Cisco Government Affairs E-Update

Volume 2, Issue 40

15 November 2002

Brought to you by Cisco Government Affairs Online: http://www.cisco.com/gov

This Week@Cisco in Government Affairs

Cisco's E-Update keeps you up to date on the major policy news of the week. Focusing on broadband, education and e-government areas, but covering high-tech and telecom in general, the E-Update is a great source of information for policymakers. To subscribe, send a message with “subscribe” in the subject line to “Subscribe-eUpdate@cisco.com

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This Week@WASHINGTON, DC

FCC CLEARS COMCAST'S AT&T DEAL - The FCC's approval of Comcast's proposed acquisition of AT&T Broadband positions the cable giant to do more than further dominate the cable industry. The deal would double the size of Comcast relative to its nearest competitor while also making it the largest provider of high-speed Internet service in the nation. The commission voted 3-1 down party lines, with Michael Copps dissenting on the grounds that Comcast's position would create too much potential for abuse. The Department of Justice also indicated that it would not oppose the deal, which creates the first US cable company with national reach. http://www.washingtonpost.com/wp-dyn/articles/A51219-2002Nov13.html

NEW COMMISSIONER AT FCC - The Senate on Thursday approved one of outgoing Majority Leader Tom Daschle's aides for the Federal Communications Commission after almost a year of bickering over President Bush's nominations.  Bush announced back in February that he would nominate Jonathan S. Adelstein, a legislative assistant for Daschle since 1995, for the FCC.  http://story.news.yahoo.com/news?tmpl=story2&cid=536&ncid=536&e=17&u=/ap/20021115/ap_on_go_ot/fcc_adelstein

ILECs, CLECs FACE OFF AT NARUC - At the National Association of Regulatory Utility Commissioners annual convention in Chicago this morning, a group of representatives from ILECs and CLECs this morning held a round table to discuss the state of relations between their companies. And to no one's surprise, the two sides continued to harp on the UNE-P pricing and availability, with the ILECs arguing for a change and the CLECs supporting the current structure.  http://telephonyonline.com/ar/telecom_ilecs_clecs_face/index.htm

BABY BELLS HOPING FOR A REPRIEVE - Senator Ernest F. Hollings, Democrat of South Carolina, gatekeeper role as chairman of the Commerce Committee helped to stifle a bill that was backed by the regional Bell telephone companies and had passed the House by an almost two-thirds majority. The legislation, which would have freed the Bells from being forced to lease their advanced data communications networks to competitors, had been opposed by AT&T and other communications carriers who count Senator Hollings among their allies.  But now that the Republicans have regained control of the Senate, Senator Hollings will be replaced as the committee's chairman by John McCain, the Arizona Republican who had led the panel until a year and a half ago and has a close relationship with the chairman of the Federal Communications Commission. By tradition, the Commerce Committee typically takes the lead on communications issues. http://www.nytimes.com/2002/11/11/business/11TELE.html  (Free registration required)

CAN THE GOP RESCUE TECH? - Tech industry lobbyists are licking their chops at the prospect of a GOP-led Congress.  While the political leanings of many digerati fall somewhere between radical libertarianism and extreme ambivalence, the CEOs who run technology companies and the organizations that represent them in Washington are eager for the new Congress to get under way. It's easy to see why: According to a News.com analysis, Senate Republicans voted in accordance with the tech industry's views 84 percent of the time, compared with 65 percent for Senate Democrats. House Democrats went along with tech 43 percent of the time, while 89 percent of House GOP votes sided with tech.  http://www.business2.com/articles/web/0,1653,45093,FF.html?nl=ti

HOUSE PASSES HOMELAND SECURITY BILL - The U.S. House of Representatives overwhelmingly passed legislation on Wednesday to create a Department of Homeland Security, handing President Bush a major victory in his war against terrorism.  The Senate, in perhaps one of the final acts of the 107th Congress, is expected to give final congressional approval within a week, clearing the way for Bush to sign it into law.  Proposed by Bush in response to the Sept. 11, 2001, attacks on the United States, the measure would trigger the biggest U.S. government reorganization in a half century by rolling into the new department all or parts of 22 existing federal agencies, including the Coast Guard, Border Patrol and Secret Service.  http://story.news.yahoo.com/news?tmpl=story2&cid=584&ncid=584&e=3&u=/nm/20021114/pl_nm/congress_homeland_dc

