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January 2017

Five regulatory fights facing tech in 2017

Here are five regulatory fights the tech world will be watching closely in 2017.
1) Apple's record tax penalty in Europe: In August, the European Union’s Commission on Competition handed a record judgment against Apple, ordering the company to pay over $13 billion in back taxes to Ireland.
2) The fight over encryption
3) AT&T-Time Warner merger: AT&T's plans to merge with Time Warner will be under heavy scrutiny.
4) Google's antitrust fight: Google has its own fight with the European Commission.
5) Amazon's EU tax case: Amazon is also awaiting a key tax ruling form the European Union. The decision was expected in 2016 but will be coming in the new year.

A simple solution to make journalism better in Trump’s America

[Commentary] News organizations should commit to opening at least five bureaus in midsize and smallish cities somewhere in the middle of America in 2017. I don't have any set list of what those cities should be, but just for kicks, here are five: Omaha (NE), Knoxville (TN), Dallas (TX), Missoula (MT), Columbus (OH). President-elect Donald Trump carried all five states. The states represent significant geographic diversity. They range from tiny (Missoula) to pretty darned big (Dallas).

In the modern age of reporting, the relative costs for an effort like this are low. You need to hire one person in each of these places. They can work from home. You pay for their salary, their Wi-Fi, their cellphone and their gas for reporting trips. Given what is expended on, say, covering a presidential campaign, we are talking about peanuts. Technology allows a reporter to work from anywhere, at a low cost. The times demand different coverage. Why not this? And why not now?

Comcast Acquires Watchwith

In a move that tacks on technologies that will drive deeper search and discovery capabilities into its X1 platform, Comcast has acquired Watchwith, a company that has built a video metadata platform that can decipher what’s happening inside a movie, TV show or sporting event. Financial terms of the deal, which closed last month, were not disclosed. Watchwith’s deep metadata platform can provide information about what’s occurring within the video, such as which actors are appearing on screen, the location of a given scene, or the start of a memorable scene within a movie or TV show. It does that through the blending of two tools—an editorial tool that enables producers to manually tag specific video segments and an automated media analysis/tagging tool that relies on algorithms and machine learning techniques.

Targeted Media Boosts Share of Political Pie

It was a record year for political ad spending, according to ad trackers at Borrell Associates, up 4.6% from the 2012 presidential election to $9.8 billion, but money is shifting toward more targeted ads, with cable in on the new bounty. Broadcast TV remained the big dog at $4.4 billion, more than three times any other outlet. Borrell pointed out that represented a 44.7% share, down from 57.9% in 2012, a $1 billion decline when many were predicting a $1 billion increase. Part of that was President-elect Donald Trump's heavy reliance on earned media and digital media, but it was also because of the general shift to more targeted media. Cable, digital and direct mail gained a total $1.7 billion over 2012. Cable jumped from $891.78 million in 2012 (9.5% of the total pie) to $1,355.28 billion (13.8%), Borrell pointed out. Online and digital exploded from $159.21 million in 2012 to 1,415.38 billion in 2016.

India says free data is good for the poor, but regulators reject evidence-based approach

Recently, the Telecom Regulatory Authority of India (TRAI) released its Recommendations on Encouraging Data usage in Rural Areas through Provisioning of Free Data. In February 2016 TRAI imposed a two year ban on differential pricing for data services, but it now acknowledges that free data can benefit the poor. In its latest decision, TRAI rejected three proposed models for free data and presents a new model in which “third party aggregators” create the market for free data. The aggregators may also be eligible to take advantage of India’s Universal Service Obligation Fund (USOF) to participate. Let’s applaud TRAI for recognizing the value of free data. Aggregation is a novel approach, but it is neither costless nor neutral. Moreover, the ruling creates a new problem of regulatory discrimination restricting how telecom service providers can participate in the market.

Analysis

The Trump FCC’s Toolkit For Deregulating Media and Telecommunications

January 3, 2017 (Happy New Year!)

