Tech Brief: Intel Report Includes Unsubstantiated Allegations That Russia Has Compromising Info on Trump

Washington Brief

  • Intelligence officials presented classified documents to President Barack Obama and President-elect Donald Trump showing that Russian operatives say they have compromising personal and financial information about Trump. The unverified allegations were presented last week with the intelligence report on Russian cyber operations aimed at disrupting the 2016 U.S. presidential election. (CNN)
  • Alibaba Founder Jack Ma’s meeting with Trump, where he promised to create American jobs by selling American products through his e-commerce platforms, comes as federal regulators have raised concerns about the company’s part in undermining U.S. industry by failing to crack down on the sale of fake goods. (The Wall Street Journal)
  • Executives at the advertising website refused to testify before the Senate Permanent Subcommittee on Investigations following the panel’s report alleging the website consistently edited its “adult” ads to remove words that indicate sex trafficking. The hearing followed a report from the subcommittee accusing Backpage of making child sex trafficking easier. (The Associated Press)

Business Brief

  • David Plouffe, a policy adviser for Uber Technologies Inc. who previously worked as an Obama campaign adviser, will be president of policy and advocacy for the philanthropy group formed by Facebook Chief Executive Mark Zuckerberg and his wife Priscilla Chan. Plouffe will remain on Uber’s board of directors. (Recode)
  • The Federal Reserve and the Office of the Comptroller of the Currency criticized several Wall Street banks, including Morgan Stanley, over the handling of a $1.15 billion loan they helped arrange for Uber last year. (Reuters)
  • Privacy rules proposed by the European Commission would allow media companies to ban customers who use ad blockers. (Financial Times)

Chart Review

Events Calendar (All Times Local)

Open Technology Institute event on internet freedom 9:30 a.m.
Reps. Hultgren, Luján speak at event on tech R&D 10 a.m.
Senate Commerce Committee nomination hearing for Elaine Chao to lead Transportation Dept. 10:15 a.m.
Atlantic Council event on a nonstate strategy for cybersecurity 3:30 p.m.
FTC hosts PrivacyCon 9 a.m.
Rep. Pompeo testifies at Senate Intelligence Committee nomination hearing for CIA post 10 a.m.
Brookings event on privacy 10 a.m.
FCC Chairman Wheeler speaks at Aspen Institute event 11 a.m.



Former Obama campaign adviser David Plouffe is joining Mark Zuckerberg’s philanthropy team
Kurt Wagner and Johana Bhuiyan, Recode

Mark Zuckerberg and his wife, Priscilla Chan, plan to give away virtually all of their wealth. Now they’re taking steps to ensure that the issues they invest in — curing diseases and pushing for more personalized learning, among others — won’t hit political roadblocks along the way.

Trump’s Meeting With Jack Ma Comes as U.S. Keeps Eye on Alibaba
Kathy Chu, The Wall Street Journal

A pledge by Jack Ma, the billionaire founder of Alibaba Group Holding Ltd., to create American jobs by selling U.S. goods through his e-commerce platforms comes weeks after Washington’s trade adviser identified the Chinese company as undermining U.S. industry by failing to stamp out sales of fake goods. During a meeting with President-elect Donald Trump in New York on Monday, Mr. Ma discussed efforts to add a million U.S. businesses to Alibaba’s online-shopping platforms.

Backpage Execs Refuse to Testify at Sex-Trafficking Hearing
Matthew Daly, The Associated Press

Executives at the advertising website refused to testify before Congress Tuesday following a Senate report that accuses the site of systematically editing its “adult” ads to remove words that indicate sex trafficking. Four top executives and the company’s lawyer told a Senate subcommittee they were invoking their Fifth Amendment rights against self-incrimination.

Senate delays confirmation hearing for Wilbur Ross due to lack of ethics paperwork
Kimberly Alters, The Week

The Senate Committee on Commerce, Science, and Transportation announced Tuesday that it would postpone its confirmation hearing for Wilbur Ross, President-elect Donald Trump’s nominee for commerce secretary. The hearing, originally scheduled for Thursday morning, will now take place on Wednesday, Jan. 18.

