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Tech Edge

Lawmakers Clash Over City Internet Service

By Laura Ryan (@NJLJRyan), with help from Alex Brown (@AlexBrownNJ), Brendan Sasso (@BrendanSasso), and Dustin Volz (@dnvolz)

TODAY'S TOP PARAGRAPH: The House passed an amendment to stop the FCC from overturning state laws on municipal broadband. The issue also took center stage at a Senate Commerce Committee hearing on the future of video. Time Warner rejected an $80 billion takeover offer from Rupert Murdoch. Meanwhile, the FCC is closing in on 1 million net-neutrality comments.

 

TOP NEWS

HOUSE VOTES TO HAMSTRING FCC ON CITY BROADBAND: In a 223-220 vote Wednesday, the House approved an amendment from Rep. Marsha Blackburn of Tennessee to stop the FCC from preempting state laws that restrict municipal broadband networks.

Chattanooga, Tenn., which has its own fiber network, would be a likely first target for FCC action. Rep. Chuck Fleischmann, who represents Chattanooga, was one of four Republicans to oppose the amendment.

The House also approved the overall funding bill, which would cut $17 million from the FCC's budget. (Sasso, NJ)

 

EXECS OPPOSE CITY BROADBAND: Comcast's David Cohen and AT&T's John Stankey argued during a Senate Commerce Committee hearing Wednesday that the municipal broadband networks are often wastes of taxpayer money. Cohen said he doesn't necessarily support state bans, but the FCC shouldn't intervene in the issue. Stankey warned that the networks "chase away private investment."

But Democrats praised the city projects. Sen. Cory Booker said they can offer cheap Internet service to low-income consumers, and Sen. Ed Markey argued that they boost competition.

TIME WARNER SPURNS MURDOCH: The media giant turned down 21st Century Fox's $80 billion offer, but Rupert Murdoch is unlikely to give up. The massive deal would allow the content companies to bulk up and gain negotiating power as the cable and telecom companies plan their own wave of consolidation. (Andrew Ross Sorkin/Michael J. De La Merced, NYT)

MERGERS UNDER THE SPOTLIGHT: During the the Senate Commerce Committee hearing Tuesday, Chairman Jay Rockefeller expressed anxiety about the spate of proposed and possible mergers. In his long career, he said, he has heard many executives boast about the consumer benefits from consolidation but that "in most cases, those benefits never came to pass." He touted the potential of online to shake-up the industry.

 

NETFLIX AND TIME WARNER CABLE WEIGH IN ON NET NEUTRALITY: Netflix's filing urged the FCC to seriously consider Title II reclassification and said the agency needs to pursue stronger protections than Wheeler's proposal. In its comment Wednesday, the video site said that "opposition to Title II is largely political, not legal."

Netflix is one of the few big tech companies to be so supportive of Title II. But according to Quartz, smaller companies like Tumblr, Spotify, and Reddit told Wheeler to classify the Internet under Title II during a meeting.

In its filing, Time Warner Cable said cable companies aren't the bad guys, but are "primarily responsible" for the emergence of the open Internet "as a robust and essential platform for innovation, economic growth, and free expression." The cable company opposes Title II reclassification, and says whatever rules the agency adopts should be applied to wireless providers and web services.

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As of yesterday afternoon, the agency had received about 969,000 comments. The deadline for the first round of comments is Friday—but then the agency will accept replies until September.

WHEELER MEETS WITH VENTURE CAPITALISTS: A group of venture capitalists told Wheeler that paid discrimination would reduce investment in tech start-ups. During a meeting Monday, a group of New York City-based VC's said the current proposal would be a "radical departure" from the way the Internet has operated for the past 20 years.

NIST TOLD TO RECONSIDER RELATIONSHIP WITH NSA: Outrage erupted last year over news that the NSA got NIST to undermine an Internet security standard. In a report, an external advisory board wrote that NIST "may seek the advice of the NSA on cryptographic matters but it must be in a position to assess it and reject it when warranted."

TOP LINES

LOBBYING UPDATES: The American Association of Independent Music hired Seth Bloom, the former general counsel to the Senate Antitrust Subcommittee and president and founder of Bloom Strategic Counsel, to lobby on copyright and antitrust issues. Also, Etsy joined The Internet Association.

APPLE TO PAY $450 MILLION TO SETTLE E-BOOK SUIT: Apple will pay $450 million, most of which will go to consumers, to bring a long-running e-book antitrust lawsuit to an end. (Nate Raymond/Alison Frankel, Reuters)

HOUSE WI-FI BILL INTRODUCED: The bill, a counterpart to legislation from Sens. Marco Rubio and Cory Booker, would direct the FCC to explore making more spectrum available for Wi-Fi in the 5 GHz band.

TREASURY SECRETARY PUSHES CYBER BILL: Speaking at an investor conference Wednesday, Treasury Secretary Jacob Lew urged Congress to pass cyber information sharing legislation and warned that the financial sector is vulnerable to attack.

ADMIN IS LOOKING FOR A NEW OBAMACARE SITE CONTRACTOR: The bid probably won't go to CGI Federal. (Volz)

GOOGLE'S NEW D.C. DIGS AIM TO 'DEMYSTIFY' TECHNOLOGY FOR VISITORS: Google feted the opening of its new D.C. offices Tuesday with senators, meatballs, and molecular gin and tonics. (Stephanie Green, Bloomberg)

HOW TO CUT THE CABLE CORD: Digital antennas, Slingboxes, and online streaming are reducing the need for colossal pay-TV bills. (Geoffrey Fowler, WSJ)

POLL: 83 PERCENT THINK A WARRANT SHOULD BE REQUIRED FOR CELL SEARCHES: A Microsoft-commissioned poll asked Americans about privacy issues, and it found most citizens want their information protected. (Microsoft)

SPRINT, T-MO'S SPECTRUM JOINT-BID COULD IMPROVE MERGER ODDS: The two companies are planning to bid together on next year's airwave auction, which they think could help them build their case that a powerful alliance would yield more network investment. (Scott Moritz/Olga Kharif, Bloomberg)

FBI: DRIVERLESS CARS COULD BECOME LETHAL WEAPONS: Bad guys can do more bad stuff if they don't have to keep their eyes on the road, the agency said—or they could plant bombs in cars and send them to a destination. (Mark Harris, The Guardian)

THE DAY AHEAD

  • The Senate Finance Committee will hold a hearing on the role of trade and technology in 21st-century manufacturing at 10 a.m.

  • The House Commerce subcommittees on Communications and Technology and Health will hold a hearing on "21st Century Technology for 21st Century Cures" at 9:30 a.m.

  • Georgetown will hold a discussion on "A Regulator's Dilemma: Policy in an Age of Disruption," at 10 a.m.

  • The Software and Information Industry Association will host a briefing on big data at noon.

DON'T MISS TODAY'S TOP STORIES

I read the Tech Edge every morning."

Ashley, Senior Media Associate

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