Blumenthal

Three Democratic senators are calling for an investigation into why nearly 10 million phony net neutrality comments were allowed to be included on the record as part of the Republican majority decision to rescind the rules in early 2018.

Sens. Ed Markey (Mass.), Richard Blumenthal (Conn.), and Brian Schatz (Hawaii), jointly signed a letter addressed to the FCC’s Inspector General claiming the net neutrality matter was likely clouded by industry-funded lobbyists and astroturf groups, possible Russian interference, and intransigence by Republican FCC officials unwilling or unable to investigate the phony comments.

The New York Attorney General’s office has made significant progress in its own independent investigation, identifying 14 so-called “groups of interest” that could have subverted the net neutrality debate with fake comments from non-existent individuals, comments from those whose identities had been stolen, duplicate comments, and signatures on questionnaires and petitions that may have misled the public about the definition of net neutrality.

New York subpoenaed industry-friendly special interest, lobbying, and public strategy groups including: Broadband for America, the Center for Individual Freedom, Century Strategies, CQ Roll Call, LCX Digital, Media Bridge, the Taxpayers Protection Alliance and Vertical Strategies.

Markey

Freedom of Information requests and the ongoing investigation uncovered multiple historical instances of manipulation and potentially counterfeit comments, according to the senators:

• CQ Roll Call submitted “millions of individual comments” on behalf of a paid client in the broadband privacy docket.
• In 2014, Broadband for America claimed many community organizations, veterans groups, and small businesses were opposed to net neutrality, but in fact these groups had no position on the issue and in some instances claimed they never heard of Broadband for America.
• Media Bridge was involved in assisting a group called American Commitment to flood the net neutrality docket with duplicative comments hostile to net neutrality. Media Bridge sells companies on manipulating the public debate on issues, claiming “if your organization wants to stop ‘showing’ and start dominating the issues, pick up the phone and give Media Bridge a call.”
• The Center for Individual Freedom was responsible for submitting comments that repeated the inflammatory phrase, “unprecedented regulatory power the Obama administration imposed on the internet.” A Wall Street Journal investigation found that 72% of those comments may have been falsely submitted.

Schatz

“The Commission’s apparent disinterest in investigating fraudulent comments risks undermining public trust in the FCC’s rule-making process. Presently, the only efforts at accountability have been led by the New York State Attorney General and the Government Accountability Office (GAO), prompted by a request from Congress,” the senators’ letter reads. “The status of cooperation with both is unclear, and the FCC has previously resisted requests from the NY AG. Moreover, while journalists have sought to conduct their own research through FOIA requests, the Commission has ignored those requests and withheld documents under dubious exemption claims. Given the seriousness of this issue, the FCC should respond transparently and thoroughly, and fully cooperate with all attempts to investigate fraudulent comments.”

The senators are requesting the FCC’s Inspector General investigate:

• What policies are in place at the FCC to investigate and address fake comments?
• When did the FCC first become aware of the fraudulent comments?
• Was the FCC aware of the sources of these comments, and did they investigate them?
• Is the FCC fully cooperating with the NY Attorney General and GAO and is the agency turning over requested documents? If not, why?
• What is the status of FOIA requests at the FCC. Are they being handled in a timely and responsive manner? Were denials and exemptions appropriate?

Pai

Despite the potential for a Democratic Party takeover of the U.S. House of Representatives that is likely to usher in a new era of more aggressive oversight of the Republican-dominated Federal Communications Commission, current chairman Ajit Pai “plans to lead the FCC for the foreseeable future.”

Multichannel News reports Pai is unlikely to leave his post just two years after being appointed to the position by President Donald Trump, despite an ethics controversy over alleged assistance given to Sinclair Broadcast Group to allow the company to acquire more stations despite a federal ownership cap on the number of stations that can be owned by a single entity. Pai also was responsible for a highly controversial decision to cancel net neutrality provisions enacted during the Obama Administration.

“Chairman Pai remains focused on his key priorities, including bridging the digital divide, fostering American leadership in 5G and empowering telehealth advancements,” said Brian Hart, director of the FCC’s office of media relations.

Should both the Senate and House flip to Democrats in next week’s midterm election, Pai’s agenda of deregulation, media consolidation, and elimination of many Obama-era consumer protections would be in peril and subject to determined Congressional oversight.

Pai has taken heat from consumer groups for ending a set-top box competition program that could have forced television providers to accept equipment obtained competitively in the retail market. He also faced criticism for reinstating a program giving UHF TV station owners the opportunity to acquire more stations, directly benefiting Sinclair and allowing it to pursue its since failed merger with Tribune Broadcasting.

