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Blumenthal Thinks If Only The FTC Can Enforce KOSA It Won’t Be Abused; He’s Wrong

from the stop-regulating-what-you-don't-understand dept

It’s pretty amazing to me just how wrong one Senator can be about the internet for years and years and years. But we’ve been writing about Senator Richard Blumenthal and never, ever letting his own confusion about the internet get in the way of him boldly making foolish claims about the internet since before he was even Senator Blumenthal. Back in 2008, when he was simply clueless Connecticut Attorney General Richard Blumenthal, we had to try to explain to him the internet and Section 230, and sometimes I feel like his ongoing vendetta against the internet stems from looking so foolish all the way back then.

I mean, the defining moment of Blumenthal’s demands to regulate the internet remains his “will you commit to ending Finsta” demand, which only cemented just how clueless many of our elected officials are about the internet.

But, really, Blumenthal’s defining moment of internet ignorance should be his role in passing FOSTA, legislation that has been roundly recognized as (1) not even remotely doing what Blumenthal promised us it would do and (2) instead harming many people while simultaneously shutting down speech of marginalized groups.

No one should trust Senator Blumenthal around literally anything having to do with regulating the internet. He is a danger to the public.

And, of course, he’s still pushing his follow up to FOSTA, called KOSA (the Kids Online Safety Act). As with FOSTA, those who don’t understand the internet are doomed to get people killed. KOSA has all sorts of problems, in that its “duty of care” provisions will force websites to remove information that politically motivated enforcers will claim is “harmful.” Republicans have actually been quite upfront about this, publicly saying they support Blumenthal’s KOSA because they want to use it to drive LGBTQ content offline. Senator Marsha Blackburn, Blumenthal’s partner in crime on KOSA, has directly said that KOSA is needed to “protect minor children from the transgender in our culture.”

Yet Blumenthal still refuses to back down. While he agreed to some changes in the law to try to limit its scope to six designated areas of content, it’s not difficult to figure out how culture war enforcers could twist those areas to silence speech such as LGBTQ speech as “harmful” to children. We’re already seeing how Republican legislatures are doing exactly that.

The latest is that, in a paywalled article in Politico (thanks to a few of you who sent it over), Blumenthal (who denied there were any problems with the bill last year) says he’s open to changing the enforcement mechanism in the bill, potentially removing the provision that allows any state AG to enforce the law which would open it up to culture warrior AGs) and limiting it to just the FTC or possibly some other federal agency.

In the piece, Blumenthal admits that “as a former AG” himself, he would prefer to keep the AG enforcement mechanism in the bill, but he’s open to some other enforcement authority if it will get the bill over the finish line.

But, of course, this implies that the FTC is somehow not prone to abuse by whoever is in charge at the time, and wouldn’t use this new power as a political weapon. I mean, we already have Republicans constantly whining about Lina Khan’s somewhat rogue leadership and case selection at today’s FTC.

And, then, if Trump were re-elected, does anyone actually think he wouldn’t install some culture war MAGA crony to run the FTC and use it to hammer “big tech” with lawsuits? I mean, of course, he’d use KOSA — pushed by Democrats like Blumenthal — to force companies to remove pro-LGBTQ content as “harmful to kids.” How is that even in question?

Remember, this is the same Trump who tried to get the FCC to do his bidding in removing social media company’s right to moderate. That only failed when the clock ran out on his administration.

So, no, handing authority over to the FTC (or any federal agency) won’t fix the problems of KOSA. The problems of KOSA are inherent to the bill. They’re inherent to Blumenthal’s near complete ignorance of how the internet actually works, and what happens when you create these types of laws.

There are ways the government could help make the internet safer for kids. But it involves the boring, less flashy (but actually effective) things that Blumenthal will never look to do, because they don’t get him headlines or big attention-grabbing hearings.

Filed Under: ftc, kosa, richard blumenthal, state ags

Heritage Foundation Says That Of Course GOP Will Use KOSA To Censor LGBTQ Content

from the democratic-support-censoring-lgbtq-speech dept

We’ve talked a lot about KOSA, the “Kids Online Safety Act” that has massive bipartisan support in Congress. The latest version was introduced with 26 Senators as sponsors or co-sponsors. We’ve explained over and over again how the bill is unconstitutional and will actually do a lot to harm kids.

Of course, like so many of these “bipartisan” anti-internet bills that have bipartisan support, the support on each side of the aisle is based on a very different view of how the bill will be used in practice. We went through this last year with the AICOA antitrust bill. Democrats supported it (falsely) believing that it would magically increase competition, while Republicans were gleefully talking about how they were going to use it to force websites to host their propaganda.

Now, with KOSA, again you have Democrats naively (and incorrectly) believing that because it’s called the “Kids Online Safety Bill” it will magically protect children, even though tons of experts have made it clear it will actually put them at greater risk.

