May 2014

GOVERNMENT & COMMUNICATIONS

FIGHT OF THE SUMMER
[SOURCE: The Hill, AUTHOR: Julian Hattem]
Civil libertarians who say the House didn’t go far enough to reform the National Security Agency are mounting a renewed effort in the Senate to shift momentum in their direction. After compromises in the House bill, the NSA’s critics are buckling down for a months-long fight in the Senate that they hope will lead to an end to government snooping on Americans. “This is going to be the fight of the summer,” vowed Gabe Rottman, legislative counsel with the American Civil Liberties Union. If advocates are able to change the House bill’s language to prohibit NSA agents from collecting large quantities of data, “then that’s a win,” he added. “The bill still is not ideal even with those changes, but that would be an improvement,” Rottman said.
benton.org/node/184753 | Hill, The
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HOUSE COMMITTEE PUTS NSA ON NOTICE OVER ENCRYPTION STANDARDS
[SOURCE: ProPublica, AUTHOR: Justin Elliott]
An amendment adopted by a House committee would, if enacted, take a step toward removing the National Security Agency from the business of meddling with encryption standards that protect security on the Internet. The amendment adopted by the House Committee on Science, Space, and Technology would remove an existing requirement in the law that National Institute of Standards and Technology (NIST) consult with the NSA on encryption standards. Rep Alan Grayson (D-FL), quoted our story on the NSA from 2013. “NIST, which falls solely under the jurisdiction of the Science, Space, and Technology Committee, has been given ‘the mission of developing standards, guidelines, and associated methods and techniques for information systems,’” Rep Grayson wrote. “To violate that charge in a manner that would deliberately lessen standards, and willfully diminish American citizens’ and businesses’ cyber-security, is appalling and warrants a stern response by this Committee.” Rep Grayson’s amendment, which is part of a bill that funds NIST, was approved by a voice vote
benton.org/node/184743 | ProPublica
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GOOGLE, YAHOO, FACEBOOK AND MICROSOFT SAY GOVERNMENT HAS NO RIGHT TO SUPPRESS DATA REQUEST DISCLOSURES
[SOURCE: Washington Post, AUTHOR: Hayley Tsukayama]
Unsealed court documents show Google, Yahoo, Facebook, and Microsoft are arguing that government gag orders that stop them from disclosing the number of national security requests they receive violate the companies' First Amendment right to free speech. Leaks by former National Security Agency contractor Edward Snowden that revealed how the government uses tech firms in its surveillance efforts have damaged their bottom lines and public reputations -- particularly overseas. The companies have begun to push back against some government orders to stay silent. The gag orders, called "national security letters," compel Web and telecommunication companies to share information with the government while simultaneously prohibiting them from speaking about the request. Since the Snowden leaks, Google, Yahoo, Facebook, and Microsoft have fought to include more information about national security requests in regular reports they release on how much data the government requests from their servers. In the court documents, filed in April with the 9th Circuit Court in California, the tech giants argue that the government is infringing on their First Amendment rights -- a form of prior restraint. The government has argued that companies have no First Amendment right to share information gained from participation in a secret government investigation, according to the filing. The case is now on appeal.
benton.org/node/184729 | Washington Post
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NETWORK NEUTRALITY

