Tech Brief: T-Mobile CEO Hints at Sprint Merger After Trump Takes Office

Washington Brief

  • House Homeland Security Committee Chairman Michael McCaul (R-Texas) pushed back on President-elect Donald Trump’s plan to give the Defense Department a bigger role in defending U.S. computer networks. McCaul said moving cyberdefense from the Department of Homeland Security to the Pentagon would be a “grave mistake.” (CyberScoop)
  • A report from U.S. intelligence agencies on Russia’s interference in the 2016 presidential election process identifies actors involved in delivering stolen Democratic emails to WikiLeaks and details the efforts of Russian intelligence entities to hack Democratic and Republican networks. (The Washington Post)
  • The Federal Bureau of Investigation accused the Democratic National Committee of blocking its access to DNC computer systems and hindering an investigation into the breach of the DNC servers by Russia-based hackers. The accusation comes after the DNC said the FBI never requested access to the compromised servers. (BuzzFeed News)

Business Brief

  • T-Mobile Chief Executive John Legere said a merger with SoftBank Group/Sprint Corp. is a “potential future outcome” of the incoming Trump administration and a friendlier regulatory environment at places like the Federal Communications Commission. (The Verge)
  • Trump is still opposed to AT&T Inc.’s proposed $85.4 billion takeover of Time Warner Inc. because he believes it would concentrate too much power in the media industry, according to unnamed sources close to the president-elect. (Bloomberg News)
  • Verizon Communications Inc. is unsure about its planned acquisition of Yahoo Inc.’s internet business, according to a senior Verizon executive. The uncertainty comes after Yahoo disclosed the largest known data breach in history last month. (Reuters)

Chart Review

Events Calendar (All Times Local)

DC Internet Society holds debrief of the 2016 Internet Governance Forum 9 a.m.
Commerce, USPTO officials speak at CES 2017 1 p.m.



Apple chief accused of ‘disrespect’ to Ireland
Vincent Boland, Financial Times

Tim Cook, Apple chief executive, has been accused of being “disrespectful” to Ireland after he turned down an invitation to talk to a committee of MPs investigating the US technology giant’s Irish tax arrangements. The invitation from the Irish parliament’s finance committee followed the European Commission ruling that Apple owed Ireland €13bn in unpaid taxes because of an arrangement that amounted to illegal state aid.

Can a Law Stop Distracted Driving? California Hopes to Find Out.
Jonah Engel Bromwich, The New York Times

Thousands of people die in distracted driving accidents every year, and California is hoping to do something about it. This week, as a new law went into effect in the state with an aim toward cutting the number of drivers using smartphones, federal data is scheduled to be released that shows that more than 3,400 people were killed in accidents that involved at least one distracted driver in 2015.

China’s ZTE to slash about 3,000 jobs – sources
Sijia Jiang, Reuters

Chinese telecom equipment maker ZTE, which is facing U.S. trade sanctions that could severely disrupt its supply chain, is slashing about 3,000 jobs, including a fifth of positions in its struggling handset business in China, company sources said. The sources said the Shenzhen-based company, one of the world’s biggest telecoms gear makers, is axing about 5 percent of its 60,000 global workforce.

Second Wind for Dollar Before Jobs Undercuts Bonds: Markets Wrap
Garfield Clinton Reynolds and Cecile Gutscher, Bloomberg News

The Stoxx Europe 600 Index fell 0.3 percent, trimming a weekly advance, as commodity producers declined. S&P 500 futures were little changed

Intellectual Property

Amazon is granted a patent for using a subterranean network to deliver packages
Alan Boyle, GeekWire

Maybe it shouldn’t be that surprising that Amazon has patented a system for delivering goods via a dedicated network of underground tunnels. After all, the Seattle-based company is looking into virtually every other mode of transportation.

Axanar isn’t fair use, judge finds, setting stage for Star Trek copyright trial
Cyrus Farivar, Ars Technica

A federal judge in Los Angeles has decided that the copyright lawsuit over the pending Star Trek fan film Prelude to Axanar should move forward. For now, a civil trial is set to begin on January 31, 2017.

Telecom, Wireless and TV

T-Mobile CEO says Sprint merger is ‘potential outcome’ under Trump
Chris Welch, The Verge

During T-Mobile’s Q&A session after the company’s event today, I asked CEO John Legere about the resurgent rumors of a potential merger or combination with SoftBank/Sprint under President Donald Trump and a new FCC. He described that combination as “a potential future outcome” of a new administration and friendlier regulatory environment.