BENTON'S COMMUNICATIONS-RELATED HEADLINES for TUESDAY, JANUARY 03, 2017

TRANSITION
   The Trump FCC’s Toolkit For Deregulating Media and Telecommunications
   FCC's 5 biggest battles for Trump's first year
   Bringing the Connected Future to All Americans, May 11, 2012 – January 3, 2017 - FCC Commissioner Rosenworcel blog
   Trump Adds Wireless Entrepreneur to FCC Landing Team
   The need for a bipartisan strategy and consensus in the Trump administration’s FCC - Brookings analysis
   Trump names Bush administration veteran Thomas Bossert to White House homeland security post [links to Washington Post]
   Tech's power shifts as Obama fades to Trump [links to Hill, The]
   Kara Swisher: the seven reasons why Silicon Valley likes Trump [links to Vox]
   Jessell: Wheeler Leaves Misguided Broadcast Legacy [links to TVNewsCheck]

ELECTION/HACKING
   Obama administration announces measures to punish Russia for 2016 election interference
   White House fails to make case that Russian hackers tampered with election [links to Ars Technica]
   President Obama moves to split cyberwarfare command from the NSA [links to Benton summary]
   Adam Schiff and Jane Harman: Russia attacked our democracy. That demands intense review by Congress. [links to Washington Post]

SECURITY/PRIVACY
   Facebook Doesn’t Tell Users Everything It Really Knows About Them [links to ProPublica]
   Trump questions quest for cybersecurity: ‘No computer is safe’ [links to Washington Post]
   Op-Ed: We're living through the first world cyberwar – but just haven’t called it that [links to Guadian, The]
   Guide for Cybersecurity Event Recovery [links to National Institute of Standards and Technology]
   Can Alexa help solve a murder case? Police think so, but Amazon won't give up the data [links to Los Angeles Times]
   FDA outlines cybersecurity recommendations for medical device manufacturers [links to US Food and Drug Administration]

INTERNET/BROADBAND
   Tribal Broadband: Status of Deployment and Federal Funding Programs - research

GOVERNMENT & COMMUNICATIONS
   House leadership proposes plan to penalize live-streaming lawmakers
   Could Technology Remove the Politicians From Politics? [links to Vice]
   ‘We the People’: Five Years of Online Petitions - Pew research [links to Benton summary]
   FCC Seeks Comment Regarding Possible Revision or Elimination of Rules Under the Regulatory Flexibility Act - public notice [links to Benton summary]

OWNERSHIP
   How Amazon, Google, and Facebook Will Bring Down Telcos - Wired analysis [links to Benton summary]
   Hollywood Reporter-Billboard Group acquires Spin, Vibe and Stereogum [links to Los Angeles Times]
   General Cable Pays $82.3 Million to Settle Bribe Charges [links to Broadcasting&Cable]
   FCC Adopts Globalstar Report and Order - press release [links to Benton summary]

TELECOM
   Birch To Pay $6.1M To Settle Slamming And Cramming Investigation [links to Federal Communications Commission]

CONTENT
   The Most Dangerous People on the Internet in 2016 - Wired editorial [links to Benton summary]

JOURNALISM
   'Washington Post' To Hire 'Dozens' Of Journalists in 2017 [links to MediaPost]
   If Donald Trump Targets Journalists, Thank Obama - [links to Benton summary]
   Cable News Networks Have Banner Year in 2016 [links to New York Times]
   New York Times, Wall Street Journal editors take on Trump and the media [links to Politico]

POLICYMAKERS
   Chairman Wheeler Announces Intergovernmental Advisory Committee Members - public notice [links to Benton summary]

STORIES FROM ABROAD
   French Law Giving Workers 'The Right To Disconnect' Goes Into Effect [links to Benton summary]

