Netflix pushed back against remarks from Comcast Executive Vice President David Cohen, who before the Senate Judiciary Committee Wednesday (CD April 10 p1) said Netflix approached Comcast to form the paid peering agreement the two companies announced earlier this year. Cohen said Netflix wanted to cut out the “middle man” and connect directly with Comcast’s Internet backbone, and called that relationship Netflix’s idea. “The key thing to understand is that we have been working with ISPs for more than two years to partner on Open Connect, our content delivery network,” a Netflix spokesman told us when asked about Cohen’s comments. “We do reach out to ISPs, but to partner with them at no cost to them or to us.” The hearing likely didn’t change the trajectory of the Comcast proposal to acquire Time Warner Cable, with approval likely still coming in early 2015, Paul Gallant of Guggenheim Partners told investors in a note following the hearing. “There were clearly more negative than positive comments, which should reinforce regulators’ instinct to examine this deal very closely,” Gallant said.

Six House Democrats sent FCC Chairman Tom Wheeler a letter supporting an FCC proposal to use a new license size, partial economic area (PEA), during the incentive TV auction. “The ability of small and rural carriers to provide spectrum-based services hastens the buildout of wireless services to consumers in rural America,” they said. Robust wireless service is often not available in rural areas, the letter said. “The Commission has an opportunity to take an important step forward to fill this detrimental geographical gap by adopting the PEA or similar license map.” The letter was signed by Rep. Peter Welch of Vermont, co-chairman of the Rural Telecom Working Group, plus Reps. Anna Eshoo, Doris Matsui and Jerry McNerney, all of California, Bobby Rush of Illinois and Ben Ray Lujan of New Mexico. PEAs are a good alternative to smaller cellular market area (CMA) licenses, said Steve Berry, president of the Competitive Carriers Association. “To promote competition and benefit consumers, especially in regional and rural areas, competitive carriers must have the opportunity to bid at auction,” he said. “If the FCC does not use CMAs, adopting CCA’s proposal for Partial Economic Areas would help ensure a compromise between the larger Economic Areas (EAs) and the smaller CMAs and would afford all carriers a meaningful chance to bid on much needed spectrum."

The Senate Judiciary Committee appeared unlikely to mark up the Patent Transparency and Improvements Act (S-1720) Thursday, two stakeholders told us. “Thursday is going to be a stretch,” said Daniel Nazer, an Electronic Frontier Foundation staff attorney who’s focusing on Capitol Hill’s patent revamp efforts. The committee postponed the S-1720 markup Tuesday amid continued disagreements about controversial provisions in the bill, but Chairman Patrick Leahy, D-Vt., had said he hoped the committee would reach a deal in time to consider it Thursday (CD April 9 p13). Senate Judiciary had not rescheduled its executive business meeting, during which the committee would mark up the bill, at our deadline Wednesday. If the committee does not mark up S-1720 this week, it will have to wait until after the upcoming two-week recess. Members of the committee were still disagreeing over several longstanding issues in the bill, including the language in a proposed fee-shifting provision, an industry lawyer said.

Sen. Ed Markey, D-Mass., introduced S-2219 Tuesday, which would require NTIA to “update” a 1993 report “on the role of telecommunications, including the Internet, in the commission of hate crimes” (http://1.usa.gov/1kr6rck). Markey is on the Senate Communications Subcommittee, which has jurisdiction over NTIA. As a House member, Markey sent a letter, along with then-House Commerce Committee Chairman John Dingell, D-Mich., to NTIA requesting an update on the role of telecom in hate crimes in 2007 (CD June 19/07 p7). Markey’s bill has been referred to the Senate Commerce Committee. Rep. Hakeem Jeffries, D-N.Y., in January introduced the Hate Crimes Reporting Act (HR-3878) to require an update to NTIA’s hate crimes report (CD Jan 17 p14). Jeffries’ bill has 29 co-sponsors (http://1.usa.gov/ODR29O).

The Senate Commerce Committee still plans to take on the FCC Consolidated Reporting Act but is waiting for the FCC, Chairman Jay Rockefeller, D-W.Va., said Wednesday. He spoke at an executive session considering several bills; the agenda had originally included then dropped that legislation. “I will note that we had planned to mark up an FCC reports bill sponsored by” Sen. Dean Heller, R-Nev., “but we still need some technical assistance from the FCC,” Rockefeller said. “That bill will require a few more modifications before it is ready for markup.” The House unanimously passed the legislation last fall.

The Senate Commerce Committee nixed the FCC Consolidated Reporting Act from its Wednesday executive session agenda, it said Tuesday. The committee originally had included it among several items last Thursday. The session will be 2:30 p.m. in 253 Russell. The legislation passed the House last fall.