Meanwhile, Republicans are now freely admitting that they’re going to use KOSA to force websites to censor LGBTQ content. They’re literally proud of it. The Heritage Foundation, which at least used to have some principled stances before being taken over by culture warriors without any principles, is bragging about how it will use KOSA in this manner:

In that tweet, Florence Ashley calls out an article on Heritage’s website laughably entitled “How Big Tech Turns Kids Trans” (which, um, is not how any of this works), and includes this paragraph:

Lawmakers can also help. Raising the minimum age for internet use (as the Child Online Privacy and Protection Act would do) may be one way to protect kids from online harms. Another step in the right direction would be to prohibit the sexual exploitation of minors and the promotion of content that poses risks to minors’ physical and mental health (which the Kids Online Safety Act would do). If we seek to protect kids online, we must guard against the harms of sexual and transgender content.

Ashley, correctly calls out that they’re openly admitting how they’ll use KOSA to censor content. And Heritage replies in a quote tweet doubling down that this is exactly their plan:

Yes we do. Keeping trans content away from children is protecting kids. No child should be conditioned to think that permanently damaging their healthy bodies to try to become something they can never be is even remotely a good idea.

Leaving aside that this framing is utter nonsense, it’s also none of lawmakers’ business what individuals and their doctors decide is the healthiest way forward for anyone.

So, um, seeing as over a dozen Democratic Senators, including Richard Blumenthal, Ben Ray Lujan, Tammy Baldwin, Amy Klobuchar, Gary Peters, John Hickenlooper, Chris Murphy, Chris Coons, Brian Schatz, Mark Warner, Peter Welch, Maggie Hasan, Dick Durbin, Sheldon Whitehouse, and Bob Casey are supporting, can anyone ask them why they’re supporting a bill that Republicans are saying directly they will use to silence LGBTQ speech?

Again, the enforcement mechanism in the bill is that state Attorneys General get to bring lawsuits against websites for not removing such “harmful” content. And if you don’t believe that there are GOP state AGs itching to bring exactly these lawsuits, you haven’t been paying attention.

I get that Blumenthal and Klobuchar have both made it clear that they don’t care one bit about how Republicans will use their bills to take away rights of the public, but could someone ask the others on that list why they’re supporting such a bill?

Filed Under: 1st amendment, censorship, gop, kosa, lgbtq, state ags
Companies: heritage foundation

With All The Other Nonsense Going On, Senate Democrats’ Priority Is To Spy On Kids Online?

from the this-is-a-really-bad-bill dept

I do not understand the Democratic Party in the US for a wide variety of reasons. But one of the most confusing thing about them is their priorities. With everything else going on in the world that needs serious attention from Congress right now, Senate Dems have decided to host a markup on one of the worst, most ridiculous bills they’ve come up with in a long, long time: the “Kids Online Safety Act.”

I wrote about just how terrible a bill this is back when it was introduced in February by Senators Richard Blumenthal and Marsha Blackburn — two Senators who have a long and well documented history of hating on the internet and wishing to basically destroy it.

The bill is very much the typical “but think of the children!” kind of legislation that (I’m sure, coincidentally) always becomes popular right around election season. As we explained at the time, the bill assumes a lot of completely unproven things about how much “harm” the internet does to kids, and decides that companies need to magically stop the bad stuff. It ignores that companies put tons of efforts into stopping bad stuff on their platforms but (1) it’s a much more difficult problem than people realize and part of the reason it’s so difficult is that (2) trying to silence kids talking about certain topics has a long history of absolutely backfiring and making problems worse. We’ve seen that with actual data regarding things like eating disorders and suicide.

Forcing websites to take down such content, without addressing the underlying reasons why kids are seeking out such information does not help. Even worse, the mechanisms in this bill would basically just mean constant, unending, intrusive surveillance of every kid online. That’s awful.

This is not to say that people should let kids roam the internet willy nilly, but it is important to actually teach them how to handle the internet in an age appropriate way. Spying on kids at all times teaches kids the exact wrong lesson. It normalizes constant surveillance and privacy invasions and also never lets kids really learn for themselves and take responsibility.

Especially given the recent concerns over abortion data and access to abortion information, Democrats should be running away from this bill rather than supporting it. As policy expert Josh Lamel notes, if the Kids Online Safety Act becomes law, a Republican FTC or state Attorney General could force websites to block teen access to any abortion information.

KOSA will allow a Republican FTC or Republican State AG to force Internet platforms to block teen access to any abortion access or information that is not “pro-life” community approved. It has two provisions that can be used for this. First, “harmful content” and second, content and services “unlawful for minors”. A republican FTC will almost definitely use this as a cudgel on abortion issues. So will Republican State AGs.

KOSA will allow a Republican AG to file a federal court action to prevent access to information at all about sex online under the “harmful content” provision. This includes contraception info, STD info & so much more. Do you trust this fed. judiciary w/that?

