With help from John Hendel, Leah Nylen, Steven Overly and Sam Sabin
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— Paging the FCC: The agency’s commissioners have not testified on the Hill for more than a year, even as Congress sends billions their way to expand broadband access.
— The Khan revolution: Chair Lina Khan is remaking the agency, according to a memo she sent to staff. Here’s what that all means.
— Crisis averted: Next week’s meeting of the EU-U.S. Trade and Technology Council is back on track.
IT’S FRIDAY, SEPT. 24. WELCOME TO MORNING TECH. I’m your host, Benjamin Din. We made it to the weekend! When’s the last time you had a chance to relax? Make sure you’re taking good care of yourself.
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FCC ESCAPES HILL SCRUTINY AS PANDEMIC DRAGS ON — One unexpected casualty of the disruptions wrought by the long pandemic: FCC commissioners haven’t testified before Congress in more than a year. It’s a gap that comes at an immensely consequential time for policymakers, as they seek to close the digital divide, and for the FCC itself, as it administers multiple Covid relief programs involving north of $10 billion.
— Why is the FCC MIA? Logistical challenges around the virus have sometimes meant fewer committee hearings generally (although Congress still managed to secure Senate and House testimony from the FTC this year). And lawmakers have generally fixated on bigger legislative vehicles, like the last pandemic relief package, the bipartisan infrastructure bill and Democrats’ massive spending plan. President Joe Biden also hasn’t named his permanent FCC chair, so Democrats may be reluctant to summon FCC officials in the interim.
— The implications: Lawmakers haven’t had a chance to directly pepper acting FCC Chair Jessica Rosenworcel and her fellow commissioners with questions about how the pandemic aid programs and other big-ticket items are going. The FCC is holding a 5G airwaves auction next month, for instance, and is finally opening a subsidy program to help small wireless carriers ditch gear from Chinese companies Huawei and ZTE. And the agency’s critics have raged over its messy rollout of the Rural Digital Opportunity Fund subsidy program.
Don’t forget: Democratic chairs on House Energy and Commerce used to say their panel should hear testimony from the FCC four times a year. Without these live hearings, lawmakers are stuck with a slower (and less spicy) form of oversight: writing letters.
Republicans, for their part, have clamored for months to get Rosenworcel in front of their panels this year, saying they have questions on broadband mapping and the aid programs. Democratic Commerce Committee spokespeople didn’t respond to questions about any potential sessions before year-end.
MT EXCLUSIVE: BLUMENTHAL ASKS FCC TO EXPEDITE ROBOCALL CRACKDOWN — Sen. Richard Blumenthal (D-Conn.) is sending an FCC letter of his own this morning, urging the agency to be more aggressive in tackling robocalls and “the recent surge of unsolicited text messages” — tactics often used in fraudulent marketing schemes.
Although the FCC has taken steps to address the issue — and Rosenworcel has made it a top priority as chair — Blumenthal said the agency should take additional actions, such as reconsidering some of the deadline extensions and exemptions it has given telephone carriers to implement anti-robocall technology. “Years spent waiting is billions of dollars lost to fraud,” he wrote.
— ‘Drastic escalation’: The number of spam texts has exploded over the past year, with 7.1 billion spam texts sent in July, compared with 5.74 billion robocalls. “Alarmingly, recent waves of messages have used vulgar and obscene content to lure, threaten, and shock consumers into opening malicious websites and phish passwords, steal identities, or extort money,” Blumenthal wrote, though he allowed that stopping them will be a “more complex challenge” given the number of services and service providers involved. He urged the FCC to “use all of its authorities, including investigations, rulemaking, and enforcement” to stop the flood of spam.
KHAN’S ‘VISION’ FOR THE FTC — The FTC chair laid out her vision and priorities for the agency in a memo sent to staff Thursday. POLITICO antitrust guru Leah helped MT break it all down:
— No more silos: Cross-agency coordination is the new watchword. Khan said antitrust lawyers, who work in the agency’s Bureau of Competition, and consumer protection attorneys detailed to the Bureau of Consumer Protection need to start working on “an integrated approach.” Having worked on the House Judiciary probe into online competition, Khan is very aware of how the FTC’s bureaucratic structure contributed to some of its biggest decisions on tech regulation, or the lack thereof. (See Leah’s dive into Google’s expansion and the two separate investigations the FTC undertook into Facebook’s WhatsApp acquisition.)
— Ending the era of economists: The FTC’s Bureau of Economics got no love from the new chair in her memo. Instead, she highlighted her desire to hire “technologists, data analysts, financial analysts, and experts from outside disciplines” to aid the agency’s work. Khan has been deeply critical of what she sees as an overemphasis on economics in antitrust — one of the reasons for the FTC’s split with Carl Shapiro, the economist it had hired for the Facebook case, soon after she became chair.
Shapiro, in turn, criticized the FTC’s withdrawal of guidelines on vertical mergers in an influential academic antitrust blog Thursday, though the post sparked a backlash when Shapiro and co-author Herb Hovenkamp didn’t originally disclose their former clients. (Republican FTC Commissioner Christine Wilson then took Shapiro’s critics to task for not disclosing their own funding.)