THE OPEN INTERNET AND THE DIGITAL DIVIDE
[SOURCE: Benton Foundation, AUTHOR: Kevin Taglang]
[Commentary] At a May 20 House oversight hearing, FCC Chairman Tom Wheeler emphatically defended the Commission’s latest open Internet proposal saying, “There is one Internet. Everybody ought to have open, equal access to the capacity delivered by the Internet." But what is the impact of open Internet policies on the digital divide? Since May 15, Washington has been abuzz with addressing a fundamental question posed by the Federal Communications Commission: “What is the right public policy to ensure that the Internet remains open?” At the Benton Foundation, we’ve been particularly interested in how the FCC made it a point to highlight that its Notice of Proposed Rulemaking (NPRM) seeks comment on questions designed to consider the impact of the open Internet on ensuring broadband access for all communities. In particular, the FCC highlights, the NPRM: 1) asks whether any parts of the nation are being left behind in the deployment of new broadband networks, including rural America and parts of urban America; and 2) considers the impact of the proposals on groups who disproportionately use mobile broadband service.
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SENATE APPROPRIATORS: NO PLANS FOR FCC RIDER
[SOURCE: The Hill, AUTHOR: Julian Hattem]
Republicans in the Senate aren’t thinking about using the appropriations process to block the Federal Communications Commission from issuing new regulations on Internet service providers. The top GOP senators on the Appropriations Committee and the subcommittee overseeing the FCC both told The Hill that they don’t expect a rider preventing the commission from moving forward with the effort.
benton.org/node/184739 | Hill, The
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HOW MUCH POPULAR SUPPORT DOES NET NEUTRALITY REALLY HAVE?
[SOURCE: Revere Digital, AUTHOR: Amy Schatz]
There has been no shortage of outrage on the Internets about the Federal Communications Commission’s recent net neutrality proposal, which would allow broadband providers to offer fast-lane service to content companies. But do most people really care? A recent study by the Pew Research Center suggested that most Americans have no idea what net neutrality is or what all the fuss is about, since network and cable news shows have mostly ignored the debate. According to Pew researchers, of the 2,820 news programs that aired on eight network and cable news channels from January thru May 12, just 25 programs mentioned the term net neutrality. Six of those programs were on Al Jazeera America which is, shall we say, thinly viewed.
benton.org/node/184674 | Revere Digital | Pew study
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WHY YOU NEED TO TELL THE FCC TO SAVE NET NEUTRALITY NOW
[SOURCE: The Nation, AUTHOR: Editorial staff]
[Commentary] Telecommunications conglomerates often prevail in debates about the future of media by pretending that the issues are too complicated for Americans to understand. But there is nothing complicated about the current battle over the future of the Internet. Nor is there anything complicated about the need for citizens to rise up and defend net neutrality -- also known as the First Amendment of the Internet, because it provides the guarantee of free speech online for all. If the Federal Communications Commission allows the “paid prioritization” of some websites and communications over others -- as has been proposed under a plan the commissioners recently voted 3 to 2 to consider -- the basic premise of a free and open Internet will be undermined. In a digital age, this threatens a lot more than online shopping. “Profits and corporate disfavor of controversial viewpoints or competing services could change both what you can see on the Internet and the quality of your connection,” warns the ACLU. “And the need to monitor what you do online in order to play favorites means even more consumer privacy invasions piled on top of the NSA’s prying eyes.” The threat is real. Public interest groups warn that under a plan developed by FCC chair Tom Wheeler, cable and telecom companies could shape a pay-to-play Internet, in which they charge cash-rich corporations and special-interest groups to provide high-speed service while consigning websites without billionaire benefactors to a digital dirt road. FCC Chairman Wheeler’s plan comes in response to an appeals court ruling that scrapped a previous FCC attempt to preserve net neutrality. A Democrat, albeit one with a background as an industry lobbyist, Chairman Wheeler says he wants to maintain an open Internet. But he’s going about it the wrong way. His plan is much like the one the courts rejected: he envisions a complex set of rules that would require the FCC to constantly “scrutinize” these pay-for-priority schemes for certain websites, apps and online services.
benton.org/node/184702 | Nation, The
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WHY THE FCC IS BEING SO VAGUE ABOUT NET NEUTRALITY
[SOURCE: National Journal, AUTHOR: Brendan Sasso]
[Commentary] Federal regulators are trying to leave themselves plenty of power to oversee the Internet -- they're just not willing to get too specific about what they plan to do with it. The Federal Communications Commission is moving ahead with a network neutrality proposal, but no one knows exactly what business practices it would ban. And for the FCC, that's all part of the strategy. The commission wants a vague standard to allow Internet companies to experiment with new business models, while giving the agency authority to step in when it sees abuses. A senior FCC official argued that "putting rigid rules in place" would not let the Internet "evolve in a natural way." But the official added that "the government has to be in a position to oversee the Internet and intervene if it needs to." Vague rules could allow future FCC chairmen (especially Republicans) to be lax on enforcement, letting Internet providers get away with a host of abuses. The next administration could essentially ignore net neutrality if the regulations don't specify which particular business practices are illegal.
benton.org/node/184700 | National Journal
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INTERNET/BROADBAND