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TRANSITION

TRUMP'S FCC TOOLKIT
[SOURCE: Benton Foundation, AUTHOR: Andrew Schwartzman]
Although there are many articles and blog posts discussing likely policy changes in the media and telecommunications space, it is far too early to know exactly when and what will happen at the Federal Communications Commission under the forthcoming Trump Administration. However, it is not too soon to identify the legal mechanisms available to Congress and the FCC to unwind many of the Obama era accomplishments. In light of the Democrats’ loss of the White House and failure to take control of the Senate, public interest advocates will have a very hard time protecting these and earlier regulatory requirements given the breadth of the power conferred by these statutes. From the moment he took office in late 2013, outgoing FCC Chairman Tom Wheeler operated from the premise that his tenure might not extend beyond January 2017. Even though he undertook an ambitious agenda as soon as he arrived, a number of his major initiatives were not completed until the latter part of 2016. As a practical matter, it is reasonably easy for Congressional Republicans and the incoming Republican majority at the FCC to derail at least some of these recently adopted regulations. Here’s how.
benton.org/headlines/trump-fccs-toolkit-deregulating-media-and-telecommunications | Benton Foundation
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FCC'S 5 BIGGEST BATTLES
[SOURCE: The Hill, AUTHOR: Ali Breland]
Here are 5 looming fights for the Federal Communications Commission in President-elect Donald Trump's first year:
1. Network Neutrality: The fate of the agency's net neutrality rules will be the FCC's biggest fight of the year.
2. Set-top cable boxes: The FCC's lone, remaining Democratic commissioner, Mignon Clyburn, supports FCC Chairman Tom Wheeler's set-top proposal. But its unclear how much of a fight Clyburn can put up.
3. Broadband privacy: Chairman Wheeler's new privacy rules for broadband providers were another high-profile item from his tenure. It's unclear, though, if the FCC's Republican Commissioners would agree to scale them back. Internet companies and consumer groups, though, are likely to keep up pressure for the rules.
4. AT&T-Time Warner merger: The Justice Department will be looking into the proposed deal, but its unclear yet if the FCC will take up its own review.
5. Business data services: Chairman Wheeler also hoped to pass a major reform of the market for so-called special access deals, but dropped those plans after Trump's victory.
benton.org/headlines/fccs-5-biggest-battles-trumps-first-year | Hill, The
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BRINGING THE CONNECTED FUTURE TO ALL AMERICANS
[SOURCE: Federal Communications Commission, AUTHOR: Jessica Rosenworcel]
It has been an honor, a privilege, and a wild ride serving as Commissioner at the Federal Communications Commission. It has provided me with a front row seat at the digital revolution. Every day I have been able to see how communications technology is remaking every aspect of civic and commercial life. This experience has convinced me—truly, madly, deeply—that the future belongs to the connected. No matter who you are or where you live in this country, you need access to modern communications to have a fair shot at 21st century success. I am proud of the work I have done at the FCC to expand access to digital age opportunity. I am proud that these efforts—described in more detail below—have laid the foundation for a more safe, prosperous, and connected future for all.
benton.org/headlines/bringing-connected-future-all-americans-may-11-2012-january-3-2017 | Federal Communications Commission
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TRUMP ADDS WIRELESS ENTREPRENEUR TO FCC LANDING TEAM
[SOURCE: Broadcasting&Cable, AUTHOR: John Eggerton]
President-elect Donald Trump has added a fourth member to the Federal Communications Commission landing team, the volunteers working on transitioning the agency to Republican majority control come Jan 20. David Morken is the newest member, currently the co-founder and CEO of Republica Wireless parent company, Bandwidth.com. Morken combines a couple of life experiences that appear to hold a lot of weight with the incoming President. He is a former member of the US military (a Marine) and an entrepreneur/disruptor who built an "overnight success" through a decade of hard work growing a business. Bandwidth.com, which started as a URL generating sales leads for other telecoms, built out its network on the theory that Wi-Fi could be the primary network and cellular (Sprint) the backup, which would allow it to charge less ($19 a month at launch) for voice and broadband.
benton.org/headlines/trump-adds-wireless-entrepreneur-fcc-landing-team | Broadcasting&Cable
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THE NEED FOR A BIPARTISAN STRATEGY IN TRUMP FCC
[SOURCE: Brookings, AUTHOR: Stuart Botman, Nicol Turner-Lee]
While President-elect Donald Trump’s appointee as the next Federal Communications Commission Chairman remains to be announced, one real challenge ahead is how to change course after the widely- publicized track record of polarized decision making and disjointed collaboration under the Wheeler-led Commission. Moving forward, President-elect Trump’s FCC will have the opportunity to designate an agency leader who can achieve bipartisan consensus on critical issues, while still realizing the incoming administration’s policy agenda. While differences may emerge around network neutrality, media ownership, mergers and acquisitions and other items, the new FCC chairman might consider confronting matters at the outset that are ripe for collaboration and necessary for the next phase of progress. These issues include spectrum policy, infrastructure, digital inclusion, agency process reform, and the inevitable update of the Telecommunications Act of 1996.
benton.org/headlines/need-bipartisan-strategy-and-consensus-trump-administrations-fcc | Brookings
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ELECTION/HACKING

