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Executive Summary: Week of August 3, 2009 Executive Summary: Week of August 3, 2009

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Executive Summary: Week of August 3, 2009


FCC Sees Far-Reaching Broadband Plan

A national broadband plan being crafted by the FCC will be massive in scale, tackling not only access and deployment but the technology's potential for revolutionizing education, the economy and health care, rivaling the watershed Telecommunications Act of 1996 in size and scope. Two days of agency meetings to kick off the effort this week have underscored the ambitious nature of the project, with high-level officials urging participants to develop grand ideas for connecting Americans to the Internet and harnessing its capabilities. "Broadband is the great infrastructure challenge of our generation. It is to us what railroads, electricity, highways and telephones were to previous generations," FCC Chairman Julius Genachowski said during the first of 22 public workshops to be held in August and early September. But the project is not without sizable hurdles. Congress set a short deadline of Feb 17, forcing the FCC to deliver a final report before a comprehensive nationwide map of broadband availability is expected to be complete. In addition, the plan would require congressional and FCC action, raising the specter of debates about costs that could run into the billions of dollars and regulatory conditions that might dissuade participation by influential telecom companies. Major broadband providers already have balked at applying for the $7.2 billion in broadband stimulus funding due to regulatory strings attached by Congress, a potential harbinger of battles for the FCC. One of the toughest challenges will be creating incentives for Americans who don't take advantage of having access to broadband service to sign up for it. That population is estimated at nearly 30 percent, dwarfing the roughly 8 percent that lacks access.


Intellectual Property

Judiciary Committee Backs PTO Nominee

The Senate Judiciary Committee late this week swiftly approved by voice vote IBM Assistant General Counsel David Kappos to become director of the Patent and Trademark Office and undersecretary for intellectual property at the Commerce Department. In a written statement, Judiciary Chairman Patrick Leahy emphasized the importance of getting a PTO director in place quickly. "The PTO needs strong and accountable leadership," he said, noting the agency's growing backlog of patent applications and economic woes. Leahy was seeking a vote by the full Senate before lawmakers left for their August break.

Intellectual Property


Leahy: Radio Royalty Bill Will Move

Senate Judiciary Chairman Patrick Leahy issued a warning this week to the National Association of Broadcasters that legislation he introduced in February to end a royalty exemption afforded to AM and FM radio will advance this Congress despite the trade group's lobbying blitz. A companion measure passed the House Judiciary Committee in May and awaits floor action. "This is legislation that's going to move," Leahy said at a hearing on the topic. "The time to sit down and talk is now." Music industry stakeholders have repeatedly complained that NAB has refused to discuss a reasonable fee. Leahy added that for some stations, the cost of paying a flat rate under the House bill would be less than what they give the NAB in dues. Under the House bill, stations with gross revenues under $100,000 would pay $500 a year. Stations grossing between $100,000 and $500,000 would pay $2,500 while those making up to $1.25 million would pay $5,000. Rates for stations that gross more than $1.25 million would be set by a federal panel of copyright judges if stakeholders are unable to strike the right tone in private negotiations. But Commonwealth Broadcasting Corp. CEO and NAB Radio Board Chairman Steve Newberry said saddling AM and FM stations with new fees could jeopardize their livelihood. National Association of Black Owned Broadcasters Executive Director James Winston agreed, saying minority-owned stations would be particularly hard hit because "there are no fat profits to skim." As an alternative, Sen. John Cornyn, R-Texas, proposed the creation of a do-not-play list that could "restore choice to performers who own intellectual property without imposing a compulsory license." They would still earn revenue from platforms like cable, Internet and satellite, which pay royalties. Senate Majority Whip Durbin said the proposal could be troublesome for composers who do get paid by AM and FM stations.


Lawmakers Seek Info On Cybersecurity Official's Resignation

Senate Homeland Security and Governmental Affairs ranking member Susan Collins has requested a copy of the resignation letter of Melissa Hathaway, senior cybersecurity adviser to Director of National Intelligence Dennis Blair, and asked her staff to interview her about why she is leaving the Obama administration. Hathaway, who began working for Director of National Intelligence Mike McConnell in 2007, is the chief architect of the Obama administration's review of the government's ability to identify and thwart high-tech attacks. She announced early this week that she would leave her post Aug. 21, and in news reports she said she felt she was not in a strong enough position to effect change. She was a potential candidate for a cybersecurity coordinator position that President Obama announced in May. He Some speculated she would not have gotten the job because of her ties to the Bush administration, but Hathaway told The Wall Street Journal that she took her name out of the running for the job a few weeks ago. Collins said she was alarmed by the departure of Hathaway, who helped shepherd a largely classified multibillion-dollar plan to secure government IT networks. Collins took issue with having another White House czar, who would not be confirmed but wield great authority. The position "reduces congressional oversight and undermines our ability to confirm individuals to important policy posts," she said. Senate Intelligence Chairwoman Dianne Feinstein also weighed in, saying she was sad to see Hathaway go, and she stressed the need to get a cyber official in place quickly. Two potential frontrunners for the cyber coordinator position are Howard Schmidt, former White House special adviser for cyberspace security, and Frank Kramer, an assistant Defense secretary under President Bill Clinton.



