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USTR Criticizes Canadian Digital Tax, Pew Report on State Broadband, Fiber in the UK

The United States Trade Representative is concerned about Canada’s proposed tax of online services.

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President Joe Biden and Canada Prime Minister Justin Trudeau

December 16, 2021 – The Office of the United States Trade Representative said Wednesday it is concerned with Canada’s pursuit of a unilateral digital service tax.

In its fiscal update Tuesday, the Liberal government said it intends to move forward on a proposal to tax the revenues of American internet giants, a pledge the government has made previously despite pointing to negotiations at the Organization for Economic Cooperation and Development for guidance on the matter.

“Most DSTs have been designed in ways that discriminate against U.S. companies, as they single out American firms for taxation while effectively excluding national firms engaged in similar lines of business,” said a USTR spokesperson in a Wednesday press release. “USTR continues to strongly oppose any new DSTs adopted by our trading partners.”

The G20 international forum and the OECD agreed on a “two-pillar solution to address the tax challenges arising from the digitalization of the economy.” Pillar one would require businesses to pay more taxes where their consumers are located, while pillar two would establish a global minimum tax.

The OECD recently ratified a global 15 percent digital tax rate, which it aims to implement in 2023.

“The standstill on new digital services taxes prior to the implementation of Pillar One of the October 8 OECD/G20 agreement is an important part of the new architecture for international taxation, which Canada joined.  That agreement will help end the race to the bottom over multinational corporate taxation by leveling the corporate tax playing field,” USTR said.

Accountability Measures Vary Among State Broadband Grants

States vary in their measures to ensure accountability for grant spending, according to a Pew Trusts report released on Tuesday. States can support accountability practices for the use of grant fund by allowing providers to challenge grant applications, the report said.

As such, providers can argue against a grant award on the grounds that the provider already provides sufficient service to the target area or has explicit plans to do so.

States have varying accountability measures. For example, Pew reports that Minnesota’s internet service providers have 30 days to challenge an application for a proposed project.

“These providers must attest that they either already serve the project area with speeds that meet or exceed the state goal or have begun construction to do so and will be online within 18 months of the grant award announcement. The information in the challenge is then evaluated, and if it is found to be credible, the proposed project will not receive funding,” Pew reported.

However, if the challenger does not meet its promise to bring service to the area, they are barred from submitting challenges for the next two grant cycles.

Other states allow grant awards to be modified to fund only the parts of a broadband project that do not overlap with a challenging provider. “Although these programs share many similarities, they also differ in key ways that reflect states’ varying policy priorities, funding levels, and local contexts,” Pew said.

Fiber now available to 8 million UK homes 

The United Kingdom Office of Communications said millions of homes across the country are now able to access fiber broadband.

However, less than a quarter of those homes have chosen to upgrade to fiber.

Lindsay Fussell, UK’s communications group director, said Thursday there is more work to do to ensure communities are connected, Yahoo reports.

“Many families now have multiple devices on the go at the same time for work, learning and entertainment – and the festive holidays can see a particular battle for bandwidth,” she said.

“Full fibir is helping meet those demands, with millions more benefitting from faster speeds and more reliable connections. But some homes in hard-to-reach areas still struggle to get decent broadband, so there’s more work to do to make sure these communities get the connections they need.”

The UK invested £2 billion pounds into delivering broadband across the country. The investment “allows people to work remotely, video call and stream TV on multiple devices at once with no interruptions.”

UK’s broadband office said they are investing another £ 5.5 billion in funding to close gaps for rural areas. “Ofcom’s report shows we are making major progress on our commitment to deliver a digital infrastructure revolution,” the agency said.

Broadband Roundup

National Privacy Law, Digital Infrastructure Firm’s $8B Raise, Wicker Wants Spectrum Cooperation

Business groups are asking Congress to supersede state laws by passing privacy legislation that sets a national standard.