CONGRESS APPROVES WEB RADIO ROYALTY DEAL - The U.S. Congress approved a deal early Friday morning that would allow small Internet-based radio stations to pay lower royalty rates to the musicians and record labels whose songs they use.  In a late-night session, both the House of Representatives and the Senate passed a bill that would give copyright holders and "Webcasters," who stream radio-style broadcasts over the Internet, authority to set royalty rates depending on whether the operator was a large commercial operation, a hobbyist or a noncommercial station.  http://story.news.yahoo.com/news?tmpl=story&ncid=582&e=1&cid=582&u=/nm/20021115/wr_nm/tech_webcasters_dc

FCC LETS WIRELESS FIRMS 'OPT OUT' OF LICENSE BIDS - Federal regulators, moving to end a long-running period of uncertainty, said they would free major wireless companies of their obligation to pay about $16 billion they bid in an ill-fated government spectrum auction.  The Federal Communications Commission, citing the "serious economic difficulties" of the wireless industry, freed the carriers from obligations to pay for licenses held by NextWave Telecom Inc. The FCC in March had returned $2.8 billion of the carriers' combined $3.3 billion in down payments.  http://online.wsj.com/article/0,,SB1037310235765896628,00.html (Paid subscription only)

IRS AWARDS ONLINE TRAINING PACT - The Internal Revenue Service has awarded a contract to Plateau Systems Ltd. that will deliver a new e-learning initiative, including helping to train 100,000 IRS workers online about the ever-changing tax code.  The initiative will put as much as 50 percent of the agency's learning material online by 2006.  http://www.fcw.com/fcw/articles/2002/1111/web-irs-11-15-02.asp

DEPARTMENT OF COMMERCE, OFFICE OF TECHNOLOGY POLICY - Global Tech Update: Issue No.1 – The European Union’s Research Framework Program - http://www.ta.doc.gov/reports/GlobalTech/0111-Update1.pdf

This Week@EMEA

BUSINESS ORGANISATIONS JOIN THE COMMISSION IN GROWING CALL FOR URGENT HIKE IN RESEARCH SPENDING - European business leaders today added their voices to calls for increased research efforts to strengthen EU competitiveness, economic growth and employment. The call came during a panel discussion in the framework of the "Research 2002" conference in Brussels organised by the Union of Industrial and Employers' Confederations in Europe (UNICE) on "Challenges for lifting European R&D expenditure from 1.9% to 3% of GDP".  http://europa.eu.int/rapid/start/cgi/guesten.ksh?p_action.gettxt=gt&doc=IP/02/1663|0|RAPID&lg=EN

THE LAND OF MILK, HONEY AND I.T. - According to market research firm Teleconomy, a proactive government, corporate funding from firms such as IBM and a well-wired university system have enabled Israel to stand out as a high-tech powerhouse in the Middle East. Internet access in the country is steadily growing each quarter, with a penetration in Q4 2002 of over 37%. Teleconomy reports that in Q3 2002, there were nearly 820,000 households and 115,000 businesses with internet access. http://www.emarketer.com/news/article.php?1001844&c=newsltr&n=lead&t=ad

This Week@Asia/Pac

CHINA'S PRESIDENT STEPS DOWN TO MAKE WAY FOR NEW GENERATION - Jiang Zemin's retirement as Communist Party chief was confirmed this morning as he triumphantly closed a party congress that glorified his 13-year tenure and wrote his theory for broadening the party's base into its Constitution, alongside the thoughts of Marx, Mao and Deng Xiaoping.   Of the top seven officials, the only one who will stay on, the announcement said, is Hu Jintao, 59, the longtime heir apparent whose ascension on Friday to the country's top job, general secretary of the Communist Party, appears certain.  http://www.nytimes.com/2002/11/14/international/asia/14CHIN.html (Free registration required)

ASIA OUTPACES THE WORLD IN DSL - According to In-Stat/MDR’s “Worldwide DSL Market: Asia Thrives as US Slows” report, Asia-Pacific has grabbed a slice of the global digital subscriber line market that nearly equals the combined market share of Europe and North America. http://www.emarketer.com/news/article.php?1001835&c=newsltr&n=lead&t=ad