USF SURVIVES COURT CHALLENGE
[SOURCE: New York Times, AUTHOR: Edward Wyatt]
A federal appeals court upheld the Federal Communications Commission’s effort to convert its $4.5 billion program that pays for telephone service in rural parts of the country into one that subsidizes high-speed Internet service in high-cost areas. The program, known as Connect America, is the largest portion of the $8 billion Universal Service Fund, which pays for a variety of efforts to provide telecommunications links to schools, low-income families and others. In October 2011, the FCC approved an overhaul of the fund. Soon after its approval, however, the effort was challenged in court by dozens of phone companies. Many were small carriers that provided service in rural areas and that stood to lose annual subsidies because of the changes. The United States Court of Appeals for the Tenth Circuit, in Denver, rejected the phone companies’ arguments because their claims were “either unpersuasive or barred from judicial review.”
benton.org/node/184747 | New York Times
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OWNERSHIP

A CABLE MERGER TOO FAR
[SOURCE: New York Times, AUTHOR: Editorial staff]
[Commentary] There are good reasons the Justice Department and the Federal Communications Commission should block Comcast’s $45 billion acquisition of Time Warner Cable. The merger will concentrate too much market power in the hands of one company, creating a telecommunications colossus the likes of which the country has not seen since 1984 when the government forced the breakup of the original AT&T telephone monopoly. The Justice Department and the FCC could try to address some of the problems with the Comcast-Time Warner Cable deal by imposing conditions, like requiring the company not to give favored treatment to established content providers like Netflix and Google at the expense of smaller companies. Comcast agreed to similar terms in exchange for government approval of its 2011 acquisition of NBC Universal. Even so, this merger would fundamentally change the structure of this important industry and give one company too much control over what information, shows, movies and sports Americans can access on TVs and the Internet. Federal regulators should challenge this deal.
benton.org/node/184770 | New York Times
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FCC FAILING
[SOURCE: San Jose Mercury News, AUTHOR: Editorial staff]
[Commentary] For more than a decade, the Federal Communications Commission has been failing to protect the public interest and strengthen the nation's broadband infrastructure. It's pretty much game over if the FCC and the Department of Justice allow the death of net neutrality and the planned Comcast and AT&T megadeals, all very real possibilities. Eliminating net neutrality or allowing further consolidation of the communications industry are not in consumers' interests. Consumer dissatisfaction even now is rampant. Consumers need more competition, not less, among communication companies. Merging two big companies with already bad service cannot end well for customers.
benton.org/node/184767 | San Jose Mercury News
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MERGER CONCESSIONS
[SOURCE: Wall Street Journal, AUTHOR: Ryan Knutson]
A spate of telecom and media mergers is complicating the Federal Communications Commission's already controversial agenda. But it might also offer a solution. FCC Chairman Tom Wheeler is entangled in a difficult debate over net neutrality. The FCC is hemmed in by a pair of court decisions that have shot down its previous attempts to require equal treatment on the Internet, but its efforts to split the difference with new rules that would allow carriers to charge Internet companies for priority service set off a firestorm of criticism. Merger review could in theory give the FCC a way around a divisive and risky policy debate. In negotiating approval of deals, the commission gets the opportunity to extract concessions that could advance its policy goals -- like net neutrality. AT&T's $49 billion offer to acquire DirecTV, Comcast's $45 billion acquisition of Time Warner Cable and a potential Sprint acquisition of T-Mobile give Chairman Wheeler an opening to impose terms that will govern a sizable chunk of the broadband Internet market. "You got two-thirds of the industry in front of you potentially by the end of the summer, which is enormously tempting to try to create an industry structure around that," said Harold Feld of Public Knowledge, an open Internet advocacy group. "But it's not as easy as it looks. You'll have a bunch of different companies, many of whom may not be willing to go that far."
