Want A Box At The Grammies With Two Bigshot Congressmen? That'll Be $5,000 (Entertainment Lobbyists Only)

from the soft-corruption dept

We've talked a lot in the past about the concept of soft corruption. These are the kinds of practices that are most likely legal, and possibly even common among the political class, but which absolutely stink of corruption to the average American. And that's a huge problem, not just because of the general ethical questions raised by such soft corruption, but because it creates a cynical American public that does not trust politicians to adequately represent their interests.

Here's just one example. It appears that a bunch of industry lobbyists have been receiving the following email:

If you can't read it, it says the following:

Subject: Chairman Jeffries Grammy Weekend Feb 8-10

Good afternoon!

Chairman Hakeem Jeffries and Ranking Member Nadler will be splitting a box for the upcoming Grammy Awards Feb 8-10. The room block is at the newly renovated Sheraton Grand Los Angeles, which is a short walk from the Staples Center. To access the invite and registration form, please CLICK HERE

Tickets are $5,000 each. If you need a second ticket then please let me know and I will put you in touch with Yuichi Miyamoto from Ranking Member Nadler's team.

Please let me know as soon as possible if you want to attend since we have a limited number of spots. We also request that you use the room block for the stay.

Thanks again!

The link then takes people to an official invite to hang out with Reps. Jeffries and Nadler at the Grammies. Just $5 grand a pop. They'll even book your hotel for you! What a deal! What a steal!

Jeffries and Nadler are both bigshots in Congress. Jeffries (who originally ran for Congress stating: "Washington is broken. Congress is dysfunctional.... We deserve more") was just elected to be the chair of the Democratic Caucus, which makes him an incredibly powerful Congressman. Nadler is the current "Ranking Member" on the powerful Judciary Committee, and once the new Congress begins, will become the Chair of the Judiciary Committee -- the very committee in Congress that is in charge of copyright law. Nadler has a long history of pushing horrific anti-public copyright bills. Back in 2012, he proposed what I jokingly referred to as the RIAA Bailout Act of 2012, as the entire point of the bill was to drastically increase the rates internet radio would have to pay the record labels. He's also mocked digital rights activists, by calling the idea that "you bought it, you own it" was "an extreme digital view."

So, it certainly does seem notable that both of these Congressional Reps (1) have "a box" at the Grammies and (2) they're actively asking industry lobbyists to give them $5,000 per ticket to hang out with the Congressmen at the Grammies.

Again, some may suggest that this is "how fundraising is done" in Congress (though, frankly, it's usually a bit less blatant). But, even so, is this how it should be done? Doesn't anyone in Jeffries' or Nadler's office think that going to a key recording industry event and asking the industry's biggest companies to pay them $5k to spend some time with them... looks really, really bad? And, relatedly, how the hell can we trust that the various copyright bills that are certain to be under Nadler's control over the next two years (at least) are actually written for the benefit of the public, as per the Constitutional requirement, rather than the benefit of his $5,000 paying "friends" who hang out with him at the biggest celebration of the industry over which Nadler gets to set key rules?

In the past, there have been ethical questions raised by Congressional Representatives hosting fundraisers targeting industries they have jurisdiction over regulating, but these things tend to get swept under the rug in Congress as part of "the way things are done."

But, it certainly stinks of the kind of "soft corruption" that makes the public distrust the government. Indeed, it's the kind of thing that makes people say: "Washington is broken. Congress is dysfunctional.... We deserve more."

Filed Under: congress, copyright, grammies, hakeem jeffries, jerry nadler, lobbying, recording industry, regulators, soft corruption

Legacy Copyright Industries Lobbying Hard For EU Copyright Directive... While Pretending That Only Google Is Lobbying

from the because-of-course dept

Have you heard that all of the opposition to the EU Copyright Directive and its hugely problematic Articles 11 and 13 is really being driven by Google lobbying? Most of you probably realized this was nonsense, but it now turns out that not only was the lobbying almost entirely dominated by the legacy copyright players, but a key plank of their lobbying campaign was to falsely allege that all opposition was just Google.

If you've been paying attention at all to the crazy fights over the EU Copyright Directive, you may have heard some claims being passed around that it's somehow "Google" lobbying heavily against the bill. Indeed, all over Twitter, that's the talking point from tons of EU Copyright Directive supporters. After the EU Parliament put the brakes on the bill back in July, I even saw a former RIAA exec (who has since blocked me on Twitter, so I can't show it to you) tweet that this was a clear perversion of the "will of the people" by Google's corporate lobbying. Of course, it's hilarious for that to come from an ex-RIAA exec, who was heavily involved over the past 3 decades in pushing through all sorts of protectionist, anti-public, anti-musician legislation and trade agreements.

