Ken Reif, dir. of Colo. Office of Consumer Counsel, will leave Nov. 30 to take a position with a Colo. power company… Conexant Chmn. Dwight Decker adds CEO title… USA Network promoted Chris McCumber to senior vp-mktg. & brand strategy… Patrick Reilly, ex-BMG, named Sirius senior vp-communications… Murray Williams, Buy.com, joins 5G Wireless Communications board… Zhang Yue, ex- China Mobile Communications, named CellStar pres.-China operations… Rachel Lizerbram, ex-Robinson Lerer & Montgomery, becomes TV Land/Nick at Nite vp-communications.
Exports to China
Technology to allow HDTV to be delivered via satellite in China is being developed by a $20 million joint venture named Asia Digital Media, officials said. Partners include Entrust, which provides access management, China Aerospace New World Technology, ADML Holdings and RockRidge Capital Partners. A demonstration version of the system is expected in early 2005, the group said, with full rollout in the 4th quarter via the Sinosat-2 satellite.
News Corp. revenue increased 12% to $5.2 billion in the first quarter ended Sept. 30, and operating income rose 12% to $805 million. The TV group’s operating income increased 30% to $233 million due to double-digit earnings improvement at Fox Bcstg., the company said. Fox operating losses improved $35 million due to higher ad prices and lower programming costs. Fox TV Stations operating income increased slightly despite competition from the Olympics and weaker prime-time ratings. Star’s revenue increased 14% due to ad growth in India and China and higher subscription revenue from the international distribution of local Indian channels, the company said. Cable network programming operating income increased 47% to $196 million, reflecting continued strength in primary cable channels. Fox News Channel operating income grew 20% due to ad growth, which more than offset higher costs associated with coverage of the political conventions. Regional sports networks, FX and Speed’s total operating profit increased 39% due to higher affiliate ad revenue and more subscribers. Satellite TV Sky Italia revenue grew 45% due to new subscribers. Sky’s revenue growth was offset by increased subscriber acquisition costs and higher programming spending, the company said.
Nokia said its 3rd-quarter earnings were down 20% over last year as a result of price cuts on many of its phones. It also said wireless phone sales were down 13% in the quarter. Profits were $817 million, down from $1 billion in the year-earlier quarter. The N. American market wasn’t kind to the company, said CEO Jorma Ollila. “We made substantial market-share gains in major Western European markets and maintained our leadership position in China,” he said. “However, in the U.S., we lost market share during the quarter, and despite strong sales growth, our market share in Latin America was down slightly.” But Sony Ericsson, which also reported, saw profits increase 45% -- to $111 million in the 3rd quarter, from $77 million in the year-earlier period.
While pointing to “signs of positive intent,” the U.S. Chamber of Commerce said in a report Wed. China took “no overt action” in the past year toward meeting WTO telecom commitments. While “all geographic restrictions on value-added services (VAS) have theoretically been lifted… yet there has been no rush by foreign carriers to enter the world’s largest and fastest-growing telecom market,” it said. China, which joined the WTO in Dec. 2001, has 5 years to comply with that organization’s requirements. “Telecom is an area of lagging implementation” in China, U.S. Chamber of Commerce Dir.-N. Asia Jeremie Waterman told us: “We are not seeing a flood of companies even apply for licenses.” The report said the lack of interest could be “at least in part” explained by “the need to find a willing Chinese joint venture partner and to navigate a licensing labyrinth.” According to the Ministry of Information Industry (MII), it had received 15 applications for value-added telecom services licenses from foreign investors and had issued 2. “If so, the licensees are keeping a low profile,” the report said. Waterman said another concern was “the whole issue of China telecom law.” He said China had made “some progress on the drafting process” and the draft Telecom Law was being circulated among govt. officers. “I think foreign telecom companies are really looking at this telecom law to solidify a sound regulatory environment that values the contributions of both foreign and domestic companies equally,” he said. The chamber said in the report it hoped the new law would “replace the existing categories of basic and value-added services with the more objective and transparent Type I (facilities-based) and Type II (non-facilities based) classifications.” It said such change would be “in conformance with international norms and would potentially accelerate service provider market entry, but only if foreign carriers are not somehow officially marginalized into an artificial subcategory in the process.” Another “significant barrier to market entry for foreign telecom investors” cited in the report was “highly excessive capitalization requirements.” The report criticized the decision by the Administrative Regulation on Foreign-Invested Telecom Enterprises specifying that “for those enterprises engaged in national or cross-provincial basic telecommunication