TEST Daily Digest 11/3/2017

This election season, Comcast is once again devoting funds to an investment it considers necessary - influencing elections in Seattle (WA) and Fort Collins (CO).  In Seattle, Comcast and CenturyLink have donated $50,000 to a political action committee that supports a candidate opposed to publicly owned Internet infrastructure. In our analysis, we’ve run a range of possible scenarios and offered both a conservative Comcast loss estimate and figures based on higher loss of subscribership. For example, if 20 percent of the city’s 138,000 current Comcast Internet access subscribers choose to switch to some other ISP, the company could lose $1.38 million per month based on monthly rates of $50 per month. In Fort Collins, residents will vote on a ballot question that would authorize the city to build a broadband network. Comcast is a member of two groups that have collectively spent $210,000 to fund a campaign against the municipal broadband proposal.

Comcast met with Federal Communications Commission Chairman Ajit Pai's staff the week of Oct 30 in an attempt to prevent states from issuing network neutrality rules. As the FCC prepares to gut its net neutrality rules, broadband providers are worried that states might enact their own laws to prevent ISPs from blocking, throttling, or discriminating against online content. Comcast Senior VP Frank Buono and a Comcast attorney met with Pai Chief of Staff Matthew Berry and Senior Counsel Nicholas Degani on Oct 30. Comcast urged Pai's staff to reverse the FCC's classification of broadband as a Title II common carrier service, a move that would eliminate the legal authority the FCC uses to enforce net neutrality rules. Pai has said he intends to do just that, so Comcast will likely get its wish on that point. But Comcast also wants the FCC to go further by making a declaration that states cannot impose their own regulations on broadband.

On Oct 5, several Members of Congress wrote to Federal Communications Commission Chairman Ajit Pai regarding the FCC's Notice of Inquiry "Concerning Deployment of Advanced Telecommunications Capability to All Americans in a Reasonable and Timely Fashion." The lawmakers wrote, "we strongly oppose any proposal to lower speeds from the current standard of 25 Mbps download/3 Mbps upload to 10 Mbps download/I Mbps or to find mobile broadband as a universally appropriate replacement for fixed, home broadband." On Oct 24, Chairman Pai responded, writing, "With respect to claims that the Section 706 NOI proposes to lower the current speed benchmark of 25 Mbps download and 3 Mbps upload (25 Mbps/3 Mbps) for fixed broadband, the item clearly proposes to maintain the 25 Mbps/3 Mbps standard for fixed broadband." 

[Commentary] Last week the Federal Communications Commission, led by Chairman Ajit Pai, announced two orders that will be voted on later in Nov, which would roll back hard fought civil rights advances — at a time when our educational and economic opportunities, as well as political participation, are increasingly dependent upon communications infrastructure and technology. 

T-Mobile and Sprint jointly announced that they have ceased talks to merge as the companies were unable to find mutually agreeable terms. “The prospect of combining with Sprint has been compelling for a variety of reasons, including the potential to create significant benefits for consumers and value for shareholders. However, we have been clear all along that a deal with anyone will have to result in superior long-term value for T-Mobile’s shareholders compared to our outstanding stand-alone performance and track record,” said John Legere, President and CEO of T-Mobile US, Inc.

Attorneys general from IL, MD, MA, and RI have teamed up to ask the Federal Communications Commission to block the merger of Sinclair and Tribune. The joint filing comes at the same time the Coalition to Save Local Media was urging all the state AG's to weigh in against the deal. The AGs principal beef appears to be the size of the deal, which would create the largest TV station group in the country reaching over 70% of the national audience. Saying they are the chief consumer protection officers in their states, the AGs argue that the deal "fails to further the public interest by allowing for increased consolidation that will decrease consumer choices and voices in the marketplace." Because the deal will reduce consumer choices and threatens the "diversity of voices," they say, the FCC should block it, or at the least postpone a decision until the US Court of Appeals rules on Free Press's legal challenge to the FCC's reinstatement of the UHF discount.

President Donald Trump boasted Nov 3 of his social media influence after his personal Twitter account was briefly deactivated by a departing company employee, raising serious questions about the security of tweets the president wields to set major policy agendas, connect with his voter base and lash out at his adversaries. The deactivation Nov 2 sparked deep and troubling questions about who has access to the president's personal account, @realDonaldTrump, and the power that access holds. The deactivation also came at a time when the social network is under scrutiny for the role it played in spreading Russian propaganda during the 2016 presidential election.

US lawmakers say Russia's use of social media in the 2016 presidential election amounts to cyberwarfare. Sens Dianne Feinstein (D-CA) and Angus King (I-ME) both used that term to describe Russian accounts and advertising that sowed division among Americans by promoting fake news and even protests. "This country has to have some kind of cyberwarfare deterrent capacity," Sen King said. "Right now, there's no price to be paid for meddling in our democracy." But there's no explicit definition or legal framework in the United States for what constitutes cyberwar. So far, there are no reports of physical injury as a result of the Russian campaigns. Two protests organized by Russian trolls in Texas were reportedly non-violent. But they targeted American democracy by relying on Facebook and Twitter's power to share information to large audiences.

[Commentary] I was struck this week by two inside-baseball journalism stories following Oct 30’s Mueller investigation bombshells that spoke, tangentially but notably, to what I have often said about a main obstacle in our industry’s ability to regain the trust of the public: The conflation in many information consumers’ minds between responsible journalism and the opinion media. I invoke the spirit of Walter Cronkite to make some points that I believe are critical in our current time. First, we have a responsibility as journalists, as we face more obstruction, threats, harassment, arrests and even physical assaults, to answer our misguided critics – by that I mean those acting out harshly against responsible journalism, egged on by the bullhorn of some powerful bully pulpits, merely because they don’t like or understand responsible journalism – by doing more and better journalism.

Senate Majority Leader Mitch McConnell (R-KY) said he believes technology companies that displayed Kremlin-linked ads during the 2016 election could help the United States “retaliate” against Russia. “What we ought to do with regard to the Russians is retaliate, seriously retaliate against the Russians,” Sen McConnell told MSNBC’s Hugh Hewitt. “These tech firms could be helpful in giving us a way to do that.” Sen McConnell did not elaborate on what that retaliation might look like. “I’m a little skeptical of these disclosure-type proposals that are floating around, which strikes me would mostly penalize American citizens at trying to use the internet and to advertise,” said Sen McConnell. He doesn’t believe a special commission is required to look at the broader issue of technology and national security, but recognized that it’s a complex issue.

During months of merger talks with T-Mobole, Sprint Chairman Masayoshi Son sought a way to merge the two wireless rivals without really having to hand over the keys. There was discussion over inserting a provision to buy the combined company back after two years. The companies explored giving the Japanese billionaire the right to increase his stake over time. He was offered the role of co-chairman. In the end, nothing worked. The abrupt turn of events derailed a deal that many on Wall Street have anticipated for years, and that Son has long desired. The latest round of deal talks began to unravel in late October.