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Tech Brief: The EU Contemplates Another Record Fine Against Google

Washington Brief

  • The Trump administration filed an application with a European Union court in support of Apple Inc.’s appeal of an EU order that the company pay $14.8 billion in back taxes. The European Union ruled last year that Apple had received illegal tax benefits from Ireland and ordered the company to pay back the taxes. (The Hill)
  • Jerry Ellig, a senior fellow at the Mercatus Center at George Mason University in Fairfax, Va., has been named the new chief economist for the Federal Communications Commission. Among Ellig’s first tasks will be establishing the Office of Economics and Data, an initiative first announced by FCC Chairman Ajit Pai in April that will provide input on rulemakings, transactions and data management for the commission. (Broadcasting and Cable)
  • Democratic and Republican lawmakers expressed concerns about finances at the U.S. Census Bureau as the federal agency works to undertake a far-reaching IT modernization initiative with the goal of saving $5 billion on the 2020 census. Members of the House and Senate wrote to the agency and the Trump administration citing unreliable cost estimates, management and staffing concerns and the implementation of new tech programs. (FCW)

Business Brief

  • Antitrust regulators with the European Union have appointed a panel of experts to provide a second opinion on their case against Google Inc.’s Android mobile operating system. The European Commission charged Google last month with a record $2.7 billion penalty for favoring its shopping services over those of its competitors, but the fine for the Android case could be even larger. (Reuters)
  • European Parliament approved recommendations for tech companies to make electronic devices like cellphones and laptops easier to fix, including a provision creating a European Union-wide definition on the practice of “planned obsolescence.” The European Commission has yet to decide when the recommendations will be put to a final vote. (Vice News)
  • An examination of New York Uber Inc. drivers’ receipts found that the company may have deducted hundreds of millions of dollars in excessive commissions from fares to pay state taxes that are technically due from passengers. Uber admitted earlier this year to shortchanging its New York drivers and pledged to make changes. (The New York Times)

Chart Review

Events Calendar (All Times Local)

Thursday
Milwaukee Tech-Security Conference 8:15 a.m.
US-China Green Energy Council event on smart grid tech 2 p.m.
RobotX Space event on self-driving robots 6 p.m.
Friday
Net neutrality town hall featuring FCC Commissioner Mignon Clyburn 2 p.m.

 

General

Trump administration backs Apple’s appeal of EU tax case
Harper Neidig, The Hill

The Trump administration is backing Apple’s appeal of a European Union order that it pay $14.8 billion in back taxes to Ireland. The U.S. has filed an application with an EU court to support Apple’s appeal, according to a source familiar with the matter.

Lawmakers press on Census finances and leadership
Chase Gunter, FCW

Congressional watchdogs from both sides of the aisle are concerned about finances at the Census Bureau and want to see an updated cost estimate to reflect potential cost overruns.The bureau is undertaking a wide-ranging modernization of its technology and methodology with the goal of saving about $5 billion on the 2020 census, compared to repeating the 2010 approach.

How Uber’s Tax Calculation May Have Cost Drivers Hundreds of Millions
Noam Scheiber, The New York Times

Amid the turmoil at Uber that resulted in Travis Kalanick’s stepping down as chief executive, the company announced a series of changes in late June aimed at improving its drivers’ work experience, including a new tipping option in its passenger app. But even as Uber makes a concerted effort to win over drivers, it has not acknowledged all the ways it may have squeezed them in New York State.

Why the Robot Takeover of the Economy Is Proceeding Slowly
Craig Torres, Bloomberg News

Vik Singh’s company has powerful artificial intelligence software that helps firms hunt down the best sales leads. Getting somebody to use it — well, that’s a story that says a lot about the U.S. expansion.

European Bonds and Stocks Slump; Oil Rises on Data: Markets Wrap
Samuel Potter, Bloomberg News

European government bonds slumped as concerns over demand for new securities lent momentum to a selloff. Stocks in the region followed suit, and oil clawed back some of its biggest loss in four weeks.

Intellectual Property and Antitrust

Exclusive: EU asks expert panel to check Google Android case – sources
Foo Yun Chee, Reuters

EU antitrust regulators have appointed a panel of experts to give a second opinion on their case against Google’s Android mobile operating system, two people familiar with the matter said, as they weigh another record fine against the company. Assuming the panel agrees with the initial case team’s conclusions, it could pave the way for the European Commission to issue a decision against Google by the end of the year.

Google’s Record Fine Is Only the Start From the EU
Aoife White and Stephanie Bodoni, Bloomberg News

Google could see more fines from European Union antitrust regulators this year as probes into its AdSense advertising service and Android mobile-phone software near their end, three people familiar with the cases said just a week after the company was hit with a record penalty for its shopping-search services.Both are at advanced stages, though the Android case may not be concluded until later this year, according to one of the people, who all spoke on condition of anonymity.

