism in place will only undercut the previous progress." NTCA (here), the South Dakota Telecommunications Association (here) and Alarm Industry Communications Committee (here) also filed opposition. NTCA urged the FCC to broadly define "intermediate providers" whose RCC performance would be subject to covered provider monitoring and oversight under an April order. NCTA also opposed and ITTA backed a recent USTelecom request that the FCC stay the monitoring rule (see 1806130086). USTelecom (here), Verizon (here) and ATIS (here) backed eliminating the two rules. Verizon and ATIS opposed mandating industry best practices, with Verizon urging flexible intermediate-provider service-quality standards and full implementation of the Improving Rural Call Quality and Reliability Act and all RCC rules before compliance deadlines. USTelecom sought a broad intermediate-provider definition. NCTA said covered providers should have to only "monitor the performance and registration status of intermediate providers with which they have a contractual relationship." The American Cable Association said a covered-provider definition should be retained, particularly a 100,000-subscriber line threshold. Incompas urged a "flexible" approach to implementing the new law and consideration of "the role that access arbitrage" plays. West Telecom Services said the FCC shouldn't "micromanage" intermediate-provider duties and proposed eliminating a safe harbor's "two-hop cap on use of intermediate providers" by covered providers. HD Tandem backed "transparency mechanisms" to allow regulators "to root out illegal cost shifting or other routing behaviors that impair high-quality call completion." Inteliquent endorsed mandating best-practice compliance.

In a tie-in with closing its buy of Time Warner, AT&T Wireless Thursday rolled out a streaming video app, WatchTV, due to launch Tuesday with Unlimited & More and Unlimited & More Premium wireless plans and a $15 per month stand-alone option. WatchTV customers will be able to stream 31 live channels at launch, including A&E, AMC, Animal Planet, Cartoon Network, CNN, Discovery, Food Network, History, IFC, Lifetime, Sundance TV, Turner Classic Movies and TNT, said the carrier. The Premium plan adds one premium entertainment service at no extra cost from a choice of HBO, Cinemax, Showtime, Starz, Amazon Music Unlimited, Pandora Premium or the VRV gaming service, it said. The WatchTV app is compatible on “virtually every” current smartphone, tablet or browser and “certain streaming devices,” it said. AT&T called WatchTV the first of “new offers to come” from the takeover, combining content and connectivity for a “fresh approach to how media and entertainment works for you.” The carrier referenced a “new level of choice, innovation and value” and a more personalized and immersive entertainment experience that includes “experimenting with new forms of content” and offering new ways to access premium content “especially on mobile devices.” Wireless plans start at $80 per month for Unlimited & More and $90 per month for Premium, a chat representative told us. Premium customers will get 15 GB of high-speed Wi-Fi hot spot access and access to HD video; customers of both plans will receive a $15 monthly credit toward DirecTV, DirecTV Now or U-verse TV, said AT&T.

Most net neutrality litigants agreed to a proposed briefing format and schedule running from August through November, said a motion (in Pacer) Wednesday of petitioners and intervenors challenging the FCC broadband reclassification order. Sixteen groups of petitioners and seven supporting intervenors made the proposal, with word limits, to the U.S. Court of Appeals for the D.C. Circuit in Mozilla v. FCC, No. 18-1051. They said respondents FCC and DOJ consented, but intervenors supporting the FCC plus intervenor Digital Justice Foundation (DJF), which supports neither side, didn't. "The proposed format accommodates the divergent interests of the various parties to this complex appeal," said the motion. "It ensures consolidation among parties wherever the differences in position are possible to bridge." Petitioner briefs would be due Aug. 20; their supporting intervenor and DJF briefs Aug. 27; the FCC/DOJ brief Oct. 11; FCC-supporting intervenor briefs Oct.18; and petitioner and supporting intervenor briefs Nov. 16. The motion noted respondents didn't agree with its "characterization or description of the issues presented by or the procedural history of the case." It also included a statement from ISP intervenors that support the FCC -- the American Cable Association, CTIA, NCTA, USTelecom and Wireless ISP Association -- asking for "sufficient words to respond to all the arguments" of petitioners, akin to what the court provided intervenors in litigation over the FCC 2015 net neutrality order and consistent with an updated rule. The DJF asked (in Pacer) to be allowed to file a reply brief: "No other party (1) supports net neutrality as a policy goal, (2) believes that the 2015 net-neutrality rules had certain statutory defects nonetheless, (3) believes the ... Order's repeal of the conduct rules and reclassification is within [FCC] discretion ..., but (4) believes that the Order's transparency and preemption provisions are unlawful, at least in part."

Commissioner Mike O’Rielly wants the FCC to use the 2018 quadrennial ownership review to define the media market in line with the court decision on AT&T/Time Warner (see 1806200015), he said in a speech at the Mackinac Center for Public Policy Wednesday. “All relevant participants: newspapers, radio stations, broadcast television stations, cable companies, over-the-top providers, Internet sites, social media platforms, streaming music services, and satellite radio must be included in any media market definition,” he said. “The entire foundation of how the government currently views the ‘communications’ market -- be it voice, video, or data -- is outdated and misguided.” A similar “myopic view” causes officials not to consider mobile broadband as a viable alternative to fixed broadband, O’Rielly said. The quadrennial review of broadcast ownership rules and biennial review of telecom rules offer the agency a chance to move away from being stuck in “administrative molasses,” O’Rielly said.

