May 2015

With deadline looming, the future of government spying is in flux

The decision ruling the NSA domestic phone records program illegal by the US Court of Appeals raised the stakes on Capitol Hill, where Senate Majority Leader Mitch McConnell (R-KY) is advocating for an extension of Section 215 of the Patriot Act through 2020. But that would likely push the issue to the Supreme Court to settle. On the other side of the debate, long-time government surveillance critic Sen Ron Wyden (D-OR) threatened to filibuster a short-term extension of the law "unless there are major reforms like getting rid of this bulk phone record collections."

Sen Wyden is a supporter of the USA Freedom Act, a compromise bill that supporters say would effectively end the government's bulk collection of phone records by requiring the agency to request information from service providers instead of maintaining its own database. But the bill, which would extend the altered version of Section 215 through 2019, has split privacy advocates. Some groups argue that the legislation might impede the progress being made in court challenges of surveillance programs or more comprehensive legislative reform efforts. The deciding factor, more than anything at this point, may be time. While the official deadline for Section 215 is June 1, Congress has a recess scheduled for the last week of May -- meaning the effective deadline is more like May 22. The House Judiciary Committee has passed a version of the USA Freedom legislation and the bill is scheduled for a floor vote -- which it is expected to pass. The real action is likely to be in the other chamber. "Start popping your popcorn and find a comfy chair, because it looks to be a dramatic couple of weeks in the Senate," said Kevin Bankston, the policy director at New America's Open Technology Institute and a supporter of the bill. "There’s no way there are 60 votes in the Senate for a clean [Section 215] reauthorization, and the clock is running down fast."

Title II Petitioners Must Combine Arguments

It could take cable and telecommunications company operators a few more days to put together their combined request that the US Court of Appeals for the DC Circuit stay the June 12 effective date of the Federal Communications Commission's Title II reclassification order until the court hears their underlying legal challenge. The court on May 8 denied a motion by the National Cable & Telecommunications Association and American Cable Association to exceed the 20-page stay request page limit by allowing the two groups to file a single, 35-pager. Instead, the court will require all the petitioners -- more than a half dozen -- to file a single, 35-page brief; the FCC will get to file 35 pages in response, and the petitioners may file 18 pages in response to that.

Given that the lawyers now have to get together on a single request, it could take more time. Also adding to the time is the fact that the same parties sought stay requests from the FCC first. The FCC denied those last week, but in doing so made numerous points about why the stay should be denied, points that the parties will likely respond to in buttressing their argument for the court stay.

Comcast Hires SS+K to Help Bridge the Digital Divide

The Comcast-Time Warner merger is off, but not Comcast's push to reduce the digital divide. In fact, Comcast has hired SS+K to focus on marketing Internet Essentials, a 4-year-old program that supplies broadband Internet access to low-income families. The New York shop landed the assignment after a pitch against two other undisclosed agencies. Comcast and SS+K didn't disclosed media spending, but sources estimated its annual value would exceed $20 million. Previously, various Comcast roster shops and its in-house marketing group created ads around the program. SS+K's work is expected to take the form of traditional and digital ads, social media marketing and events.

The first campaign is slated for Fall 2015. Agency partner Lenny Stern likened the assignment to working on corporate initiatives for the likes of Allstate ("X the TXT") and Wells Fargo ("Small is huge") as well as its marketing around the Livestrong bracelet. "The digital divide has hindered progress all over this country for a generation. Tons of people talk about the problem, but few are really doing something about it," Stern said. "Comcast is walking the walk."

Public TV Groups Seek FCC Help for DBS Carriage

Two groups representing public and state-run television stations have told the Federal Communications Commission that the agency may have to step in to push satellite-TV providers to provide noncommercial TV networks to more of their subscribers. That came in comments to the FCC, which Congress directed in satellite reauthorization legislation (the STELA Reauthorization Act of 2014) to report on the current designated market area (DMA) system of determining access to programming and how it could better foster localism. The legislation also provided more flexibility for direct broadcast satellite operators to deliver state-run noncommercial networks to subscribers in orphan counties, border-crossing DMAs that deliver programming from one state to subs in another.

