Daily Digest 3/14/2018 (Happy Pi Day 2018)

The Senate Commerce Committee kicked off a series of infrastructure hearings March 13 with one focused on broadband, including a big focus on collecting accurate date about where broadband is, and more importantly, isn't. Sen Roger Wicker (R-MS) presided over the hearing, "Rebuilding Infrastructure in America: Investing in Next Generation Broadband", saying he was greatly encouraged by the President Donald Trump's support for programs to increase broadband infrastructure in rural areas. While the President said getting broadband to farmers was a priority, he didn't actually earmark any funds for broadband in his infrastructure plan, though he did say that $50 million would be going to rural infrastructure, with states free to use all or part of that for broadband. Committee Ranking Member Bill Nelson (D-FL) pointed out that he and his colleagues had wanted direct investments in broadband to be part of any infrastructure plan and called the Trump proposal -- $200 billion in federal funds for all infrastructure, with $50 billion for rural, but no direct earmarks for broadband and the hope that the private sector leverages that $200 billion into a $1.5 trillion rebuild/buildout -- "simply inadequate on broadband expansion." He signaled it was up to the Senate Commerce Committee to step up and fill that void with "critical" direct investment in broadband, something Democrats have done in their own infrastructure proposal to the tune of $40 billion.

satellite internet has been the service of last resort for people who live in places where cable and telco broadband can’t reach. But that may begin to change as a next wave of satellite technology begins entering orbit over the earth over the next few years. The “last alternative” role of satellite service may not last forever, though. Changes are afoot in the industry. These new satellites, called Low Earth Orbit or LEOs, will be smaller and lighter and could soon cost less than $1 million each. Some investors believe the cost of these satellites will drop to around $100,000. New LEO-based services from companies will begin coming to market within the next two or three years.

[Research] Why the government’s case against the AT&T-Time Warner merger is both warranted and consistent with past enforcement practices. The case is necessary to prevent possible coordination among dominant firms that would likely thwart the development and expansion of innovative online video platforms as well as cheaper alternatives to traditional cable and satellite services. AT&T sits in the center of a tight oligopoly of a few dominant transmission and content companies that require substantial public oversight to prevent extending past abuses of both consumers and competition in the digital marketplace. An extensive analysis of decades of market and regulatory developments, both involving antitrust enforcement and regulatory policy, across all the markets involved in both AT&T and Time Warner’s various businesses delivers these key findings:

• The application of the merger framework under the conditions in the communications sector shows that the AT&T-Time Warner merger poses a severe threat to competition.
• Policies to prevent discrimination against independent service providers in access to critical bottleneck facilities deliver significant benefits in terms of the quality of content and consumer choice.
• Historical antitrust interventions such as the Microsoft case delivered substantial pro-innovation and pro-consumer benefits, and the Microsoft case in particular is analogous to the AT&T-Time Warner suit due to the presence in both of real or likely vertical leveraging.
• Given the growing importance of a small number of platforms in the digital communications space, which is described in the paper as a “tight oligopoly on steroids,” the Department of Justice’s decision to oppose is not only correct on the facts, it is squarely within the mainstream of antitrust law and practice because the merger would harm competition, slow innovation, stifle the growth of online video distribution and raise consumer prices.
• In abandoning the 2015 Open Internet Order, the Federal Communications Commission has turned a blind eye to anti-consumer, anticompetitive practices that afflict all digital communications markets -- increasing the need for the Department of Justice to act.
• Assistant Attorney General Delrahim should welcome the opportunity to lay out the broad basis for the decision to oppose the merger in a rich qualitative narrative during the AT&T-Time Warner trial.

A Q&A with Republican Commissioner Brendan Carr of the Federal Communications Commission. Commissioner Carr is looking forward to addressing state and local regulations he believes might be holding up 5G deployment. He also addressed the recent backlash against large internet companies and said he hadn’t been contacted by a watchdog probing the agency’s chairman. “As I have looked at the infrastructure docket I’ve divided it into two main buckets, one is the federal historic and environmental review side, which we’re doing this month. The next bucket is going to be taking a look at state and local laws and looking at our authorities under [the primary communications law] to make sure that we’re all headed in the same direction to enable that deployment... The other big piece of it obviously is spectrum and the chairman in Barcelona a couple weeks ago announced that we’re going to hold a 5G auction at the end of this [year],” he said. 

China is to abolish the State Administration of Press, Publication, Radio, Film and Television (SAPPRFT) and is expected to set up a new media body answerable to the Cabinet, further tightening the Communist government’s control of media and entertainment. SAPPRFT, the regulatory body which currently oversees the media and entertainment sector, would be replaced by a new state radio and television administration attached to the State Council, or Cabinet. The proposal is being put to China’s ongoing national legislative session for deliberation. “The proposed administration, directly under the State Council, will be responsible for drafting policies and measures for radio and television management and their implementation, coordinating development of broadcasting undertakings and industries, promoting institutional reform in the sectors, importing radio and television programs, and facilitating the sectors to go global,” said official news agency Xinhua. The move is one of several administrative mergers within the Chinese government, announced in the past days and being voted on at China’s annual parliamentary sessions. It is also expected that China Central Television, China Radio International and China National Radio may be merged to form a new state broadcasting giant.