Internal Revenue Service established new rules for space, ocean and telecom income sources Jan. 16, setting guidelines that income from space or ocean activity by U.S. person will be sourced in U.S., while income from foreign people will be foreign-sourced. Exceptions to rules include foreign companies with half or more ownership by U.S. persons. As result, foreign satellite companies established in no-tax jurisdictions could conduct most of business in U.S. but pay no U.S. or foreign taxes on satellite leasing income.

SANTA CLARA, Cal. -- Internet is at a “critical time” as data and telephony converge, and that convergence could offer “the best or the worst of both worlds,” Packet Design CEO Judy Estrin said at Supernet conference here Jan. 16. Future trends include consolidation of voice, video, and data services, she said. “We are still in the covered wagon stage” of Internet, and it will progress via developments such as ubiquitous bandwidth, increased ease of use, greater connectivity and improved security, Estrin said.

Hearst-Argyle TV will use Harris Corp. DTV transmitters under new agreement. Deal at start covers 17 stations, allowing them to begin DTV broadcasting this year, companies said. Hearst-Argyle owns or manages 26 stations.

DirecTV is facing another class action lawsuit for alleged monopolistic practices that resulted in increase in price subscribers must pay for its products and services. Suit filed last Sept. in U.S. Dist. Court, L.A., alleged that DirecTV engaged in activities intended to stifle competition in violation of various federal and state antitrust laws. Suit said all DirecTV subscribers from March 1996 to Sept. 2000 had been damaged by DirecTV conduct and were entitled to damages. Best Buy, Circuit City, RadioShack and Thomson Consumer Electronics also were named in suit. Sears Roebuck also sued DirecTV claiming, among other things, that latter had canceled its contract after Sears didn’t stop selling EchoStar products and services.

Hot topics at N. American Numbering Council (NANC) meetings Wed. were elimination of certain numbering/dialing options and expansion of N. American Numbering Plan (NANP)capacity. Industry Numbering Committee (INC) proposed elimination of proposals to: (1) Use 4-digit area code. (2) Use 1-digit national destination code that would be dialed as “1” is now for long distance calls. (3) Dial NANC steering committee’s proposed 2-digit geographical code before area code. Also discussed were: (1) How to transition changes once decision is made on dialing methods and whether transition should be gradual or “flash cut.” (2) Whether 10-digit dialing question has been decided. (3) Whether need to move to new dialing regimes is pressing, since it appears significant amount may be accessible soon. NARUC representative said real resolution of numbering issues wouldn’t occur soon.

Time Warner Cable and Intellicast.com said they teamed up to start Broadband Weather, new online weather information service delivered over high-speed cable lines, in MSO’s Portland, Me., system. New on-demand, 24-hour service features hourly local weather forecasts, national forecasts, video segments, local radar, storm watches and warnings, severe storm tracking. Time Warner said it would offer broadband service to its Road Runner subscribers in Portland area first and then extend it to several other regions.

PanAmSat Net36 and Hughes Network Systems (HNS) said Net36 would provide additional streaming content delivery for DirecPC services. With addition of new service, Net36 now has access to half of N. American broadband households via satellite-to-edge servers. Meanwhile, HNS said it was expanding its relationship with Telkom SA Ltd. of S. Africa. HNS will supply Telkom SA with 14,000 very small aperture terminals (VSATs) that will meet 90% of nation’s VSAT needs. HNS technology will support delivery of Telkom SA’s VSAT service to provide advanced communications systems for election monitoring, air traffic control, rapid financial transactions, multimedia, other services. No terms were disclosed.

Telecom officials didn’t get answer from Bush Administration representatives Wed. to question who would be named FCC chmn., and when, we're told. Industry officials, primarily contributors to campaign, met with Bush transition office Wed. afternoon in what was described as “very generic and nonspecific” meeting. Most of attention focused on FCC reform, expediting agency decision-making and similar broad issues, we're told.

Public broadcasters’ DTV transition will run $779 million shortfall with no funding increases from federal govt., White House said in final Economic Outlook report. PTV made list of “pending policy proposals” -- Clinton Administration budget items that were cut severely by Congress -- after receiving only $44 million of requested $110 million for FY 2001. White House also said FCC’s spectrum auction authority had reaped $20 billion since 1994, and failure to renew it past 2008 would cost federal govt. $500 million annually.

PanAmSat asked FCC to defer deadline for filing comments on supplemental information provided by Intelsat in application to construct, launch and operate C-band and Ku-band satellites. PanAmSat wants comment period delayed until Commission has: (1) Acted upon Intelsat request, which PanAmSat opposes, for confidential treatment of documents filed along with supplemental information. (2) Determined whether Intelsat should be required to furnish additional relevant and material information.