But... it's a talking point. And it's one that lots of people have jumped on. Digital Music News, who is always quick to restate the recording industry's talking points, claimed that Google spent more than $36 million lobbying over Article 13. Billboard Magazine published a similar claim. Various music industry groups, in what appeared to be closely coordinated messaging, all started blaming Google and "the tech giants" for any opposition to the EU Copyright Directive -- which, mind you, would change the fundamental ways in which the internet works. Yet, in their minds, all of the opposition came from the internet giants.

Here's Geoff Taylor from BPI:

The US tech lobby has been using its enormous reach and resources to try to whip up an alarmist campaign...

And here's Richard Ashcroft from PRS for Music:

the Internet giants... have whipped up a social media storm of misinformation about the proposed changes in order to preserve their current advantage.

And how about UK Music's Michael Dugher who really wants to blame Google for everything:

Some absolute rubbish has been written about the EU’s proposed changes on copyright rules.

Amongst the ludicrous suggestions from the likes of Google is the claim that the shake-up will mean the end of memes, remixes and other user-generated content. Some have said that it will mean ‘censorship’ and even wildly predicted it will result in the ‘death of the internet’.

This is desperate and dishonest. Whilst some of the myths are repeated by people who remain blissfully untroubled by the technical but crucially important details of the proposed EU changes, in the worst cases this propaganda is being cynically pedalled by big tech like Google’s YouTube with a huge vested and multi-million-pound interest in this battle.

MEP Axel Voss, who was the EU Parliament Member who lead the charge on the Copyright Directive, and who has long been seen as being in the pocket of the copyright interests, even put out a press release recently blaming the tech giants and their lobbying:

After the vote, rapporteur Axel Voss (EPP, DE) said, “I am very glad that despite the very strong lobbying campaign by the internet giants, there is now a majority in the full house backing the need to protect the principle of fair pay for European creatives.”

There's been a lot more like that. On Twitter, whenever I talk about Article 13, the same crew that has been falsely attacking my views for years immediately start attacking me, claiming that it's all Google lobbying against Article 13.

So... about that. The wonderful site Corporate Europe Observatory, has a very thorough and very in-depth write-up about just who is lobbying on the EU Copyright Directive. And, quite incredibly, it's almost entirely dominated by all of those legacy copyright industries:

Since November 2014 there were 765 declared encounters between lobbyists and the Commission with “copyright” as a subject 1 Over 93% of these were with corporate interests, but the list of main actors might be quite surprising: the lobbyists with the highest access were in fact not big tech, but the collecting societies, creative industries (including big film and music studios) and press publishers.

The most frequently listed names are: IFPI - Representing recording industry worldwide (37 meetings) whose members include Sony Music and Warner Music, followed by the Federation of European Publishers (27) which represents national associations of book publishers, and GESAC - the European lobby for collecting societies (25), whose members include big EU collecting societies such as PRS for Music, the US giant recording label Universal Music Group International (22), and the Society of Audiovisual Authors (22), which represents national collecting societies.

Of the top 20 lobbyists by meetings, only two represented tech interests – Google, ranking number seven, and one of the trade associations it belongs to, DIGITALEUROPE, ranking 18th – while one sole NGO, the independent consumer organisation BEUC, ranked 12th.

The real story is even worse than that. Because I have abundant free time, I went through the file that Corporate Europe Observatory linked to detailing these lobbying meetings, and I went through all 205 entities and added up how many lobbying meetings were held by legacy entertainment interests, tech interests or public interests. Here's the breakdown:

While Corporate Europe Observatory lists 765 meetings, their spreadsheet actually shows 784. Also, there were a few organizations/lobbyists/lawyers where it was not exactly clear who they were lobbying for or on what side of the debate. To be as fair as possible, I simply included all of the ones I was unsure of into the "lobbying for tech" list. So, uh, for all the talk that Google was the one lobbying here, over 80% of the lobbying efforts came from the legacy copyright industries. That's pretty stunning. Of course, it's also disappointing to see that only 6% of the lobbying came from civil society groups. As CEO notes:

The voices of civil society organisations, small platforms, libraries, academics, citizens and even the UN Special Rapporteur on Freedom of Opinion and Expression were the collateral damage of the dispute between competing big business lobbies. Lobbyists and groups with a vested interest dominated the debate, while citizens’ opinions and interests were crowded out of the discussion.

Very depressing. For what it's worth, I included the "small platform" lobbying efforts in the "tech" list above (again, to be as careful as possible), but many of them view this issue even more strongly than Google, and are more focused on the public interest arguments.

Anyway, that chart is just for lobbying the EU Commission. CEO looks at some other available data for lobbying the EU Parliament as well (tragically, not that much info is public), but based on what is public it comes to the same conclusion:

Overall, the limited information which is available about lobby meetings shows the intense level of lobbying taking place on the Copyright Directive, but it also interestingly exposes that the biggest lobbies were not in fact big tech companies and their associates, as many headlines claimed, but the publishers, creative industries and collecting societies.