What began two years ago as the paid streaming service of Turner Classic Movies and grew into a highly respected catalog of 1,800 critically acclaimed films, has been axed by its new owner, AT&T, because it failed to attract a mainstream audience of subscribers.

FilmStruck was the five-star version of Netflix, a niche-streaming service that curated a vast collection of art house, international, independent, classic, and cult favorite films that was perceived by many critics as an essential treasure trove of films. Among the titles: “Casablanca,” “Rebel Without a Cause,” “Singin’ In the Rain,” “Citizen Kane,” “The Music Man,” “Bringing Up Baby,” “The Thin Man” and “Who’s Afraid Of Virginia Woolf?” from Warner Bros. Other classics included: “Babette’s Feast,” “Blow Out,” “Boyhood,” “Breaker Morant,” “Chicago,” “A Hard Day’s Night,” “My Life as a Dog,” “Our Song,” “The Player,” “A Room with a View,” “Seven Samurai,” “The Seventh Seal,” “Thelma & Louise,” “The Times of Harvey Milk” and “The Umbrellas of Cherbourg.”

Last Friday morning, subscribers received a disappointing email:

We regret to inform you that effective November 29, 2018, FilmStruck will be shutting down. As a subscriber currently on a monthly plan, effective immediately you will no longer be billed for FilmStruck and will continue to have access to the service until November 29.

We would like to take this opportunity to thank you for being a FilmStruck subscriber. It has been our pleasure sharing the best of indie, art house, and classic Hollywood with you. FilmStruck was truly a labor of love, and in a world with an abundance of entertainment options – THANK YOU for choosing us.

If you have any questions please visit our FAQs or email the FilmStruck customer service team at [email protected] You can also manage your account by clicking here.

Thank You,
The FilmStruck Team

Customers were informed all levels of the FilmStruck service were being discontinued. This included the FilmStruck Only Monthly package, the FilmStruck+Criterion Monthly package, the FilmStruck+Criterion Annual package, and the FilmStruck+Criterion Student package. Customers on annual plans will receive a pro-rated refund of the remaining term of their subscription.

“We’re incredibly proud of the creativity and innovations produced by the talented and dedicated teams who worked on FilmStruck over the past two years. While FilmStruck has a very loyal fanbase, it remains largely a niche service,” AT&T’s Turner and WB Digital Networks said in a statement. “We plan to take key learnings from FilmStruck to help shape future business decisions in the direct-to-consumer space and redirect this investment back into our collective portfolios.”

In fact, AT&T has been pressing hard to wring cost savings out of its multi-billion dollar acquisition of Time Warner, Inc., now known as WarnerMedia. AT&T has sent a clear message it will not be in the niche content business.

On Oct. 16, AT&T ordered the closure of DramaFever, a Warner Bros. subscription video on demand service offering Korean dramas.

Last week, the company also announced it was pulling the plug on Super Deluxe, a Millennial-targeted content producer that claimed to reach 52 million 18-34 year olds, with 165 million views across Facebook, Twitter, YouTube, and Instagram. AT&T called Super Deluxe “duplicative.”

The first sign that AT&T intended to be aggressive about changing Time Warner’s media businesses took place at a June “town hall” meeting with new HBO executive John Stankey, when employees learned AT&T was impatient with its newly acquired premium movie channel. Stankey made clear AT&T was gunning to push for major changes at HBO, pulling away from a decades-old format showing movies repeated a dozen times a month and a handful of very expensive, but award-winning TV series. The future of AT&T’s HBO will be closer to a Netflix competitor, releasing enough new shows and original content to attract mainstream audience viewing for several hours a day. To make this possible, AT&T will have to provide HBO with a bigger budget, funded in part from money transferred away from services like FilmStruck.

AT&T sources have leaked word that the company will eliminate most of Time Warner/WarnerMedia’s projects that are not proven major producers of revenue to fulfill promises to Wall Street that AT&T’s acquisition will eventually result in substantial financial growth for investors.

The Criterion Collection

FilmStruck subscribers and some Hollywood critics feel blindsided by the decision to shutter the streaming service. New Yorker author Richard Brody minced no words — “Nothing but contempt for the Mr. Potters who are shutting down FilmStruck,” Brody wrote in a scathing opinion piece.

Among consumers, disgust over the decision ranged from shock from Turner Classic Movies fans over AT&T’s decision to shut down a service showing movies not mired in violence, sex, and immorality, to film buffs disillusioned with Hollywood’s mainstream commercial films left furious over the abandonment of a central depository of independent, high quality cinema.