— Root of the problem: Khan said the FTC needs to stop its “whack-a-mole approach” to enforcement and instead focus on the “root causes” and “structural incentives” that cause illegal conduct. That will mean looking at companies’ underlying business models, including the incentives of private equity or other investors. It’s a refrain she shares with her former boss, Commissioner Rohit Chopra, who has repeatedly criticized the FTC for settlements that punish businesses for their conduct but fail to change their incentive structures (see his dissents in the Facebook and Zoom privacy cases).
MT EXCLUSIVE: FORMER ANTITRUST CHIEFS BACK KANTER — Top antitrust enforcers from every administration dating back to the Ford administration are urging the confirmation of Jonathan Kanter as the DOJ’s top antitrust leader in a letter to Senate leaders dated Thursday.
“Some of us may not share the policy positions Mr. Kanter has taken in the past and some of us may disagree with decisions he will take if confirmed,” the nine former assistant attorneys general for antitrust wrote. “But we share the view, based on seeing him in action for almost 25 years, that the nominee possesses the qualities that will make him an effective Assistant Attorney General.”
— Among the signers: Charles F. “Rick” Rule, antitrust chief for Ronald Reagan and a mentor of Kanter’s; Thomas Barnett, who served in the George W. Bush administration and has long represented Facebook, including in the Instagram and WhatsApp purchases; and Christine Varney, the first antitrust chief under Barack Obama who reps Epic Games in its suit against Apple.
TRADE AND TECH MEETING BACK ON TRACK — Despite the public spat between the U.S. and France over the last week, the EU will indeed send its top diplomats to Wednesday’s inaugural meeting of the transatlantic council in Pittsburgh. Short-term semiconductor issues will be a top priority at the meeting, with conversations about long-term strategies to expand manufacturing expected at the council’s next meeting in Europe, a European Commission spokesperson said.
The council’s European co-chairs, Margrethe Vestager and Valdis Dombrovskis, confirmed their attendance via Twitter. “Strategic alliances are about shaping common approaches and also overcoming difficulties,” they posted in identical messages Thursday. In Pittsburgh, they will meet with the U.S. co-chairs, Secretary of State Antony Blinken, Commerce Secretary Gina Raimondo and U.S. Trade Representative Katherine Tai.
— High-stakes drama: Top EU officials have expressed ambivalence all week about participating in the meeting. Political leaders flirted with postponing the inaugural gathering, months in the making, after France was cut out of a multibillion-dollar contract with Canberra due to a new defense alliance between Australia, the U.K. and the U.S.
MEANWHILE, AT THE WHITE HOUSE — The Biden administration asked semiconductor manufacturers and their customers to turn over information about their business needs during a White House meeting Thursday. The Commerce Department also revealed a Federal Register notice that asks them to voluntarily provide information about their sales, inventory, ordering practices and more over the next 45 days. (Raimondo told Bloomberg the White House could use the Defense Production Act to compel companies to respond.)
SHOW ME THE MONEY — Since receiving an emergency $1 billion in funding earlier this year, the Technology Modernization Fund has already received enough proposals to spend all that money — and more.. So far, agencies have submitted more than 100 project proposals totaling more than $2.3 billion, federal CISO Christopher DeRusha told lawmakers Thursday. (House Democrats hope to boost the TMF with another $1 billion as part of their $3.5 trillion social spending package.)
HOT JOB: “Public Policy Manager for Youth, Instagram”
Camille Francois is stepping down as chief innovation officer from Graphika and will chair its advisory board. She is a Google alum and was part of the Election Integrity Partnership. … Edward Perez is joining Twitter as director of product management, focused on civics, elections and real-time crises. He was most recently the director of tech development at election security organization OSET Institute. … Brian Shealey joins Immuta as VP of sales for the public and government sector. Rehan Sadiq joins as VP for regional alliances in the public sector.
The Rural Wireless Association has elected its board: John Nettles as president, Jake Baldwin as VP, Chris Townson as secretary and Mike Higgins as treasurer. Outgoing president Jana Wallace was appointed president emerita and will continue to serve on the board.
The Wireless Infrastructure Association has joined the National Spectrum Consortium. … The National Security Commission on Artificial Intelligence will sunset in October. … Airbnb.org could help to house an additional 20,000 Afghan refugees.
I’ll be watching you: “How Google Spies on Its Employees,” via The Information.
Firing back: Russian opposition leader Alexei Navalny slammed Apple, Google and Telegram in a Twitter thread, accusing “Big Tech” of turning into accomplices of Vladimir Putin.
Open data: To comply with best practices, federal agencies like the FCC should fully describe the public comments data they release, including potential limitations to their use, the Government Accountability Office said in a report.
A wild ride: “Massachusetts women agree to surrogacy on Facebook, sparking custody case,” WaPo reports.
ICYMI: “Amazon CEO Andy Jassy makes first visit to Capitol Hill since taking top job,” Daniel Lippman and Emily report.
Tips, comments, suggestions? Send them along via email to our team: Bob King ([email protected]), Heidi Vogt ([email protected]), John Hendel ([email protected]), Alexandra S. Levine ([email protected]), Leah Nylen ([email protected]), Emily Birnbaum ([email protected]), and Benjamin Din ([email protected]). Got an event for our calendar? Send details to [email protected]. And don’t forget: Add @MorningTech and @PoliticoPro on Twitter.
HAVE A GREAT WEEKEND!