benton.org/node/184765 | Wall Street Journal
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AMAZON ESCALATES ITS BATTLE AGAINST HACHETTE
[SOURCE: New York Times, AUTHOR: David Streitfeld]
Amazon, under fire in much of the literary community for energetically discouraging customers from buying books from the publisher Hachette, has abruptly escalated the battle. The retailer began refusing orders for coming Hachette books, including JK Rowling’s new novel. The paperback edition of Brad Stone’s “The Everything Store: Jeff Bezos and the Age of Amazon” -- a book Amazon disliked so much it denounced it -- is suddenly listed as “unavailable.” In some cases, even the pages promoting the books have disappeared. Anne Rivers Siddons’s new novel, “The Girls of August,” coming in July, no longer has a page for the physical book or even the Kindle edition. Only the audio edition is still being sold (for more than $60). Otherwise it is as if it did not exist. The confrontation with Hachette has turned into the biggest display of Amazon’s dominance since it briefly stripped another publisher, Macmillan, of its “buy” buttons in 2010. It seems likely to encourage debate about the enormous power the company wields. No company in American history has exerted the control over the American book market -- physical, digital and secondhand -- that Amazon does.
benton.org/node/184663 | New York Times
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AMAZON’S TACTICS CONFIRM ITS CRITICS’ WORST SUSPICIONS
[SOURCE: New York Times, AUTHOR: Farhad Manjoo]
[Commentary] Amazon is confirming its critics’ worst fears and it is an ugly spectacle to behold. For years, authors and publishers have warned that Amazon would one day use its power for ill. Sure, so far, Amazon has marketed itself as a book buyer’s best friend. It sells books at terrifically low prices, it delivers them amazingly quickly, and it constantly invents new technologies to improve the way we read. Amazon has also invested heavily in publishing new authors and it has pushed exciting new formats made possible by electronic distribution. Yet the literary community has always greeted Amazon’s moves with suspicion. The fear is mostly about the future. What will happen to books when Amazon controls the entire industry? How will authors and publishing houses reckon with Amazon’s unchecked power? Most recently, as part of a contract dispute with the publisher Hachette, we’re seeing Amazon behaving at its worst. The company’s willingness to nakedly flex its anticompetitive muscle gives new cause for concern to anyone who cares about books -- authors, publishers, but mainly customers.
benton.org/node/184715 | New York Times
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HOW HACHETTE COULD FIGHT BACK AGAINST AMAZON
[SOURCE: Digitopoly, AUTHOR: Joshua Gans]
[Commentary] Amazon.com, in its zeal to keep book prices low, is in a large fight with Hachette -- the smallest of New York’s big 5 publishers. According to the NYT, it started with tactics to crimp Hachette’s sales and has now apparently led to the removal of many Hachette books including, ironically, the paperback version of Brad Stone’s terrific book on Jeff Bezos but far more interestingly, JK Rowling’s latest that is due to be released soon. For Hachette, with its looming JK Rowling book launch date, there is opportunity. If people want to be able to read her book on their Kindle, Hachette need only provide it in .mobi format without DRM to make it so. Yes, that would leave them with the spectre of potential piracy but that exists anyway and the music industry has demonstrated that most consumers will take convenience over free anyday; especially curmudgeonly readers tied to their existing devices. All they need to do is set up a site that allows people to pay and then click a ‘send to Kindle’ button. Not only will Hachette bypass Amazon but they can sell the book for less because they don’t have to pay Amazon’s commission.
benton.org/node/184692 | Digitopoly
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LABOR