DHS Still Exploring How To Coordinate Cybersecurity Threat Response

Homeland Security Secretary Napolitano acknowledged this week that her department is still exploring how best to coordinate the government's response to cybersecurity threats, saying several critical issues remain unresolved, such as how to interact with the Defense Department and work with private companies. "We need to be looking at [cybersecurity] not from a traditional standpoint of how we do law and order, but how we need to do it in a new and evolving world," Napolitano said during the keynote speech at a cybersecurity conference hosted by the Secret Service. She said her department was not properly organized to deal with cybersecurity when she took it over in January. "We need to be recruiting and training investigators who only do this kind of work," Napolitano said. She said the Obama administration is working through how the department will interact with the Pentagon's new cyber command. Napolitano said the department is weighing the creation of an integrated center. But she quickly noted privacy concerns created by having the military involved in protecting U.S. civilian networks. She cited several other unresolved issues including how to work with the agency's partners, how to exchange information between the government and the private sector in real time, and how to recruit and train the right personnel.


Key Senators To Revamp Cybersecurity Bill

Senate Commerce Chairman John (Jay) Rockefeller and Sen. Olympia Snowe, R-Maine, plan to circulate after the August recess a retooled version of sweeping cybersecurity legislation they introduced in April, according to aides. The bill will likely be the subject of a September hearing, with a markup scheduled shortly thereafter. They had been aiming for July committee action but the healthcare debate "put everything on simmer," said one staffer. One of the bill's most controversial provisions, which high-tech policy watchers say would give the president the power to effectively shut off the Internet during a cyber crisis, has been a critical component of discussions with stakeholders. It is uncertain how the measure may change in light of the White House's roadmap for fighting high-tech attacks, which was released in May. The original bill would establish an Office of the National Cybersecurity Adviser within the Executive Office of the President. But under the administration's plan, the cyber czar will report to the National Security Council and the National Economic Council. The reworked legislation will emphasize making sure citizens have the knowledge and tools available to protect themselves from cyber threats, an aide said. Also under review by aides is a section that would require a presidentially appointed advisory panel to ensure that national security would not be compromised before approving the renewal or modification of a contract between the U.S. government and the Internet Assigned Numbers Authority, the entity that oversees global Internet addresses and is part of the Internet Corporation for Assigned Names and Numbers.


FTC's Google, Apple Probe To Continue

FTC Competition Bureau Director Richard Feinstein said this week the agency would continue to investigate remaining interlocking directorates between Apple and Google despite the fact that Google CEO Eric Schmidt has stepped down from Apple's board. The FTC has been examining the Google-Apple connection for some time, and Feinstein commended the companies for recognizing that sharing directors raises competitive issues as Google and Apple increasingly compete with each other. Schmidt has served on Apple's board since 2006; since that time, Google has entered the Web browser and operating system business with Google's Android and Chrome products. While praising Schmidt's input on the board, Apple CEO Steve Jobs said in a statement that "as Google enters more of Apple's core businesses ... Eric's effectiveness as an Apple board member will be significantly diminished, since he will have to recuse himself from even larger portions of our meetings due to potential conflicts of interest." Genentech Chairman Arthur Levinson also sits on the boards of both companies. Schmidt's move came just days after it was disclosed that the FCC was looking into reports that Apple wouldn't approve the Google Voice application for the iPhone -- and had removed related (and previously approved) third-party applications from the iPhone App Store. In light of pending FCC proceedings regarding wireless open access and handset exclusivity, the FCC wants a more complete understanding of this situation, FCC Wireless Bureau Acting Chief James Schlichting told Apple, Google and AT&T in a letter late last week.


