Daily Digest 5/16/2018 (Net Neutrality Vote Today)

Benton Foundation

A busy day includes a Senate vote on Net Neutrality

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The Time to Get the Net Neutrality Rules Back is Now

[Commentary] The best and fastest vehicle for bringing back the vital protections of net neutrality resides in both houses of Congress. It’s called a “Joint Resolution of Disapproval” which is allowed under a law called the Congressional Review Act (CRA). The CRA allows Congress to overturn an agency decision soon after it is adopted with a simple majority of members in attendance. This Congress used the CRA last April to repeal Federal Communications Commission rules that would have required ISPs to protect the privacy of their customers. Now the CRA is being used by net neutrality supporters to overturn the FCC’s December 14th order and reinstate the 2015 rules. Should the Joint Resolution pass the Senate, the House must pass it by the time Congress adjourns at the end of the year. The House Joint Resolution currently has 161 co-sponsors, with a total of 218 votes needed for passage. But once it passes the Senate, the pressure will mount for House members to co-sponsor the Joint Resolution.

[Gigi Sohn is a Georgetown Law Institute for Tech & Society Fellow, OSF Fellow, and Mozilla Fellow. She served as Counselor to former-FCC Chairman Tom Wheeler.]

via Medium

Google Fiber’s Unfulfilled Promise In Atlanta

Google has released little public information about the Atlanta rollout delays. But it’s possible that, in the time it has taken Google Fiber to figure out how to travel the last mile to people’s homes, fiber optic technology may no longer be the best way to get there. Atlanta isn’t the only city to see Google Fiber falter. In Nashville, big telecom operators sued and all but blocked Google Fiber from tapping half of the city’s 88,000 utility poles — essential for completing the backbone of its last-mile delivery. Nearly four years after the company announced it was coming to Nashville, Google Fiber finally reached 10 Nashville neighborhoods late last year. Google Fiber didn’t face as many obstacles here, although its Atlanta build-out has been anything but a textbook case. One thing is indisputable: most who were once gaga over Google are now fed up with its failed fiber promise.

via WABE

The rise of free urban internet

Intersection, the Alphabet-backed smart cities startup known for creating free internet kiosks for cities, is pushing to make free internet accessible in as many major cities as possible across the globe. There are two things a city must have:

  1. Physical infrastructure: "You've gotta have power and fiber in the grounds," said Intersection CEO Ari Buchalter. "Those types of infrastructure readiness is a critical factor and is a big driver of cost for the program."
  2. Critical mass of people that can be exposed to ads. "We lay out of city in terms of density a factor." In New York City, for example, you have a critical mass of people exposed to advertising. Does that mean you have to be as big or dense as NYC to work? No, absolutely not. We will work figure out what other locations in cities can work in critical mass."
via Axios

The telecom industry's identity crisis

The internet age has become an identity crisis as they face increasing competition from Silicon Valley, an uncertain merger landscape and global pressures in the race to 5G networks. It's no longer enough to power the pipes and cell towers that send internet traffic coursing around the world. The services that ride on top of that traffic, -- Google, Facebook and Amazon -- now dominate the internet ecosystem. Meanwhile, companies like Comcast, Verizon and AT&T that built the networks in the first place are trying to stake their claims in the next round. This dynamic isn't new; telecom companies have been grappling with rising cord-cutters, a saturated broadband market, declining monthly bills and shifting consumer habits for several years. But analysts say it's become a make-or-break situation for the established telecom providers to chart a course for survival — with many planning to do so through mergers and acquisitions.

via Axios

President Trump Orders Help For Chinese Phone-Maker After China Approves Money For Trump Project

A mere 72 hours after the Chinese government agreed to put a half-billion dollars into an Indonesian project that will personally enrich President Donald Trump, he ordered a bailout for a Chinese-government-owned cellphone maker ZTE.  “President Xi of China, and I, are working together to give massive Chinese phone company, ZTE, a way to get back into business, fast,” President Trump announced on Twitter on May 13. “Too many jobs in China lost. Commerce Department has been instructed to get it done!” President Trump did not mention in that tweet or its follow-ups that on May 10, the developer of a theme park resort outside of Jakarta had signed a deal to receive as much as $500 million in Chinese government loans, as well as another $500 million from Chinese banks. Trump’s family business, the Trump Organization, has a deal to license the Trump name to the resort, which includes a golf course and hotels. President Trump, despite his promises to do so during the campaign, has not divested himself of his businesses, and continues to profit from them. “You do a good deal for him, he does a good deal for you. Quid pro quo,” said Richard Painter, the White House ethics lawyer for former President George W. Bush.