FOUR TECH GIANTS FORMALLY AGREE TO $325 MILLION HIRING CASE SETTLEMENT
[SOURCE: Revere Digital, AUTHOR: Jonathan Stempel]
Four major Silicon Valley companies have formally agreed to pay $324.5 million to settle claims brought by employees accusing them of colluding not to poach each other’s talent. The settlement -- between Apple, Google, Intel Corp, Adobe Systems and roughly 64,000 workers -- was disclosed in papers filed with the federal court in San Jose, California. US District Judge Lucy Koh has been asked to preliminarily approve the accord at a June 19 hearing, over an objection by one of the four named plaintiffs. That plaintiff, Michael Devine, said the settlement let the companies off too easily. The settlement gives workers only a few thousand dollars each on average. The companies’ combined profit in their latest fiscal years was about $60 billion, with three-fifths coming from Apple.
benton.org/node/184713 | Revere Digital
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LOBBYING

TECH: DC’S BIGGEST LOSER?
[SOURCE: Politico, AUTHOR: Tony Romm]
Silicon Valley just can’t win in Washington. A surveillance reform bill easily survived a House vote, but it barely resembles the measure that Google, Facebook and others once touted as a way to restore Americans’ trust. Quick changes to patent law now seem impossible after the Senate shelved the issue days earlier. And immigration reform and the industry’s pursuit of more high-skilled visas long ago had devolved into a war of words between congressional Democrats and Republicans. As tech companies join the ranks of other big Beltway business interests -- tapping power lobbyists, recruiting hired guns and cozying up to lawmakers with more donations than ever before -- the setbacks only serve as a reminder that even major players still lose the Washington game sometimes.
benton.org/node/184751 | Politico
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PRESSING CONGRESS FOR PRIVACY LAW
[SOURCE: New York Times, AUTHOR: Elena Schneider]
A Reagan-era law that allows the government to read email and cloud-stored data more than six months old without a search warrant is under attack from technology companies, trade associations and lobbying groups, which are pressing Congress to tighten privacy protections. Federal investigators have used the law to view content hosted by third-party providers for civil and criminal lawsuits, in some cases without giving notice to the individual being investigated. Nearly 30 years after Congress passed the law, the Electronic Communications Privacy Act, cloud computing companies are scrambling to reassure their customers, and some clients are taking their business to other countries. Silicon Valley giants like Facebook, Twitter and Google say they will no longer hand over their customers’ data without a search warrant. But smaller web hosting and cloud computing companies may be outmuscled by law enforcement officials as they try to protect their customers, said Ron Yokubaitis, the co-chief executive officer of Data Foundry, a data center company based in Texas.
benton.org/node/184749 | New York Times
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AGENDA

FCC ANNOUNCES TENTATIVE AGENDA FOR JUNE OPEN MEETING
[SOURCE: Federal Communications Commission, AUTHOR: Press release]
Federal Communications Commission Chairman Tom Wheeler announced that the following items will be on the tentative agenda for the next open meeting scheduled for June 13, 2014:
Technology Transitions Presentation: The FCC will hear a presentation with an update on the efforts to transition circuit-switched networks to Internet Protocol (IP) networks. The presentation will include a status report on the voluntary experiments proposed by AT&T designed to assess how the transition to IP networks affects users.
Expanding Community Access to Radio: The FCC will hear a presentation with an update on the continuing efforts to launch new and diverse voices to the American public via increased access to Low Power FM radio stations.
benton.org/node/184718 | Federal Communications Commission
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LOOKING BACK, MOVING FORWARD
[SOURCE: Federal Communications Commission, AUTHOR: FCC Chairman Tom Wheeler]
Memorial Day weekend also falls on the 200th year anniversary of the first official telegraphic message sent over a long distance. On May 24, 1844, Samuel Morse famously telegraphed, “What hath God wrought!” from Washington, DC, to Baltimore, the first official telegraphic message sent over of a long distance. Coincidentally, 18 years later to the day, Abraham Lincoln would send nine telegraph messages to Union generals, becoming the first President to regularly use electronic communications. Eighty years ago, Congress passed a law largely to deal with the network revolution Morse unleashed -- the Communications Act of 1934, which established the FCC. Fast forward to today, and the Commission is grappling with the transition to the next network revolution -- the digital revolution that is being fueled by ubiquitous high-speed connectivity and increasingly powerful computing devices. June’s open Commission meeting will be highlighted by an update on our efforts to facilitate the transition from the circuit-switched networks of Alexander Graham Bell to a world with fiber, cable and wireless Internet Protocol (IP) networks. Soon, the Commission will receive a status report on proposed experiments and how best to deploy next-generation networks, while preserving enduring values like universal access, competition and consumer protection. The Commission will also hear a presentation on progress made in processing Low Power FM applications from the October 2013 window.
benton.org/node/184704 | Federal Communications Commission | Federal Communications Commission
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STORIES FROM ABROAD

