Security
Tech Lobbyists Laud Compromise Homeland Security Bill
     High-tech companies are pleased that legislation to create a Homeland Security Department emphasizes cyber security and technology, according to industry lobbyists. The House this week passed the compromise bill, H.R. 5710, and the Senate is poised to complete debate next week, clearing the way for President Bush to create a department that would incorporate numerous existing agencies and 170,000 employees whose purpose would be to thwart both physical and Internet attacks against the United States. The two most important provisions to high-tech companies would set a specific threshold for computer security at government agencies and exempt companies from the Freedom of Information Act if they share information with the department about break-ins or vulnerabilities to their computer networks. Also this week, the House passed a bill to boost national cyber-security research and development by providing $903 million to university and industry programs through competitive programs. The bill now heads to the White House for the president's signature.

Privacy
House-Passed Security Measure Prompts Privacy Concerns
     Lawmakers' decision to cast aside a Senate-crafted compromise on amending the Freedom of Information Act as part of homeland security legislation pleased technology industry officials but riled privacy and public-records advocates. Privacy advocates also raised concerns about the last-minute addition of anti-hacking language to the security measure, another issue that has pitted them against technology industry groups, which have solidly supported the proposal. But most observers in the privacy community said they could find nothing in the new Homeland Security Department bill, H.R. 5710, that would give government the authorization to scour commercial databases for information about private citizens. That fear has been raised by recent attention to the Total Information Awareness program at the Defense Department.

Security
Security Adviser Presses For New 'Fusion And Analysis' Agency
     The president should create a new, stand-alone agency to serve as an "all-source fusion and analysis center" for intelligence related to potential terrorist attacks, the chairman of an influential counter-terrorism commission told a House Armed Services subcommittee. "There are misgivings with the idea of a new agency, but frankly, our commission doesn't seem to see any other alternative," James Gilmore, chairman of the Advisory Panel to Assess Domestic Response Capabilities for Terrorism Involving Weapons of Mass Destruction, told lawmakers during a hearing on the panel's fourth annual report to the president and Congress. The formal report is due in December, but members of the panel, commonly known as the Gilmore Commission, decided to release certain recommendations in advance, to help "inform the current debate," as policymakers implement legislation to create a Homeland Security Department.

Cyber Security
Business Roundtable Puts Cyber Security On Its Plate
     The push to make cyber security a priority issue for top executives is on the agenda for Business Roundtable (BRT) members who met in Washington this week to set their 2003 policy agenda. Dick Brown, EDS chief executive and chairman of the BRT's Digital Economy Task Force, planned to encourage the group's 150 CEOs, who represent $3.5 trillion in revenue, to do more to protect their companies' computer networks and to make security a topic for boardroom discussions. "Dick's request will be part of an ongoing series of activities we have worked on to make cyber security a larger issue at the CEO level," said EDS Vice President of Global Government Affairs Bill Sweeney. "It goes to the protection of corporate assets, and personal and public information and how do we raise CEO awareness" on the issue. White House Office of Cyberspace Security Director Richard Clarke has noted that at some companies, the budget for coffee service trumps the budget for cyber security.

Telecom
As Chairman, Sen. Burns Plans Different Spectrum Approach
     Spectrum reform will be the first order of business for Sen. Conrad Burns when the lawmaker reclaims the position of chairman of the Commerce Subcommittee on Communications, his spokesman said. "The senator anticipates he will pass the first comprehensive overhaul of spectrum management during his chairmanship," Eric Bovim said. Holding hearings and introducing legislation to reform spectrum management will be Burns' first act as chairman, he added, noting that Burns hopes to tackle the issue within the first three months of becoming chairman of the subcommittee. Burns, a Montana Republican, has focused on the nation's system of distributing the nation's airwaves for commercial and government use, vocally criticizing the current auction system for commercial users. In hearings this summer, Burns questioned whether two bodies -- the FCC and the National Telecommunications and Information Administration -- should oversee spectrum and whether the auction process is wise.

Telecom
FCC Says Wireless Carriers Can Forego Spectrum Payments
     Citing the economic slump hampering the telecommunications sector, the FCC said it will not force wireless carriers to pay for spectrum licenses that were won under an controversial government auction. The agency freed wireless companies from their obligation to pay nearly $16 billion for spectrum licenses that NextWave Telecommunications was supposed to vacate. The FCC in March already returned $2.8 billion of the firms' combined $3.3 billion in down payments. The controversy stems from a wireless spectrum auction that the FCC held in 1996. It took back the licenses granted to NextWave after the company defaulted on payments and re-auctioned them. That action sparked a fury of court battles over whether the FCC had the right to take back the licenses. That issue is pending before the Supreme Court.

Intellectual Property
Senate Passes Webcasting Compromise
     Lawmakers are close to passing a bill that temporarily will spare small webcasters from paying royalties to recording firms and artists for online content. Senate lawmakers approved a compromised version the webcasting bill, H.R. 5469, offered by Sens. Jesse Helms, R-N.C., and Patrick Leahy, D-Vt., which reflects an agreement that the Recording Industry Association of America (RIAA) negotiated with a trade association of religious broadcasters. That compromise would give the royalty-collecting arm of the RIAA the right to negotiate "retroactive discounts" with small webcasting businesses and noncommercial stations. The original measure, which already passed the House, sought to delay royalty payments that online broadcasters would have to make to music firms and artists for content they air online. Webcasters complained that the royalty rate set by the librarian of Congress is too high. Now, the House will consider the compromised bill.

Taxes
States' Group Ratifies Simplified Tax System
     A group of states working to craft a simplified tax system gave final approval to a plan at a meeting Tuesday in Chicago. The move brings states a step closer to being able to tax online sales, but the process is far from complete, project participants said. Once the proposal is approved, it will be sent to individual state legislatures for consideration. The agreement sets the ground rules for the number of taxes allowed in each state, establishes definitions of products and outlines a governance system to oversee a nationwide streamlined sales tax system. Each state government will have to approve it with changes made to state law and tax code for it to go into effect.