Facebook-backed group adds former lawmakers

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Quick Fix

— MT exclusive: Two former lawmakers have signed on to chair the advisory board of a Facebook-backed pro-tech group.

— You’re out: House Agriculture Republicans introduced a bill on Wednesday that would give USDA more power over expanding rural broadband access, a task it now shares with the FCC.

— Eyes open: Tech trade groups are watching the U.S. Innovation and Competition Act, S. 1260 (117), to see what amendments senators might try to sneak in.

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Tech of the Town

FIRST IN MT: HEAVYWEIGHTS JOIN PRO-TECH GROUP — Former Rep. Greg Walden (R-Ore.) and former Sen. Heidi Heitkamp (D-N.D.) are joining the American Edge Project and will work to promote “internet openness, accessibility and free expression” as lawmakers inch towards regulating the major tech companies. In addition to Facebook, the group’s members include tech trade group NetChoice and the Connected Commerce Council.

Walden, who chaired the House Energy and Commerce Committee, said he’s joining the group to promote ideals like free expression, as “techno-autocracies” advance their vision for censoring the internet.

— Ongoing controversy: American Edge Project has been shrouded in controversy since Facebook confirmed last year its role in launching the “dark money” group, which is meant to burnish the image of U.S. tech companies as they face intensifying regulatory scrutiny. (Facebook declined to comment.) The group is registered as a nonprofit with an accompanying foundation, allowing American Edge to avoid disclosing all of its donors.

— Adding heavy hitters: Walden and Heitkamp, both of whom only recently left Capitol Hill, will add extra heft to American Edge as it continues to advocate against antitrust reform. A person familiar with the organization declined to share Heitkamp and Walden’s salaries but told Emily their positions as advisory board co-chairs will be similar to other American Edge Project advisers, including former Sens. Kent Conrad (D-N.D.) and Saxby Chambliss (R-Ga).

‘FCC’S HAD THEIR CHANCE’ ON RURAL BROADBAND — Republicans on the House Agriculture Committee unveiled internet connectivity legislation Thursday, another salvo in the intensifying interagency spat over which is best suited to expand access to rural broadband.

The House proposal would codify the Agriculture Department’s three-year-old ReConnect rural broadband program, increase minimum speeds for users and authorize $3.7 billion annually for USDA’s rural broadband efforts.

— The major players: A lot of federal agencies are in the mix to solve these digital divide shortfalls — including the FCC, which manages its own billions in rural broadband subsidies — and it’s not clear who should take the lead. On Thursday, House Energy and Commerce Republicans also proposed sticking $20 billion for broadband buildout at the Commerce Department in their own new bill.

But Agriculture panel lawmakers say USDA is best suited to wire rural America. “The FCC’s had their chance, and they haven’t gotten it done,” Rep. Austin Scott (R-Ga.) said Thursday.

— A group of 22 Republicans are co-sponsoring this new bill, led by House Agriculture ranking member G.T. Thompson (R-Pa.). “USDA is the one that has the expertise,” Thompson told reporters.

— Rural broadband was a frequent banner issue FCC’s GOP leadership touted during the Trump era, including when it held a $9.2 billion rural broadband subsidy auction. “I don’t know that sending every dollar to one particular entity is a necessity,” but money going to different agencies will require coordination, Commissioner Brendan Carr said when asked about the proposal. Even so, he said, “we’re headed very much in the right direction.”

MEANWHILE, ANOTHER FCC MATTER TO WATCH — FCC acting chief Jessica Rosenworcel confirmed Thursday that she’s circulated a proposal to press pause on a Trump-era order approved last fall that reallocated some 4.9 GHz airwaves now used for public safety for commercial use. Rosenworcel, who dissented last year amid public safety pushback, told reporters she believes that order was “directionally correct” given the band’s underutilized spectrum but said she hopes the pause will provide time to find better uses for the spectrum “at national scale.”

TECH GROUPS’ TOP TABS ON USICA — Tech trade groups are anxious to see what ends up in the final version of Senate Majority Leader Chuck Schumer’s U.S. Innovation and Competition Act. One add-in of concern: the Country of Origin Labeling Online Act, introduced by Sens. Tammy Baldwin (D-Wis.) and Rick Scott (R-Fla.), which has already been included as an amendment.

Though these trade groups broadly support the USICA package as a whole, they are wary of lawmakers who want more transparency for online purchases. The bipartisan labeling amendment would require products sold online to list their country of origin, which the lawmakers say could encourage consumers to buy American goods.

Earlier this week, the National Retail Federation, joined by major tech associations — TechNet, the Information Technology Industry Council, the Internet Association, the Consumer Technology Association, the Chamber of Progress and the Computer and Communications Industry Association — sent a letter to the Senate Commerce Committee opposing the amendment, arguing that the legislation puts the burden on retailers and sellers, not suppliers, to figure out an item’s country of origin.