Incredibly, the narrative that all the lobbying is coming from Google has caused EU regulators to flat out discount complaints from people warning about problems with the proposal, while treating petitions supporting the Directive very differently. For example, the CEO report notes that organizations supporting both sides of the Copyright Directive set up "email your MEP campaigns," but the reaction to them was... let's just say, uneven.

Email your MEP campaigns are a common tool used by civil society organisations who mobilise their communities and supporters to exercise their democratic rights to engage with their elected representatives. Identity verification standards vary according to the tool used, but in this case, it seems that the campaign did not require email verification. That means that technically speaking, people could lie and change their identity in those emails.

De Cock explained that when they started the campaign they did not expect that so many people would participate, and so they themselves were surprised by the strength and impact of the campaign. But even then, can it really be labelled a denial of service attack? Such attacks are generally quite hostile, and aim to shut a website down completely. This is a remarkably different objective from that of an Email Your MEP campaign, which aims to ensure that MEPs are aware that there is popular support for certain causes and issues.

Astoundingly, ALDE MEP Jean Marie Cavada even said in an interview:

“After having analyzed the platform from which all emails come, I realized that it does not require a valid email address from the “users” to send emails. Thus, as sometimes we receive dozens of emails per minute, we can conceive that it is actually robots that send all these emails, which luckily makes this movement lose credibility.”

Many MEPs simply wrote back to the senders to confirm their identity. De Cock, for instance, was then forwarded several of these exchanges between MEPs and their constituents. It seems Mr Cavada did not write back to the people who had contacted him.

It is worth noting that PRS for Music also created a tool to email MEPs in advance of the vote, with the call to action: “PRS Member – Take 90 seconds to influence the vote”. This tool did not even include a return address, and yet there were no claims that these emails were sent by bots. It is interesting that C4C seem to have been criticised simply because of the volume of emails, which arguably simply indicates the level of concern from constituents on the issue. However, both the C4C and PRS can be criticised for the loose use of internet tools to email MEPs.

In other words, because so many more people used the tools to say that they were against Articles 11 and 13, at least some MEPs derided them as fake, while saying nothing about the many fewer people emailing in favor of those articles. Hmm.

Oh, and what about that claim of $36 million spent lobbying by Google all against Article 13. Turns out that that number is also bullshit (and Billboard should really issue a retraction).

That same week, immediately before the JURI committee vote, the UK Music Industry body published a press release stating that “figures show Google’s €31m EU lobbying bid” on copyright. UK Music simply took the entire lobby budget declared by Google in 2017, €6 million, and added to that the budgets of all the organisations and think tanks it is a member of, declaring that the “The combined value of Google’s indirect lobbying of the EU amounts to €25.5m”.

This is a highly problematic and flawed interpretation of the Transparency Register. Google’s entire self-declared lobby budget does make it one of the EU’s highest spending lobby groups. However, only a portion of the declared €6 million would likely be spent on copyright, especially as Google is also fighting several other significant lobby battles in the EU (for example on the anti-trust law cases being brought against Android, digital tax, terrorist content, fake news etc). According to available meeting data, it looks like most of Google's lobby meetings were in fact on issues from the Copyright Directive, so it appears that this is not their priority at the moment.

The €31 million figure also assumes that all the associations and think tanks of which Google is a member focused their entire declared EU lobby spending on copyright in 2017. That would include, for example, BusinessEurope, the EU employers’ lobby, which are not necessarily active on the Copyright Directive, and if they are would only spend a marginal part of their budget on this issue. In most cases these groups (such as Friends of Europe, Konrad Adenauer-Stiftung, Bruegel etc) did little or nothing at all on the Copyright Directive, so these amounts should clearly not be included in the calculations.

Incredibly, CEO reports that much of the lobbying effort... was focused on blaming Google for too much lobbying. No, really.

In the copyright discussion, claims that GAFA, and particularly Google, were behind all opposition to Article 11 and 13 were again a strong message from publishers, and harder to counter. For instance, in the lobby newspaper produced by the news agencies, both the text from AFP’s editor Katz, and the ‘editorial’, mention what they call deceptive lobbying. Katz wrote that the “reform has been fiercely opposed by Facebook and Google, who have campaigned on a complete fabrication: a supposed threat to people’s free access to the internet”. He even declared that “I am convinced that the members of parliament who have been misled by deceptive lobbying now understand that non-paying access to the internet is not at risk.”

So, let's be clear: there are lots of corporate interests at play here, and tragically, the voice of the public is getting drowned out. But if anyone claims that any of this process has been driven by the big tech firms, they are flat out lying. Don't let them get away with it.

