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Antitrust

Broadband Roundup: Congress Questions FCC Over Rural Fund, Banning Huawei, T-Mobile/Sprint Merger and Inequality

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Photo of Sen. Rick Scott in February 2011, then Florida governor, speaking at CPAC by Gage Skidmore used with permission

Over twenty members of Congress sent a letter to Federal Communications Commission Chairman Ajit Pai on Friday asking for clarification on the changes to the Rural Digital Opportunity Fund  announced during the agency’s vote to approve the program on January 30.

In a last-minute change, the FCC eliminated the ability for areas receiving state subsidies for broadband deployment to also receive RDOF funds.

“We are concerned that the RDOF Order may inadvertently undermine the ability of the states to help close the digital divide due to the rushed process undertaken by the FCC’s adoption of the Order,” the member of Congress wrote.

Congress asked the following questions of Pai:

  • “What kinds of state funding programs are considered ‘similar’ to the RDOF subsidy?”
  • “Will an area be considered ‘served’ and therefore excluded from RDOF funding if a state subsidy program facilitates deployment to only a portion of a particular census block?”
  • “How will the FCC become aware of state funding decisions?”

Sen. Rick Scott introduced bill to ban commerce with Huawei

Sen. Rick Scott, R-Florida, introduced bill S.3316 on Friday to restrict trade with Huawei. According to a press release from Scott’s office, “the U.S. Government has determined [Huawei] to be a national security threat and continues to be a bad actor across the globe.”

U.S. tech companies have been able to continue selling goods to Huawei by “finding ways around the blacklisting, including supplying Huawei through subsidiaries or partners in foreign countries.”

“I look forward to all of my colleagues and the Administration joining in support of my proposal to crack down on U.S. exports to Huawei, protect our national security and the security and growth of the U.S. technology industry,” Scott stated.

Decision on T-Mobile/Sprint merger combination seen as ignoring issue of inequality

In an op-ed for Fast Company, Amitrajeet A. Batabyal writes  that a federal judge’s decision to grant the $26.5 billion T-Mobile/Sprint merger in spite of concerns about eliminating competition and soaring prices betokens a larger issue: inequality.

Batabyal believes that the United States could address the “wealth gap” by “cracking down on anticompetitive behavior in the marketplace,” but the merger is a woeful step in the wrong direction.

Batabyal identified three inequalities intensified by the T-Mobile and Sprint Merger.

First, the lack of competitive prices “transfers wealth from customers who pay the higher prices to the dominant company.”

Second, “anticompetitive behavior arises in the context of mergers and acquisitions…the telecoms sector was already very concentrated, and now it’s expected to get even worse.”

Third, “anticompetitive behavior frequently arises when there is common ownership of corporations.”

Adrienne Patton was a Reporter for Broadband Breakfast. She studied English rhetoric and writing at Brigham Young University in Provo, Utah. She grew up in a household of journalists in South Florida. Her father, the late Robes Patton, was a sports writer for the Sun-Sentinel who covered the Miami Heat, and is for whom the press lounge in the American Airlines Arena is named.

Antitrust

‘Time is Now’ for Separate Big Tech Regulatory Agency, Public Interest Group Says

‘We need to recognize that absolutely the time is now. It is neither too soon nor too late.’

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Photo of Harold Feld, senior vice president at Public Knowledge

WASHINGTON, June 21, 2022 – Public Knowledge, non-profit public interest group, further advocated Thursday support for the Digital Platform Commission Act introduced in the Senate in May that would create a new federal agency designed to regulate digital platforms on an ongoing basis.

“We need to recognize that absolutely the time is now. It is neither too soon nor too late,” said Harold Feld, senior vice president at Public Knowledge.

The DPCA, introduced by Senator Michael Bennet, D-CO., and Representative Peter Welch, D-VT., would, if adopted, create a new federal agency designed to “provide comprehensive, sector-specific regulation of digital platforms to protect consumers, promote competition, and defend the public interest.”

The independent body would conduct hearings, research and investigations all while promoting competition and establishing rules with appropriate penalties.

Public Knowledge primarily focuses on competition in the digital marketplace. It champions for open internet and has openly advocated for antitrust legislation that would limit Big Tech action in favor of fair competition in the digital marketspace.

