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Global Media Governance 2

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  1. 1. 100-507 1916-18 Radio patents suspended during hostilities. Global Media Governance 1918 US Navy unable to maintain monopoly on patents encourage general Electric to buy out US arm of British Marconi in order to maximise use of Alexanderson alterna- tor transmitters. 2 The Market: the USA 1919 GE, Marconi and Navy stations form Radio Corpora- tion of America with monopoly on radio technology. 1921 Jack Dempsey-Carpentier fight. AT&T supply landline connections to transmitters and receivers; Navy Secretary FD Roosevelt makes navy transmitter available 1926 RCA establishes National Broadcasting Company NBC. Bases of network transmission establiished. Sponsor- ship and advertising stabilise as major economic drivers 1927 CBS founded in buy-out of network established by tal- ent agent and Columbia Records 1933 Edwin Howard Armstrong patents FM radio; first of 31 ‘fireside chats’ delivered by president Franklin D. Roosevelt 1943 FCC anti-trust decision breaks up NBC into Red and Blue networks: NBC retain Red; Blue will become ABC 1945 FCC bow to RCA lobbying and allocate TV waveband in the FM zone Edwin Howard Armstrong in 1920
  2. 2. 1948 TV broadcasting begins in 23 of 25 largest cities; FCC freeze on new licenses in November, in place till July 1952 1949 Research Company of America publishes “Forgotten 15 milliion” report on advertising to African Americans 1952 Governor Talmadge of Georgia threatens boycott of “race-mixing” stations; Eisenhower victory in first “TV elec- tions”; National Pubic Radio launches on FM band 1953 I Love Lucy reaches 66% of households 1951-4 formation of Top 40 radio format 1954 Edwin Howard Armstrong commits suicide 1955 car radio sales outstrip domestic sets 1956 Nat King Cole first African American TV show 1959 Charles van Doren testifies in the “quiz show scandals” Congressional hearing 1962 XERA-AM “rip and read” goes into profit: first all-news radio station 1966 all three networks in colour 1967 Smothers Brothers Comedy Hour launched; Supreme Court award Armstrong’s FM patents to his wife Marion
  3. 3. 1975 Sony introduce Betmax video cassette; first television satellite transmissions; HBO launched with Ali-Frazier fight c. 1979 FM radio overtakes AM as medium of choice 1979 C-SPAN launched during discussions with Congress of cable regulation 1980 CNN launched 1982 AT&T lose antitrust case: end of “natural monopoly” on telephone services 1984 NBC premiere The Cosby Show 1985 E.T. earns $150m in rentals (four times ticket sales) 1987 Murdoch completes 20th Century Fox and Metromedia purchases, Fox network debuts primetime programming, benefitting from ‘must-carry’ rules 1989 100,000 video rental stores in the US (and 25,000 cin- emas) 1990 Three quarters of US homes have cable 1993 Mosaic web browser released 1996 Telecommunications Act removes one-to-a-market and cross-ownership rules
  4. 4. Issues in deregulated commercial broadcasting “natural” monopoly brakes on innovation profit maximisation vs journalism normative power of advertisers relations between manufacturers and content providers mutual assistance of government and broadcasters electoral vs civil politics
  5. 5. $2 billion expected from spectrum sale held spectrum if it does not co-operate. ARI SHARP The Age, January 6, 2010 To maximise its revenue, the Government will be keen to entice other players to the auction,''What COMPANIES as diverse as Google and Woolworths you'll probably see will be some new entrants get- could become key players in a multibillion-dollar ting in, the likes of new media,'' said one analyst. He auction of wireless spectrum, soon to be freed by the nominated online search company Google as a con- move to digital television. tender. The Federal Government yesterday announced that Broadcasters were unlikely to be among the bidders, the switch-off of analog TV signals by the end of 2013 he said. would make available 126 megahertz of spectrum The spectrum could be used for a new free-to-air tele- once the restacking of remaining broadcasters was vision channel, although present market conditions completed. would not support it. The spectrum will be sold off in the next four But NBN Co, the Government-owned company es- years and could raise about $2 billion for the tablished to build the broadband network, could use Government.A similar auction in the US garnered the spectrum to provide fast internet to the 10 per $US19 billion. cent of households not served by fibre. The most obvious contenders are existing mobile A second analyst said Woolworths might bid in an operators Telstra, Optus and Vodafone Hutchison effort to expand its Everyday Mobile product, which Australia. Analysts expect each will require about 40 now relies on the Optus mobile network. megahertz to provide the next generation of mobile services. The plans for the new spectrum were outlined in the ''Digital Dividend'' green paper released yesterday by Telstra's involvement in the auction will be compli- Communications Minister Stephen Conroy. cated by the deal it reaches with the Government over its separation, which follows a threat of with-
  6. 6. But if anyone thought the new regime at Telstra was going to take things lying viable prospect, it could even prosper without Telstra. down, the supposedly more touchy-feely team now in charge of Telstra, Th- odey and the chairman, Catherine Livingstone, certainly dispelled that notion Then again, they would say that. this week. NBN Co needs to be profitable enough to attract telecom industry vendors as Draft legislation released by the government opened up the possibility for the shareholders in the venture and eventually be attractive enough to allow full first time that the NBN Co's "wholesale only" network may dabble in a bit of privatisation according to draft legislation released last week. retail. All the angst over the retail clause in the draft legislation has overshadowed Telstra exploited this unexpected opening. the implications of a $43 billion monopoly infrastructure asset being com- pletely privatised for what will certainly be considerably less than this amount. "We are very concerned about this potential change in the government's posi- tion. If enacted, we would need to factor this into the financial consideration .... required to achieve an agreement It does nothing to hide the bottom line for Recent comments from Telstra's disastrous interim results also strike a concil- Telstra though. The longer it can hang on to its traditional phone line business, iatory tone from Thodey. where its near-monopoly accounts for 75 per cent of revenues and 90 per cent of profits, the better. "We remain very constructively engaged with both the government and NBN Co, and we do remain committed to try to find a mutually acceptable outcome. As long as these customers hang on with it. But I have to stress, these are very complex considerations. Very complex. We need to move slowly and very deliberately". It is in no hurry to move to the broadband network unless the established tele- phony business dwindles to the point where the costs of maintaining the vast Thodey may have turned up the pressure a notch by suggesting Telstra is copper network chew up most of the profits. prepared to wait six months if that's how long it takes to nut out a deal he is prepared to take to shareholders. It has not stopped some analysts from speculating – tentatively – that the telco may be better off testing the government's mettle and continue on its own path With three downgrades in two months on his watch, and more bad news ex- as a rival to the NBN. pected from Telstra's fixed-line business in the full-year results – which will further weaken his bargaining position over the network – it's either another ...... bluff, or yet another example of how any misstep in the agreement could have In October last How is the government going to get an economic return on a huge implications for the telco as he pointed out last month. bare-bones network even if its cost does come in well under the $43 billion mark as expected. "I am not going to be driven into a short-term decision and we've got to be very clear about all the considerations, because you could miss one little thing A study by McKinsey and KPMG assessing the feasibility of the NBN Co's that would have and enormous impact to the future of the business", Thodey business plan was due this week and while no details have been announced said. word has been quietly spreading that the report says that not only is NBN Co a (The Age, Saturday 6 March 2010)