Filed Under: article 11, article 13, copyright, eu, eu copyright directive, lobbying, narratives
Companies: google

Cable's Top Lobbyist Again Calls For Heavier Regulation Of Silicon Valley

from the glass-houses-and-all-that dept

After having just successfully convinced the Trump administration to neuter state and federal oversight of lumbering telecom monopolies, those same companies continue their unyielding call for greater regulation of Silicon Valley.

If you've been paying attention, you'll know that Comcast, AT&T, and Verizon's attack on net neutrality rules was just the tip of a massive, dysfunctional iceberg. Those companies have also convinced the Trump administration to effectively neuter FCC authority over ISPs, and are in the process of trying to ban states from protecting consumers from wrongdoing as well (you know, for freedom or whatever). With neither competition nor even tepid meaningful oversight in place, the kind of bad behavior we've long seen from Comcast appears poised to only get worse.

At the same time, top lobbyists for the telecom industry continue to insist it's Silicon Valley giants that are in need of massive regulation. You're to ignore, of course, that these calls are coming just as giants like Verizon, AT&T, and Comcast try to pivot more fully from broadband into online video and advertising, in direct competition with the companies' they're calling to have heavily regulated. Former FCC boss Mike Powell, now the cable industry's top lobbyist over at the NCTA, has been leading this charge for much of the last year or two.

Powell was back last week at an industry event insisting once again that government needs to step in and start heavily regulating the companies Powell's clients are trying to compete with:

"I think there is a fundamental underappreciation in policy circles about the extraordinary power of the platforms and the data that rides on these companies and value of that information both as a competitive advantage as a platform and the potential dangers to consumers. “That has always been a naive concept and one that I think government was entirely inattentive to for too long, only to wake up in 2018 to realize there are some consequences that are not necessarily affirmative."

Powell's of course trying to play up Silicon Valley's admitted and obvious naivete as it pertains to aiding the amplification of propaganda and racist drivel. But at the same time, of course, he's happy to ignore all of the obvious problems caused by his own sector's growing competition issues, which Powell will be happy to tell you don't exist. In fact back in March Powell gave a very similar speech during which he effectively accused Silicon Valley of most of the things the telecom sector has been doing for years:

"Our governmental authorities need to get a handle on what kind of market power and harm flow from companies that have an unassailable hold on large pools of big data, which serve as barriers to entry, allowing them to dominate industries throughout the economy. For years, big tech companies have been extinguishing competitive threats by buying or crushing promising new technologies just as they were emerging. They dominate their core business, and rarely have to foreclose competition by buying their peers. Competition policy must scrutinize more rigorously deals that allow dominant platforms to kill competitive technologies in the cradle."

While it's obvious that Silicon Valley has plenty of problems that need addressing, listening to Powell's advice (read: Comcast's advice) on these subjects is like getting fire safety advice from a serial arsonist. But for whatever reason it's advice that's clearly resonating in the Trump administration, which pretty consistently has called for antitrust inquiries into major Silicon Valley giants while neutering most meaningful consumer protections (from privacy to net neutrality) governing some of the most clearly anti-competitive and unpopular companies in all of American industry.

Filed Under: cable, competition, lobbying, michael powell, regulations, silicon valley
Companies: at&t, comcast, facebook, google, verizon

AT&T's Top Anti-Net Neutrality Lobbyist In California Doesn't Register As A Lobbyist

from the funny-how-that-works dept

We've noted for years how U.S. lobbying laws and restrictions are essentially hot garbage, and are routinely laughed at by some of the country's largest corporations. The legal DC definition of a lobbyist was beefed up slightly back in 2007, when the Lobbyist Disclosure Act was notably amended by the Leadership and Open Government Act of 2007. Those changes required that if an employee spends more than 20% of their time lobbying, they have to register with the government as a lobbyist, detail their travel with lawmakers, and more fully outline their contributions to politicians and their myriad foundations.

But many lobbyists responded to those changes by just changing their title or calling their lobbying... something else. We've examined, for example, how Comcast's top lobbyist David Cohen shifted his title to "Chief Diversity Officer" in order to skirt around that 20% restriction. Cohen often can frequently be seen holding press junkets heralding Comcast's altruism because it offered some discounted broadband connections to the poor to get its NBC Universal merger approved. But the lion's share of Cohen's time is spent lobbying local lawmakers during these junkets.

Comcast, it's worth noting, gets really mad when you point this out.