He goes on to note that the bill could be used to enable parents to spy on their kids, and even to find out if their kids are purchasing contraception online. It’s a privacy nightmare at a time when we need more privacy, not less.

So, why the hell is Senator Maria Cantwell moving this bill forward? It’s not just preposterous, but it’s downright dangerous.

Bizarrely, by the way, the very same markup will review the Children and Teens Online Privacy Protection Act, which is supposed to extend privacy protections aimed at protecting children 12 and under to those 16 and under. But if the Kids Online Safety Act becomes law, kids will have no privacy at all.

Filed Under: blocking, for the children, ftc, kids online safety bill, kosa, maria cantwell, markup, marsha blackburn, richard blumenthal, spying, state ags

The Worst Reason To Brush Off Content Moderation Concerns In Antitrust Bills: Eh, The Supreme Court May Destroy 230 Anyway, So It Shouldn’t Much Matter…

from the wait,-really? dept

We’ve been highlighting the one big problem with Amy Klobuchar’s AICOA antitrust bill being that it has a trojan horse to enable lawsuit challenges over content moderation — and that this is the main reason why Republicans are supporting it. Still, with a big push to get the bills over the finish line, Adam Conner and Eric Simpson at the Center for American Progress did a big analysis of AICOA and the related Open App Markets bill that has similar content moderation concerns, and decided to recommend both bills, brushing aside the concerns.

Most of the analysis is quite good. And I agree with them that some of the other concerns raised about these bills seems exaggerated at best. Also, I appreciate that, for the most part, they take criticism of the bill seriously and try to respond to it, rather than ignore it. However, I take issue with them brushing off the content moderation concerns. Most incredibly, they argue that because Florida and Texas are already trying to legislate content moderation bans, and the Supreme Court will eventually weigh in (more completely than it already has), that state AGs won’t bother to use AICOA’s provisions when they can use the even worse provisions they’re hoping the Supreme Court will approve:

Finally, recent laws passed by Texas and Florida limit content moderation on social media platforms. These laws are in various stages of litigation before two different circuit courts, and it is increasingly possible that the U.S. Supreme Court will address the issue of online content moderation in the near future. Should either of these laws be allowed to stand by the Supreme Court, it is certainly difficult to imagine a state attorney general choosing to use a provision in these antitrust laws for a purpose they were not intended for, instead of working with the state legislature for more direct changes and challenges to content moderation on social media platforms.

And, um, sure? Yes, if even worse bills are allowed to become law, then I guess AICOA is the least of our concerns around content moderation, but that hardly seems like a reason to endorse this bill.

Earlier in the paper, they also brush off concerns about the content moderation issue in AICOA because it doesn’t have a private right of action for individuals or companies to sue directly, but would have to convince a state Attorney General or the DOJ or the FTC to take up a case. They discuss this in a hypothetical involving Alex Jones trying to sue YouTube over being moderated (this is a strange choice, as there are much more on point concerns, such as the moderation of Parler…):

YouTube currently enjoys First Amendment protections to moderate its private platform as it sees fit, including by removing Jones. Should Jones wish to get around these protections by arguing terms-of-service enforcement discrimination that resulted in material harm to competition under the bill, he would first have to persuade the DOJ, FTC, or a state attorney general to take up his case, as there is no private right to action in American Innovation, and Open Apps Markets does not apply here. The government would then need to prove in federal court that YouTube did not merely apply its terms of service in banning Jones, but that it applied the terms of service in a discriminatory fashion among “similarly situated business users.” In other words, the complainant must prove that Jones was treated differently than other YouTube users similarly violating the terms. Further, it would need to show that discriminatory application of the terms of service resulted in material harm to competition in the marketplace. It is highly unlikely that such an effect could be shown, since YouTube earned revenue from Jones’ videos, and operations of competing platforms were not harmed by the ban.

I mean, all of that puts a ton of extremely undeserved faith in a variety of government officials and judges to not take on a politically motivated cause. And there is little reason at all to believe that would be the case.

As we’ve pointed out for many, many years now, State AGs have become extraordinarily political, and in some cases positively eager to abuse their power to take on a sketchy case for political grandstanding reasons. I mean, Texas’ AG Ken Paxton seems to relish abusing power to bring politically motivated cases against his foes. It seems like that should at least be called out?

And what happens if Trump or DeSantis wins in 2024. Does anyone really think that a DOJ or FTC, led by people handpicked by either of them, would choose not to use these powers against companies for moderating content in a manner they don’t like? I mean… that’s just naïve. During the Trump administration he made it quite clear that he believed the DOJ was his own personal enforcers and should be used against his political enemies. And even as Trump’s former Attorney General Bill Barr tries to rehabilitate his tainted image, remember that he led multiple politically motivated antitrust inquiries against Trump’s enemies.