Boucher Does Not Sign On To Net Neutrality Bill

House Energy and Commerce Communications Subcommittee Chairman Rick Boucher, D-Va., is conspicuously absent from the list of co-sponsors of new legislation designed to ensure that major telecommunications and cable providers never block or degrade content traversing their high-speed Internet networks. The measure was introduced by Reps. Edward Markey, D-Mass., and Anna Eshoo, D-Calif., both senior members of the Energy and Commerce Committee, just before the House began its summer recess late last week. Boucher's absence from the bill appears to reinforce a policy shift, given that just three years ago he co-sponsored a similar measure with Markey and Eshoo. This time around, a congressional source said Markey reached out to Boucher and Energy and Commerce Chairman Henry Waxman, who didn't sign onto the bill but conveyed his support for it. But Boucher made clear after taking over the subcommittee this year he would not join a renewed legislative effort on net neutrality, saying he supports a negotiated remedy involving industry stakeholders and public watchdogs. "Negotiations are ongoing," Boucher's office said in a written response to questions, adding Boucher did not "encourage or discourage" Markey from pursuing the bill. Art Brodsky of Public Knowledge, an advocacy group that favors net neutrality, was unaware of recent negotiations. Another source said discussions may be occurring between Boucher and broadband providers. There has been speculation that Boucher pulled back from his previous stance on the need for legislation to avoid alienating major telecom companies as he seeks to craft bills affecting the wireless industry and a federal fund subsidizing telecom service in low-income and rural areas.


Schumer May Offer Immigration Proposal When Congress Returns

Lawmakers and groups seeking to overhaul the nation's immigration laws this year are gearing up for legislative battles beginning when Congress returns in September from its summer break. Senate Judiciary Immigration Subcommittee Chairman Charles Schumer, D-N.Y., intends to introduce his immigration reform proposal around Labor Day, although it may be in the form of a framework, rather than an actual bill, his spokesman said. Regardless, it is expected to detail a strategy for dealing with the future flow of legal immigration and giving millions of undocumented workers in the country a path to citizenship. Schumer and his staff have been meeting with various interest groups and now have begun the process of meeting with other lawmakers and staffs to vet their plans. But no date has been set to mark up a bill. "This is very complicated, but we're making excellent progress on many fronts," Schumer said. Judiciary Immigration Subcommittee ranking member John Cornyn, R-Texas, said he has "discussed broad outlines of a proposal with Senator Schumer" but has not been asked for input on specific proposals. Meanwhile, business groups and immigrant advocates are developing their lobbying strategies. A broad-based business coalition sent Schumer, Cornyn and other lawmakers a letter this week urging them to ensure that legislation includes a system to bring foreign workers -- both high-skilled and low-skilled -- into the country to address current and future employment needs. But the letter did not address whether an independent commission should be created to set visa levels and determine how many foreign workers should be brought into the country -- a proposal backed by immigration reform advocates and labor unions that has created a fissure with business groups, who are skeptical about the idea.


Bill Would Ban 'Spoofing' Of Caller ID Technology

The Senate Commerce, Science and Transportation Committee passed legislation this week that would make it a crime to "spoof" caller identification technology. The bill, offered by Sen. Bill Nelson, D-Fla., would make it a felony with a fine of up to $10,000 per violation to "spoof" caller I.D.s. "Spoofing" is when someone masks the data, such as name, location and phone number displayed on a call recipient's caller I.D. The FCC has rules prohibiting spoofing, but companies that offer "spoofing" technology market it under the guise of protecting a caller's privacy. It has been exploited by people engaged in identity theft and other crimes. Nelson said the problem has become more serious as there has been an increase in cases of "I.D. swatting," where spoofers dial 911 with it appearing like they are calling from a victim's address. The goal is to have police show up at a victim's house with guns drawn. The bill would not restrict a person's ability to block their data from being displayed on a caller I.D. and it includes an exemption for law enforcement or any court order that permits caller I.D. manipulation. The bill would only apply to companies based in the United States and therefore would not affect many spoofing Web sites whose companies are based in other countries. A companion bill has been introduced in the House.


LaHood To Focus On Text, E-Mail Use While Driving

Transportation Secretary LaHood said this week he will convene a summit of experts next month to figure out how to curb cell phone use and texting by drivers, which studies and some recent accidents have shown can be a lethal combination. "The bottom line is, distracted driving is dangerous driving," LaHood said in a statement. "Following next month's summit, I plan to announce a list of concrete steps we will take to make drivers think twice about taking their eyes off the road for any reason." Senior transportation officials, safety advocates, law enforcement representatives, members of Congress and academics will be invited to the summit, he said. Virginia Tech researchers recently reported that those who text while driving are 23 times more likely to get into an accident. Sens. Charles Schumer, D-N.Y., Robert Menendez, D-N.J. and others introduced legislation last week that would require states to pass bans on texting while driving or risk losing 25 percent of their federal highway funding each year. According to the Governors Highway Safety Association, 17 states plus the District of Columbia ban texting while driving.

