Daily Digest 7/24/2018 (Policy for an Open Internet Ecosystem)

[Speech] The primary focus of my remarks will be the primary focus of my chairmanship since day one: closing the digital divide in order to make sure everyone can benefit from the Internet revolution. To date, I’ve visited roughly 90 cities in 33 states in the US, driving more than 8,500 road miles in some hard-working rental cars. What are some of the key lessons from this travel? One is that no matter what you do for a living or where you do it, broadband is critical.  A second key lesson is that the communities that are the hardest to connect are also the places that have the most to gain from next-generation networks. The third takeaway is that the costs of being on the wrong side of the digital divide are high and getting higher. That brings me to the final subject I wanted to highlight: disaster response. We should learn from our experiences and develop best practices so that we’re all better prepared and more effective in responding to future disasters. We may come from different countries, but we all share common bonds—bonds of geography and, more importantly, bonds of shared values. As your neighbor, I’m calling on all of us to work together to bring digital opportunity to all the people we are honored to serve.

[Speech] I want to talk about the secret to smart policies about smart cities.  I can summarize my idea in one word.  Learning. A major tactic in the Federal Communications Commission’s effort to regulate cities is through its Broadband Deployment Advisory Committee (BDAC) process. The stated, and worthy, goals of the BDAC are to accelerate and broaden deployment of next-generation broadband networks and reduce the digital divide. However, the BDAC suffers from significant failures of design and execution. The failures are threefold. First, the BDAC did not have a balanced membership that could have lead to a real consensus between stakeholders. Second, the BDAC started from the false assumption that industry does not have the leverage to negotiate the deals it needs to make investments in new networks, an assumption the industry acknowledges is false. Third, BDAC did not understand how to use a negotiating process to create value for both sides, by focusing on how each can give up on something small to get something big.  Instead, it primarily focused on forcing cities to give carriers what the carriers wanted.But underlying these three failures is a failure to learn anything. We have a lot of work to do and a lot to learn to achieve the outcomes we desire. But I trust cities can do that learning in ways the FCC has shown itself incapable of doing.

[Blair Levin is the Executive Director of Gig.U. He also serves as a Non-resident Senior Fellow of the Metropolitan Policy Project of the Brookings Institute.]

The Federal Communications Commission has released an additional $36 million annually for 175 small rural carriers that opted to transition to receive broadband Universal Service support based on the alternative Connect America cost model (A-CAM). In exchange, the A-CAM carriers have committed to more aggressive broadband deployment goals – although those goals are not as aggressive as those originally established for the A-CAM portion of the high-cost Universal Service program back in 2016. At that time, more carriers than expected opted to receive A-CAM support, driving the commission to reduce both funding and deployment commitments. Anticipations changed in March 2018, however, when the FCC voted to release an additional $360 million over a 10-year period to A-CAM carriers.  As a July 23  FCC press release explains, the $360 million is based on an adding approximately $36 million annually to the A-CAM budget for the next 10 years.

Watch for network neutrality arguments in future antitrust analysis of mergers, competition lawyers said. The Justice Department’s high-profile attempt to block AT&T from buying Time Warner didn’t address the possibility that the AT&T customers could see slowed internet traffic for some content. But that kind of argument could come up one day. The DOJ has looked at past merger cases on the grounds of its impact on open internet access said Ketan Jhaveri, a former trial lawyer at the DOJ’s Antitrust Division. “If net neutrality were to come up, it would come up in a merger of [internet service] providers,” he said, adding that those legal arguments are likely a long way off. Allegations that a merged AT&T-Time Warner could throttle streaming content from rival ISPs would have improved the government’s case that the merger would cause harm. “But they couldn’t do that,” said Blair Levin, a former chief of staff at the Federal Communications Commission in both the Obama and Clinton administrations. If the DOJ told a court that the combined AT&T-Time Warner would slow internet speeds for rival content services, it would have undermined the FCC’s successful push to undo net neutrality rules, Levin said. 

After being separated from their children at the border and detained in facilities scattered across the US, some migrant parents have to pay steep fees to speak with their children, a policy that a group of Democratic lawmakers have called "shameless" and "morally reprehensible." In a letter sent to US Immigration and Customs Enforcement, about 150 Democratic members of Congress argued that the practice of charging "exorbitant" prices to place phone calls from immigrant detention violates ICE's national standards. Detained immigrants are able to call specific lawyers and government help lines for free, according to the agency's telephone access standards. It also states that facilities should enable detainees to make direct or free calls to "immediate family or others for detainees in personal and family emergencies" and that detainees should have "equitable access to reasonably priced telephone services" — which the letter from Congress points out. For anyone else, detainees or the people they are contacting are responsible for the cost of the phone call.