Meanwhile, DeSantis has similarly made it clear that he has no qualms about retaliating against political enemies. And, by all indication, Trump and DeSantis both see the failure of Barr’s politically motivated investigations as a problem to be solved with even more toadying and aggressive law enforcement agents.

As for the claim by CAP that the courts will somehow throw this out, that’s increasingly unlikely as well. Remember, the 5th Circuit seemed willing to make a purely political decision in reinstating Texas’ content moderation law. And some members of the Supreme Court seem willing to go along with that. I guess that’s why CAP’s argument is basically “well, if the courts are going to be bad about this, they’ll be even worse,” but again, that hardly seems like a good reason to support this bill.

Filed Under: 1st amendment, aicoa, competition, content moderation, courts, state ags, supreme court

John Oliver’s Big Whiff: Just Because You Agree There’s A Problem, Doesn’t Mean That This Is The Right Solution

from the not-all-laws-are-good-laws dept

Here on Techdirt, we’ve written about a bunch of John Oliver’s Last Week Tonight shows that are quite frequently directly in agreement with what we write about on Techdirt. We’re often impressed at the level of detail and nuance he’s able to approach complex issues with, while (of course) keeping things quite funny. I know that he has a large, very smart team, that often digs in deep with experts in order to get a complete picture. That’s why his reports on SLAPP suits, voting machines, grandstanding state AGs, police accountability, encryption and much much more have been featured here as worth watching on important topics we’ve covered for decades.

However, I’m quite disappointed in his most recent show about antitrust reform and tech monopolies. I do think it’s worth watching, but it’s missing some important context that I would have normally expected from him and his team.

I think that the video does do a good job addressing some of the actual problems of giant tech companies and their power. Though, I do wonder about using a quote from Jonathan Taplin as support for anything, considering he’s an extremist copyright maximalist, whose screeds against Google and the internet are so full of wrongness that they’ve inspired a whole genre of NY Times corrections.

But, the problem with Oliver’s segment is that while it spends most of the episode laying out legitimate concerns about tech power concentration, it then simply accepts that the two popular bills making their way through Congress will actually help and won’t cause problems. Oliver embraces and supports the American Innovation and Choice Online Act (AICOA) and the Open App Markets bill. However, as we’ve explained, while both bills have some good parts, the only reason Republicans are supporting them is that they know that the bills will be massively abused to litigate content moderation decisions.

Oliver doesn’t mention this or explore the issues. He only mentions Republican support in noting that both Bernie Sanders and Josh Hawley support the bills, suggesting that the only reason the bills have bipartisan support is because they’re “too narrow.” But that ignores that the actual reason they have Republican support is because Republicans see this as a tool to punish and intimidate “big tech” into leaving their lies and propaganda online. Ted Cruz has repeatedly noted he supports these bills because they will “unleash the trial lawyers” on these companies.

And, just after Oliver’s segment aired, Hawley again bragged about using them to attack “woke” corporations:

And, at the very least, I’d expect Oliver and his team, with their willingness to explore nuances, to at least maybe explore why support for these bills are coming from copyright maximalist extremists and populist propagandist politicians.

But… he doesn’t.

Instead, he implies falsely that the only criticism of these bills is coming from big tech “shills.” And while it is true that some of the pushback on these bills is coming from disingenuous sources, using disingenuous arguments, some of the concerns are legit. And to wipe them away and assume that just because he’s accurately laid out the problem, that these bills are automatically a solution is the type of facile, but wrong, exploration of complex solutions I’m used to it from much of the rest of the media, but had come to expect better of from Oliver.

I mean, just as one example, four years ago, Oliver himself did a wonderful piece about how state Attorneys General abuse their positions for political means, often doing the will of certain industries, to attack other industries. And, I should note clearly here that these bills enable state AGs to go after the tech companies. So, if Oliver and his team are well aware of that, why are they downplaying the possibility that these bills might be abused and dangerous, political ways?

As we’ve discussed at length over the last few months, there are fairly easy ways that these bills could be amended to limit the possibility of abuse. But the Democrats sponsoring the bills have refused to do so, because they know they’d lose that critical “bipartisan support.” But, really, that should be the story here. The only reason these bills have bipartisan support is because Republicans know they’ll be abused, and WANT them to be abused. The only amendments we’ve seen have simply been to carve out certain industries after lobbyists complained.

Again, that seems like the kind of story I’d expect to see from Oliver, rather than full throated support for these bills.

Filed Under: aicoa, antitrust, big tech, john oliver, josh hawley, open apps market, state ags

TikTok Hysteria Returns: AGs Launch Mental Health Impact Inquiry

from the moral-panic dept

Thu, Mar 3rd 2022 12:12pm - Karl Bode

While the repeated freak outs over TikTok tend to be bipartisan, they’re often motivated by different things. The Trumpist right generally doesn’t like TikTok because Chinese people made a product that’s better and more successful than U.S. tech platforms (the latter point being obvious if you spend thirty seconds comparing the Facebook/Instagram and TikTok video platforms).