State lobbying restrictions, as you might imagine, aren't much better. Another lobbying juggernaut in the telecom space, AT&T, has also found itself under fire for lobbyists who pretend not to be lobbyists. The company's top lobbyist in California, Vice President of Legislative Affairs Bill Devine, has never registered as a lobbyist under California law. Devine has spent a lot of time lately lobbying to kill efforts in California to pass net neutrality law (you know, for freedom!), without adhering to lobbying requirements:

"By not registering as a lobbyist, Devine can take advantage of political influence techniques that registered lobbyists are banned from under California laws. The Political Reform Act of 1974 requires registered lobbyists to disclose their lobbying activity expenses to the state. It also bans them from giving gifts worth more than $10 to state, legislative and agency officials. Under Proposition 34, enacted in 2000, registered lobbyists are also banned from making campaign contributions."

Devine's lobbying lambada was noticed courtesy of an anonymous complaint filed with the California Fair Political Practices Commission (FPPC):

"William H. Devine, an AT&T Vice President, unlawfully fails to register as a lobbyist, despite spending the majority of his time in the Capitol Building talking to lawmakers and staff in order to influence legislation. It is an open secret in the Capitol building that Mr. Devine is an undeclared AT&T lobbyist."

"Mr. Devine hides his lobbyist status by setting up meetings under other AT&T employee and lobbyist names,” the complaint alleges. “In particular, Mr. Devine has recently been lobbying legislators on SB 822 and SB 460. On information and belief, Mr. Devine attended numerous meetings with other AT&T lobbyists, employees and grant beneficiaries, including, but not limited to, employees of CalInnovates (paid by AT&T to work against SB 822/SB 460) and a researcher paid by CalInnovate, David Sosa. He may also have accompanied Mark Kleeman, a fellow at University of California – San Diego."

This isn't really complicated. Devine has been paid $117,000 so far this biennial legislative session by AT&T for lobbying-related activities, most notably related to AT&T's lobbying against the state's two net neutrality laws, SB 822 and SB 460. He coordinates routinely with other AT&T lobbyists, and works hand in hand with the various policy groups, think tankers and consultants AT&T uses as proxies for its messaging, including that outfit that was just busted trying to scare grandmothers away from net neutrality via misleading robocalls.

The FPPC has given Devine 14 days to respond to the complaint. But if history is any indication, it's likely no punishment will materialize. Because despite our collective, bipartisan chirping about how grotesque American lobbying and corruption is, these sort of things tend to float in one ear and out the other of the collective American consciousness. It's also kind of hard to improve state and national lobbying rules, when you've got an ocean of lobbyists consultants, think tankers, chief diversity officers, liaisons, and others lobbying courageously striving to keep that from happening.

Filed Under: bill devine, california, lobbying, politics, registration
Companies: at&t

AT&T Cans Exec Over Cohen Payment Kerfuffle, Pretends This Kind Of Influence Peddling Isn't Perfectly Routine

from the whoops-a-daisy dept

As you've probably seen, AT&T was recently exposed for paying $600,000 into a shady shell LLC operated by President Trump's "fixer" Michael Cohen. Initially, AT&T tried to claim that the company had simply hired Cohen for "insight" into President Trump. Given AT&T could easily gain said insight into Trump from any number of its lawyers, lobbyists, and above-board consultants (not to mention the ocean of politicians and regulators in its back pocket), the idea they'd pay a dubious NYC "fixer" for such insight never really carried much weight.

It seems fairly obvious at this point that AT&T was probably paying Cohen for additional access to the President. A leaked document provided to the Washington Post makes it clear that AT&T hoped to gain some advantage in its business before the FCC (net neutrality, privacy, protectionism, protecting its monopoly power), and its efforts to gain regulatory approval for the company's $86 billion Time Warner merger:

"A “scope of work” describing Cohen’s contract in an internal AT&T document shows that he was hired to “focus on specific long-term planning initiatives as well as the immediate issue of corporate tax reform and the acquisition of Time Warner.”

He was also directed to “creatively address political and communications issues” facing the company and advise the company on matters before the Federal Communications Commission."

There's every indication that this additional attention may have paid monumental dividends.

While the Trump DOJ did sue to block AT&T's merger (DOJ antitrust chief Makan Delrahim wandering off script to actually defend antitrust law), the repeal of net neutrality and broadband privacy rules was a smashing success. AT&T has also had great success in its efforts to force NAFTA "reform" making it easier for AT&T to expand into the Mexican wireless market. And AT&T's luck has been stellar at the FCC, where the Commission majority (the makeup of which was dictated by AT&T lobbying) has rubber stamped AT&T's every desire, including the protection of its business broadband monopoly.

As the scandal has grown, AT&T CEO Randall Stephenson was forced to admit the error of his ways in an e-mail to AT&T employees. Stephenson admitted the payments to Cohen were a mistake, but tried his best to pretend that this wasn't routine behavior for AT&T:

"To be clear, everything we did was done according to the law and entirely legitimate. But the fact is, our past association with Cohen was a serious misjudgment. In this instance, our Washington D.C. team’s vetting process clearly failed, and I take responsibility for that.