Federal Communications Commission Chairman Ajit Pai phoned Sinclair executive vice president and general counsel Barry Faber July 18 to let the company know that just withdrawing the three TV station "sweetheart deal" sale applications was not going to head off an administrative hearing on the proposed Tribune merger. But Faber told Chairman Pai in a letter filed with the FCC that the company was not planning to cancel the deal the week of July 16, saying that would require board approval it did not have. Furthermore, Faber said Sinclair should not have to cancel the deal because it had never hidden or mischaracterized the structure of the deal. Sinclair tried to get Chairman Pai to delay the hearing, but the hearing designation order passed unanimously. The hearing looks certain unless Sinclair does decide to pull the plug on the deal. "I know that you told me yesterday that the withdrawal of these three applications would not prevent you moving forward with the [Hearing Designation Order]," Faber wrote, "but I am writing to ask you to reconsider that position (or at least delay it until you have an opportunity to more fully consider the situation," Faber wrote. Chairman Pai didn't delay the decision, and with the vote of FCC Commissioner Michael O'Rielly on July 18 making it unanimous, the deal was referred to the FCC's lone administrative law judge for an evidentiary hearing that could take upwards of a year. 

[Commentary] Talk about a curveball. Last week, Federal Communications Commission Chairman Pai struck a potentially fatal blow to a deal that President Donald Trump favored, the proposed merger of Sinclair Broadcasting and Tribune Media. If it had gone through, the deal would have had a major adverse impact on future election cycles, making Sinclair the king of the hill with unfettered capabilities to control political advertising and messages across all of its stations. There was a lot riding on the Sinclair deal—economically and politically—and its sudden demise seems a bit too unnerving to me. It may be just as it seems. Sinclair may have just made a devastating miscalculation and Chiarman Pai simply could not let the deal go through. But there is a voice in my head that tells me to look down the road. Will the FCC change the audience cap to something higher than the present 39%--say 50%, as the media industry has strongly advocated? Will a chastened Sinclair try again? Will the inevitable forthcoming mergers use Sinclair as an object lesson on how NOT to do it, and, having learned that lesson, easily get FCC approval? I have an uneasy feeling because I don’t know if any of this will happen. But it easily could. And it will determine the fate of local television in the United States.

[Danilo Yanich is Professor of Urban Affairs & Public Policy at the University of Delaware whose research focuses on media consolidation, political ads, money, and local television news content.]

There’s a lot of pieces that need to come together to get 5G networks to work on mobile devices — new standards need to be agreed on, new modems need to be developed, and new networking hardware for towers needs to be rolled out. But Qualcomm might have just cleared one of the major hurdles with the announcement of its new QTM052 mmWave antenna modules, the first that have been announced that will enable the high-speed swath of networking spectrum to work with mobile phones. That’s a big deal, because not all 5G is created equal. As Qualcomm’s own simulated test results from MWC earlier in 2018 showed, users will already get big jumps in speed with lower-bandwidth 5G solutions, but the truly impressive leap forward will come from the mmWave network. But in order for that to work, we first need viable mmWave hardware for phones, which isn’t easy. While the mmWave portion of the spectrum offers dramatically faster speeds, it also transmits at a much shorter range and is far more easily blocked by things like walls and even users’ hands held over their devices. But Qualcomm claims that its QTM052 antenna is the solution. It’s a tiny antenna array, roughly the size of a penny, that features four antennas that can (with the help of Qualcomm’s algorithms) accurately point toward the nearest 5G tower.

Newspaper layoffs have far from abated in the past year, and digital-native news outlets are also suffering losses.  At least 36 percent of the largest newspapers across the United States – as well as at least 23 percent of the highest-traffic digital-native news outlets – experienced layoffs between January 2017 and April 2018, according to the Pew study. Among newspapers, those with the highest circulation were most likely to be affected. The analysis comes amid a series of highly publicized staff reductions by hedge fund companies that had acquired well-known newspapers, including The Denver Post, where employees publicly criticized the cuts made by the papers’ owners. Of the 110 daily newspapers in the analysis, 40 – or 36 perceny – were found to have gone through publicly reported layoffs during the 16-month study period, with at least 12 experiencing more than one round of layoffs. It is possible that even more occurred but remained under the radar of the search methods employed in this analysis.