GOOGLE'S SETTLEMENT WITH EUROPEAN UNION FACES INCREASED PRESSURE
[SOURCE: Wall Street Journal, AUTHOR: Sam Schechner, Vanessa Mock]
Google's proposed settlement with European Union antitrust cops is under increasing threat of being revised or scrapped, amid calls to more tightly regulate the Web giant in the run up to European Parliament elections. Politicians from France and Germany have in recent days ramped up rhetoric against the settlement with Google, which aims to resolve accusations that the company abuses its dominance in online search to promote its own businesses. Germany's economy minister said the deal should be improved. His French counterpart said that the European Commission -- the bloc's executive arm -- should reject it as it stands. Behind closed doors, commission officials have suggested to opponents that some elements of the deal -- in which Google has pledged to dedicate space for competitors atop its search results --could be revisited, according to people involved in the discussions. Google officials, for their part, have been holding similar meetings to press their case that their settlement is fair, and tougher than regulators might get by pressing formal antitrust charges, people familiar with those meetings said. "The offers by Google aren't worthless, but they're not nearly enough," said EU Energy Commissioner Günther Oettinger, among the 28 commissioners who must approve a settlement before it becomes binding. "We don't want to become a digital colony of global Internet giants," said French Economy Minister Arnaud Montebourg said at an event to oppose the antitrust deal. "It is necessary, indeed urgent, to put in place a framework that guarantees a level playing field" for European companies.
benton.org/node/184698 | Wall Street Journal
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TRANS-ATLANTIC WAR OVER GOOGLE
[SOURCE: Associated Press, AUTHOR: ]
Europe’s moves to rein in Google -- including a court ruling this month ordering the search giant to give people a say in what pops up when someone searches their name -- may be seen in Brussels as striking a blow for the little guy. But across the Atlantic, the idea that users should be able to edit Google search results in the name of privacy is being slammed as weird and difficult to enforce at best and a crackdown on free speech at worst. “Americans will find their searches bowdlerized by prissy European sensibilities,” said Stewart Baker, former assistant secretary for policy at the US Department of Homeland Security. “We’ll be the big losers. The big winners will be French ministers who want the right to have their last mistress forgotten.” Google says it’s still figuring out how to comply with the European Court of Justice’s May 13 ruling, which says the company must respond to complaints about private information that turns up in searches. Google must then decide whether the public’s right to be able to find the information outweighs an individual’s right to control it -- with preference given to the individual.
benton.org/node/184758 | Associated Press
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EU WEB PRIVACY
[SOURCE: New York Times, AUTHOR: Mark Scott]
Which European regulator will have the final say in enforcing online privacy rules? Under proposals, companies will be able to operate throughout the region if they fulfill the requirements -- and the interpretation -- of European rules from only one country’s privacy authority. Companies currently must comply with the regulator in each of the 28 countries in the union in which they operate. Lawmakers in favor of the proposals say that leaving the oversight with one country’s office gives companies more clarity about the rules. But consumer groups in Europe have warned that if the current proposal stands, technology companies -- including American giants like Microsoft, Amazon and Google -- could set up shop in the European country with the most lenient interpretation of data privacy.
benton.org/node/184756 | New York Times
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TWITTER AGREES TO BLOCK ‘BLASPHEMOUS’ TWEETS IN PAKISTAN
[SOURCE: New York Times, AUTHOR: Robert Mackey]
At least five times in May, a Pakistani bureaucrat who works from a colonial-era barracks in Karachi, just down the street from the former home of his country’s secularist founder, Mohammed Ali Jinnah, asked Twitter to shield his compatriots from exposure to accounts, tweets or searches of the social network that he described as “blasphemous” or “unethical.” All five of those requests were honored by the company, meaning that Twitter users in Pakistan can no longer see the content that so disturbed the bureaucrat, Abdul Batin of the Pakistan Telecommunications Authority: crude drawings of the Prophet Muhammad, photographs of burning Qurans, and messages from a handful of anti-Islam bloggers and an American porn star who now attends Duke University. The blocking of these tweets in Pakistan -- in line with the country-specific censorship policy Twitter unveiled in 2012 -- is the first time the social network has agreed to withhold content there. A number of the accounts seemed to have been blocked in anticipation of the fourth annual “Everybody Draw Muhammad Day” on May 20. This censorship comes as challenges to Pakistan’s draconian blasphemy law have become increasingly deadly, amid a flurry of arrests, killings and assassination attempts on secularists.
benton.org/node/184665 | New York Times
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Analysis

May 2014

China accuses US of ‘unscrupulous’ spying

May 27, 2014 (A Cable Merger Too Far)

A Cable Merger Too Far

FCC failing on its No. 1 priority

FCC Could Use Merger Concessions to Advance Policy Goals

Why case for landline phones is growing increasingly moot

FTC Chair Edith Ramirez Fights for Data Security and Privacy Rights

Internet security is a global issue that requires global cooperation

Trans-Atlantic war over Google

EU Debates Which Nation Will Regulate Web Privacy