Hatch could be unlikely tech ally in Trump administration
Ashley Gold, Politico

The youth-obsessed tech industry may have an unlikely ally in Donald Trump’s Washington: octogenarian Sen. Orrin Hatch. The Utah Republican, 82, says he stands ready to advance issues like encryption and increasing the amount of visas for the high-skilled workers that help power places like Silicon Valley and Utah’s own “Silicon Slopes.”

Ellen Pao Returns to Venture Capital After Gender-Discrimination Fight
Ellen Huet, Bloomberg News

Ellen Pao, whose 2012 lawsuit against her former venture capital firm sparked a debate about gender equality in Silicon Valley, is returning to the world of startup financing. Pao will become an investing partner at Kapor Capital, an Oakland, California, VC firm that lists Uber Technologies Inc. and Alphabet Inc.’s Dropcam among its investments.

Google in Talks to Sell Its Satellite Business
Rolfe Winkler and Jack Nicas, The Wall Street Journal

Alphabet Inc.’s Google is in talks to sell its satellite business to competitor Planet Labs Inc., a satellite-imagery startup that is seeking a new round of funding to help pay for the possible acquisition, according to people familiar with the talks. The sale of its satellite-imagery unit, Terra Bella, would be a rapid about-face for Google, which has recently shed some of its bolder ventures.

SoftBank’s $100 Billion Investment Fund Starts to Take Shape
Landon Thomas Jr., The New York Times

Many business titans have made the trek to Trump Tower for a private audience with Donald J. Trump since he was elected president, but none have made a bigger splash than Masayoshi Son, the billionaire telecommunications entrepreneur. “Ladies and gentlemen, this is Masa of SoftBank of Japan and he has just agreed to invest $50 billion in the U.S. and 50,000 jobs,” Mr. Trump said, wrapping an arm around the beaming Mr. Son last month.

Some Tech Companies Are Trying Affirmative Action Hiring—But Don’t Call It That
Ellen Huet, Bloomberg News

Tracy Chou wrote a post on Medium in October 2013, challenging tech companies to tell the world what percentage of their software engineers were women. Surprisingly, it worked: Google, Apple, Facebook and others published their lopsided race and gender statistics, and Chou, then a Pinterest software engineer, became a face of the tech diversity movement.

Dollar Gains Before Trump as Oil Rises on OPEC Cut: Markets Wrap
Cecile Gutscher and Emma O’Brien, Bloomberg News

The Stoxx Europe 600 Index added 0.2 percent while the U.K.’s FTSE 100 Index rose 0.1 percent, climbing for a 12th day. If the move holds, it would be the gauge’s longest rising streak on record. S&P 500 Index futures edged higher, reversing declines over the week’s first two days.

Intellectual Property

New Apple Patent Shows How That Edge-to-Edge Display Could Work
Christina Warren, Gizmodo

On Tuesday, the US Patent and Trademark Office on Tuesday granted Apple a patent that gives credence to those rumors of an edge-to-edge OLED iPhone. For years, users have longed for a phone that’s totally made up of a screen—no bullshit bezel needed—and this looks like one way it could happen.

Telecom, Wireless and TV

House Passes Bills on Small ISP Exemption, Data Efficiency
Brendan Bordelon, Morning Consult

The House passed two bills on unanimous voice votes Tuesday — one that would waive certain transparency requirements for small internet service providers and one that encourages data efficiency in the federal government. H.R. 288, or the Small Business Broadband Deployment Act, would exempt ISPs with fewer than 250,000 subscribers from transparency requirements that were mandated under the Federal Communications Commission’s controversial Open Internet order.

FCC Targets Jan. 18 for Forward Auction Re-Start
John Eggerton, Broadcasting and Cable

The Incentive Auction Task Force says that it anticipates launching the next stage (stage 4) of the forward portion of the incentive auction, which is wireless companies and others bidding on spectrum freed up by broadcasters. Stage 4 of the reverse auction ends Jan. 13, so the FCC is wasting no time proceeding—Monday, Jan. 17, is a federal holiday, so essentially that will mean the forward auction will restart the next business day following the reverse auction close.