[Commentary] We need to move away from the arguments that the country should care about laid-off reporters or that the suits should be held to account. This can’t be about us. It has to be about why the country should care if local news goes away, which is the trajectory we now find ourselves on. What are the effects on a democracy if local news is no longer in the picture? How is my life as a New Yorker going to be worse now that the Daily News has been so terribly hobbled? If you’re in journalism and you can’t muster an answer to that question, you need to move on. For the rest of us in this profession, it is the case we now must make, especially in the face of a national administration that has made it its business to question why journalism matters. What does it mean not to have local news in your town? Would it change where you live, how you raise your kids, where they go to school? It would if a local coach were abusing kids, and would have kept doing so if a newspaper hadn’t reported it. It would if money that was supposed to be going to city services was instead going to higher financing costs for government bonds, since no one was paying attention to the deals the city was cutting. It would if there were a spike in health viruses, because there wasn’t the news infrastructure to warn people to be safe. All of those examples are real. And it’s easy enough to add Daily News scoops to the list, something many of its fans, myself included, will be doing as they process this terrible day.

Our job at Columbia Journalism Review—and the job for all of us who care about the importance of the press to democracy—is to answer the foundational questions we face as a country. Our window for addressing them—and, crucially, in a way that resonates with readers—is in very real danger of closing entirely.

President Donald Trump used his Twitter account to make false and misleading attacks against The Washington Post and Amazon, the behemoth online retailer whose founder owns The Post. In the first of his tweets, President Trump said the “Amazon Washington Post has gone crazy against me ever since they lost the Internet Tax Case in the U.S. Supreme Court two months ago.”  The president was apparently referring to a Supreme Court case decided in June  that will allow state governments to compel online retailers beyond their borders to collect sales tax revenue from consumers. Amazon, whose founder and chief executive Jeffrey P. Bezos owns The Post, does not collect taxes on third-party purchases. The Post and Amazon are independently operated. It’s not clear what Trump meant by “gone crazy against me,” though he was critical in a separate tweet July 23 of media coverage of his efforts to rid North Korea of nuclear weapons. The Post reported over the weekend that Trump has privately fumed about a lack of progress even as he has publicly touted his administration’s efforts.

As controversies have piled up for top tech companies, so have their lobbying bills. Tech firms continued to pour record sums of money into federal lobbying during the second quarter, new disclosures show, reflecting their defensive maneuvering on matters like consumer privacy, market competition and the treatment of political speech on social media. Facebook spent its largest single-quarter sum ever, $3.67 million, during a period that included CEO Mark Zuckerberg’s grilling in Congress over the company’s privacy lapses and the Cambridge Analytica data scandal. Like Facebook, Google battled questions this spring over its user privacy protections and perceived bias against conservatives on its YouTube platform. Its lobbying bill: a record $5.83 million. Amazon’s quarterly spending also ticked up to a record $3.47 million as the company faced scrutiny over its market power and, more recently, its sale of facial recognition software to law enforcement. President Donald Trump also has the company’s shipping contract with the U.S. Postal Service under the microscope as part of his postal reform task force. 

More big spenders: Microsoft, whose presence in Washington goes back further than most other tech firms, paid out $2.64 million, its largest quarterly sum since late 2013. In recent months the company has come under fire for its contracting arrangements with U.S. immigration authorities amid uproar over the Trump administration’s highly criticized practice of family separation along the U.S.-Mexico border. Twitter, which continues to grapple with criticism over the spread of misinformation as well as its content moderation approach, doubled its typical quarterly sum at $320,000. The Internet Association, a trade group representing more than 40 of the industry’s players, shelled out $660,000, also more than double the amount it usually spends.

Merger land: T-Mobile and Sprint formally unveiled plans to combine in late April and immediately began selling their merger to both Capitol Hill and federal agencies. T-Mobile also tapped several lobbying shops in the first half of the year to help bolster its case. But all that hustle didn’t translate into more lobbying dollars in the second quarter, records show. T-Mobile spent $2.09 million and Sprint paid $800,000, figures consistent with their recent filings.

Other spenders: AT&T, which in June gained approval from a federal judge for its merger with Time Warner but is now battling an appeal from the Justice Department, spent $4.58 million. Comcast, which sought federal approval for its bid for the bulk of 21st Century Fox before ultimately waving the white flag, tallied $3.54 million. Other tech and telecom lobbying tallies included: Apple, $1.62 million; Charter Communications, $2.39 million; CTIA, $2.39 million; Entertainment Software Association, $1.64 million; IBM, $1.59 million; National Association of Broadcasters, $3.57 million; NCTA, $3.29 million; Oracle, $1.81 million; Qualcomm, $2 million; and Verizon, $2.95 million.