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Senator Roger Wicker, R-Mississippi

January 19, 2022 – As states begin to pass their own privacy laws, business groups are asking the federal government to pass legislation that would mitigate confusion by creating a national standard, reports MediaPost Communications.

The Association of National Advertisers, Interactive Advertising Bureau, and the U.S. Chamber of Congress are just a few of the business groups that are asking for a national privacy law.

“As the Federal Trade Commission considers a privacy rulemaking that would add a further layer of complexity to the state patchwork, it is critical that Congress pass one single national standard”, the groups stated in a letter that was signed by 15 national organizations and then by local business groups from across the country, the MediaPost report said.

California, Virginia, and Colorado are just a few of the states that have passed their own version of a privacy law, and while they all serve a similar purpose, they have various nuances that the business groups said they believe will be difficult to navigate for their businesses and for consumers across state lines, MediaPost reports.

In addition, there are members of Congress who are also asking for a national plan for consumer privacy.

Digital infrastructure firm DigitalBridge raises over $8 billion

DigitalBridge Investment Management, an investment firm in digital infrastructure, raised a higher-than-expected $8.3 billion, according to a Wednesday press release, illustrating interest in projects including fiber builds.

“The Fund has already invested in nine portfolio companies across towers, easements, hyperscale data centers, edge infrastructure, indoor DAS infrastructure and fiber, running reliable, mission-critical network infrastructure for many of the world’s leading hyperscale cloud providers and mobile network operators,” the release said.

The round comes as the federal government pushing billions of dollars into infrastructure, including broadband and as the pandemic has shown a need for remote capabilities driven by broadband.

Republican lawmaker calls for NTIA-FCC cooperation on spectrum

Senator Roger Wicker, R-Mississippi, sent a letter earlier this month to the head of the Federal Communications Commission and the National Telecommunications and Information Administration asking them to consider a renewed agreement to work together on spectrum management.

The January 13 letter to FCC Chairwoman Jessica Rosenworcel and new NTIA head Alan Davidson said their “relationship can be strengthened” on matters related to the shared use of radiowaves between federal and non-federal users by refreshing the memorandum of understanding that was last updated in 2003.

“In light of recent disputes over spectrum allocations, it is more important than ever that the [FCC and NTIA] work together to promote spectrum policy that best serves the dual goals of furthering commercial innovation and enabling the mission-critical operations of federal agencies,” the letter said.

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Airlines’ 5G Warning, 3.45 GHz Winners, Bongino YouTube Suspension

Airlines claim the need to cancel a many flights because of interference between altimeters and 5G transmitters.

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Dan Bongino
Conservative commentator Dan Bongino

January 18, 2022 — Major American airlines are saying that they will need to cancel a significant number of flights from possible interference between aircraft altimeters and 5G signals this week, according to multiple news reports.

Verizon and AT&T, which are deploying 5G services around airports using the C-band spectrum, had already agreed to a deployment delay earlier this month at the behest of the airlines, but are planning of turning on service this week.

The signals that come from the 5G service risk “interfering with safety equipment pilots rely on to take off and land inclement weather,” said the CEOs of major American airlines in a letter to United States officials, according to NBC News.

“The nation’s commerce will grind to a halt” and leave “tens of thousands of Americans” stranded overseas, the letter said, adding “immediate intervention is needed to avoid significant operational disruption to air passengers, shippers, supply chain and delivery of needed medical supplies.’”

Industry group Cellular Telecommunications Industry Association stated that “5G is safe and the spectrum is currently in use in nearly 40 other nations.”

FCC announces winning bidders in 3.45 GHz auction

The Federal Communications Commission announced Friday the winning bidders for the 3.45 GHz auction, frequencies important for 5G services.

The top five winners were AT&T with winning bids worth just over $9 billion; Weminuche  won bids worth just over $7 billion; T-Mobile took nearly $3 billion worth; Three Forty-Five Spectrum nabbed $1.4 billion worth; and United States Cellular Corp took licenses valued at nearly $600 million.