This is dressed up under all manner of other pretenses (see: Trump trying to offload the whole company to his friends at Oracle and Walmart under the pretense he was just suddenly and uncharacteristically, super concerned about consumer privacy).

Then of course there’s another segment of TikTok hysteria common on the right and left, which, as we’ve seen throughout history when new tech is involved, requires tearing your hair out about a parade of perceived horribles being caused by something you don’t actually understand.

The latest example of that segment of TikTok hyperventilation can be seen in a new multi-state AG investigation into weather TikTok is causing mental and physical health issues in teens:

Today, Attorney General Maura Healey launched a nationwide investigation into whether TikTok is designing, operating, and promoting its social media platform to children, teens, and young adults in a manner that causes or exacerbates physical and mental health harms. Attorneys general nationwide are examining whether the company violated state consumer protection laws and put the public at risk.

Data clearly proving that social media is actively the cause of teenage depression is hard to come by. Especially in a country where mass shooting, terrible or nonexistent mental health care, corruption, shitty parenting, climate change, income inequality, racism, and countless other factors contribute to the ebb and flow of mental illness rates.

The AG’s announcement doesn’t really explain the need for the investigation (especially the claim TikTok causes “physical harm”), but does make it sound like it’s already effectively understood that it’s social media that’s directly responsible for the entirety of teenage ills:

“As children and teens already grapple with issues of anxiety, social pressure, and depression, we cannot allow social media to further harm their physical health and mental wellbeing,” said AG Healey. “State attorneys general have an imperative to protect young people and seek more information about how companies like TikTok are influencing their daily lives.”

As history keeps showing us, whatever technology is new and innately poorly understood, it is blamed for age-old problems because it’s simpler than fixing the real, underlying, and often complicated issues. That’s not to say that teens aren’t experiencing body image issues or other problems due to unrealistic portrayals of human beings — or that we shouldn’t research those issues and try to fix them.

But those problems already existed in arenas like traditional media and advertising. They’re simply not specific to social media, or having a cellphone (also routinely blamed as the cause of teen depression). And there’s always a select certainty that comes along with these moral panics that don’t really incorporate the concept that technologies can have both positive and negative effects.

For example, not that long ago there was a massive freak out over claims that TikTok was causing a huge spike in diagnosis’ of Tourette Syndrome among teenage girls. Only later (after the din of false headlines had died out) did folks point out that this likely wasn’t happening at all.

In reality, there was a spike in referrals for those curious if they had Tourette, caused by either increased awareness of what Tourette was due to a lot of famous influencers on TikTok having the disorder (the building of awareness itself being a good thing leading to more people getting help), or by disorder tourism and mimicry by young adults trying to feel more connected or popular (not good, but not a specific TikTok problem).

It would be nice if there was a singular, easy answer that would immediately make the planet’s young adults feel happy, confident in their bodies, and less depressed. But again, there’s no hard evidence that TikTok is the singular cause of these problems. Which leaves you wondering: in an era with so many massive, obvious challenges (climate, hunger, corruption, COVID, war, abysmal mental health care), is a big inquiry like this genuinely the best source of our consistently strained resources?

Filed Under: maura healey, mental health, moral panic, social media, state ags
Companies: tiktok

US Antitrust Enforcement Clearly Broken As Court Rubber Stamps T-Mobile Merger

from the ill-communication dept

Tue, Feb 11th 2020 10:44am - Karl Bode

When AT&T was busy trying to gain regulatory approval of its $86 billion merger with Time Warner, economists, consumer groups, antitrust experts, and opponents of the deal warned it should be blocked because a bigger AT&T would only act anti-competitively to raise rates and hamstring competitors. AT&T and the FCC denied those claims, only to have them all come true a short while later.

Fast forward to this week and we’re repeating history all over again. This morning U.S. District Judge Victor Marrero approved (pdf) T-Mobile’s controversial $26 billion merger with Sprint, shutting down a multi-state AG lawsuit aimed at stopping the deal. Citing ample evidence that the reduction of four major carriers to three would dull any incentive to compete on price, a coalition of AGs tried to stop the deal after it was rubber stamped by both the FCC and FTC. But in his decision, Marrero tied himself into bizarre, esoteric knots in a bid to try and justify approval of the deal:

“How the future manifests itself and brings to pass what it holds is a multifaceted phenomenon that is not necessarily guided by theoretical forces or mathematical models,? Marreno wrote. ?Instead, causal agents that engender knowing and purposeful human behavior, individual, and collective, fundamentally shape that narrative.”

That’s deep, bro.