This Week@Americas/International

PANAMA CRACKS DOWN ON NET TELEPHONY - The Panamanian government has ordered local Internet service providers to take steps aimed at blocking Internet telephone traffic that passes through the country.  The Oct. 25 decision requires ISPs to begin blocking 24 UDP ports, including the gateways most commonly used to shuffle so-called VoIP (voice over Internet Protocol) telephone calls. VoIP is currently banned in the country, whose phone services are provided under an exclusive contract through January 2003 with Cable & Wireless Panama, a joint venture between the government and the U.K.-based phone giant Cable & Wireless. http://news.com.com/2100-1033-965073.html

CANADA: AN ONLINE NATION - More than half (56 per cent) of all Canadians have used the Internet in the past two years to research travel information, and more than six million (26 per cent) Canadians 18 years of age or older have used the Internet to book and pay for a vacation in the past two years. http://www.newswire.ca/releases/November2002/12/c0933.html

This Week@US States

STATE COALITION APPROVES INTERNET SALES TAX PLAN - Revenue-hungry states today took the first step toward building a national framework for taxing items sold over the Internet.  In a meeting in Chicago, lawmakers and tax officials from 30 states -- including Virginia and the District of Columbia - endorsed a proposal to simplify their tax laws and enter into a voluntary pact to collect online sales taxes. Maryland officials present at the meeting abstained from today's vote.  http://www.washingtonpost.com/wp-dyn/articles/A40364-2002Nov11.html

TEACHERS MAINELY HAPPY WITH TECH - When Maine Gov. Angus King unveiled his plan to put a computer in the hands of every seventh-grader in the state, some thought the idea was as loony as trying to catch a laptop in a lobster trap.  Teachers in particular were concerned. After all, they would be expected to use the machines with their students -- many of whom knew more about computers than they did.  http://www.wired.com/news/school/0,1383,56284,00.html

OTHER TECH STORIES OF THE WEEK

BABY BELLS ON HOLD - The Baby Bells, which own the wires connecting the vast majority of U.S. homes and businesses to global communications networks and lease access at regulated rates to other companies that want to provide voice or data services, may have escaped the worst of the current telecom turmoil. But despite their advantages, their traditional revenues are faltering. Competitors are making inroads into the local-phone-service market--so far, 6 percent of it. Meanwhile, the number of fixed-access telephone lines in U.S. homes and businesses declined sharply in 2001, by 9 million lines (nearly 5 percent), because wireless communications are expanding and many customers, who now want high-speed Internet service, are relinquishing their second dial-up line. Furthermore, the Baby Bells’ version of high-speed access, DSL (digital subscriber line), is increasingly losing out to the broadband offers of cable companies.

http://news.com.com/2009-1085-965818.html

GOVERNMENT ONLINE AROUND THE WORLD - The number of people around the world going online for government information and other resources grew from 26% in 2001 to 30% this year, reports TNS. Learn what these people are doing on government websites and which countries are the most active.  http://www.emarketer.com/news/article.php?1001828&c=newsltr&n=lead&t=ad

’NOISY LIGHT’ IS NEW KEY TO ENCRYPTION - Scientists at Northwestern University say they have harnessed the properties of light to encrypt information into code that can be cracked only one way: by breaking the physical laws of nature.  This high-speed quantum cryptography method allowed the scientists to send encrypted data over a fiber-optic line at 250mbps (megabits per second), which the researchers said was more than 1,000 times faster than what was achievable with existing quantum technology.  http://msnbc-cnet.com.com/2100-1001-965957.html

GROWING WI-FI SERVICES CAST WIDE NET - Demand for Wi-Fi -- wireless Internet technology -- seems primed to explode.   With several locations providing wireless "hotspots" to customers and companies such as Microsoft and T-Mobile offering compatible hardware and services, consumers have begun to jump on the Wi-Fi bandwagon. Private sector plans to further stimulate demand include developing Wi-Fi-ready devices, increasing the number of public Wi-Fi hotspots and creating more reliable security measures to protect against hacking. The technology is not without its bugs -- namely the fact that its spectrum is unregulated and signals often compete on the same frequency -- but proponents claim that Wi-Fi's potential outweighs the short-term bugs.  http://www.usatoday.com/tech/news/techinnovations/2002-11-13-wi-fi-technology_x.htm

SPANNING THE WORLD WITH WIRELESS DATA - International travel used to present a fair number of communications challenges. Often the best way to stay in touch with the home or home office is to call in regularly from a hotel phone.  Wireless phones changed that. In particular, the tri-mode GSM phone, which works on wireless networks in the U.S., Asia, Europe, Australia and much of Africa, has become the type of mobile phone to have among the globe-hopping set. http://www.forbes.com/2002/11/12/cx_ah_1112tentech.html