According to a press release from the FCC, 13 of the 23 companies that won bids are “small businesses or as entities serving rural communities.”

Chairwoman Jessica Rosenworcel said that enabling “commercial use of this spectrum is important to America’s continuing economic recovery and 5G leadership.” The gross proceeds of this auction were over $22.5 billion.

Dan Bongino latest conservative voice ousted from tech platform

Alphabet’s YouTube temporarily suspended conservative commentator Dan Bongino‘s channel due to misinformation regarding the COVID-19 pandemic, making him the latest voice from the right to be removed for that purpose.

The Hill reported that Bongino declared masks “useless” in the fight against COVID-19, which was in direct violation of YouTube’s COVID-19 policy, which “specifically prohibits content denying the effectiveness of wearing masks, which the vast majority of the scientific community agrees reduces the risk of infection.”

The suspension, which includes him being removed from a program that allows him to get paid for his uploads, lasts a week with a second offense leading to a two-week suspension, and a third to a permanent ban.

The ban follows social media company Twitter’s removal of Georgia Republican Representative Marjorie Taylor Greene, which was followed by Republican Kentucky Senator Rand Paul removing himself from YouTube earlier this month.

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January 6 Committee Social Media Subpoenas, Iranian Hacks, Google Ad Auctions Lawsuit

Lawmakers chastised the companies for providing little information in response to past committee inquiries.

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Rep. Bennie Thompson, D-Miss.

January 14, 2021 – The House Select Committee on the Jan. 6 attack at the U.S. Capitol has issued subpoenas to social media giants Alphabet, Meta, Reddit and Twitter, saying the companies’ responses to prior requests for information were inadequate.

The committee had previously reached out to the companies to assess their knowledge of misinformation, efforts to overturn the 2020 election, domestic extremism and foreign influence in the 2020 election that may have taken place on their platforms.

Central to the inquiry is whether the companies took any steps to “prevent their platforms from being breeding grounds for radicalizing people to violence,” said committee Chairman Bennie Thompson, D-Miss.

Iranian intelligence agency engaged in international hacks

U.S. Cyber Command said Wednesday that hacking group MuddyWaters is part of an Iranian intelligence agency which is responsible for several global cyberattacks.

The group, identified as part of the Iranian Ministry of Intelligence and Security, has been labeled an “Iranian threat group” by authorities.

The information comes following a year of increased cyberattack activity from abroad in the U.S. including the prominent breach at Colonial Pipeline involving hackers with ties to Russia.

Allegedly, the group has targeted nations across the Middle East, Europe and North America in efforts to surveil opponents.

According to the Center for Strategic and International Studies, between 2013 and 2017, Iranian hackers stole $3.4 billion in intellectual property from 170 universities and targeted U.S. officials and journalists as well as United Kingdom banks.

Google alleged to have misled publishers and advertisers

Newly unredacted allegations in a lawsuit by state attorneys general say that Google for years misled publishers and advertisers about pricing and processes in its ad auctions.

The lawsuit says Google created secret programs which deflated sales for some companies while increasing buyer prices, engaging in trust and monopoly-building activities.

The unredacted filing of the lawsuit occurred Friday in the U.S. District Court of the Southern District of New York after a judge ruled and amended complaint from last year could be unsealed.

Google says the lawsuit is “full of inaccuracies and lacks legal merit,” and intends to file a motion for its dismissal next week, asserting that its advertising practices are competitive.

The suit is led by Texas Attorney General Ken Paxton and joined by over a dozen other states, alleging that Google’s practices inflate advertising costs which in turn create higher-priced products for consumers.

A separate antitrust case exists against Google from the U.S. Justice Department and over three dozen state attorneys general focusing on the company’s search services.

Additionally, a proposed bipartisan bill in the Senate with the support of a dozen lawmakers would treat Google’s search engine like a railroad operator and ban it from advantaging its own products and services at the expense of other businesses that rely on the platforms – just part of an ongoing adversarial relationship between Congress and the tech company.

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