OBAMA ANNOUNCES MEASURE TO PUNISH RUSSIA
[SOURCE: Washington Post, AUTHOR: Missy Ryan, Ellen Nakashima, Karen DeYoung]
The Obama Administration announced sweeping new measures against Russia on Dec 29 in retaliation for what US officials have characterized as interference in 2016’s presidential election, ordering the expulsion of Russian “intelligence operatives” and slapping new sanctions on state agencies and individuals suspected in the hacks of US computer systems. The response, unveiled just weeks before President Barack Obama leaves office, culminates months of internal debate over how to react to Russia’s election-year provocations. In recent months, the FBI and CIA have concluded that Russia intervened repeatedly in the 2016 election, leaking damaging information in an attempt to undermine the electoral process and help Donald Trump take the White House. Because Dec 29's announcement is an executive action, it can be undone by the next administration. President Obama also ejected 35 suspected Russian intelligence operatives from the United States and imposed sanctions on Russia’s two leading intelligence services.
benton.org/headlines/obama-administration-announces-measures-punish-russia-2016-election-interference | Washington Post | New York Times | The Guardian | Executive Order | Fact Sheet | WH Press Release
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INTERNET/BROADBAND

TRIBAL BROADBAND
[SOURCE: Congressional Research Service, AUTHOR: Lennard Kruger]
Until recently, data on tribal broadband deployment had been scarce. However, the Federal Communications Commission (FCC) and the National Telecommunications and Information Administration (NTIA) have begun to collect and compile data on tribal broadband deployment. The most recent data show that, as of December 31, 2014, approximately 41% of Americans living on tribal lands lacked access to broadband at speeds of 25 Mbps download/3 Mbps upload. This compares unfavorably to 10% of all Americans lacking access to broadband at those speeds. Tribal areas that are the most lacking in broadband service are rural Alaskan villages and rural
tribal lands in the lower 48 states. Currently, the largest overall source of federal funding for telecommunications services is the FCC’s Universal Service Fund programs. As these programs transition towards a broadbandcentric orientation (e.g., the Connect America Fund), the issue for tribal broadband is how this transition will affect broadband funding to tribal lands, and to what extent these programs might be configured towards addressing the relatively low levels of broadband deployment and adoption in tribal lands.
benton.org/headlines/tribal-broadband-status-deployment-and-federal-funding-programs | Congressional Research Service
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GOVERNMENT & COMMUNICATIONS

HOUSE LEADERSHIP PROPOSES PLAN TO PENALIZE LIVE-STREAMING LAWMAKERS
[SOURCE: Politico, AUTHOR: Kelsey Sutton]
Seeking to prevent another live-streaming "viral video moment" from taking place on the floor of the US House of Representatives, House Speaker Paul Ryan (R-WI) has introduced a rules package that would fine and punish lawmakers for recording photos and video from the floor. Lawmakers would be fined $500 for the first offense and $2,500 for each subsequent violation. The fines would be deducted from members’ paychecks. The move comes in response to Democratic lawmakers, who in June live-streamed a sit-in on the House floor over gun control legislation. Democrats organized the sit-in to protest Republican lawmakers’ decision not to bring to the floor a gun-control bill, which if passed would have broadened background checks and prevented people on no-fly lists from buying guns.
benton.org/headlines/house-leadership-proposes-plan-penalize-live-streaming-lawmakers | Politico
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Bringing the Connected Future to All Americans, May 11, 2012 – January 3, 2017

It has been an honor, a privilege, and a wild ride serving as Commissioner at the Federal Communications Commission. It has provided me with a front row seat at the digital revolution. Every day I have been able to see how communications technology is remaking every aspect of civic and commercial life. This experience has convinced me—truly, madly, deeply—that the future belongs to the connected. No matter who you are or where you live in this country, you need access to modern communications to have a fair shot at 21st century success. I am proud of the work I have done at the FCC to expand access to digital age opportunity. I am proud that these efforts—described in more detail below—have laid the foundation for a more safe, prosperous, and connected future for all.

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