Net Government

Key House Lawmakers Call For Permanent Oversight Of ICANN

House Energy and Commerce Chairman Henry Waxman and Communications Subcommittee Chairman Rick Boucher, D-Va., this week called for the creation of a permanent relationship between the Commerce Department and the Internet Corporation for Assigned Names and Numbers, which administers the world's Web addresses. A memo formally joining the two entities is slated to expire late next month, amid concerns on Capitol Hill and within industry about ICANN's transparency and accountability. ICANN leaders have claimed that, after 10 years in business, the California nonprofit is ready for its independence. A letter to Commerce Secretary Gary Locke from Boucher, Waxman and eight other Democratic lawmakers said a set of enduring principles "will place beyond doubt the value of the current model for managing" the Internet address system and will prevent any one entity from controlling the underpinnings of the Internet. Their proposal would provide for periodic reviews of ICANN's performance and create a mechanism for implementing ICANN's plan to vastly increase the number of new types of Internet addresses. Republicans on the Energy and Commerce Committee are said to be preparing their own letter to Locke with recommendations for ICANN's path forward. House Energy and Commerce Communications Subcommittee members at a June hearing called for an extension of the U.S. government's formal oversight agreement with ICANN. At the time, Rep. John Dingell, D-Mich., said ICANN remains "far from a model of effective and sustainable self-governance" and it would be unwise to shrink the federal government's role amid increased cyber attacks and rapid Internet innovation.


Panel Urges Procedures To Ensure Policy Doesn't Influence Science

A bipartisan panel of scientific and regulatory experts called on the White House and federal agencies this week to make specific changes to clearly distinguish scientific questions from policy disputes. The report from the Science for Policy Project, which is co-chaired by former Rep. Sherwood Boehlert, R-N.Y., and former Science editor Donald Kennedy, was released on the eve of the first meeting for the Obama administration of the President's Council of Advisors on Science and Technology. The report recommends requiring new information when regulations are proposed by agencies such as the Environmental Protection Agency and the Food and Drug Administration, and enhancing the credibility of federal advisory committees to ensure the integrity of science in regulatory policymaking. Many recommendations are relevant to ongoing efforts by agencies to implement President Obama's March memorandum on scientific integrity. The White House has reviewed an interim version of the report to inform forthcoming guidelines on scientific integrity and regulatory reform. "Often, policy disputes are cast as fights over science," Boehlert said in a news release. "This damages the credibility of science and obscures the real issues that ought to be debated." The SPP paper coincided with the release of a memo from OMB Director Peter Orszag and Obama's science adviser John Holdren asking agencies to build on federal science and technology priorities reflected in the stimulus package and the FY10 budget in their planning for the next fiscal year.


Proposal Would Target Tech Firms That Do Business With Iran

With heightened international pressure facing Iran in the wake of its controversial presidential election in June, some U.S. lawmakers are hoping to advance legislation that would crack down on foreign technology firms that do business there. Sen. Charles Schumer, D-N.Y., and Rep. Brad Sherman, D-Calif., introduced identical bills in late July that would punish companies selling equipment to aid the Iranian government in monitoring or blocking Internet and cellular phone communications. In particular, the bills would ban such firms from applying for U.S. government contracts or renewing expiring ones unless their ties with Iran were severed. Electronics giant Siemens, for example, has thousands of federal contracts worth more than $250 million in 2009, and a joint venture with Nokia holds about $5 million worth of U.S. government contracts, Schumer's office said. Both have been implicated in Tehran's efforts to spy on its citizens and stifle communications, especially after the country's post-election unrest. Officials involved in the Siemens-Nokia joint venture have denied any wrongdoing. In a statement issued in June, they said Iran's national telecom operator was given the capability to conduct voice monitoring of local calls on its fixed and mobile networks in order to fulfill a lawful intercept requirement. But the technology cannot facilitate Internet snooping, network filtering or international call monitoring, Nokia Siemens Networks said. For now, Sherman's bill is still awaiting consideration by the House Oversight and Government Reform Committee, while Schumer's is pending before the Senate Homeland Security and Governmental Affairs Committee. A related provision in the Senate-passed FY10 defense authorization bill would authorize funding that could also be used for anti-censorship software and anti-jamming efforts for Iranian radio, satellite and Internet-based transmissions, according to the offices of its sponsors, Homeland Security and Governmental Affairs Chairman Joseph Lieberman and Sen. John McCain, R-Ariz.

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