Trump Tells Confidant He Still Opposes AT&T-Time Warner
Gerry Smith and Joshua Green, Bloomberg News

Donald Trump remains opposed to the megamerger between AT&T Inc. and Time Warner Inc. because he believes it would concentrate too much power in the media industry, according to people close to the president-elect, who has been publicly silent about the transaction for months. Trump told a friend in the last few weeks that he still considers the merger to be a bad deal, said one of the people, who asked not to be identified because the conversation was private.

Verizon executive says company unsure about Yahoo deal
Aishwarya Venugopal and Narottam Medhora, Reuters

A senior Verizon Communications Inc executive said on Thursday that the company was unsure about its planned acquisition of Yahoo Inc’s internet business. Yahoo came under renewed scrutiny by federal investigators and lawmakers last month after disclosing the largest known data breach in history, prompting Verizon to demand better terms for its planned purchase.

Mobile Technology and Social Media

Apple’s App Store Sales Top $28 Billion
Tripp Mickle, The Wall Street Journal

Apple Inc. said its App Store generated record revenue of more than $20 billion for developers in 2016, as that business roughly maintained its growth rate even as iPhone sales volumes declined. The figure released Thursday implies the App Store’s total revenue topped $28.5 billion, with Apple collecting about $8.5 billion based on its 30% share of such sales.

Trump’s Twitter feed traumatizes Washington
Eli Stokols and Josh Dawsey, Politico

Donald Trump’s unique, chaos theory of presidential communications is upending Washington, leaving lawmakers, government officials and lobbyists aghast that they are beholden to a single leader’s whims, not to mention the uncertainty about his true thoughts and intentions. Unlike more traditional administrations, in which a White House focuses on one big agenda item at a time and mobilizes all resources to galvanize public and congressional support for it, Trump has shown no sign of abandoning his off-the-cuff, scattershot approach to tweeting.

Can Donald Trump save Twitter?
Olivia Solon, The Guardian

“It’s like owning your own newspaper – without the losses.” That’s how Donald Trump described the San Francisco-headquartered social media tool in November 2012. In a little over four years, the celebrity businessman turned president-elect has grown his Twitter audience from about 2 million followers to almost 19 million, using it as his personal Pravda to post propaganda and stream-of-consciousness musings.

Obama White House social media, Trump campaign receive expansive archives
Sam Machkovech, Ars Technica

In one of the weirder political coincidences in recent memory, digital archives for President Barack Obama and President-elect Donald Trump launched within hours of each other on Thursday. The Obama Social Media Archive, launched officially by Obama’s administration and developed by ArchiveSocial, serves as the first-ever culling of an administration’s full online presence.

Mark Zuckerberg shares Facebook’s secrets with all his employees, and almost none of it leaks
Kurt Wagner, Recode

On a Friday afternoon in July 2015, Mark Zuckerberg stood in front of a couple hundred employees at Facebook’s Menlo Park, Calif., headquarters, a video camera there to record his words for thousands of other employees around the globe. Zuckerberg, usually calm and a natural introvert, was uncharacteristically angry.

Cybersecurity and Privacy

‘A Grave Mistake’ — Rep. McCaul pushes back on Trump cyber-defense plan
Chris Bing, CyberScoop

An influential Republican congressman is pushing back against President-elect Donald Trump’s plan to increase the Defense Department’s role in defending domestic computer networks. Trump’s proposal, originally announced in late November, would see the Homeland Security Department take a backseat with regard to the federal government’s private sector cybersecurity efforts.

U.S. intercepts capture senior Russian officials celebrating Trump win
Adam Entous and Greg Miller, The Washington Post

Senior officials in the Russian government celebrated Donald Trump’s victory over Hillary Clinton as a geopolitical win for Moscow, according to U.S. officials who said that American intelligence agencies intercepted communications in the aftermath of the election in which Russian officials congratulated themselves on the outcome. The ebullient reaction among high-ranking Russian officials — including some who U.S. officials believe had knowledge of the country’s cyber campaign to interfere in the U.S. election — contributed to the U.S. intelligence community’s assessment that Moscow’s efforts were aimed at least in part at helping Trump win the White House.

The FBI Now Says Democrats Were Behind Hack Investigation Delay
Ali Watkins, BuzzFeed News

The FBI struck back at the Democratic National Committee on Thursday, accusing it of denying federal investigators access to its computer systems and hamstringing its investigation into the infiltration of DNC servers by Russia-backed hackers.

Clapper: Trump rhetoric on intel agencies alarming U.S. allies
Martin Matishak and Connor O’Brien, Politico

Democrats used a bipartisan hearing on Russian hacking Thursday to attack President-elect Donald Trump’s ongoing disparagement of the intelligence community, arguing his statements ruin morale and embolden the country’s enemies. Minority members on the Senate Armed Services Committee turned Congress’ first hearing on Russia’s alleged election hacks into a platform to strike at the billionaire businessman and try to drive a wedge between him and GOP leadership — with even South Carolina Republican Lindsey Graham joining in the criticism.