Marreno at one point goes on at great length to suggest that it’s “unlikely” that U.S. telecom giants, among the least competitive companies on the planet, would ever possibly act anti-competitively in the wake of the deal:

“In this court’s view, in the intensely competitive and rapidly changing environment in which complex and dynamic markets operate, the anticompetitive business strategies and market effects Plaintiff States predict are unlikely. It is not likely, perhaps improbably or even not rational, that a major new or reinforced market participant, rather than vying aggressively to entire additional customers from competitor by introducing innovations, and investing more to protect and expand market share, would do the exact opposite, thereby risking har to its customer base.

Here in reality, there’s ample evidence from around the globe that such 4 to 3 market shifts result in higher prices and significant layoffs. From Canada to Ireland, this kind of consolidation almost never ends well for consumers, competition, or the market. Hell, you only need look at Comcast, whose legendary status as one of the most despised companies in America is a direct byproduct of mindless M&A and a patent refusal to scale customer service alongside its relentless growth. US telecom consolidation has not been a good thing, no matter how many telecom-linked think tanks spin themselves into butter insisting otherwise.

American antitrust enforcement and consumer protection has turned into a running joke. The Trump administration uses antitrust to pursue weird, petty and pointless vendettas, while deals that create obvious market harm (AT&T Time Warner, T-Mobile Sprint) are allowed to proceed. The FCC rubber stamped the T-Mobile merger before staffers had even read the full proposal. The DOJ approved the deal against the advice of its own staffers.

The grotesqueness of the T-Mobile approval process couldn’t have been any more blatant. Former FCC Commissioners from both parties, ranging from Mignon Clyburn to Robert McDowell, lobbied to help gain regulatory approval, often without identifying themselves (in Op/Eds and elsewhere) as being on T-Mobile’s payroll. T-Mobile also hired Trump ally Corey Lewandowski (just days after he mocked a kid with Down Syndrome on national TV), and made a point of ramping up executive stays at Trump’s DC hotel to further grease the wheels. It clearly worked.

To justify its approval of the deal, the DOJ created an absurd proposal that involves shoveling some spectrum off to Dish Network, which will then be tasked with building up a new fourth replacement carrier over a period of seven years. Economists pointed out repeatedly the plan isn’t likely to work.

Dish (whose history of flaky promises in wireless was even previously mocked by T-Mobile) will spend much of that time as little more than a rebranded T-Mobile MVNO, and may never become fully viable. The effort is also likely to be undermined by AT&T and Verizon, which have every incentive to make sure Dish never becomes a viable fourth competitor. Who is supposed to prevent AT&T and Verizon from scuttling the effort? Who makes sure T-Mobile and Dish live up to their promises? Ajit Pai? The guy who mindlessly rubber stamps every fever dream the telecom sector has?

US consumers already pay some of the highest prices in the developed world thanks to regulatory capture and muted competition. A laundry list of economists have made it abundantly clear that further consolidation in wireless will only make the problem worse. There’s literally forty years of documented history showing how these kinds of deals drive up prices, erode jobs, and result in worse overall service. While DC policy experts freak out about the perils of “big tech,” we’re giving big telecom a free pass to build something that could be arguably far worse.

Filed Under: antitrust, competition, consolidation, judge, state ags, victor marrero, wireless
Companies: sprint, t-mobile

10 State AGs Join Forces, Will Sue To Stop T-Mobile Sprint Merger

from the bigger-ain't-better dept

Wed, Jun 12th 2019 12:22pm - Karl Bode

While the FCC has indicated it’s more than eager to approve T-Mobile’s $25 billion merger with Sprint (despite an endless list of red flags), other regulators have proven to be a harder sell. The DOJ, for example, seems a bit sheepish on signing off on a deal that will reduce already semi-tepid US wireless competition by 25%. They’re correct to worry: US telecom is awash with examples of how such consolidation tends to devastate employment, and results in significantly higher rates for consumers and businesses alike.

Granted with the DOJ now run by former Verizon attorney Bill Barr, it’s still very possible the DOJ approves the deal anyway. But even then, the deal is going to have to get past a new coalition of 10 state attorneys general, who say they’ve joined forces and will file a lawsuit to block the deal whether the DOJ approves it or not. New York Attorney General Letitia James and California Attorney General Xavier Becerra were fairly blunt in a statement announcing the move:

“When it comes to corporate power, bigger isn?t always better,? said Attorney General Letitia James. ?The T-Mobile and Sprint merger would not only cause irreparable harm to mobile subscribers nationwide by cutting access to affordable, reliable wireless service for millions of Americans, but would particularly affect lower-income and minority communities here in New York and in urban areas across the country. That?s why we are going to court to stop this merger and protect our consumers, because this is exactly the sort of consumer-harming, job-killing megamerger our antitrust laws were designed to prevent.”

While everybody is certainly welcome to their own opinions when it comes to tech policy, there’s really not much of a debate when it comes to the impact mindless M&As have had on the telecom sector.

