ONE DAY IN THE FALL OF 2004, Mike Simon was interrupted by a phone call that he still remembers well. The caller was a pollster, who asked a dozen or so questions related to the local government’s plan to build a broadband network. The questions became increasingly annoying. Then came the kicker: “Should tax money be allowed to provide pornographic movies for residents?” the caller asked. “It was just blatantly a push poll,” says Simon, a landlord and entrepreneur in a Chicago exurb called the Tri-Cities. “When I asked, ‘Who are you representing?’ they just hung up.”
That pollster, it was clear, was part of the strong resistance that had mobilized against the community’s broadband plan. […]
[…] Why were SBC and Comcast spending hundreds of thousands of dollars preventing a Tri-Cities scheme they thought wasn’t feasible anyway? Comcast declined to comment for this article, but SBC spokeswoman Andrea Brands says her company was merely playing a “civic role” in educating the voters and newspapers about the risks. “We welcome competition. We try to be a good neighbor,” Brands says.
“That makes me shiver,” says Mayor Burns. “Civic responsibility is engaging in a civilized debate, not in an underhanded, disrespectful, and disreputable campaign.”
Communications companies like Comcast are also taking the local fight to the statehouse and to Congress. Fourteen states, heavily lobbied, have passed restrictions that either encumber municipalities looking to get in the broadband game, or prohibit their involvement outright. Philadelphia, which is launching an ambitious project to cover its entire 135 square miles with cheap wireless access, barely snuck by a 2004 Pennsylvania law prohibiting cities and towns from offering the service without giving the local telephone company a first option. This year the industry is supporting legislation in five more states, and in Washington, D.C., negotiations have begun on a rewrite of the mammoth 1996 Telecommunications Act–another opportunity for lobbyists to push restrictions.
Yahoo said it was offering the service with an introductory price of $4.99 a month for an annual subscription, or $6.99 if bought monthly.
The service, available May 11, lets users play tunes from a catalog of more than one million songs, transfer tracks to portable devices and share music with friends through Yahoo Messenger.
[…] P. J. McNealy, an analyst with American Technology Research, said: “Yahoo’s clearly putting big pricing pressure on folks like Real and Napster. Neither have the advertising leverage that Yahoo has, so this has the potential to be highly disruptive to any digital music subscription service, particularly Napster since its a pure-play digital music company.”
Later: Music stocks are out of tune
Music stocks hit a low note Wednesday after Yahoo! Inc. unveiled its new online music subscription service and drastically undercut the prices of the current industry leaders.
[…] RealNetworks stocks plunged over 20 percent in afternoon trading on the Nasdaq.
Shares of Napster sank 32 percent. […]
Shares of Apple Computer Inc. (Research), which doesn’t offer a subscription service but rather allows users buy individual songs or albums through iTunes, fell nearly 5 percent on the Nasdaq.
Yahoo! shares edged higher.
“Clearly, this is a reaction to Yahoo’s aggressive entry into the space,” Steven Frankel, an analyst with Adam Harkness Inc., told Reuters “They were expected to enter the market, they were expected to be aggressive, but they were not expected to be this aggressive.”
The German media company Bertelsmann said yesterday that it would buy Columbia House, a membership-based seller of DVD’s and CD’s, from the buyout company Blackstone Group.
The company would not confirm the value of the deal, but The Wall Street Journal Europe said the purchase price was $400 million. Blackstone owns 85 percent of Columbia House; Sony and Time Warner own the remainder.
Bertelsmann said it would combine Columbia House with its music club BMG Direct to create broader offerings for the clubs’ members.
Officials from the National Association of Realtors plan to meet with U.S. Justice Department officials in Washington, D.C., on Wednesday in a bid to stave off a federal lawsuit that could increase competition in the online real estate market and potentially lower the soaring cost of home prices.
The Wall Street Journal broke the story on Monday, saying that the Justice Department plans to accuse the nation’s primary realty association of trying to “stifle Internet-based rivals and discounters” through a bylaw — set to go into effect this July — that would allow its members to withhold their property listings from online brokers. Such a move would not only put those brokers at a competitive disadvantage, but it would keep the properties’ sellers from taking advantage of their often discounted commissions, the Journal reported.
This development adds real estate to the list of businesses reeling from the perpetually increasing popularity of the Internet.
Or not. Warner Music offering falls flat
Shares in the group were priced well below their estimated $22-24 range, at $17 per share, one underwriter said.
[…] Warner’s IPO has been criticised by some analysts for the high valuation underwriters gave to it.
“Given the fundamental industry revenue outlook, peer group valuations, limited financial disclosure and bloated balance sheet, the estimated IPO range of $22 to $24 per share looks remarkably aggressive and underwhelming,” said Michael Nathanson of investment group Sanford C Bernstein.
[Clint] Fayling’s fledgling outfit, Brickhouse Mobile, is working with pornography purveyors and other companies to deliver sexually explicit material — including ring tones, wallpaper and video — to mobile users.
[…] In Europe, South America and elsewhere around the world, such content is hardly unusual. Anything goes.
It’s just getting started in the United States, and critics are likely to fight the trend, but like it or not, pornography has moved beyond the realm of magazines, home movies and the Internet.
Mobile phones are the next frontier.
Brickhouse Mobile already has deals with companies such as Vodafone to bring everything from pictures of naked women to hard-core porn videos to cell phones overseas, he said.
“In the U.S., it’s a different story,” Fayling said.