services, registered capital must not be less than RMB2 billion.” It said the requirement “effectively bars foreign investors from China’s telecom market and severely inhibits the long-term development of an economically efficient and competitive domestic telecom services market… Few, if any, qualified foreign investors would allocate this amount of capital to a new and potentially risky undertaking.” The chamber recommended that “China should replace high capitalization requirements with the performance bonds, scaled to proposed business activity, that establish lead times to start and build operations and set certain service level thresholds.” It said performance bonds should be “scaled to the business plan for the venture as well as the risk posed by the investment to the industry and to consumers.” China should also explore the use of bank guarantees as substitutes for capitalization requirements, it said. But chamber Asia Task Force Co-Chmn. Ray Sander said some progress was still made in the Chinese telecom sector. He told us the “differentiating factor” was a visit of China Vice Premier Wu Yi during the meetings of the U.S.-China Joint Commission on Commerce & Trade in April 2004, which he said produced important steps. At that meeting, China announced a detailed action plan to improve its intellectual property compliance, the withdrawal of a discriminatory encryption standard for WLAN, and a guarantee that it would adhere to the principal of technology neutrality in its standards regime and specifically in the selection of 3rd-generation mobile technology. To liberalize its telecom market, the report said China should: (1) Accelerate its work to separate the regulatory and commercial functions of its telecom regulator. (2) Adopt the Telecom Law. (3) Remove artificial market entry barriers in that law and in implementing regulations, including reduction of capitalization requirements on foreign-invested telecom joint ventures. (4) Grant equivalent national treatment to domestic and foreign telecom investors. (5) Improve the transparency of its regulatory processes. (6) Enforce the legality of telecom contracts “in a consistent and transparent manner.”
Norsat International said it received an order for its satellite tranceivers from Dynamic Engineers (DE). DE will use the transceivers in a broadband offering in China, the company said. The order was valued at $940,000, Norsat said.
LONDON -- The U.S. and U.K. see eye-to-eye on many telecom and Internet issues despite differences in their respective infrastructures, NTIA, FCC and State Dept. officials said Wed. “Technology doesn’t recognize any borders,” said NTIA Dir. Michael Gallagher. Given their common heritage and common approach to difficult issues like spectrum and broadband, he said, it’s not surprising the countries’ positions are in alignment. Investment challenges associated with broadband deployment exist in every country, said FCC Comr. Kathleen Abernathy. Neither the U.S. nor the U.K. directly subsidizes deployment, she said, meaning “we're all looking at the same things to spur investment” through regulatory approaches. Their comments came during an interview with Communications Daily.
New spots for ex-CTIA staffers: Christina Martin becomes Powell Tate/Weber Shandwick exec. vp; Travis Larson to Clear Channel media affairs… Former Irish Prime Minister John Bruton moves to D.C. as head of the European Union delegation to the U.S… Mary Arnold, ex- AT&T, to head SAP America congressional affairs office… Timothy Kurth, ex-telecom aide to House Speaker Hastert (R-Ill.), joins Lundquist Group as vp… Ivan Shen, ex- Global Pioneer, joins Lucent as vp and as chmn. of Lucent China… John Cunningham, ex-IBM, joins Sonus Networks board… John Czwartacki, ex-aide to Sen. Lott (R- Miss.), named Verizon exec. dir.-external communications… Industries International promoted Liang Wang chmn. and CEO.
The Republican platform unveiled at the party’s convention in N.Y. contains familiar Bush administration positions on broadband deployment, critical infrastructure protection and intellectual property protection. But the 87-page document contains few details -- for example, mentioning support for first responders without addressing the issue of clearing spectrum for them. Missing from the platform is any mention of 2 pressing media issues -- broadcast indecency and media ownership. Broadband deployment is the only topic addressed under “Telecommunications.”
A European Audiovisual Observatory (EAO) official this week will lay out Europe’s experience with digital TV (DTV) at the President’s Forum of Chinese-Foreign Radio & Television Stations at Beijing Broadcasting U. The invitation comes at an “interesting moment,” said EAO Exec. Dir. Wolfgang Closs. With China now a member of the World Trade Organization, the country’s audiovisual market is opening. Foreign investments of up to 49% in audiovisual coproduction are now possible, film production is booming, and DTV is set for launch in 2005, he said. The EAO will explain European broadcasting rules as well as the current debate on participation by public broadcasters in the development of DTV, he said. The conference is Sept. 4-8. The EAO, established in 1992, collects and circulates information on the European audiovisual industry. It’s a public service body whose members include 35 countries and the European Commission.