White House eliminates top cyber adviser post

The Trump administration has eliminated the White House’s top cyber policy role, jettisoning a key position created during the Obama presidency to harmonize the government's overall approach to cybersecurity policy and digital warfare. The decision is part of an effort to “streamline authority” for the senior directors who lead most NSC teams. “The role of cyber coordinator will end,” Christine Samuelian, an aide to John Bolton, President Donald Trump's new national security adviser. The NSC’s cyber team has two senior directors, Samuelian wrote, and thus “cyber coordination is already a core capability.” Rob Joyce, Trump’s first coordinator who came from the NSA, left the White House and will return to Fort Meade.


How Betting Will Change the Sports Media Business

The Supreme Court injected a dose of optimism into the sports television industry when it ruled to strike down a 26-year-old federal law that largely prohibited sports betting in the United States. The ruling is likely to produce the next major boost to the value of live, televised sports, industry executives and experts say, at just the time when it is most needed. Nearly everyone agrees the appetite for sports consumption both online and on traditional television will surely rise, as more fans might suddenly have a vested interest in tuning in to a Tuesday night matchup in June between the Cincinnati Reds and the Miami Marlins. History has shown that the ability to place a bet on a sporting event makes fans pay closer attention to the action, and watch more. Sports bettors watch about twice as much sports coverage as non-bettors do. So it stands to reason that making it easier for people to become sports bettors will make them more likely to watch sports.


Justice Department and FBI Are Investigating Cambridge Analytica

The Justice Department and the FBI are investigating Cambridge Analytica, the now-defunct political data firm, and have sought to question former employees and banks that handled its business. Prosecutors have questioned potential witnesses in recent weeks, telling them that there is an open investigation into Cambridge Analytica — which worked on President Trump’s election and other Republican campaigns in 2016 — and “associated U.S. persons.” But the prosecutors provided few other details, and the inquiry appears to be in its early stages, with investigators seeking an overview of the company and its business practices. The investigation appears to focus on the company’s financial dealings — investigators have reached out to the company’s banks, for instance — and how it acquired and used personal data pulled from Facebook and other sources. In a sign of the inquiry’s scope, one of the prosecutors involved is the assistant chief of the Justice Department’s securities and financial fraud division, Brian Kidd. The effort is being assisted by at least one agent who investigates cybercrime for the FBI.


As big chains gobble up small TV stations, merged newsrooms are creating a uniformity of news coverage

The TV news has a familiar feel to it in west-central Pennsylvania. News stories broadcast on WJAC, the NBC affiliate in town, have appeared on nearby station WATM, the ABC affiliate. And many of those stories are broadcast on WWCP, the Fox station here, as well. Not just the same topics — identical stories, reported by the same reporter or anchor, and repeated, almost verbatim at times, by the other stations. Almost all of the look-alike news emanates from WJAC’s studios where reporters and anchors buzz around two sets equipped with backdrops representing the three different stations. The anchors assemble in front of the appropriate backdrop when that station has its newscast scheduled. The media overlap in Johnstown (PA) — where all three stations are either owned or managed by the Baltimore-based Sinclair Broadcast Group — is part of a trend that has spread across the country, as a small number of large holding companies are taking over local TV stations, often more than one in the same market. It has allowed companies to cut costs by consolidating newsrooms that may have once competed against each other — creating a uniformity of news coverage and, critics fear, diminishing the watchdog power of local media. Sinclair’s arrangement in Johnstown — where the first newsroom mergers happened even before Sinclair entered the market — has parallels in many other communities. 

Is Sprint a victim of 'The Rule of Three and Four?'