In the filing, the Association of Public Television Stations and the Organization of State Broadcasting Executives said they had expected that provision would "result to a considerable degree in the voluntary carriage of state public television network signals by the DBS carriers," but that had not been the case. They argued that the FCC's report must show that "little or no" progress" had been made in achieving the legislation's goal of state-wide coverage for public TV networks and look seriously at whether anything short of "legal compulsion" can get DBS carriers to " to carry state network signals that they have the authority to carry."

T-Mobile to shut down legacy MetroPCS CDMA network on June 21

T-Mobile plans to shut off the legacy CDMA network of its MetroPCS prepaid brand on June 21, earlier than expected. The carrier still needs to shut down the CDMA network in three major markets. T-Mobile CFO Braxton Carter said that the carrier expected to shut down the entire CDMA network in the second half of 2015, so the June 21 deadline indicates the company is speeding up the process.

T-Mobile is pushing hard to get customers who still have CDMA-based phones to upgrade to phones that work with T-Mobile's GSM/HSPA+/LTE network. There are still several hundred thousand customers in that category. A MetroPCS website notes that "phones operating on the legacy network must be upgraded by 6/21/15." After that date, the site notes, "MetroPCS will be converting our legacy network to our new network, making the network bigger and faster in these markets." MetroPCS notes that "phones operating on MetroPCS' legacy network after 6/21/15 are not guaranteed to have service."

Sony would probably buy fast lanes in a world without net neutrality

Sony Pictures executives spent months discussing how they should handle the subject of network neutrality. As revealed in a series of leaked e-mails, executives waffled on whether or not they should file a comment with the Federal Communications Commission to present their view. Ultimately, Sony declined to file because of concerns that it was difficult to get the entirety of Sony on the same page, that Sony may not be able to add much value to the discussion, and that Sony could end up burning some bridges. But during the months leading up to the comment filing deadline in mid-September, Sony executives were still discussing what they would write in a filing, should they decide to comment.

While there was no final consensus, Sony appeared to move more and more toward supporting paid fast lanes as the September deadline approached. Sony Pictures and other Sony units such as Crackle "are in the premium content business and do not want to be on equal footing with a random 'mom and pop' video streaming service," Keith Weaver, Sony Pictures' executive vice president of worldwide government affairs, wrote in early July. About a week later, Jim Morgan, Sony Electronics' government counsel, wrote that he was cutting out comments that touched on fast lanes because "[Sony Pictures Entertainment] or other parts of Sony may want to take advantage of paid prioritization, and so doesn’t want to be constrained by any arguments we make in these comments." Basically, Sony writes that it can see itself wanting to use paid fast lanes to help its many content businesses, be it delivering video games, movies, or something else. "The bottom line," Weaver wrote just over a week before the filing deadline, "net neutrality rules should not apply to content producers."

Licensed Spectrum for Commercial Wireless Networks Generates More Than $400 Billion in Annual Economic Activity for America

Spectrum licensed to US wireless carriers generates more than $400 billion annually in economic activity, according to a report issued by the Brattle Group and prepared for CTIA-The Wireless Association. The $400 billion figure includes direct and indirect economic impact generated by the mobile carriers, but excludes billions more in economic benefits produced by mobile health, mobile education, the app economy and other sectors that use licensed spectrum as a platform for their own business models, according to the report, Mobile Broadband Spectrum: A Vital Resource for the American Economy.

“Licensed spectrum is vital to the mobile industry and to our nation’s economy,” said Meredith Attwell Baker, President and CEO of CTIA. “As this report shows, policymakers need to continue to look for hundreds of MHz of additional licensed spectrum so this economic growth is sustained and America remains the global leader in this rapidly changing sector. Licensed spectrum serves as the industry’s backbone for network operators to boost speeds and capacity, device manufacturers to develop new products and apps and content developers to create new offerings.” The Brattle Group report also shows that in large part because the fiercely competitive mobile sector drives down prices, Americans value their mobile service between $5-$10 trillion more than they actually pay to use it.