FCC Commissioner Brendan Carr told the Senate Broadband Caucus Tuesday his travels across rural America have brought home to him how important broadband is to swaths of the country that haven't been connected. Carr recalled his visit to a Lincoln, Nebraska-based startup called Quantified Ag, which built a “Fitbit” for cattle. Early results show “the technology is helping to improve outcomes for the herd, saving time and money, and reducing the use of antibiotics and other treatments,” he said. Carr promised the FCC would continue its focus on closing the digital divide. “We need to keep cutting the regulatory red tape that needlessly drives up the costs of deploying broadband infrastructure,” he said. “We need to keep freeing up spectrum for next-generation uses. And we need to continue supporting rural broadband providers through programs like our Connect America Fund.” Sen. Heidi Heitkamp, D-N.D., said farmers need to be connected. “I can imagine a time in American agriculture where someone sits in an office … and basically plants a quarter-section of land in a day, operating their tractor from not the tractor but through automation,” she said. “None of that is possible if we don’t have the backbone of connectivity.”

Broadcasters seeking a 50 percent national ownership cap are correct about why relief is needed, but their arguments also demonstrate why the limit should be eliminated entirely, Nexstar wrote the FCC, posted Monday in docket 17-318. Commissioners may soon vote on altering the cap now at 39 percent (see 1806180055). “The 50 Percent Proponents appropriately rest their position on the types of 'tectonic changes' in the communications marketplace” but “ignore the reality that such changes do not justify a national television ownership cap set at 50 percent, but instead a complete repeal of the cap,” Nexstar said. CEO Perry Sook has predicted predicts a raise to 65 percent, saying broadcasters must “ask for a pony to get a puppy” (see 1806140055). The Nexstar letter cited AT&T having bought Time Warner and prospects for Fox's takeover by Disney or Comcast as evidence broadcasters are dwarfed by competition. “These companies are already behemoths when compared to the nation’s largest local broadcasters before any of these market-altering transactions,” Nexstar said. The scale efficiencies created for broadcasters by a 50 percent cap would be increased if the cap were eliminated, Nexstar said. “Plucking a number out of thin air” would be arbitrary and capricious, Nexstar said. Ion said the cap should be removed, in meetings last week with Chairman Ajit Pai, Commissioners Mike O’Rielly and Brendan Carr, Media Bureau Chief Michelle Carey and an aide to Commissioner Jessica Rosenworcel, a filing said. If the FCC doesn’t eliminate the cap, it should adopt permanent grandfathering for “companies like ION that have built new competitive networks based on the traditional discount to the national audience reach of UHF stations,” the company said. Raising or eliminating the cap will lead to higher retransmission consent prices for consumers, said the American Cable Association in a meeting last week with Carey. The FCC should “confirm and quantify this harm through its own econometric analysis” and consider it in any plans to alter the cap, ACA said. The FCC can’t “transmogrify” the UHF discount into one based on ratings, the association said. Using ratings as a basis for calculating reach was suggested by NAB in the form of a discount for all broadcasters and by Covington Burling attorney Mace Rosenstein as a rejiggering of how reach is determined (see 1806050040). The FCC “has always defined ‘reach’ in terms of whether a viewer can physically access broadcast signals,” ACA said. “Ratings have nothing to do with a station’s ‘reach,’ at least as the Commission has always understood that term.”

Verizon will no longer sell mobile customers’ real-time locations to two third-party data brokers “to prevent misuse of that information,” it wrote Sen. Ron Wyden, D-Ore., in a response which he released Tuesday. AT&T said it's also ending the practice. Verizon sold the data to LocationSmart and Zumigo, which then resold it to other companies. “We conducted a comprehensive review of our location aggregator program,” wrote Verizon Chief Privacy Officer Karen Zacharia. “We are initiating a process to terminate our existing agreements for the location aggregator program.” She said Verizon won’t sign new agreements “unless and until we are comfortable that we can adequately protect our customers’ location data through technological advancements and/or other practices.” AT&T did the same, a spokesperson said. “Our top priority is to protect our customers’ information, and, to that end, we will be ending our work with aggregators for these services as soon as practical in a way that preserves important, potential lifesaving services like emergency roadside assistance.” “Sounds like word hasn’t gotten to you, @ronwyden,” tweeted T-Mobile CEO John Legere. “I’ve personally evaluated this issue & have pledged that @tmobile will not sell customer location data to shady middlemen.” T-Mobile also responded more formally to Wyden. Sprint said it takes steps to protect customer privacy. Wyden noted the Verizon and AT&T statements in a tweet.

FCC Commissioner Jessica Rosenworcel voted for a USF rural healthcare cap hike, from $400 million to $573 million, an aide told us Tuesday. Chairman Ajit Pai's proposal to index the program for inflation, including retroactively, already received the votes of his fellow Republican commissioners (see 1806060057 and 1806140017). The draft order wasn't released.