Feld published a book in 2019 titled, “The Case for the Digital Platform Act: Breakups, Starfish Problems and Tech Regulation.” In it, Feld explains the need for a separate government agency to regulate digital platforms.

Digital regulation is new but has rapidly become critical to the economy, continued Feld. As such, it is necessary for the government to create a completely new agency in order to provide the proper oversight.

In the past, Congress empowered independent bodies with effective tools and expert teams when it lacked expertise to oversee complex sectors of the economy but there is no such body for digital platforms, said Feld.

“The reality is that [Congress] can’t keep up,” said Welch. This comes at a time when antitrust action continues to pile up in Congress, sparking debate across all sides of the issue.

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Antitrust

FTC Commissioner Concerned About Antitrust Impact on Already Rising Consumer Prices

Noah Phillips said Tuesday he wants the commission to think about the impact of antitrust rules on rising prices.

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Screenshot of Federal Trade Commissioner Noah Phillips

WASHINGTON, May 17, 2022 – Rising inflation should be a primary concern for the Federal Trade Commission when considering antitrust regulations on Big Tech, said Commissioner Noah Phillips Tuesday.

When considering laws, “the important thing is what impact it has on the consumer,” said Phillips. “We need to continue to guard like a hawk against conduct and against laws that have the effect of raising prices for consumers.”

Current record highs in the inflation rate, which means money is becoming less valuable as products become more expensive, has meant Washington must become sensitive to further price increases that could come out of such antitrust legislation, the commissioner said.

Phillips did not comment on how such movies would mean higher prices, but that signals, such as theHouse Judiciary Committee’s antitrust report two years ago, that reign in Big Tech companies and bring back enforcement of laws could mean higher prices. He raised concerns that recent policies are prohibiting competition rather than facilitating it.

This follows recent concerns that the American Innovation and Choice Online Act, currently awaiting Senate floor consideration, will inhibit America’s global competitiveness by weakening major American companies, thus impairing the American economy. That legislation would prohibit platform owners from giving preference to their products against third-party products.

This act is one of many currently under consideration at Congress, including Ending Platform Monopolies Act and Platform Competition and Opportunity Act.

Small businesses have worried that by enacting some legislation targeting Big Tech, they would be impacted because they rely on such platforms for success.

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Antitrust

Critics and Supporters Trade Views on American Innovation and Choice Online Act

American Innovation and Choice Online Act is intended to protect fair competition among businesses, but panelists differed on its impact.

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Photo of Amy Klobuchar from August 2019 by Gage Skidmore used with permission

WASHINGTON, May 10, 2022 – Experts differed on the effect that antitrust legislation targeting big tech companies allegedly engaging in discriminatory behavior would have on small businesses.

Small businesses “want Congress not to do anything that will screw up or weaken the services that they rely on for their business,” said Michael Petricone, senior vice present of the Consumer Technology Association, at a Protocol Live event on Thursday.

Petricone said that antitrust bill would encourage tech companies to relocate to other countries, harming the American economy. He said small businesses would be affected the most.

Instead, Petricone called for  a “smarter immigration policy” to allow foreign innovators access to American tech market, as well as the defeat of the antitrust legislation.

But other said that small businesses suffer from predatory behavior by big tech companies. “Companies can’t get their foot in the door when there is already self-preferencing,” said Awesta Sarkash, representative for Small Business Majority, an advocacy organization, adding that 80% of small businesses say they want antitrust laws to protect them.

Self-preferencing on online platforms is detrimental to the success of small businesses who rely on social media advertising for business, she said. The new antitrust proposals would ensure an level playing field and promote fair competition, she said.

The American Innovation and Choice Online Act would prohibit certain online platforms from unfairly preferencing products, limiting another business’ ability to operate on a platform, or discriminating against competing products and services.

The bill sponsored by Sen. Amy Klobuchar, D-Minn, was introduced to the Senate on May 2 and is awaiting Senate floor consideration.

The debate follows concerns raised by both democrats and republicans about America’s global competitiveness as the bill would weaken major American companies.

If passed, the bill will follow the European Union’s Digital Services Act which similarly sets accountability standards for online platforms, preventing potentially harmful content and behavior.

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