Why doubts still cloud Russian hacking allegations
Paul F. Roberts, The Christian Science Monitor

Since the White House blamed Russia for hacking US political organizations to undermine the presidential election, administration critics, skeptics, and cybersecurity experts have pushed the government to reveal its evidence. But so far, much of what has come out of Washington regarding Moscow’s suspected digital tampering has only raised more questions about the government’s claims.

Kaine: Separate threat of Russian hacking from election results
Joe Uchill, The Hill

Hillary Clinton’s former running mate on Thursday said the goal of investigating Russia’s alleged interference with the presidential election is not changing the outcome of the vote. Sen. Tim Kaine (D-Va.) compared the situation to the Watergate scandal, when both parties united to protect the integrity of the electoral process.

McCain Says Graham Will Head New Cybersecurity Subcommittee
Brendan Bordelon and Amir Nasr, Morning Consult

Senate Armed Services Committee Chairman John McCain on Thursday said his panel will create a new subcommittee on cybersecurity within “a couple of days.” The subcommittee will be led by Sen. Lindsey Graham (R-S.C.), and will assume the jurisdiction of cybersecurity issues that’s now overseen by the Subcommittee on Emerging Threats and Capabilities.

Opinions, Editorials and Perspectives

What Will Be the Trump Card in U.S.-Chinese Relations?
Gary Shapiro, Morning Consult

In 2017, the world’s two largest economies, the United States and China, will enter a new phase of their relationship. Both countries are primed and actively exploring avenues for change — in polar-opposite directions.

Donald Trump Casts Intelligence Aside
The Editorial Board, The New York Times

What plausible reason could Donald Trump have for trying so hard to discredit America’s intelligence agencies and their finding that Russia interfered in the presidential election? Maybe he just can’t stand anyone thinking he didn’t, or couldn’t, win the presidency on his own.

A Useful Trump Intelligence Shakeup
The Editorial Board, The Wall Street Journal

Donald Trump may or may not be planning to reorganize the 17 separate U.S. intelligence agencies, and the mere suggestion seems to be a breach of Beltway etiquette. But the intelligence services shouldn’t be immune from a bureaucratic shakeup, especially at the White House, and we have some suggestions.

Let’s not stack the deck against consumers and innovators by rolling back the Open Internet Order
Terrell McSweeny and Mignon Clyburn, Recode

As two of the members of the Federal Communications Commission and the Federal Trade Commission, we have helped shape how our government has responded to the rapid shifts in our economy and our relationship to technology. From our vantage point, we have come to realize that the main component of our innovation economy is not data or communication networks, but is instead the trust of the American consumer.

Don’t Gut Net Neutrality. It’s Good for People and Business
Nicholas Economides, Wired

The invention and commercialization of the internet is one of the things that makes America great. And what makes the internet great is the easy, unrestricted, and free availability of all kinds of information, regardless of the content provider, a regime known as network neutrality.

Alibaba’s ‘Notorious’ Brand
The Editorial Board, The Wall Street Journal

The U.S. Trade Representative last month labeled Alibaba’s Taobao a “notorious market” for counterfeit goods, citing evidence that the e-commerce platform is a haven for pirates selling cheap knock-offs. The designation, which carries no penalty beyond reputational damage, ought to encourage Alibaba to clean up its act. Judging from the company’s reaction, that isn’t likely to happen soon.

FTC chair Edith Ramirez on CES, the future of the agency and how you can win $25,000
Hayley Tsukayama, The Washington Post

FTC Chairwoman Edith Ramirez sat down with us at CES to talk about why consumers should pay attention to the security on all their devices, why she wants to pay out $25,000 to someone with a good idea and how she thinks the FTC will operate under President Donald Trump. The FTC confirmed that Ramirez (D) and other senior FTC officials have had preliminary meetings with members of the Trump transition team.

Why car and tech companies have different visions for self-driving cars
Timothy B. Lee, Vox

For much of the 2010s, Google was the only company putting serious resources into the technology underpinning self-driving cars. That started to change in 2016, as almost every major automaker announced technology partnerships to develop their self-driving capabilities.

Research Reports

From Awareness To Action: A Cybersecurity Agenda For the 45th President
Sen. Sheldon Whitehouse et al., The Center For Strategic and International Studies

This report lays out specific recommendations for the next administration’s cybersecurity policy. It identifies the policies, organizational improvements, and resources needed for this.