Analysis

[Commentary] First, it is shocking to see presidential conversations released in this way. Some in the executive branch, as Anthony Scaramucci aptly put it, are intent on protecting the country from President Trump. This is a good thing, by the way. White House Chief of Staff John F. Kelly has obviously failed to plug the flood leaks, and one wonders whether a leak this egregious is meant to signal that the White House will remain dysfunctional.

And that brings us to the next point: Trump is frighteningly obsessed with himself and his image to such an extent that he cannot fulfill the role of commander in chief. Third, President Trump’s narcissism leaves him open to flattery and threats (to reveal embarrassing material, for example). That’s the worry in the Russia investigation — namely, that Vladimir Putin has “something” on Trump, which compels Trump to act in ways inimical to U.S. interests. President Trump’s interests are paramount, so a cagey adversary can easily manipulate him.

[Commentary] To keep things straight, “open internet” is synonymous with network neutrality, and “paid prioritization” is another way of saying “fast lane” for the internet. Foes of paid prioritization say it follows that if someone pays for a fast lane, then all who don’t pay are relegated to a slow lane — or worse. For two days during the week before the end of the comment period, news reports surfaced that Verizon Wireless — Verizon is one of the United States’ largest internet service providers — was intentionally slowing down video streaming services on its customers’ data plans. Open-internet advocates call that throttling. Verizon’s definition: optimization, adding it was just a network test that should not have disrupted their customers’ internet experience.

Steve Bannon, the chief strategist to President Donald Trump, believes Facebook and Google should be regulated as public utilities, according to an anonymously sourced report in The Intercept. This means they would get treated less like a book publisher and more like a telephone company. The government would shorten their leash, treating them as privately owned firms that provide an important public service.

The plan is a prototypical alleged Bannonism: iconoclastic, anti-establishment, and unlikely to result in meaningful policy change....Americans will have to examine the most fraught tensions in our mixed system, as we weigh the balance of local power and national power, the deliberate benefits of central planning with the mindless wisdom of the free market, and the many conflicting meanings of freedom.

While Verizon is telling the Federal Communications Commission to get rid of Title II classification and to weaken the open internet rules, Verizon Wireless is already trying to undermine the open internet by experimenting with potentially anti-consumer discrimination practices. Unfortunately, Verizon Wireless is proving why millions of Americans are correct in voicing their concern over the FCC’s proposal to repeal its 2015 net neutrality rules.

Recently, many Verizon Wireless customers reported their Netflix and YouTube speeds appeared to be capped at 10 Mbps. Verizon acknowledged that it was conducting “network testing” to “optimize” its video streaming, and claimed that it was reasonable network management. Verizon’s actions and the cloud of uncertainty surrounding their practices is a timely reminder that, absent a strong regulator, Internet service providers can and will use their gatekeeper power to harm consumers and grow their own market power. If you want to connect to the internet, and access all the services that you can get through that connection (from entertainment to education to employment) you must go through an internet service provider. Broadband companies know they have substantial leverage in the internet ecosystem, which is why it is so vital for the FCC to actively combat harmful practices such as throttling.

The political landscape in France is worrisomely ripe for the enactment of new laws or policies that could undermine the security of encrypted products and services in the name of national security. France has a new president, Emmanuel Macron, who has taken an aggressive stance on encryption and allied himself with UK Prime Minister Theresa May, another hawk on the issue. Meanwhile, French law enforcement officials continue their multi-year push—including in the New York Times and at the EU level—for legislation that would ensure that they can always obtain the encrypted data they seek. Under these conditions, it seems that the encryption debate in France is just beginning—and could end abruptly in favor of backdoors in the face of another major terror attack.

For the past few days, rumors have been swirling that Sprint wants to merge with Charter Communications. If the two got together, it could be a major deal, combining the wireless and cable industries in a big, new way. But now reports suggest that Charter, the nation's second-biggest cable company, simply isn't interested in a deal. There are indications that Sprint and its parent company, Softbank, aren't yet ready to give up on Charter. But why is Sprint so hellbent on a tie-up with the cable giant in the first place, and why doesn't Charter want to partner with America's fourth-biggest cellphone carrier?