Comcast (and it’s comically terrible customer service) was born from the mindless sector obsession with growth for growth’s sake. This consolidation, especially in wired broadband, has left us with a clearly unhealthy sector with little real competition, resulting in some of the highest prices and slowest speeds in the developed world. There’s not a single telecom metric the US isn’t mediocre in, and it’s a direct reflection of two things: regulatory capture and mindless merger mania. That’s now being extended to wireless, where the reduction of overall competitors from four to three will dramatically reduce any incentive to, you know, actually try.

It’s also pretty clear that when government tries to “fix” these anti-competitive unions via condition, it rarely works out well. The conditions imposed in these deals are often flimsy and proposed by the companies themselves (usually because they know they don’t actually do much). Even then, companies are routinely free to ignore conditions without meaningful penalty, and many bipartisan incarnations of the FCC have simply refused to enforce them anyway. Pre-merger promises (and there’s plenty attached to the T-Mobile deal) aren’t worth the paper they’re printed on, yet US policymakers adore pretending otherwise.

With former Verizon lawyers running both the FCC and DOJ, the chance that this administration imposes and then enforces tough deal conditions is slim to none. That leaves the more simple option: blocking the deal entirely. Some variant of this deal has been blocked twice already (AT&T’s attempted T-Mobile acquisition in 2011, and Sprint’s attempted merger in 2014), and for obvious reasons. Still, T-Mobile and Sprint executives are hoping that the Trump administration opens the door wide to approval anyway, leaving it (yet again) up to state AGs to actually protect the market and consumers in the face of federal apathy.

Filed Under: antitrust, california, doj, mergers, new york, state ags
Companies: sprint, t-mobile

John Oliver Exposes The Sketchiness Of Political Grandstanding State Attorneys General

from the it's-even-worse-than-he-says dept

Once again, it appears that comedian John Oliver is doing much more to dig into actual political problems than much of the rest of the news. The latest was his show this past Sunday about the weird and wacky world of state Attorneys’ General. If you haven’t seen it yet, it’s worth a watch:

Oliver’s piece focuses on state AGs (of both parties) filing partisan lawsuits against the federal government (of the opposing party). But the real “scandal” is in how various corporations have recognized the power of state AGs to effectively create policy (mainly by causing trouble for competitors). We’ve discussed this aspect multiple times in the past, mainly around Mississippi’s Attorney General Jim Hood going after Google at the request of the MPAA. And, of course, it wasn’t just “at their behest,” it was literally Hood more or less rubber stamping a demand letter written by the MPAA’s lawyers and sending it on as his own. The emails from the Sony hack revealed that the plan was literally to have the MPAA lawyers do all the investigative work and prepare many of the documents, and hand them off to “friendly” state AGs to shake down and threaten companies such as Google.

And they didn’t come up with this idea out of nowhere. It came in response to a 2014 NY Times article detailing how corporate lobbyists were “pursuing” state AGs directly in plans to cause trouble for competitors (or to get themselves out of investigations).

Attorneys general are now the object of aggressive pursuit by lobbyists and lawyers who use campaign contributions, personal appeals at lavish corporate-sponsored conferences and other means to push them to drop investigations, change policies, negotiate favorable settlements or pressure federal regulators, an investigation by The New York Times has found.

A robust industry of lobbyists and lawyers has blossomed as attorneys general have joined to conduct multistate investigations and pushed into areas as diverse as securities fraud and Internet crimes.

But unlike the lobbying rules covering other elected officials, there are few revolving-door restrictions or disclosure requirements governing state attorneys general, who serve as ?the people?s lawyers? by protecting consumers and individual citizens.

Most normal people would look at this and see the horrors of soft corruption. The MPAA looked at this and appeared to think, “hey, we should get in on that.” (I’ll leave aside the irony of the strict copyright maximalist MPAA sending around an entire copy of a NY Times article with no commentary to all the top staff at the MPAA and all the top legal folks at its member studios…) That resulted in them crafting a big plan to “fund” significant amounts of cash directly for doing the dirty work for state AGs to target Google.

And, of course, it gets even worse than that. Years back, we wrote about Chris Tolles’ harrowing tale in which a long list of state AGs effectively tried to shake down his startup, despite everyone admitting it had not broken any laws. The whole story is worth reading, but perhaps the most incredible part is after Tolles spoke with the state AGs, openly provided all the details on how his site operated, and why it was clearly within the law… they then went after him in the court of public opinion by misrepresenting everything he said (but never actually going after him in court):

So, after opening the kimono and giving these guys a whole lot of info on how we ran things, how big we were and that we dedicated 20% of our staff on these issues, what was the response. (You could probably see this one coming.)

That’s right. Another press release. This time from 23 states’ Attorney’s General.

This pile-on took much of what we had told them, and turned it against us. We had mentioned that we required three separate people to flag something before we would take action (mainly to prevent individuals from easily spiking things that they didn’t like). That was called out as a particular sin to be cleansed from our site. They also asked us to drop the priority review program in its entirety, drop the time it takes us to review posts from 7 days to 3 and “immediately revamp our AI technology to block more violative posts” amongst other things.