As somebody who has covered AT&T for decades now, I can assure you this Cohen payment is just a tiny portion of the greasy influence peddling AT&T engages in on a daily basis. The idea that this behavior wasn't perfectly in line with AT&T's "values" is laughable. And in a country where flimsy lobbying disclosure requirements are routinely tap danced around, trying to claim that this was all above board because you didn't violate any laws is akin to claiming you're an expert high jumper because you cleared a bar one inch off the damn ground.

And despite the payment being well in line with AT&T's behavior, the company decided to throw top lobbying and policy man Bob Quinn under the bus as penance for its sins:

"For the foreseeable future, the External & Legislative Affairs (E&LA) group will report to our General Counsel David McAtee. Bob Quinn, Senior Executive Vice President – E&LA, will be retiring. David’s number one priority is to ensure every one of the individuals and firms we use in the political arena are people who share our high standards and who we would be proud to have associated with AT&T."

Bob Quinn had been on the job for less than two years after the retirement of former top lobbying and policy man Bob Cicconi. You may recall Quinn from such hits as AT&T's laughable efforts to pretend it supports net neutrality while simultaneously spending millions to dismantle popular federal net neutrality protections. And again, while paying Cohen to gain access to the President is certainly shady, it's well in line with AT&T's behavior over the last several decades. The question then becomes: will anybody actually do anything about any of it?

AT&T's a shining example of how "creative" influence peddling has infected this country down to its marrow. From co-opting minority groups and creating fake consumer groups to undermine productive proposals, to using think tanks, hired consultants and academics to spread disinformation, testify as "objective" experts and write Op-Eds where financial ties are rarely disclosed, there's a universe of influence peddling and lobbying AT&T routinely engages in that existing U.S. laws don't even operate in the same dimension on.

America has, time and time again, made it abundantly clear that this kind of influence peddling, lobbying and disinformation is not just perfectly legal, it's the norm. So whether this latest scandal results in substantive change or is just brushed aside as a one-off instance of bad judgement by just a few otherwise innocent companies will be interesting to see.

Filed Under: antitrust, bob quinn, donald trump, influence peddling, lobbying, michael cohen, randall stephenson
Companies: at&t, essential consultants

T-Mobile Hires Ex-FCC Commissioner To Claim Its Competition-Killing Merger Will Be Really Great For...Farmers

from the synergies,-yo dept

As we've discussed, the looming Sprint T-Mobile merger is going to be decidedly ugly for American consumers. Global history has shown repeatedly that when you reduce the number of total competitors from four to three, you proportionally reduce any incentive to truly compete on price. Analysts have also predicted that anywhere between 10,000 and 30,000 retail, management, and administrative employees will lose their jobs as the bigger company inevitably eliminates redundant positions. Of course like any American merger, the two companies' CEOs have spent much of the last week trying to claim the exact opposite.

Still, it's going to be an uphill climb for Sprint and T-Mobile to sell regulators on the deal, even for an administration that seems to take pride in undermining consumers and small businesses. To try and sell it, Sprint and T-Mobile have been trying to make the claim that the only way to ensure we have the fifth-generation (5G) networks of tomorrow is if we sign off on their competition-eroding megamerger:

"It is critically important that America and American companies lead in the 5G era. Early U.S. leadership in 4G fueled a wave of American innovation and entrepreneurship that gave rise to today’s global mobile Internet leaders, creating billions in economic value and job growth. America’s early 4G leadership is credited with creating 1.5 million jobs and adding billions to the U.S. GDP. With 5G, the stakes are even higher – because 5G will be even more transformational."

This plays in handily to the Trump administrations protectionist efforts to ban Chinese companies from the American market in order to "win the 5G race." The problem is that 5G isn't some magic wand. While it will provide us with faster, lower latency and more resilient wireless networks, it's not going to magically cure the fact that American broadband is ranked somewhere around 62nd in speed, and consumers pay some of the highest rates for mobile data in the developed world thanks to a telco monopoly over the fiber lines that feed cellular towers.

Both T-Mobile and Sprint had been making it clear for months that they could deploy 5G easily and independently of each other. Suddenly we're being told that these next-gen networks are only made possible if we sign off on a deal history tells us will be arguably terrible for anybody other than AT&T, Verizon and SprinT-Mobile, who'll all have less motivation to engage in real price competition post merger.

To try and sell this "only merging can deliver next-gen networks" argument, T-Mobile this week hired former FCC Commissioner Robert McDowell to make the same point in an op/ed over at Fortune:

"The T-Mobile-Sprint merger will benefit our country and all Americans. From a farmer in Nebraska using 5G technology to better track crop conditions, to a small business owner in New Hampshire looking to sell products in the global marketplace, to a smart city with autonomous vehicles, all of us will depend on 5G. We can’t afford to lose the global race to develop this remarkable technology."