The deal could mean new bundles of services. You might, for example, be able to buy Sprint's wireless service together with Charter's cable service. And much like AT&T has done with DirecTV, it's possible Sprint could seek to put Charter's video content on mobile to attract and retain customers. But, since Charter is working on a pilot of its wireless plans, it's still early enough in the process that the cable company can afford to wait.

Discovery Communications has agreed to acquire Scripps Networks Interactive for $11.9 billion, combining two powerhouses of nonfiction television programming at a time of major upheaval in the cable-TV business. The tie-up is a bet that bigger is better as the television industry is upended by cord-cutting and the rise of “skinny” online TV bundles from the likes of Hulu, YouTube, Sling TV and others. The thinking is that a broader portfolio of channels that specialize in nonfiction and lifestyle programming like travel, food and nature could appeal to younger viewers and give the combined company a leg up in negotiations with advertisers and programming distributors.

The deal will create a must-buy network group for advertisers interested in targeting women and help the network command more premium ad rates. Of the top 20 US cable networks, the merged company will control four of the top five with the highest percentage of female viewers—TLC, HGTV, Investigation Discovery and Food Network. Discovery said it would be able to expand Scripps’s channels into more overseas markets, which could help generate significant additional revenue. The combined company is also touting its short-form video production, which will help it gain more viewers and ad dollars on social-media platforms. The deal could put pressure on other media companies, from AMC Networks to Viacom Inc., that must defend their turf on the cable dial.

As congressional Democrats rolled out their new “Better Deal” agenda for the American people, even some in their own ranks were surprised by the level of interest in the party’s new agenda on antitrust and competition policy. One reason for that is that even some members of Congress may not be aware of how significant the commitments are that Democrats are making. After all, to a casual observer/member of Congress, invocations of the interests of “workers” and “small businesses” can easily seem like boilerplate rhetoric — the mom and apple pie of economic policy. But they actually seal the deal on a significant transformation of the party’s approach to anti-trust issues, one that’s actually been building for some time. Democrats are saying, with increasing clarity, that they want to overthrow a legal paradigm that’s existed for about 40 years and which held that consumer welfare — typically as measured by consumer prices — is the sole relevant metric for making antitrust policy.

Earlier this year, the Yale Law Journal had published a 24,000-word “note” by Lina Khan titled “Amazon’s Antitrust Paradox.” The article laid out with remarkable clarity and sophistication why American antitrust law has evolved to the point that it is no longer equipped to deal with tech giants such as Amazon, which has made itself as essential to commerce in the 21st century as the railroads, telephone systems and computer hardware makers had been in the 20th.

It’s not just Amazon, however, that animates concerns about competition and market power, and Khan is not the only one who is worrying. The same issues lie behind the European Union’s recent $2.7 billion fine against Google for favoring its own services in the search results it presents to its users. They are also at the heart of the long-running battle in the telecom industry over net neutrality, and the ability of cable companies and Internet service providers to give favorable treatment to their own content. They are implicated in complaints that Facebook has aided the rise of “fake news” while draining readers and revenue from legitimate news media. They even emerge in debates over the corrupting role of corporate money in politics, the decline in entrepreneurship, the slowdown in corporate investment and the rise of income inequality.

LinkedIn may very well succeed in its effort to stop a San Francisco (CA) startup from using the data of its members. But the Sunnyvale (CA) company, now a division of Microsoft, has certainly lost the moral high ground. In fact, the job-hunting and networking site is guilty of blatant hypocrisy. HiQ Labs makes software that analyzes data from public LinkedIn profiles to help employers determine which workers are likely to leave or stay. But at a hearing at U.S. District Court in San Francisco, lawyers representing LinkedIn argued that HiQ was causing significant harm to its business because members expected LinkedIn to protect their privacy. LinkedIn’s most valuable currency is “trust with customers,” said Donald Verrilli, a partner with Munger, Tolles & Olson law firm in Washington. That sounds very noble. But the very idea of a social media giant serving as the champion of privacy rights seems suspect. When a service tells you it’s free, that means it’s making money another way. And more likely than not, you’re the product.