Nine more House members signed on as co-sponsors of the Local Radio Freedom Act opposing new performance royalties, according to Congress.gov (http://1.usa.gov/1mKPXwI). The new co-sponsors are Reps. Michele Bachmann, R-Minn., Kerry Bentivolio, R-Mich., Chris Collins, R-N.Y., Doug LaMalfa, R-Calif., Vance McAllister, R-La., Beto O'Rourke, D-Texas, Robert Pittenger, R-N.C., Ileana Ros-Lehtinen, R-Fla., and Austin Scott, R-Ga., it said. The resolution (H. Con. Res. 16) has 215 House co-sponsors and needs only three additional members for a majority of support, said a National Association of Broadcasters release (http://bit.ly/1hzL2pu) Monday.

The FCC defended its actions to several lawmakers in both chambers, in letters from FCC Chairman Tom Wheeler to various lawmakers released Friday. In a letter dated March 27 and sent to Senate Commerce Committee Chairman Jay Rockefeller, D-W.Va., ranking member John Thune, R-S.D., Communications Subcommittee Chairman Mark Pryor, D-Ark., and subcommittee ranking member Roger Wicker, R-Miss., Wheeler detailed the agency’s plans for an “accelerated” media ownership review, to be presented no later than June 30, 2016, as well as a defense of the sidecar item the agency reviewed at its March 31 meeting (http://bit.ly/1st4X2o). Wheeler told Pryor in a different March 27 letter that the FCC “is committed to realizing the tremendous promise the 5 GHz band offers for unlicensed use, but we also remain obligated to protect incumbent users from harmful interference,” touching on a report and order the FCC considered at its recent meeting (http://bit.ly/1qeMvZz). In a March 27 letter to Rep. George Miller, D-Calif., Wheeler reassured him that prisons and smaller correctional facilities may seek a waiver if the FCC’s revamp of inmate calling hurts them. “The Report and Order recognized that security measures are an important part of inmate calling services, and allowed security costs to be recovered through inmate calling service rates,” Wheeler said (http://bit.ly/1emGov2). “The Report and Order also leaves critical decisions about security to correctional facilities and inmate calling service providers. With respect to the concerns you convey that some jails and smaller correctional facilities may have to reduce or discontinue interstate inmate calling services due to the reforms, inmate calling service providers that do not believe their costs will be recovered may seek a waiver of the adopted rate caps.”

Critics of the proposed Comcast-Time Warner Cable deal will make their case Wednesday before the Senate Judiciary Committee. Public Knowledge CEO Gene Kimmelman, whose organization has announced and tried to rally others in opposition to the deal, will testify alongside Comcast Executive Vice President David Cohen and Time Warner Cable Chief Financial Officer Arthur Minson. Sen. Al Franken, D-Minn., chairs the Antitrust Subcommittee and is another vocal opponent of the deal. Kimmelman is a member of the American Antitrust Institute’s advisory board. The American Antitrust Institute warned Senate Judiciary of the deal in a letter sent Friday. It “believes that the proposed merger raises pressing issues related to competition, consumer welfare, and the protection of free speech that a diverse and independent media ensures,” AAI said (http://bit.ly/1gEqk7C). “A merged Comcast-TWC could potentially exercise undue control over: (1) the timing, method, quality, and pricing of content and its distribution; (2) the rivals that produce and distribute content; (3) the scope and nature of content; and (4) the pace of innovation in broadband development.” AAI is planning to release a white paper on the effects of the deal, set to address many questions, in late April, it said: “For example, how might combining the cable television and broadband distribution systems of Comcast and TWC enhance the merged company’s ability to restrict competing content providers’ access to a significant base of consumers through distribution channels controlled by the merged company?” Comcast, meanwhile, has defended the deal as good for consumers and has begun an advertising campaign saying “Together Is Better,” referring to the proposed acquisition of Time Warner Cable. Also testifying at the 10 a.m. hearing, now scheduled to be in 216 Hart rather than in Dirksen as originally planned, are James Bosworth, CEO of Back9Network; Richard Sherwin, CEO of Spot on Networks; and Christopher Yoo, a University of Pennsylvania law professor. Veria Living, an independent TV network whose CEO Eric Sherman met with Judiciary staff of both parties last month, will also provide written testimony, and Sherman will attend the hearing, a Veria Living spokesman told us. The FCC and Justice Department must ultimately rule on the deal.

The Federal Spectrum Incentive Act, (HR-3674), “would reduce discretionary costs by $8 million over the 2015-2019 period” and “increase net direct spending by $30 million over the 2015-2024 period,” said a Congressional Budget Office analysis (http://1.usa.gov/1mUDdT9). Reps. Brett Guthrie, R-Ky., and Doris Matsui, D-Calif., introduced the bill last year, which cleared the House Commerce Committee in December. The legislation proposes allowing federal agencies to receive a portion of money back from the sale of spectrum they relinquish. “Because the money in the SRF [Spectrum Relocation Fund] generally remains available for a period of eight years, CBO anticipates each affected agency would receive a total of about $8 million from the SRF and that the Office of Management and Budget would record the use of budget authority in the budget when [spectrum] auction receipts are deposited,” CBO said. “Outlays would be recorded in the budget as expenses are incurred.” Pay-as-you-go procedures would apply, CBO added.