Mobile Technology and Social Media

Regulators criticize banks over Uber loan – sources
Olivia Oran and Jonathan Schwarzberg, Reuters

Federal regulators criticized several Wall Street banks over the handling of a $1.15 billion loan they helped arrange for Uber Technologies Inc. this past summer, according to people with knowledge of the matter. Led by Morgan Stanley (MS.N), the banks helped the ride-sharing network tap the leveraged loan market in July for the first time, persuading institutional investors to focus on its lofty valuation and established markets rather than its losses in countries such as China and India.

EU proposal on ad blockers welcomed by publishers
Duncan Robinson, Financial Times

Media companies will be allowed to ban customers who use ad blockers under new online privacy rules proposed by the European Commission. To combat the rise of ad blocking technology, which stops online adverts from showing up on websites, many publishers — including technology magazine Wired and mainstream titles such as Bild, the German tabloid — have opted to ban users who refuse to see advertising.

WhatsApp, Facebook and Google face tough new privacy rules under EC proposal
Samuel Gibbs and agencies, The Guardian

Messaging services such as WhatsApp, Facebook Messenger and Gmail will face tough new rules on the tracking of users under a revision to the ePrivacy Directive proposed by the European Commission on Tuesday. The new legislation seeks to reinforce the right to privacy and control of data for European citizens, with messaging, email and voice services – such as those provided by Facebook, Google and Microsoft – forced to guarantee the confidentiality of conversations and metadata around the time, place and other factors of those conversations.

House passes bill to reimburse fed workers for Uber
Melanie Zanona, The Hill

House lawmakers have renewed an effort to make sure federal employees can take advantage of ride-hailing services such as Uber and Lyft when they travel on official government business. The lower chamber passed legislation by voice vote on Tuesday that would require the General Services Administration (GSA) to issue regulations clarifying that federal workers should be reimbursed for using transportation services Uber and Lyft and any similar technology that emerges in the future.

Tesla taps Apple engineer for Autopilot software
Stephen Nellis, Reuters

Electric carmaker Tesla Motors Inc has hired a key Apple Inc software engineer to oversee its Autopilot self-driving software efforts, Tesla said in a blog post Tuesday. Chris Lattner, who served at Apple for more than a decade, said in a online message to Apple developers on Tuesday morning that he would “leave Apple later this month to pursue an opportunity in another space” without saying which company he planned to join.

Samsung’s Lee Summoned in Bribery Probe, Special Prosecutors Say
Jungah Lee and Hooyeon Kim, Bloomberg News

Special prosecutors called Samsung Electronics Co. Vice Chairman Jay Y. Lee for questioning as a suspect in a bribery investigation, deepening an influence-peddling scandal that has already led to the impeachment of South Korea’s president. The de facto head of the Samsung Group was summoned to appear at 9:30 a.m. in Seoul on Thursday, special prosecution spokesman Lee Kyu-chul said in a briefing.

Cybersecurity and Privacy

Intel chiefs presented Trump with claims of Russian efforts to compromise him
Evan Perez et al., CNN

Classified documents presented last week to President Obama and President-elect Trump included allegations that Russian operatives claim to have compromising personal and financial information about Mr. Trump, multiple US officials with direct knowledge of the briefings tell CNN. The allegations were presented in a two-page synopsis that was appended to a report on Russian interference in the 2016 election.

Senate Staffers to Assess Intel Community’s Russian Hacking Report
Joseph Marks, Nextgov

Senate Intelligence Committee staffers will review and vet the classified sources underpinning intelligence agencies’ conclusion that Russian President Vladimir Putin ordered a massive hacking operation to destabilize the 2016 presidential election, Chairman Richard Burr, R-N.C., said Tuesday.