A New Way Forward With the FCC's DE Program

In the wake of the AWS-3 auction, there has been a broad, bipartisan call to reform the [Federal Communications Commission]’s Designated Entity, or DE, program. When the veil of the auction was lifted, we all learned that some bidders attempted to use the rules to obtain a windfall, and, in the process, prevented the intended beneficiaries of the program -- small business and rural [telecommunications companies] -- from obtaining valuable spectrum licenses. For this reason, AT&T is pleased to join a group of small carriers in proposing a new way forward. Together, we envision a DE program that redefines ‘small business’ in a way that is more aligned with the structure of the modern wireless industry and that seeks to benefit true small entities -- many of which operate in rural America.

To avoid incentives for abuse, we propose a strict cap of $10 million on the bidding credit available to any individual eligible applicant -- an amount that will provide a meaningful benefit to the very types of business the program is designed to benefit while ensuring policymakers that those who seek to abuse the program will not be rewarded. We also support strict build requirements as we believe scarce spectrum resources should be licensed only to those willing to deploy them for the benefit of US consumers. We believe that this proposed framework provides strong footing for a logical, equitable and sustainable Designated Entity program -- one that encourages broad participation at auction and diverse opportunity in the industry while closing loopholes attractive to those interested only in speculation or financial arbitrage. We hope the FCC will give the proposal careful consideration.

This think tank fundraising e-mail offers a disconcerting glimpse into how Washington works

In 2014 fundraiser Billy Oorbeek sought support for the American Action Forum, headed by Douglas Holtz-Eakin, which has be working to defend the Export-Import Bank. Oorbeek wrote to "a lobbyist who represented an Ex-Im subsidy recipient seeking ways the lobbyist and AAF could ‘work together.’" "Doug and the policy experts at AAF are very effective at providing third party research and validation on a variety of issues that may be important to your clients," Oorbeek wrote, explicitly mentioning Export-Import Bank reauthorization. "Doug may provide an additional service you can offer your clients that your firm may not be set up to provide."

Of course, these fundraising methods alone don't tell us whether Holtz-Eakin's research is accurate. They don't even prove that the research was motived by fundraising concerns. Holtz-Eakin wrote, "As a matter of policy we don't discuss donors or would-be donors, but it should come as no surprise that our supporters believe in the quality of our organization's research and tend to agree with my longstanding beliefs, such as support for a reformed Ex-Im." But the fact that a think tank sought to raise money by framing its research as a "service" to a lobbyist's clients is a jarring glimpse behind the scenes.

Sen Wyden pledges to filibuster rubber-stamp Patriot Act

Sen Ron Wyden (D-OR) is increasing his opposition to Senate Republicans’ insistence on a “clean” renewal of Patriot Act provisions set to expire at the end of May. Sen Wyden, a frequent spy critic, said that he would filibuster GOP leaders’ attempt to renew the law at the root of controversial National Security Agency surveillance, unless it contains significant reforms. "If for example, they decide to go with some sort of short-term extension of this flawed law, I intend to filibuster that on the floor of the Senate unless there are major reforms like getting rid of the bulk phone records collection program," he said. "The question will be, as you know, the Senate Republican leadership has been looking at a variety of ways to move forward to keep the bulk phone records collection program going," added Sen Wyden, a senior member of the Senate Intelligence Committee. "What usually happens is they say, 'Let's just have a short-term extension of it.'” “I'm tired of extending a bad law.”

A filibuster from Sen Wyden -- which would likely be cheered by other NSA critics such as Sens Rand Paul (R-KY), Mike Lee (R-UT) and Patrick Leahy (D-VT) -- only makes the path of short-term Patriot Act extensions more difficult for GOP leaders. With enough support, a filibuster from Sen Wyden or other lawmakers could push the Senate up to the brink of its end-of-the-month deadline and raise the prospect that the law expires entirely.

Benton

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