Daily Digest 5/7/2018 (3 + 4 = 3)

In a post-trial brief, AT&T and Time Warner said the government "came nowhere close" to proving the proposed AT&T-Time Warner merger violates antitrust laws. The companies said that the government's case was built on "non-probative competitor complaints, irrelevant slide shows," and a theoretical model of harm that collapsed under the weight of "real-world" evidence, then disintegrated upon first contact with real-world events, testimony, and data." The Justice Department had asserted that without spinoffs of Turner programming networks, the merger would mean substantially less competition and thus higher prices for consumers. The companies argued that to make the case, the government had to prove that the merger "will likely (not potentially or possibly) lessen competition substantially, in a video marketplace that is experiencing revolutionary, unstoppable transformation and growth in competition at all levels." Rather than "concrete evidence" based on "real world experience," Justice based its case on "conjured crystal-ball prognostications," they said.

The Federal Communications Commission is already taking steps to nix the dead enrollees in the agency’s low-income subsidy program known as Lifeline following a revelation from Sen Claire McCaskill (D-MO) that 47,942 deceased individuals were signed up between 2014 and October 2017. In July 2017,  FCC Chairman Ajit Pai directed the Universal Service Administrative Company, the nonprofit that manages the subsidies, “to take specific, immediate steps to mitigate waste, fraud, and abuse in the Lifeline program, including enrollment and subscribership of the deceased,” a FCC spokesman said. “USAC recently started using information from the Social Security Administration’s Death Master File in the identity validation process, and this step has already prevented hundreds of deceased individuals from enrolling in the program.” But what of the delayed Obama-era reform to ensure the federal government, rather than phone companies, is responsible for ensuring subsidy recipients meet income requirements? That verifier tool’s rollout was postponed in 2017 due to IT problems and also drew questioning from Sen McCaskill. The FCC spokesman said “more needs to be done” and referred to Chairman Pai “urging USAC to complete the work necessary to get the Lifeline National Eligibility Verifier up and running as soon as possible,” as well as pursuing his own overhaul of the program.

In their effort to prevent states from protecting a free and open Internet, a small handful of massive and extraordinarily-profitable Internet service providers (ISPs) are telling state legislatures that network neutrality would hinder their ability to raise revenues to pay for upgrades and thus force them to charge consumers higher bills for Internet access. This is because state-based network neutrality will prohibit data discrimination schemes known as “paid prioritization” where the ISP charges websites and applications new tolls and relegate those that do not pay to the slow lane. In essence, they are saying they have to charge new fees to websites and applications in order to pay for upgrades and maintenance to their networks. In other words, people are using so much of their broadband product that they can’t keep up on our monthly subscriptions. Nothing could be further from the truth.

The Department of Agriculture awarded Tombigbee Communications a $2.98 million grant for a rural utility broadband deployment in Alabama. Steve Foshee — president and CEO of Tombigbee Communications and its parent company Tombigbee Electric Cooperative — explained that the funding is for one of the most remote parts of a broader area that the company has targeted for broadband deployment. Tombigbee, which offers broadband under the Freedom Fiber brand, aims to deploy broadband throughout 1,000 square miles of rural Alabama where many people do not have broadband available to them at the minimum recommended speeds, explained Foshee. After conducting a feasibility study showing the entire project would cost about $40 million, the company divided the project into five phases. As Foshee explained, “The first phase was the easiest fruit to pick” and the company decided to take the project further only if Phase 1 was successful. Phase 1, which has already been undertaken, included two towns with a combined population of about 13,000 and surrounding areas and required an investment of $8 million.

Black Americans are frequent users of technology, and have helped build social media platforms like Twitter and Instagram into the giants they are today. But they aren’t reaping the same economic benefits of the tech boom as white Americans, and low rates of black employment in the tech industry are a large part of the reason why. The State of Black America 2018, a report published annually by the National Urban League, compares how black and white people fare in a number of areas, including housing, economics, education, social justice, and civic engagement. The report pays particular attention to black Americans’ access to jobs in the tech industry and STEM (science, technology, engineering, and mathematics) fields. The study reveals that while black people are one of the racial groups most likely to use smartphones and have created thriving communities on platforms like Twitter, those high rates of usage haven’t translated into employment. And this is largely because the tech industry has failed to hire black STEM grads and transition them into careers in Silicon Valley, where many of these jobs are based.

Senator Edward Markey (D-MA) wrote a letter to the Federal Trade Commission commissioners expressing concern that Facebook violated a 2011 consent decree with the Commission. In his letter, Senator Markey urges the FTC to implement a series of new privacy safeguards that Facebook should implement, including requiring Facebook to cease all tracking of users across websites after users have logged out of their Facebook accounts, requiring Facebook to suspend deployment of facial recognition tools pending completion of the FTC investigation, as well as a number of other steps to ensure compliance with the consent decree. Additionally, Senator Markey asks the FTC if Facebook has provided the Commission with all audits required by the consent decree, what steps the Commission is taking to ensure compliance, and when the investigation will be made public. The new Facebook privacy safeguards Senator Markey urges the FTC to require include:

• Creating and managing a mechanism that allows the public to review any substantial changes to Facebook’s privacy practices that are subject to the 2011 consent order
• Requiring Facebook to cease all tracking of users across websites after users have logged out of their Facebook accounts
• Prohibiting Facebook from repealing or weakening its current policy prohibiting applications from collecting users' data based on their “friends’” permission
• Requiring Facebook to release publicly and automatically transmit to the FTC any consumer complaints or records that contradict, qualify, or call into question Facebook’s compliance with the consent decree

People buying Google ads related to candidates in US federal elections will have to prove they are US citizens or lawful permanent residents beginning July 10. Under Google’s new rules, people or groups who want to advertise in elections will have to go through a process that includes producing a “government-issued ID” as well as other information, like a Federal Election Commission identification number and an IRS Employer Identification Number. Google says it aims to confirm that buyers are who they say they are and can legally participate in American elections. Advertisers can go through the verification process starting at the end of May, and Google will start enforcing the new rules on July 10, the company said. The new requirements will apply to ads featuring candidates for federal office or current officeholders in the United States. Google will also start requiring these ads to carry a disclosure that says who paid for them. The new policy will not cover ads that relate to politically contentious issues rather than a candidate, which was the case for many of the online ads placed by Russian operatives trying to interfere in the 2016 election. The company says it is looking at following Facebook in tightening restrictions on those ads as well.

Facebook and Google must answer to new cops on the beat – a group of five fresh Washington regulators at the Federal Trade Commission who have the power to punish Silicon Valley if it misbehaves. But veterans of the 103-year old watchdog say that the agency increasingly runs the risk of being outmatched by the very tech giants it oversees without more cash, cutting-edge staff and stronger legal teeth. “For a long time the FTC itself has been pointing out the gaps in its authority,” said Terrell McSweeny, a commissioner who just concluded her three-year tenure. “What I find hopeful about this moment is that people are realizing the consequences of that and having a conversation about it.” On May 1, the FTC gained its newest chairman, Joe Simons, and soon he’ll be surrounded by a full complement of four other commissioners. They’ll be expected to monitor everything from the fast-growing footprint of companies like Amazon to the security practices of the entire tech industry. Already, they face their first, high-profile test: an investigation into Facebook’s recent privacy mishaps.