John McCain passes dossier alleging secret Trump-Russia contacts to FBI
Julian Borger, The Guardian

Senator John McCain passed documents to the FBI director, James Comey, last month alleging secret contacts between the Trump campaign and Moscow and that Russian intelligence had personally compromising material on the president-elect himself. The material, which has been seen by the Guardian, is a series of reports on Trump’s relationship with Moscow.

Senators roll out Russia sanctions bill after election meddling
Jordain Carney, The Hill

Senators are rolling out new sanctions against Russia as lawmakers debate how to respond to its meddling in the U.S. presidential election. The bipartisan legislation spearheaded by Sens. John McCain (R-Ariz.) and Ben Cardin (D-Md.) was introduced Tuesday and comes in response to cyberattacks as well as ongoing conflicts in Syria and Ukraine.

Cyber threat grows exponentially, says outgoing official
Sean D. Carberry, FCW

The cyber threat — the number of attacks, the number of hackers and actors, the variety of attacks — has evolved and grown exponentially says a key White House counterterrorism and cybersecurity advisor. Lisa Monaco, the assistant to the president for homeland security and counterterrorism since 2013, told an audience at a Jan. 10 Council on Foreign Relations event in New York that the growth of the internet of things will only increase the attack surface for the expanding number of malicious cyber actors around the world.

A Message from the Electronic Payments Coalition:

A special interest bill allowed retailers to pocket $42,000,000,000. The longer we go without a Durbin Amendment repeal, the more money merchants pocket at the expense of consumers. It is time to end this failed policy. Get the facts from the Electronic Payments Coalition.

Opinions, Editorials and Perspectives

The Next National Infrastructure Push Must Be Powered by Broadband
Jonathan Spalter, Morning Consult

It’s been more than 60 years since President Dwight D. Eisenhower, fresh from World War II Europe and its front-row seat to the efficiency of the German autobahn, vowed to create our nation’s interstate highway system. Now, President-elect Donald Trump is pledging to invest upwards of $1 trillion in a long-overdue upgrade of U.S. infrastructure.

Four Reasons Why Trump’s Pick for the Next USPTO Director Matters
Bart Eppenauer, Morning Consult

As President-Elect Donald Trump continues to assemble his cabinet and administration, one of the most important selections he can make is the next director of the U.S. Patent and Trademark Office. Considering the complexity and magnitude of some of the issues defining the IP landscape right now, it’s clear the next USPTO director will shape the future of America’s role in the world as a global leader and hub for innovation. 

Online and Scared
Thomas L. Friedman, The New York Times

And so it came to pass that in the winter of 2016 the world hit a tipping point that was revealed by the most unlikely collection of actors: Vladimir Putin, Jeff Bezos, Donald Trump, Mark Zuckerberg and the Macy’s department store. Who’d have thunk it?

A New Path Forward For Net Neutrality
Hal Singer, Forbes

The changing of administrations offers a fresh chance for Washington to rethink net neutrality. While it’s easy to find faults with the prior regime, it is hard to articulate an alternative that would satisfy more than a narrow constituency.

Trump’s Cyber-Appeasement Policy Might Encourage More Hacks
Kaveh Waddell, The Atlantic

Since well before he was elected president, Donald Trump has been casting doubt on the accuracy and integrity of investigations that assign blame for cyberattacks. His statements have created an atmosphere of mistrust around forensic analyses, like the one focused on Russia that three top spy agencies briefed him on last week.

A Message from the Electronic Payments Coalition:

Despite their promises before the bill was passed, only one percent of merchants actually lowered prices following the Durbin Amendment’s implementation. It is time to end this failed policy. Learn more about retailers’ broken promises from EPC.

Research Reports

‘Hacktivists’ Increasingly Target Local and State Government Computers
Jenni Bergal, The Pew Charitable Trusts

Early last year, hackers launched a cyberattack against the state of Michigan’s main website to draw attention to the Flint water crisis. In May, they targeted North Carolina government websites to protest a controversial state law requiring transgender people to use bathrooms that match the sex on their birth certificate.