[Commentary] Bruce Henderson hypothesizes that a stable, competitive industry will never have more than three significant competitors and that the industry will find equilibrium when the market shares of the three competitors reach a ratio of 4:2:1. Taking a closer look at the wireless businesses of the four major operators in the U.S., the market share in revenue terms at the end of 2017 was: Verizon (38%); AT&T (31%); T-Mobile (17%); and, Sprint (14%). In terms of profitability as measured in operating income before depreciation and amortization (OIBDA), the relative differentials were even greater: Verizon (44%); AT&T (32%); T-Mobile (12%); and Sprint (12%). While it is highly debatable whether we can apply this hypothetical rule to the dynamic wireless industry in the US, I would argue that the general directionality of the “Rule of Three and Four” applies here. Further network investments in LTE-Advanced and 5G will require higher capital expenditure, and Sprint is certainly not in a good competitive standing to keep up the investment required. Outside of the top three, Sprint is attempting to improve its position through the consolidation with T-Mobile. So, is the T-Mobile/Sprint merger a big deal in the path towards network convergence and consolidation? For the near term, the answer is “no,” especially considering that the deal will take a year to complete. In the longer term, this deal will make a serious investment in 5G more possible, possibly forcing Verizon and AT&T to invest more as well.

[Kyung Mun is a senior analyst at Mobile Experts LLC]

via Fierce

MMTC, NABOB Say FCC Should Help Northstar, SNR Cure DE Applications

The Multicultural Media Telecom and Internet Council and National Association of Black Owned Broadcasters told the Federal Communications Commission it needs to work with SNR Wireless and Northstar to help them qualify for designated entity (DE) bidding credits, a way to encourage minority participation in spectrum auctions. The two companies teamed with Dish Network to acquire $10 billion worth of spectrum licenses in the AWS-3 auction. But the FCC subsequently concluded that Dish's majority financial interest in the companies were controlling interests that should be attributable to Dish, which meant the companies were ineligible for the $1.9 billion (Northstar) and $1.4 billion (SNR Wireless) bidding credits they had applied for.


Fox News, 21st Century Fox Settle Discrimination Suits With 18 Ex-Employees

Fox News and its parent company 21st Century Fox said they have reached settlements with 18 former employees of the news channel who had filed lawsuits that included allegations of racial and gender discrimination. The first suit, filed in March 2017 in New York state court, was brought by two black women who worked in the payroll department at Fox News. They alleged that they were subject to racial slurs and insults by their superior and that they were subjected to a hostile work environment. Other employees from payroll and accounting subsequently joined the suit, as did Kelly Wright, an on-air personality. Wright argued that discrimination based on his race had kept him from advancing at the network. Wright is leaving the network.


Chairman Greg Walden op-ed: House committee seeks input from tech CEOs

[Commentary] It is clear the questions surrounding online consumer protection and data privacy go well beyond Facebook. My committee and the American people need to hear directly from the major players in the tech industry. Consumers deserve a deliberative and exhaustive examination of the digital ecosystem that has become a part of our lives. The House Commerce Committee extends an open invitation to Silicon Valley CEOs. Come and testify before our committee, explain your business model, and enlighten consumers about how your industry affects their daily lives. I strongly encourage the best and brightest of the tech world to accept this invitation. Trust me, it’s much easier to testify at a congressional hearing before your company gets caught up in a scandal. Mistakes, abuse and breaches of trust, however, all have real-world implications for hundreds of millions of Americans, and billions of people worldwide. Congress will need the help of the best and brightest in tech to help us strike the right balance to protect consumers while also encouraging innovation and competition. I look forward to welcoming more Silicon Valley CEOs to the Commerce Committee.

[Rep. Greg Walden (R-OR) is chairman of the House Commerce Committee]

Government Performance

President Trump Strengthens Agency CIO Authority with Executive Order

In December 2014, Congress gave government chief information officers (CIOs) new powers and authority to manage the IT enterprise at their departments and component agencies under the Federal Information Technology Acquisition Reform Act (FITARA). Three and a half years later, CIOs don’t have the authority they need, administration officials said. President Trump signed an executive order giving presidential weight to mandates of FITARA, specifically the parts that give department CIOs authority over hiring, budgets and setting the IT agenda for the entire department enterprise. The administration has a three-pronged plan to modernize federal IT: institutional change, placing people in key positions and achieving early wins to gain momentum, said a senior White House official, speaking on background ahead of the signing. The executive order focuses on the first of those efforts.

Open Government

The truth is about to catch up to President Trump. He has Giuliani to thank for it.