TELECOM GIANTS WAGE AD BATTLE OVER NETWORK SHARING - The latest clash in the arcane, long-running battle over how to regulate the Baby Bell phone companies is being played out on television screens and in newspapers across the country.  In a series of rancorous ads running from San Jose to Washington, D.C., the giants of telecom are going toe to toe over rules that require the Bells to share their monopoly local phone networks with rivals such as AT&T and MCI.  http://www.siliconvalley.com/mld/siliconvalley/4506681.htm

WORLDCOM NAMES CAPELLAS AS CHAIRMAN, CEO - Michael Capellas, recently departed from computer maker Hewlett-Packard Co. on Friday was named chairman and chief executive officer or WorldCom Inc. taking up the challenge to turnaround the bankrupt telecommunications provider as it tries to rid itself of accounting scandals and retain customers. http://story.news.yahoo.com/news?tmpl=story2&cid=568&ncid=749&e=1&u=/nm/20021115/bs_nm/worldcom_capellas_dc

TECH FIRMS OFFER STOCK OPTIONS DISCLOSURE PLAN - A coalition of high-tech companies says it will pledge today to disclose more information about stock options in an urgent bid to avoid proposed accounting rules that would hurt corporate profits.  So far, 33 companies including Intel, Cisco Systems and Sun Microsystems are vowing they will report every quarter who gets options and how much money executives make when they cash in. Current law requires such disclosures only once a year.  http://www.siliconvalley.com/mld/siliconvalley/4517091.htm

BAKING SODA, VINEGAR, AND MEASURING CUPS BECOME LAB MATERIALS FOR ONLINE CHEMISTRY COURSE - Two science professors have cooked up a way for distance-education students to fulfill their science-lab requirements -- by turning their kitchens into chemistry labs. The professors say their approach, currently being fine-tuned, can help provide online students with laboratory courses, which are often required for undergraduate degrees.  Instead of using test tubes and beakers, the students make do with measuring cups and saucepans. The professors say the students come out with an understanding of introductory chemistry comparable to that of their on-campus peers.  http://chronicle.com/free/2002/11/2002111201t.htm

FACTS & STATS

CUSTOMER REACH EXTENDED BY THE NET - Over 80 percent of American small businesses with websites live during the 2001 holiday season reached new customers, reports E-Commerce Times. http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358532&rel=true

MORE UK COMPANIES PERMITTING TELEWORKING - Silicon.com reports that over 80 percent of companies in the UK now  have employees who work from home on a regular or occasional basis.   http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358542&rel=true

MORE THAN A MILLION NET CONNECTIONS IN CHILE - Business News Americas reports that Chile will have more than a million Internet connections by the end of 2002.  http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358524&rel=true

EGOVERNMENT BECOMING MORE POPULAR - The proportion of adults worldwide using the Internet to access government services or products has increased by 15 percent over the past 12 months, according to Taylor Nelson Sofres.  http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358535&rel=true

EUROPEANS NOT INTERESTED IN BROADBAND - The BBC reports that a large number of European Internet users are still reluctant to make the switch to broadband.  http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358537&rel=true

DSL IS THE LEADING BROADBAND TECHNOLOGY - Digital Subscriber Line (DSL) has surpassed cable to become the world's most popular broadband technology, according to In-stat/MDR.  http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358534&rel=true

OVER 15 MILLION BROADBAND SUBSCRIBERS IN US - America's leading cable and DSL providers added a combined 1.68 million broadband users in the third quarter, to bring the total  number of high-speed Internet subscribers in the US to 15.6 million.  http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358540&rel=true

TEN MILLION BROADBAND SUBSCRIBERS IN KOREA - The number of broadband subscribers in Korea passed the 10 million mark by the end of October, reports The Korea Herald.    http://www.nua.com/surveys/index.cgi?f=VS&art_id=905358530&rel=true

CISCO GOVERNMENT AFFAIRS@2002

Cisco’s top policy focuses for 2002 are the areas of Education, Broadband Deployment and eGovernment. 

E-UPDATE ARCHIVE

To view past issues of Cisco’s Government Affairs E-Update, visit our E-Update Archive page. http://www.cisco.com/gov/archive/eupdates/index.html

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