It’s a rare alliance between brick-and-mortar retailers and online marketplaces, which have been waging their own fight against each other over the INFORM Consumers Act, a bipartisan bill to crack down on counterfeit goods by requiring online marketplaces to verify the identities of high-volume third-party sellers. That was introduced Wednesday as an amendment to USICA by Sen. Bill Cassidy (R-La.), although a lobbyist told MT that big-box retailers are pushing to have it included in a potential manager’s amendment, which typically passes by a voice vote. The Chamber of Progress and Internet Association expressed concerns to MT separately over the legislation, saying it would harm small online sellers.

U.S., SOUTH KOREA TO TALK TECH — Tech will play a big role in today’s meetings at the White House between the Biden administration and the South Korean delegation led by President Moon Jae-in. Although the summit will likely focus on North Korea, technological competition with China will also be on the agenda, as is a roundtable with Commerce Secretary Gina Raimondo, South Korean trade minister Sung-wook Moon and tech CEOs from both countries.

The delegation is bringing “very substantial commitments — investments in technology and batteries, in high-tech semiconductors, issues associated with 5G — all determined to underscore our mutual desire to work in innovation, supply chains, new-age logic chips across the board,” a senior administration official told reporters Wednesday.

The White House has been tight-lipped on those commitments, but South Korean companies like Samsung and SK Innovation are expected to be critical to U.S. efforts to reduce reliance on Chinese manufacturers of semiconductors, batteries and other tech products.

GOOGLE’S MOTION DENIED — A Texas judge on Thursday denied the company’s motion to transfer to California an antitrust suit filed against it by a group of attorneys general from 14 states and Puerto Rico. Judge Sean Jordan wrote in his opinion that he believed the case would go to trial and be resolved faster in Texas than in California.

APPLE-EPIC UPDATE

THE GRAND FINALE (FOR NOW, ANYWAY) — Apple CEO Tim Cook will take the stand this morning in Oakland, bringing to a close the iPhone-maker’s defense against allegations its ironclad control over the App Store violates antitrust law. Cook became CEO in 2011 after the death of Apple co-founder Steve Jobs, but wasn’t among the key decision-makers when the App Store launched in 2008. His testimony is more likely to focus on the Apple of today, repeating many of the themes raised by other company witnesses: Apple invests in innovation but is dedicated to the privacy and security of its users, which the company believes will be harder to maintain if third-parties can offer competing app stores on the iPhone.

Though the trial is winding down, the suit is far from over, a fact of which Judge Yvonne Gonzalez Rogers is keenly aware. “I haven’t decided what I’m going to do,” she said Thursday. But “one or both of you won’t be happy, so it’s going to go to the court of appeals.”

— Possible signs: Gonzalez Rogers has hinted a few times that there’s information she intends to examine further, including a 2020 study by Nokia that delves into the security of Android versus iPhone devices and apparent discrepancies in testimony from Apple’s Phillip Schiller about whether some developers adopted their own methods for in-app sales before Apple’s 2009 release of its own in-app payments system.

Transitions

Rep. Michael McCaul (R-Texas) is a co-chair of the Congressional Internet Caucus. … After 24 years at the FCC, Margaret Wiener is retiring as the deputy chief of the office of economics and analytics. Deena Shetler will replace her as acting deputy chief. … Julie Wenah has joined Facebook as the civil rights team’s associate general counsel and product lead. She worked at Airbnb and NASA and is an Obama White House alum. … Roberto Fierro is joining ACG Advocacy as a partner. He was previously a lobbyist for BSA | The Software Alliance.

Apple released its latest ad focused on its new iPhone privacy feature, App Tracking Transparency.

Silicon Valley Must-Reads

Brace for impact: The U.S. will ramp up its efforts to track domestic violent extremism on social media, a move that some worry could undermine civil liberties, AP reports.

Behind the RSA hack: “In 2011, Chinese spies stole the crown jewels of cybersecurity — stripping protections from firms and government agencies worldwide. Here’s how it happened,” via Wired.

Rose to a thorn: “Paul Romer was once Silicon Valley’s favorite economist. ... Not anymore,” More from NYT.

Do this, please: The FTC is urging Amazon to take down fake-review schemers on its platform, according to internal employee messages. Recode has more.

Quick Downloads

Say goodb-IE: And another internet icon bites the dust. It’s been real, Internet Explorer. More from WSJ.

Androids fresh from the store: Google will open its first retail store in New York this summer, the Verge reports.

Caring for kids: UNICEF takes a look at how we can better govern data collection from kids.

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