AT&T believes the next generation of streaming will be much less about putting together collections of old movies or producing niche, low-budget movies and series to appeal to the Netflix crowd. Instead, the next war will be fought over high-budget, high-expectation mainstream movies and series streamed on premium subscription services. WarnerMedia will launch its own paid streaming service in 2019. It will face similar paid services launching late next year from some of America’s largest media conglomerates, including Disney. Among Disney’s planned original productions for its forthcoming service, new episodes of the animated Star Wars: The Clone Wars, a new, premium budget live-action Star Wars series from Jungle Book and Iron Man director Jon Favreau, and shows based on both the High School Musical and Monsters, Inc. franchises.

Comcast has passed 30 million customer relationships, mostly from adding new broadband customers that continue to disconnect from phone company DSL service.

In the last quarter, Comcast added 363,000 new broadband customers, a number the company calls its best third quarter subscriber add in 10 years, growing revenue by almost 10%.

High-speed residential and business internet service are among Comcast’s highest-margin businesses. Combining fast growth with sky-high profitability, Comcast boasted its broadband revenue is now the largest contributor to the cable company’s continued overall growth, reaching $4.3 billion this quarter, an increase of 9.6%.

“We have added over 1.2 million net new residential broadband customers in the last 12 months, including 334,000 net additions in the third quarter,” said Michael J. Cavanagh, Comcast’s chief financial officer. “Our offering is resonating with customers, as our consistent innovation and investment in our network has enabled us to stay ahead of customer expectations for not just high speeds, but also wall-to-wall Wi-Fi coverage and the ability to manage the increasing number of devices attached to their home networks.”

Comcast CEO Brian Roberts praised Comcast’s achievement of rolling out gigabit download speed to more customers than any other telecommunications company in the country.

“Our 1 gigabit internet is now available to nearly all of the 58 million homes and businesses passed in our footprint,” Roberts said. “This is the fastest deployment of gigabit speeds to the most locations in the country by anybody.”

Roberts claims Comcast will continue to build many of its future products and services around its broadband platform.

“We are investing to harness the capacity and capabilities of our network and deliver innovative differentiated experiences, which we believe gives us a long runway for further growth,” Roberts told investors on a morning conference call. “We are competing really well in residential broadband by offering customers the fastest speeds, most reliable Wi-Fi coverage in the home, and industry-leading Wi-Fi management and controls. We’ve branded our holistic broadband product as xFi, and continue to add new features, and we’re rolling out our xFi gateways and pods to further enhance the service.”

Comcast’s growing reliance on broadband products comes at the same time it faces additional cable television cord-cutting activity.

Cavanagh blamed online video streaming competitors like Sling TV and DirecTV Now for poaching its “low value” subscribers, admitting Comcast lost at least 95,000 net residential video customers in the last three months.

AT&T will complete its fiber buildout to areas designated to get fiber to the home service by mid-2019, according to AT&T executives.

John J. Stephens, AT&T’s chief financial officer, told investors on a quarterly conference call that AT&T is on schedule to complete expansion of its fiber to the home commitment to 12.5 million new customer locations, a regulator-required commitment imposed on AT&T in return for approval of its acquisition of DirecTV.

“We are getting near the end of our fiber build project, which is basically laying the foundation for stabilizing our broadband and TV business profits in 2019,” added AT&T CEO Randall Stephenson.

AT&T’s expansion has targeted millions of customer locations for fiber to the home service, replacing the fiber to the neighborhood technology AT&T used for several years to support its U-verse service. AT&T officials say its fiber network will reach more than one million new customers during 2018. That network is key to two AT&T initiatives – its emerging 5G wireless service, which requires fiber connections to cell towers, and AT&T Fiber and its broadband offerings — helping boost internet and online video revenue.

“This shift to fiber is beginning to drive IP broadband ARPU growth,” said John M. Donovan, CEO of AT&T Communications, Inc. “The strategic pivot we’re making with video, combined with our execution with fiber gives us the confidence that we will stabilize Entertainment Group [profitability] next year.”

AT&T Fiber is critical to the company’s ability to compete in the home broadband market against cable operators that have recently boosted internet speeds. AT&T’s hybrid fiber-copper U-verse system proved inadequate to match the significantly faster internet speeds many cable operators are rolling out. But AT&T Fiber will not reach all the company’s landline customers. Rural areas are unlikely to ever receive fiber upgrades and AT&T has had long-term plans to scrap its rural landline network, transitioning those customers to wireless voice and internet using AT&T’s 4G LTE network.