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Antitrust

Broadband Roundup: Comcast vs. Google, Sprint’s Open 5G Network, Ransomware Rises

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Photo of by Mike Mozart used with permission

Comcast is emerging as an antitrust foe against big tech companies such as Google, according to US News and World Report.

Last month, Comcast’s video ads division FreeWheel accused Google of using privacy concerns as a pretext to limit FreeWheel’s ability to resell ads of its customers YouTube channels.

This is the first time that a major company is taking sides in the antitrust battle against the world’s largest seller of online ads. However, Comcast’s concerns have not yet prompted a full-on antitrust attack on Google, although federal and state agencies are investigating the company regarding monopolization.

“FreeWheel would embrace a solution that allowed it to continue to meaningfully serve its clients when they publish their content on YouTube, as it had for over a decade on that platform,” Comcast said in a statement. “Unfortunately, the actions to remove or degrade FreeWheel’s capabilities on YouTube fall well short of that.”

Most companies that contend Google has unfairly squeezed them out have been reluctant to say so publicly because they rely on services from Google and fear retaliation. But Comcast is one of the biggest spenders of dollars for federal and state lobbying.

The House Judiciary Committee, U.S. Department of Justice and a coalition of 50 state-level attorneys general have each asked Google for information about its ads business in recent weeks as they begin investigating potential violations of antitrust law.

Google declined to comment on Comcast’s recent actions but said it continues to cooperate with investigations.

Sprint opens its 5G network to MVNOs

Sprint has opened its 5G network to mobile virtual network operators, FierceWireless reports. The carrier currently has 5G networks in nine US cities and turned up MVNO use in Chicago in mid-September.

Sprint’s goal is to have all nine cities available for MVNOs by the end of October, according to a company spokesperson.

Sprint had already announced plans to expand its MVNO partnerships with some larger providers to include 5G. That includes Google Fi, which Sprint said in late February would be an early adopter of the carrier’s mobile 5G technology that uses 2.5 GHz spectrum and Massive MIMO radio technology.

Allovi Wireless, a Sprint MVNO, in late August said 5G mobile data would “soon be available” on its month-to-month cell phone plans.

In its August report on prepaid competition, Wave7 Research also flagged Gen Mobile, another Sprint MVNO, as one that has access to Sprint 5G, and is currently developing a 5G strategy.

“We’re really pleased to support all those [existing MVNO agreements],” said Mike Sievert, president and chief operating officer at T-Mobile. All existing MVNO agreements from both companies would be inherited after the T-Mobile-Sprint merger and carry forward through their various expiration dates, with the potential to extend.

“The massive capacity that we are creating with this new network creates the incentive for us to want to be a provider to MVNOs,” Sievert added.

Ransomware attacks hit hundreds of schools and school districts

Over 500 US schools have been hit by ransomware in the last nine months, ZDNet reported. According to cyber security firm Armor, 15 school districts, accounting for over 100 schools, have been attacked within the past two weeks.

Of these 15 ransomware incidents, Armor said that five were caused by the Ryuk ransomware, one of today’s most active ransomware strains/gangs.

Overall, Connecticut’s educational institutions were the most compromised by ransomware attacks this year. In Louisiana, Governor John Bel Edwards declared a state of emergency this past July in response to a wave of ransomware infections that hit three school districts.

The Armor report does not go into details of what districts paid the ransom demand and which did not. However, Crowder College of Neosho, Missouri, reported receiving the highest ransom demand among all school districts, with hackers requesting a whopping $1.6 million to provide the district with means to decrypt its systems.

Another antivirus maker, Emisoft, claims that ransomware incidents have impacted the operations of 1,051 individual schools, colleges, and universities, more than double the number reported by Armor.

In response to these attacks, the Senate passed the Department of Homeland Security Cyber Hunt and Incident Response Teams Act. The bill would create incident response teams to help private and public entities defend against cyber-attacks, such as ransomware attacks.

Antitrust

Federal Trade Commission Will Likely Not Be Able to Implement Competition Rules, Panelists Say

Panelists at TechFreedom event said judiciary will prevent the FTC from developing proposed antitrust policies.