Telecom, Wireless and TV

FCC Names Jerry Ellig Chief Economist
John Eggerton, Broadcasting and Cable

Jerry Ellig has been named chief economist for the FCC. “Dr. Ellig’s record of distinguished scholarship and prior government service makes him the right person for this job,” said FCC chairman Ajit Pai.

Cox expands home Internet data caps, while CenturyLink abandons them
Jon Brodkin, Ars Technica

There’s good news and bad news on data caps for home Internet users. Cox, the third largest US cable company, last week started charging overage fees to customers in four more states.

U.S. broadcast M&A nears $4.5B in Q2, thanks largely to Sinclair
Ben Munson, FierceCable

U.S. broadcast M&A totaled $4.47 billion during the second quarter of 2017, according to estimates from Kagan, a group within S&P Global Market Intelligence. TV deals accounted for $4.22 billion of the total, and Sinclair Broadcast Group, through two deals, was the biggest contributor to the M&A activity.

Mobile Technology and Social Media

The European Parliament Wants Europeans to Have the Right to Repair
Louise Matsakis, Vice News

It might soon be easier than ever to fix your devices, at least in Europe. On Tuesday, the members of the European Parliament approved recommendations for hardware companies to make stuff like laptops and cell phones easier to fix, as well as have longer lifespans.

Tesla delivered 47,000 vehicles so far this year, barely meeting its goal
Johana Bhuiyan, Recode

Tesla delivered 22,000 vehicles in the second quarter of 2017, bringing its total deliveries for the first half of the year to 47,100. That’s the low end of its original estimate for the first half of this year.

Volvo, Betting on Electric, Moves to Phase Out Conventional Engines
Jack Ewing, The New York Times

Volvo Cars became the first mainstream automaker to sound the death knell of the internal combustion engine, saying on Wednesday that all the models it introduces from 2019 will be either hybrids or powered solely by batteries. The decision is the boldest commitment by any major car company to technologies that currently represent a small share of the total vehicle market, but that are increasingly viewed as essential to combating climate change and urban pollution.

Lyft is now completing one million rides a day
Megan Rose Dickey, TechCrunch

Lyft, which is only available in the U.S., just announced it’s hit one million rides a day. Uber announced one million rides worldwide in December 2014.

Cybersecurity and Privacy

U.N. survey finds cybersecurity gaps everywhere except Singapore
Tom Miles, Reuters

Singapore has a near-perfect approach to cybersecurity, but many other rich countries have holes in their defenses and some poorer countries are showing them how it should be done, a U.N. survey showed on Wednesday. Wealth breeds cybercrime, but it does not automatically generate cybersecurity, so governments need to make sure they are prepared, the survey by the U.N. International Telecommunication Union (ITU) said.

Ukraine scrambles to contain new cyber threat after ‘NotPetya’ attack
Jack Stubbs and Matthias Williams, Reuters

The Ukrainian software firm used to launch last week’s global cyber attack warned on Wednesday that all computers sharing a network with its infected accounting software had been compromised by hackers. The attack used a virus, dubbed “NotPetya” by some experts, to take down thousands of computers in dozens of countries, disrupting shipping and businesses.

Latest ransomware twist: a demand for $250,000
Michelle Meyers, CNET

A hacking group linked to last week’s ransomware attack that locked up devices at multibillion-dollar companies has reportedly made its first public statement, demanding about $250,000 in exchange for a private encryption key used in the attack. In ransom note published on the dark web Tuesday and first spotted by Motherboard, the group ostensibly behind the NotPetya malware, also referred to as GoldenEye, demanded a payment of 100 bitcoin in exchange for a key that it says could decrypt any file locked by the malware.

Opinions, Editorials and Perspectives

Cities Need Data From Uber and Lyft
The Editors, Bloomberg News

With the ouster of Travis Kalanick, its founder and chief executive, Uber has vowed to mend an array of broken and frayed relationships. It can start with cities.

Has Twitter made everyone dumb, or does it just expose them?
Nicole Russell, Washington Examiner

Like the question of the chicken and the egg, it’s now fair to ask: Is Twitter making people dumb? Or were people dumb before Twitter and this particular Internet vehicle just happens to reveal this fact?

The iPad Is About to Get More Useful—and Confusing
Geoffrey A. Fowler, The Wall Street Journal

What my iPad could use is a good mouse. I’m only half joking.

Research Reports

Why Expanding the R&D Tax Credit Is Key to Successful Corporate Tax Reform
Information Technology and Innovation Foundation

The United States has not overhauled its tax code since 1986. Since then, increased global competition has led other countries and U.S. states to lower their corporate tax rates while also introducing or expanding incentives to encourage investment and production.