Rush Limbaugh and Clear Channel's Premiere Radio Networks have agreed to a contract extension that will pay the conservative talk-radio pundit more than $400 million through 2016.The eight-year extension includes a $100 million signing bonus, Limbaugh told the New York Times. The deal comes about a month before the broadcaster celebrates 20 years in syndication August 8.One of the highest-rated programs on radio, the daily three-hour "The Rush Limbaugh Show" reaches about 20 million listeners weekly and plays on about 600 stations nationwide."This is exactly where I want to be, doing what I was born to do, with an amazing audience and phenomenal support from affiliate stations and sponsors," Limbaugh said.The 90-second weekday commentary "The Rush Limbaugh Morning Update," the monthly "Limbaugh Letter" and RushLimbaugh.com, which includes the subscription service Rush247.com, will continue under Premiere's purview as part of the agreement.Limbaugh's existing contract, which was worth $285 million over a nine-year period, was set to expire next year, the Times said. The new deal is believed to be the most expensive in radio since 2004, when Sirius Satellite Radio paid Howard Stern $500 million for five years.The deal would appear to come at a good time for Clear Channel, which has been negotiating for months to close a buyout deal that would take the company private.Wednesday's announcement comes amid speculation that Premiere will also be involved in a new deal with conservative host Sean Hannity, who is now syndicated by ABC Radio Networks.
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InformationWeek, July 2, 2008
By Mitch Wagner
Vint Cerf said this week that he never intended to seriously propose that the U.S. government should nationalize the Internet. But he does think the Internet is seriously broken, with an economic system that discourages competition and innovation and encourages harmful monopolistic practices. He argued that the Telecommunications Act of 1996, which governs Internet service providers, is obsolete and needs to be revised.
Cerf, who is vice president and chief Internet evangelist at Google, and sometimes called the "father of the Internet," told a TechCrunch reporter recently that "the Internet should be owned and maintained by the government, just like the highways." But after blogged the TechCrunch article, Cerf posted a comment here, saying nationalizing the Internet "was not intended as a serious proposition."
I talked to him about his ideas on Monday.
The current economic model for the Internet gives ISPs monopoly power, allowing them to block some applications and give others a priority track to customers, Cerf said. Most American consumers have at most two options for broadband Internet access -- their local telephone company for DSL, or their cable provider for a cable modem. Many consumers have only one of those options, and others have no broadband at all.
"What we have is not very much competition, and at best two competitors," Cerf said. "Two competitors don't produce the pressure of true competition."
Given the lack of alternatives, consumers have no choice when Internet service providers block some applications (for example, Comcast and other ISPs allegedly blocking BitTorrent). ISPs will likely try to filter traffic further, blocking access to specific applications and companies to increase their own profits. And the U.S. is lagging behind other countries, notably France, the U.K., New Zealand and the Netherlands, in broadband penetration, Cerf said.
"All of this is telling me that we didn't get it right" when the Telecommunication Act of 1996 was adopted, Cerf said. "When we wrote it, the Internet was barely visible to the public, and probably completely invisible to Congress." The Web itself had just started becoming popular two years earlier, Cerf said. "Maybe we should step back and ask ourselves how to do this better," he said.
The Internet is more like they highway system than it is like the phone or cable TV system. Phones and cable TV are networks that were purpose-built for individual applications -- voice and TV, respectively. The Internet is built for any application and information that you can digitize, just like roads are built for any wheeled vehicle, Cerf said.
"Maybe we should treat the Internet more like the road system, look for ways of creating incentives to make the Internet more accessible to everyone, and less likely to be abused by the private sector," Cerf said.
In my earlier blog post, I suggested the problem could be solved without additional government regulation, by encouraging other forms of Internet access, such as WiMAX and satellite Internet. But Cerf said that proposal is impractical -- WiMAX and satellite Internet both have technical problems. Moreover, alternate forms of Internet access will require huge capital investments up-front, and the incumbents -- telcos and cable TV companies - have a nearly unbeatable advantage, since they already have made that investment and serve most of the market.
"It's not likely you're going to want to have multiple roads owned by the private sector to get to your house. Generally speaking, that's true of the power system -- you don't have multiple wires going to your house to carry power."
The solution: Net neutrality, Cerf sayss. ISPs should be required to carry all traffic without filtering some of it selectively.
Regulators tried something similar in the 1996 Telecom Act -- requiring telcos to allow competitors to install equipment on other companies' lines, Cerf said. That proved impractical. But, under net neutrality proposals, no equipment installations are necessary.
I asked Cerf about a couple of the objections to net neutrality raised by opponents. One is that the new generation of multimedia and video applications -- including YouTube, owned by Cerf's employers at Google -- are overwhelming the Internet. Multimedia requires much more bandwidth than the text and static graphics that the networks were designed to carry.
Likewise, peer-to-peer applications like BitTorrent use the network at top capacity at all times, rather than the more typical peaks and valleys of usage that the network was designed for.
He responded that Internet service providers should sell tiers of access -- the more you pay, the more bandwidth you get. And ISPs should be prepared to deliver the bandwidth they promise. ISPs oversold the bandwidth that they actually deliver, like airlines overbooking flights and having to turn away ticket-holding passengers. "They're selling 1.5 megabits but they're not delivering except for 3 am -- the networks aren't built for the traffic they're selling," Cerf said. The ISPs should be required to deliver the bandwidth they promise.
This issue isn't new, but I haven't heard the arguments presented quite so logically and concisely as Cerf did. And it's probably true that I haven't been following this issue as closely as I should. I'm interested in hearing from opponents of net neutrality legislation -- what's wrong with Cerf's arguments?
Rural broadband is another area where the free market has failed, Cerf said. There is insufficient incentive for existing broadband carriers to to bring services to remote areas. The U.S. needs to institute something analogous to universal service for phones, but do so for Internet access.
Lack of broadband access isn't just an inconvenience -- it's disenfranchising some Americans, writes Linda Weight in a reply to my earlier blog post on nationalizing the Internet. Government agencies are closing regional offices, and referring citizens to the Web to get their business with the government done. This problem is worst in
underserved rural areas, and especially in certain demographics including elderly and poor of all ages. As a public librarian serving a community that includes those demographics I see people every day who, for example, need to take a food handler's exam to get a minimum wage job in a local fast-food restaurant. The county closed their local annex office to save money several years ago, so now the closest place to take the test in person is 60 miles away. But these people have no transportation, or it is unreliable, not to mention the cost of gas, and the offices are only open weekday hours when the person who needs the card is working. Studying for the test and taking it on-line is their only option. But these people are unlikely to have a computer, much less be able to pay for internet access, such as it is in this area. As is typical the last few years, the government agency blithly says, "You can access it at your local library", putting the onus on the library, also a tax-funded agency, to fund the set up and maintanance of a sufficient number of public computers that can connect to the Internet at a sufficient and reliable bandwidth.
The Internet is also the place to go for tax forms, social security forms, immigration forms, and more, Weight writes. "But if government agencies are going to balance their budgets by making access to their services, forms and information primarily available via electronic means, then there needs to be some sort of coordinated support for that access," Weight said.
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