May 15 is the deadline for President Trump to file his financial disclosure form for 2017. That fact may seem trivially bureaucratic, but lurking at its core is a dilemma for President Trump that continues to metastasize into something ever more grotesque. The need to submit this form shows that in the Stormy Daniels matter, Trump has been boxed in by his lawyer (sic) Rudy Giuliani — and by his own tweets — with no good way out. He needs to decide whether to disclose the debt he incurred to his personal lawyer, Michael Cohen, when Cohen paid $130,000 to Stormy Daniels just before the election, buying her silence about their alleged affair. President Trump did not disclose this debt in the financial disclosure form he filed one year ago — back when this payment, and Trump’s reimbursement of it, remained unknown. But thanks to Giuliani, we now know that President Trump did, in fact, incur this debt to Cohen. Thanks to Giuliani, Trump’s excuse for not disclosing this liability has now evaporated. To justify his failure to disclose it on his 2017 form — which detailed his finances for 2016 — President Trump could claim he didn’t know about Cohen’s payment or make any agreement to reimburse it. Whether that’s plausible or not, we can’t really disprove it. But now we know that President Trump did take on this debt in 2017, because Giuliani compelled him to admit it — by blurting out the truth.


Documents show Ajit Pai met with AT&T execs right after the company started paying Michael Cohen

AT&T apologized for for its “serious misjudgment” in hiring President Donald Trump’s personal attorney Michael Cohen to provide “insights” into how the new administration would handle issues like net neutrality and AT&T’s proposed merger with Time Warner Cable. Although Federal Communications Commission Chairman Ajit Pai denied hearing from Cohen, new scheduling documents obtained through FOIA by corruption watchdog American Oversight show Chairman Pai met with with top AT&T executives at a private dinner in Barcelona a month after the company began paying Cohen. One of the top AT&T representatives present at this meeting was Bob Quinn, who hired Cohen and has since stepped down over the controversy.

If America really wants to drain the swamp, take a good look at AT&T

If you know anything about AT&T’s history, its relationship with Trump’s personal attorney Michael Cohen shouldn’t be too surprising. The company has an army of lawyers at its disposal, is hair-trigger litigious, and is no stranger to backroom dealing in the Capitol. During 2017, the company paid $16,780,000 to 31 lobby firms, according to government filings. 

The company already has 96 DC lobbyists -- including three former members of Congress -- working to push through the company’s proposed acquisition of Time Warner, a deal which would further consolidate the media market and reduce competition. It would put one of the largest video distribution networks in America, and a mountain of video content, under the control of one company. In 2017, its lobbyists helped lead the fight to scrap net neutrality, the regulations that prevented AT&T and other telecom giants from selling expensive “internet fast lanes” on its network, and from favoring its own content over others on the web.

With these issues at stake, AT&T apparently didn’t have any qualms about jumping in bed with some unsavory bedfellows. 

$1 million mystery gift to inauguration traced to conservative legal activists

One of the largest contributions to President Donald Trump’s inaugural committee in 2016 appears to have been orchestrated by a set of powerful conservative legal activists who have since been put in the driver’s seat of the administration’s push to select and nominate federal judges. The $1 million inaugural gift came from a Northern Virginia company called BH Group, LLC. Unlike other generous corporate inaugural donors -- like Bank of America and Dow Chemical -- though, BH Group was a cipher, and likely was set up solely to prevent disclosure of the actual donor's name. Almost nothing is known about the company, including who runs it or its reason for being beyond writing a seven-figure check on Dec. 22, 2016, almost a month before President Trump was sworn in. While the source of the money used to make the gift was masked from the public, a trail of clues puts the contribution at the doorstep of some of the same actors — most notably Leonard Leo, an executive vice president at the conservative Federalist Society — who have helped promote Trump’s mission, and that of his White House counsel, Don McGahn, to fill judicial vacancies as quickly as he can with staunchly conservative, preferably young jurists.

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Benton (www.benton.org) provides the only free, reliable, and non-partisan daily digest that curates and distributes news related to universal broadband, while connecting communications, democracy, and public interest issues. Posted Monday through Friday, this service provides updates on important industry developments, policy issues, and other related news events. While the summaries are factually accurate, their sometimes informal tone may not always represent the tone of the original articles. Headlines are compiled by Kevin Taglang (headlines AT benton DOT org) and Robbie McBeath (rmcbeath AT benton DOT org) -- we welcome your comments.

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