In the piece's fine print you'll find that McDowell is now a paid T-Mobile advisor, which is a nice shift from outlets that can't be bothered to highlight op/ed author financial ties to industry. Again though, there's nothing "magical" about 5G that helps create smart cities, next-gen agricultural tools, and the automated cars of tomorrow. Those technologies can still thrive on 4G networks, and again, while 5G is going to provide some notable evolutionary improvements, it's not some kind of mystical panacea, and its impacts on our overall economy are being absurdly over-hyped by companies eager to sell networking hardware.

There's numerous problems in the wireless sector that will persist throughout the "5G revolution," none of which get magically eliminated by reducing competition and killing tens of thousands of jobs. The merger doesn't magically fix AT&T and Verizon's backhaul monopoly. It doesn't address the fact that Americans pay more for wireless data that countless other developed nations. And it certainly doesn't solve the problem of regulatory capture, which is why American broadband (fixed or wireless) tends to be such a comical shitshow in the first place.

Filed Under: 5g, competition, farmers, fcc, lobbying, mergers, robert mcdowell
Companies: sprint, t-mobile

Comcast-Owned MSNBC Blasted For 8 Minute 'News' Love Letter to Comcast

from the fluff-and-nonsense dept

Comcast-owned MSNBC this week took a bit of a beating for an eight-minute "news" segment that was effectively little more than a sappy love letter to their parent company. The segment featured top Comcast lobbyist David Cohen, who years ago began calling himself the company's "Chief Diversity Officer" to tap dance around federal lobbying rules (Comcast yells at us whenever we point that out). The program, aired during the company's Morning Joe program, waxed poetic about Comcast's altruism, at one point using Al Sharpton to compare Comcast’s corporate volunteerism with Nelson Mandela’s lifetime of civil rights work:

Several news outlets were quick to point out this glorified Comcast ad also saw prominent air time from numerous other Comcast-owned media properties, once again highlighting the perils of mindless media consolidation:

"But MSNBC wasn’t alone in covering Comcast Cares Day. NBC affiliates across the nation “pitched in.” NBC Bay Area, for example, ran a PR–sounding segment that was a lot like all of the other ones. So did NBC 5 in Fort Worth, TX, NBC 10 in Philadelphia, NBC 4 in Los Angeles, NBC 5 in Chicago, and NBC Connecticut, to name a few. Other media outlets joined in, including ABC’s WTXL in Tallahassee, FL, The Denver Post, and The Tennessean, among others."

Those of us that track Comcast for a living have been highlighting Cohen and Comcast's disingenuous behavior on this front for several years now. While Comcast volunteer programs certainly can and do help people in some limited capacities, Cohen has perfected the act of using Comcast's minority and low-income advocacy as a grotesque lobbying weapon to perpetuate policies that actively harm the communities Comcast professes to be helping.

For example, Comcast routinely pays some less ethical minority advocacy groups to parrot policies that actively harm their constituents, whether that's supporting the death of net neutrality, the company's latest megamerger, or the elimination of privacy protections for consumers. And Jesse Jackson has been used on occasion to actively oppose things like more cable box competition. This cozy quid pro quo is never put explicitly in writing, letting Cohen and friends become breathlessly indignant when reporters point out the disingenuous, cash-compromised nature of these relationships.

It's a schtick larger media outlets are comically (perhaps intentionally) oblivious to, but one that has been immeasurably successful for Comcast and Cohen.

Cohen played the starring role in selling regulators on Comcast's acquisition of NBC Universal in 2011, crafting conditions it would later be discovered Comcast ignored at its leisure. Cohen's secret weapon during that transaction was Internet Essentials, a program that promised low-income households $10, 5 Mbps broadband for a limited time should they jump through a laundry list of conditions. The program was frequently criticized for being intentionally hard to qualify for, though it provided Cohen an endless sea of photo opportunities to help portray Comcast as a bottomless well of pure altruism.

Cohen's minority and low-income advocacy schtick was so effective, he ultimately nabbed the title of "Chief Diversity Officer" to help further advertise his selfless altruism. Of course that title also conveniently lets Cohen tap dance around flimsy federal lobbying rules, which require an employee register as a lobbyist if they spend more than 20% of their time lobbying for a single client during any three-month span. And again, when you point this out, I've found that Comcast tends to get really upset with you.

The reality is that Comcast would need to do a hell of a lot more volunteering and donating to counter the obvious harm most of the company's terrible policies have on the country. It's indisputable that the company's attacks on net neutrality and privacy protections will drive up costs and harm diverse media outlets and smaller businesses. Comcast's support of protectionist state laws also routinely undermine efforts to bring competition to under-served broadband markets, driving up costs for everybody in the internet ecosystem (but especially the downtrodden parts of the country Comcast professes to adore).

