In a statement Friday, AT&T said commissioners won’t be able to vote a proposal announced Tuesday from FCC Chairman Julius Genachowski that the $39 billion merger be sent before an administrative law judge. The carrier announced it had withdrawn its FCC application in the early hours of the Thanksgiving holiday in the U.S.

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Everyone has something to say about today’s speech by FCC Chairman Julius Genachowski on the subject of net neutrality (video below). Having been blocked in the courts from imposing sanctions on Comcast for throttling users of BitTorrent, the commission has been spinning its wheels trying to find a way to nudge the broadband industry in a direction toward treating all Internet content fairly.

To Genachowski and network neutrality proponents, a bit is a bit is a bit, and your broadband service provider should have nothing to say in blocking you from using the services and applications that you choose and saying what you want to say so long as you’re not breaking any laws.

It makes sense until you hear rebuttals from the providers who spend billions to build the networks, arguing that they should have some right to protect their networks from cases where the heaviest users–video-downloading BitTorrent users are the classic example–can degrade the experience of other users. Think of it as “My network, my rules.”

Without the legal authority to force net neutrality on the providers, Genachowski has circulated draft rules that would instead require them to disclose what they intend to throttle and why, so that consumers can more intelligently choose whom they’re going to do business with. If there are going to be rules, put them on a sign where all can see them before walking in the door, he’s saying here.

Gone is the talk of reclassifying broadband, which some had described as a sort of “nuclear option” that would potentially give the FCC the authority to force net neutrality on the carriers, and would have probably led to more pointless, expensive lawsuits.

The big shift came when Genachowski said he’d be open to “business innovation to promote network investment and efficient use of networks, including measures to match price to cost such as usage-based pricing.”

That means broadband providers can start creating variable price plans under which consumers will pay more for using more.

Oh, and the wireless Internet? It’s too early in its lifetime to impose any rules on it. The FCC, he said, “would closely monitor the development of the mobile broadband market and be prepared to step in to further address anti-competitive or anti-consumer conduct as appropriate.”

The reactions have been predictable:

It’s “not perfect,” but it’s reasonable, says Kyle McSlarrow, president of the National Cable & Telecommunications Association. If the order changes materially, however, the group reserves the right to fight it.

It’s a step in the right direction but needs to be “strengthened,” says Gigi Sohn of Public Knowledge, a Washington, D.C., public interest group.

Tyrone Brown of the Media Access Project says he is “very disappointed.” By taking the reclassification option off the table, the FCC loses a key piece of the legal authority it would otherwise need to require service providers to extend broadband service to people who don’t currently have access, which has been a key objective of the Obama administration.

Josh Silver, president of FreePress, another policy organization that advocates for net neutrality, called it “fake Net Neutrality” and said that “Genachowski is taking the same exact approach to splitting the open Internet into fast and slow lanes that Verizon and Google proposed last summer.”

Republican FCC Commissioners Robert McDowell and Meredith Attwell Baker essentially promised to vote against the proposal when it comes before the commission on Dec. 21. Only Congress, Baker said, should decide if the Internet is to be regulated. Unlikely with the GOP taking control of the House in less than a month. “We don’t have authority to act,” he said.

After all that: Comcast stock is up 4 percent today; Verizon shares up one percent; Time-Warner shares are up more than two percent; Cablevision shares are up about 1.5 percent. This news will be a boon to broadband providers, says Sanford Bernstein analyst Craig Moffett in a research note issued today.

Usage-based broadband plans are probably soon to follow, which would be good for business because consumers would probably embrace them. One question for all the critics: Would that be so bad?

Here’s the video of the speech:

While executives at both AdMob and Google are pulling out all the stops to convince federal government regulators otherwise, multiple sources close to the situation said that the pair now expect the Federal Trade Commission to try to block the acquisition of the small mobile advertising start-up by the search giant.

While the situation could change, of course, sources said that the lack of any kind of indication of clear direction of the inquiry this late in the game by FTC staff–which recommends action to its five commissioners–is a bad sign.

“The federal government is looking for a way to discipline Google in some way, because of larger concerns about its search power on the Web,” said one source. “And this is where it looks like it will try to show that concern.”

Action could come as early as this week, but is more likely next week, in the form of a request for a preliminary injunction to stop the transaction due to antitrust concerns.

As luck would have it, late last week on a Virgin America redeye to Dulles Airport near Washington, D.C., BoomTown ran smack into AdMob Founder and CEO Omar Hamoui, who was on the same flight.

Unfortunately for Silicon Valley’s luckiest entrepreneur of 2009–he sold the San Mateo, Calif. start-up to Google (GOOG) for $750 million last November–it was yet another of a half-dozen trips back east so far that have taken on a less than pleasant tone.

Hamoui, who usually has a fresh-faced demeanor, was clearly looking a lot more haggard than usual.

He declined to comment in detail about the situation, only noting that, “I have been trying to explain our business, which is still nascent, to the FTC.”

That’s a big problem, of course, since Hamoui’s real job is to keep his start-up cooking with gas until it is officially bought by Google.

Along with keeping up with competitors–such as Quattro Wireless, which was bought by Apple in January–Hamoui is now hampered in hiring new staff for AdMob, as it waits in limbo.