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Photo of Peter Wallison from C-SPAN

WASHINGTON, October 22, 2021 –The Federal Trade Commission’s attempts to use rulemaking authority to issue antitrust policy governing technology companies will be struck down in federal courts, said panelists participating in a TechFreedom event on Thursday.

Recently formed conservative majorities on the Supreme Court and other panels have expressed opposition to the idea that the FTC possesses such rulemaking authority, these panelists said.

Hence, unlike past supreme courts, they current bench is likely to strike down FTC-issued binding rules.

Panelists highlighted former President Donald Trump appointees Brett Kavanaugh and Neil Gorsuch as justices who have opposed legal reasoning often used to permit FTC rulemaking.

Indeed, some panelists said early 20th Century legislation governing the FTC makes the case that the agency was created as an investigative body rather than a regulatory one.

Peter Wallison, senior fellow emeritus at the American Enterprise Institute, said that between five and six Supreme Court justices would ultimately vote to weaken precedents that allow for FTC rulemaking.

The Judiciary Committee of the House of Representatives recently advanced six antitrust bills that attempt to regulate the tech industry and foster greater competition, including the Ending Platform Monopolies Act and the Platform Competition and Opportunity Act.

FTC rules have taken on increased importance in terms of economic regulation due to the frequent inability of Congress to pass major legislation due to partisan gridlock. The FTC has proposed new procedures to ensure competition since Lina Khan was appointed as chair.

However, NERA Economic Consulting on Wednesday concluded that legislative proposals to regulate competition would impose costs of around $300 billion while impacting 13 additional American companies in the near term and more than 100 companies in the next decade.

Study author Christian Dippon contends that the legislation would limit American startup growth and international competitiveness while at the same time increasing costs for Americans.

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Antitrust

Public Interest Groups Urge Passage of Six Antitrust Bills Targeting Big Tech

Nearly 60 public interest groups signed a letter to House leaders to call a vote on six antitrust bills.

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WASHINGTON, September 2, 2021 – Nearly 60 public interest groups signed a letter Thursday urging the House party leaders to push for a vote on six antirust bills that cleared the House judiciary committee in June.

The goal of the six bills is to rein in the power of Big Tech through new antirust liability provisions, including new merger and acquisition review, measures to prevent anticompetitive activity, and providing government enforcers more power to break-up or separate big businesses. They include American Choice and Innovation Online Act, H.R. 3816, Platform Competition and Opportunity Act, H.R. 3826, Ending Platform Monopolies Act, H.R. 3825, Augmenting Compatibility and Competition by Enabling Service Switching (ACCESS) Act, H.R. 3849, Merger Filing Fee Modernization Act, H.R. 3843, and State Antitrust Enforcement Venue Act, H.R. 3460.

The letter, which was directed at House Speaker Nancy Pelosi, D-California, and House Minority Leader Kevin McCarthy, R-California, were promoting a package of six bills that were the result of a two-year bipartisan investigation that included 10 hearings, featuring the testimony of the CEOs of the major tech companies, 240 interviews, 1.3 million documents and a 450-page report, the letter notes.

“We believe that these bills will bring urgently needed change and accountability to these companies and an industry that most Americans agree is already doing great harm to our democracy,” the letter said. Public Citizen was the first of the 58 groups on the letter.

America has a monopoly problem. Monopoly power lowers wages, reduces innovation and entrepreneurship, exacerbates income and regional inequality, undermines the free press and access to information, and perpetuates toxic systems of racial, gender, and class dominance,” the letter alleged.

“Big Tech monopolies are at the center of many of these problems,” it continued. “Reining in these companies is an essential first step to reverse the damage of concentrated corporate power throughout our economy. The bills that passed out of the House Judiciary Committee, with bipartisan support, do just that and it is imperative that they move forward in the House.”