That was hardly the only example. Over the years, we’ve regularly detailed state AGs (of both parties) specifically picking on tech and internet companies with bogus legal threats, but which easily made lots of headlines, and helped get their names and faces in the paper. A lawyer friend has joked that, NAAG, the National Association of Attorneys General, it really stands for the National Association of Aspiring Governors. That’s because many, many, many state AGs end up seeking higher office — either as governor or US Senator. So getting their names in the news, even for bullshit reasons, is seen as valuable for name recognition.

Oliver’s point in all of this is that with many state AGs up for election next week, you should take the time to understand who is really running. And this is not a partisan message. We’ve covered awful state AG practices from members of both parties (and, occasionally, good state AG actions from members of both parties). But who is in that role really does matter, and it’s time we really started paying attention to who we’re putting in those powerful positions.

Filed Under: grandstanding, john oliver, shakedowns, state ags, state attorneys general

from the you'd-think-he'd-understand-it-already dept

A few weeks back, we did a post trying to explain how the planned meeting between Attorney General Jeff Sessions and a group of state Attorneys General to “discuss” how to deal with the imaginary problem of “political bias” on social media platforms actually represented a serious First Amendment problem. The government simply isn’t allowed to pressure companies into any sort of compelled speech, and yet it appears that’s exactly what these law enforcement officials were trying to do.

Late last week, we signed onto a detailed letter put together by the think tank TechFreedom, explaining why this meeting is so problematic.

We write to express our concern over your plans to convene a meeting of state attorneys general later this month ?to discuss a growing concern that [operators of popular social media services and search engines] may be hurting competition and intentionally stifling the free exchange of ideas on their platforms.? The First Amendment bars the government from attempting to ?correct? the first alleged problem, political bias, including through the antitrust laws, and sharply limits how the antitrust laws can be used against anticompetitive behavior beyond editorial bias. Essentially, antitrust law can prescribe anticompetitive economic conduct but ?cannot be used to require a speaker to include certain material in its speech product.? ? For all these reasons, we are skeptical that there are any grounds for legal action that could arise out of your inquiry.

The letter also highlights why the very idea of a “fairness doctrine” for the internet is Constitutionally impossible, not to mention ridiculous, given that the push for it is coming from the very same Republicans who have spent years falsely “warning” that the Democrats wanted to bring back a “fairness doctrine” for broadcast TV.

A Fairness Doctrine for the Internet Would Be Unconstitutional. The President and top congressional Republicans have talked about the need to ensure the ?fairness? of social media platforms and search engines. Consciously or otherwise, this invokes not antitrust law but the ?Fairness Doctrine? imposed on radio and television broadcasters by the Federal Communications Commission from 1949 until 1987. In theory, the Fairness Doctrine required broadcasters to represent a wide spectrum of opinion on controversial issues of public importance. The Supreme Court upheld this Doctrine in Red Lion (1969) ? but only because it declined to extend the full protection of the First Amendment to broadcasters on the grounds that they received government licenses to use a scarce public resource: the airwaves. Five years later, the Court categorically rejected mandating that newspapers offer a right of reply.

Anything like the Fairness Doctrine would undoubtedly be struck down as unconstitutional if applied to any other media ? whether to Fox News (the cable network) or Internet media….

Ironically, it was conservatives who led the fight to repeal the Fairness Doctrine over four decades ? because it hurt conservatives most: The threat of losing an FCC license discouraged broadcasters from including non-mainstream voices in their coverage and made impossible alternative media offerings with an unabashed conservative ?bias.? Indeed, it was President Reagan?s FCC that repealed the Fairness Doctrine in 1987.

The letter, targeted at Jeff Sessions repeatedly reminds him how such a tool might be used in the other direction as well:

The last thing conservatives should want is a Democratic administration with such arbitrary power (or a Republican administration, for that matter). A Warren administration, say, could use such powers to coerce existing social media sites and search engines to disadvantage conservatives (in the name of neutrality and fairness, and stopping ?fake news,? of course) and also to prohibit the ?Facebook for conservatives? network recently called for by Donald Trump, Jr.

It’s quite incredible that we’re even discussing this. A fairness doctrine doesn’t make any sense, and is broadly unconstitutional for a whole host of reasons. What’s bizarre and troubling is how quickly those who like to wear blue or red uniforms like to rush to it as soon as they feel one area of the media is “biased” against them, not recognizing how it would clearly be used in other areas of the media as well.

While it appears that Sessions’ gathering with Attornerys General will happen, hopefully all it serves to do is remind them all that the First Amendment exists, and that they are Constitutionally prohibited from messing with how online platforms present content.

Filed Under: antitrust, attorneys general, compelled speech, doj, first amendment, free speech, jeff sessions, political bias, search bias, social media, state ags
Companies: facebook, google, twitter, youtube