That’s because AdMob has no currency now to offer engineers,

In addition, first pointed out by MediaMemo’s Peter Kafka, since Apple (AAPL) lost out on its attempt to buy AdMob to Google, he’s also facing a less-than-cooperative company whose iPhone has been one of AdMob’s key devices to place ads on.

And Apple recently issued some new rules–thus far, unenforced–that could hurt AdMob’s ability to take advantage of the powerful iPhone smartphone platform.

Such growing rivalry is the main argument that Google and AdMob have been pushing, noting that the mobile ad business is still small and also pointing to a recent survey that shows the combined entity has only 21 percent of the market.

But that point does not seem to have moved the FTC, which has been asking for reaction of the deal from a range of sources, such as advertisers, even as Google has been soliciting official support from a number of tech sources.

In addition, lawmakers have also been agitating the FTC to act, along with intense lobbying by Microsoft (MSFT) and also public interest groups.

“The FTC really wants to do this and is in search of a legal theory that it can win with,” said a close observer of the situation.

Bloomberg also reported Friday that the FTC was urging the filing of an antitrust suit to challenge the deal.

In other words, big regulatory trouble for Google, and–more to the point–questions over the fate of AdMob.

“It feels like AdMob is going to suffer collateral damage for a bigger fight going on about reining in Google,” said one source.

And, until the verdict is in, here’s a video of an interview I did with Hamoui in late 2008, when life was a lot simpler and bureaucrat-free for him:

Please see this disclosure related to me and Google.

]]> http://allthingsd.com/20100503/close-encounters-of-the-regulatory-kind-admob-google-braces-for-the-worst/feed/ 3 http://allthingsd.com/20090629/welcome-to-the-fcc-julius-now-get-to-work-on-a-national-broadband-plan-please/ http://allthingsd.com/20090629/welcome-to-the-fcc-julius-now-get-to-work-on-a-national-broadband-plan-please/#comments Mon, 29 Jun 2009 20:04:21 +0000 Kara Swisher http://kara.allthingsd.com/?p=15185

Last week, after much delay, longtime Internet exec Julius Genachowski (pictured here) was confirmed by the Senate as the chairman of the Federal Communications Commission.

It is an important role for the future development of the Web, of course, although it took a dog’s age into the new Democratic administration to approve him.

Hopefully, he and the other commissioners can soon get to work on a wide range of major digital issues, such as a national broadband plan that does not cost Americans a fortune.

Genachowski, a close tech adviser to President Barack Obama, was seated along with Commissioner Robert McDowell, a Republican appointee who was confirmed for a second FCC term.

After the Senate approves two others–Democrat Mignon Clyburn and Meredith Attwell Baker for the GOP–in the next month, it will round out the five-member panel.

(The other FCC commissioner is a Dem, Michael Copps, who has been acting chairman while Genachowski got approval.)

Genachowski, a former FCC staffer, was most recently working as a VC at Rock Creek Ventures and LaunchBox Digital. But he is best known to many in Silicon Valley as a top exec at IAC/InterActiveCorp. (IACI).

He is likely to make his debut to chair his first meeting this coming Thursday, and it is a humdinger of dull:

According to the FCC’s Web site, the July open meeting, held in Washington, D.C., will consider three items:

1.) Amendment of the Commission’s Rules to Provide Spectrum for the Operation of Medical Body Area Networks: The Commission will consider a Notice of Proposed Rulemaking to allocate spectrum and establish service and technical rules for the operation of Medical Body Area Networks to monitor patients’ physiological data.

2.) Amendment of Service and Eligibility Rules for FM Broadcast Stations: The Commission will consider a Report and Order concerning changes in the FM translator rules to allow AM broadcast stations to rebroadcast their signals on eligible FM translator stations.

3.) Amendment of Part 101 of the Commission’s Rules to Accommodate 30 Megahertz Channels in the 6525-6875 MHz Band: The Commission will consider a Notice of Proposed Rulemaking addressing whether to provide licensees with authority to operate on channels with bandwidths up to 30 megahertz in the Upper 6 GHz band and whether to extend conditional authority to two additional channel pairs in the 23 GHz band, as well as an Order addressing a related waiver reques.

But the site also mentioned that “the Meeting also will include a presentation on the status of the Commission’s process for developing a National Broadband Plan.”

Now, that is something BoomTown would like to know about since this country is effectively still in the dirt-road period, in terms of high-speed broadband access for Americans.

But, of course, the cost of what we do get–which is very substandard compared to a lot of other countries–is also very pricey.

Let’s hope Genachowski–who has a lot of other issues on his plate, especially as the media industry undergoes drastic reconfiguration too–can do something about it.

In a related note, Lawrence Strickling was also OK’d to run the telecom division of the Commerce Department, which is the agency with the dough ($4.7 billion in government funds) to help the create this supposed Internet infrastructure boom with the FCC.

I remain dubious of any movement in the arena, but still hopeful.

And, until there is some action from Genachowski, here is a highlights video from an onstage interview Walt Mossberg and I did with former FCC chairman Kevin Martin–along with Verizon (VZ) Wireless CEO Lowell McAdam–at the sixth D: All Things Digital conference in 2008.

Here is the D6 video:

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