List of signatories:

  • Public Citizen
  • Accountable Tech
  • Action Center on Race & the Economy
  • ALIGN: The Alliance for a Greater New York
  • Alliance for Pharmacy Compounding
  • American Booksellers Association
  • American Family Voices
  • American Independent Business Alliance
  • American Specialty Toy Retailing Association
  • Artist Rights Alliance
  • Athena
  • Cambridge Local First
  • Center for American Progress
  • Center for Digital Democracy
  • Center for Popular Democracy
  • Committee to Support the Antitrust Laws
  • Decode Democracy
  • Demos
  • Electronic Frontier Foundation
  • Friends of the Earth
  • Future of Music Coalition
  • Gig Workers Rising
  • Global Exchange
  • Indivisible Georgia Coalition
  • Indivisible Hawaii
  • Indivisible Ulster/NY19
  • Institute for Local Self-Reliance
  • International Brotherhood of Teamsters
  • Jobs With Justice
  • Kairos Action
  • Local First Arizona
  • Louisville Independent Business Alliance
  • Main Street Alliance
  • Mainers for Accountable Leadership
  • Media Alliance
  • Metropolitan Washington Council, AFL-CIO
  • National Employment Law Project
  • New York Communities For Change
  • New York Communities for Change
  • North American Hardware and Paint Association
  • Open Markets Institute
  • Our Revolution
  • PowerSwitch Action
  • Public Knowledge
  • Running Industry Association
  • Secure Elections Network
  • Service Employees International Union
  • Shop Local Raleigh/Greater Raleigh Merchants Association
  • SIMBA (Spokane Independent Metro Business Alliance)
  • Small Business Rising
  • Stand Up Nashville
  • StayLocal, an initiative of Urban Conservancy
  • Strategic Organizing Center
  • SumOfUs
  • The Democratic Coalition
  • UltraViolet
  • Venice Resistance
  • Warehouse workers for justice

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Antitrust

FTC Commissioner Phillips Warns About Shifting Direction of Agency

Noah Phillips voiced concern about the scope and practices of the Biden administration’s FTC.

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FTC Commissioner Noah Phillips

WASHINGTON, September 2, 2021 — Federal Trade Commissioner Noah Phillips said at a Hudson Institute webinar on Monday that he’s concerned about the direction the competition watchdog is moving toward considering recent events.

Phillips said the left-leaning voices in Washington and the appointment of Lina Khan to chair the agency has left him wondering about the legacy of the last 40 years of competition regulation in America – which have been hallmarked by the Hart-Scott-Rodino Antitrust Improvements Act of 1976. That legislation effectively gave the FTC the ability to review mergers and acquisitions before they were finalized, rather than afterward, which governed pre-legislation.

Under Biden-appointee Lina Khan, Phillips described how the FTC has done away with the process of early termination. In the past, this process made it unnecessary for every single company to provide advanced notice and advanced approval for mergers. “Historically, parties have been able to come to the agencies and say, ‘You’re not interested in this, can we just go ahead and finish our deal,’ and the agencies have said ‘yes.’”

He said this is no longer the case, and that every single merger must provide advanced notice and approval. “What we’re introducing is an inefficiency in the market for transactions that we have no interest in pursuing, just for the sake of it. I think that’s a problem,” he continued. “My concern is that it is making merger enforcement less effective, less efficient, and less fair.”

Phillips pointed to left-of-center and leftist voices in Congress, such as Rep. David Cicilline, D-New York, Sen. Elizabeth Warren, D-Massachusetts, and Rep. Alexandria Ocasio-Cortez, D-New York, who, at the outset of the pandemic, wanted to ban all acquisitions and mergers—regardless of their merit. He described this view as falling outside of mainstream perspectives, but noteworthy nonetheless.

“I don’t think that is what most people believe,” Phillips remarked. “I don’t think that is what Hart-Scott-Rodino envisions.”

This webinar took place only a couple of weeks after Phillips spoke at the Technology Policy Institute’s 2021 Aspen Forum, where he voiced similar concerns, stating that he feared that this new direction would make it more difficult for the FTC to hear cases that it should, and defended the commission’s record against critics who said it was lax under the Trump Administration.

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