This is a company that has proven time and time again that it doesn't have your best interests at heart. But thanks to American M&A mania and our collective obliviousness to disinformation, the pretense that Comcast is a Robin-Hood-esque champion of the poor and downtrodden has proven immeasurably successful and profitable for what's arguably the least liked company in America.

Filed Under: al sharpton, altruism, corporate media, david cohen, lobbying, msnbc, nbc
Companies: comcast, msnbc, nbc

Ex-Obama FTC Boss Now Lobbying For Comcast, Trying To Prevent States From Protecting Consumers

from the revolving-door-regulation dept

While the Trump FCC has certainly taken protectionism, corruption and cronyism to an entirely new level, it's important not to forget that Trump and Ajit Pai are just products of the country's long established bipartisan dysfunction when it comes to revolving door regulators, and it's going to take more than just ejecting Trump and Pai to repair the underlying rot that has allowed them to blossom.

Case in point: former Obama FTC boss Jon Leibowitz, who has long professed himself to be a "privacy advocate," has spent much of the last few years lobbying for Comcast while at Davis Polk. That has included making a myriad of false claims about ongoing, EFF-backed efforts to protect broadband consumer privacy in California.

In an endless wave of op-eds (where his financial conflicts of interest are almost never disclosed to the reader), Leibowitz has been busy insisting that rampant ISP privacy abuses are a "nonexistent problem," and that strong state and FCC oversight of ISPs are unnecessary because the FTC will somehow rush in to save the day in the wake of efforts to neuter the FCC, kill net neutrality, and embolden massive anti-competitive telecom duopolies.

We've already outlined in detail why that's a horrible take here. More specifically, the FTC lacks rule-making authority, and can only act against ISPs if behavior is clearly proven to be "unfair and deceptive," something ISPs can usually wiggle out of on the net neutrality front (we weren't throttling a competitor, we were protecting the safety and integrity of the network!). The FTC's also understaffed, under-funded, and over-extended. And oh, did we mention that AT&T has been busy in court trying to obliterate whatever authority over ISPs the FTC does have?

Leibowitz (like most ISP lobbyists pretending to be objective analysts) "forgets" to mention that.

With more than half the states in the nation now considering some flavor of net neutrality and privacy rules in the wake of federal apathy, Leibowitz is also busy trying to help Comcast scuttle privacy and net neutrality in other states like Massachusetts. Massachusetts, with the backing of dozens of lawmakers, is contemplating new net neutrality rules that would effectively mirror the ones Comcast lobbied the FCC To dismantle last December.

Leibowitz's oppositional testimony this week in front of state leaders included claims that net neutrality somehow hampered broadband industry investment, an ISP-lobbying claim routinely debunked by just looking at ISP earnings reports, SEC filings, and countless CEO statements:

"According to his prepared testimony for a hearing before the Joint Committee on Telecommunications, Utilities, Leibowitz said he recognized "the sky did not fall" when the FCC, during the Obama Administration, reclassified ISPs as Title II common carriers. But he said that reclassification did have costs to consumers, including diminished deployment of broadband, according to the FCC, as well as removing broadband consumer protection from the FTC's jurisdiction."

Again that diminished deployment never happened. ISP CEOs admit as much. Meanwhile, the "sky did not fall" because the FCC's 2015 net neutrality rules haven't even technically been repealed yet (that's expected to occur sometime in April). Even then, ISPs aren't expected to truly even start testing their newfound anti-competitive freedoms until they're sure the FCC (with ISP help) wins their looming legal battle. Even then ISPs may not truly be comfortable behaving badly until they're sure tougher state and federal rules are pre-empted (that's why they're pushing for a fake, loophole-filled net neutrality law.)

Knowing that states might fill the consumer protection vacuum, both Verizon and Comcast lobbied the Trump FCC to include language in their net neutrality repeal trying to ban states from protecting consumers (from net neutrality or privacy violations). And while Leibowitz tried to warn Massachusetts leaders that they might run afoul of the Trump FCC if they try to protect consumers (oh no!), that ignores the fact that legal experts say the FCC abdicated its authority on this front when they decided to back away from classifying ISPs as common carriers.

Again, dozens of individual state privacy and net neutrality protections aren't ideal, but that's something Leibowitz's client Comcast should have thought about before lobbying to demolish popular and modest federal level privacy and net neutrality protections. The fact that ISP lobbyists still cling to false claims that net neutrality "demolished sector investment" speaks volumes as to the integrity of their arguments. Meanwhile, at some point media outlets in the States need to wake the hell up to the harm caused by publishing lobbyist op-eds without disclosing authors' financial ties to industries they represent.

Filed Under: broadband, california, competition, ftc, jon leibowitz, lobbying, massachusetts, net neutrality, privacy
Companies: comcast