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Tech Brief: Two House Committees Call Hearings on Equifax Data Breach

Government Brief

  • Equifax Inc. could be examined by up to three committees in the U.S. House of Representatives after a breach at the company exposed the data of roughly 143 million people. Chairman Jeb Hensarling (R-Texas) of the Financial Services Committee and Chairman Greg Walden (R-Ore.) of the Energy and Commerce Committee announced hearings, and Rep. Ted Lieu (D-Calif.) called for an investigation by the Judiciary Committee. (The Hill)
  • At a meeting scheduled for Sept. 15-16, leaders of the European Commission could discuss ways to tax tech companies like Google Inc. and Inc. based on where they do business rather than simply where they have tax residence. The finance ministers of France, Germany, Italy and Spain sent a joint letter to the EC president asking that taxes be based on revenues, not profit. (Reuters)
  • Having banned initial coin offerings for cryptocurrencies such as bitcoin, the Chinese government is reportedly preparing to outlaw trading digital currency on official domestic exchanges as well. China, which is responsible for roughly 23 percent of bitcoin trades, has been scrutinizing financial transactions ahead of the reorganization of its Communist Party leadership. (Bloomberg)

Clarification:  A previous version of this brief mischaracterized Equifax’s corporate structure.

Business Brief

  • As part of its sweeping control over its citizens’ internet use, the Chinese government has banned sites like Facebook Inc. and Google, and said that only government-approved virtual private networks will be allowed. That could have some unintended consequences, as the government encourages using the internet for commerce, but many people rely on Facebook to advertise and run their businesses. (The Associated Press)
  • While Apple Inc. prepares to launch its new iPhone Tuesday, T-Mobile US Inc. is betting on the “Internet of Things.” The company has set a goal of mid-2018 for launching a nationwide IoT network and is developing a test using narrowband spectrum to go live in Las Vegas next month. (The Wall Street Journal)
  • Following an outcry from consumer rights advocates and a letter to the company from New York Attorney General Eric Schneiderman, Equifax clarified that users wanting the company to monitor data lost in a massive breach at the company would not be restricted by an arbitration clause or class action waiver. (The Washington Post)

Chart Review

Events Calendar (All Times Local)

NATOA annual conference 8 a.m.
GSMA Mobile World Congress Americas 8 a.m.
FCC workshop on 911 outage best practices 9:15 a.m.
FCC webinar on proposed Connect America Fund Phase II auction process 11 a.m.
GSMA Mobile World Congress Americas 7:30 a.m.
NATOA annual conference 8 a.m.
NTSB vote on likely cause of Tesla Autopilot crash 9:30 a.m.
NTIA meeting on IoT security upgradeability 10 a.m.
House Energy and Commerce Subcommittee hearing on 21st century trade barriers 10:15 a.m.
GSMA Mobile World Congress Americas 7:30 a.m.
NATOA annual conference 8 a.m.
FirstNet board and committees meet 9 a.m.
Senate Commerce Committee hearing on automated trucks 10 a.m.
FCBA Wireline Committee brown bag lunch 12:15 p.m.
NATOA annual conference 8 a.m.
GSMA Mobile World Congress Americas 9 a.m.
FirstNet board and committees meet 9 a.m.
Senate Homeland Security Committee hearing on Lifeline program 10 a.m.
FCBA CLE on FCC and FTC enforcement priorities 3 p.m.
Newseum event on the future of online speech 9 a.m.
Seminar Group event on autonomous vehicles regulation 9 a.m.

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France, Germany, Italy, Spain seek tax on digital giants’ revenues
Staff, Reuters

France, Germany, Italy and Spain want digital multinationals like Amazon and Google to be taxed in Europe based on their revenues, rather than only profits as now, their finance ministers said in a joint letter. France is leading a push to clamp down on the taxation of such companies, but has found support from other countries also frustrated at the low tax they receive under current international rules.

China Is Said to Ban Bitcoin Exchanges While Allowing OTC Trades

China plans to ban trading of bitcoin and other virtual currencies on domestic exchanges, dealing another blow to the $150 billion cryptocurrency market after the country outlawed initial coin offerings last week. The ban will only apply to trading of cryptocurrencies on exchanges, according to people familiar with the matter, who asked not to be named because the information is private.

Blockchain Developers Face Off Over $1 Billion in Digital Cash
Jef Feeley et al., Bloomberg

Two of the world’s largest blockchain developers are battling over more than $1 billion in virtual-currency options, in a dispute that may help establish the leading player in providing new payment technologies to financial companies. R3, a blockchain startup that leads a group of more than 100 firms, sued rival Ripple Labs Inc. in state court in Delaware Friday, accusing it of reneging on an options agreement for Ripple’s XRP digital currency that is now worth more than $1 billion.

The first man at trial over a “gig economy” job got dismantled on cross-examination
Joe Mullin, Ars Technica

The sole plaintiff going to trial over his treatment in the “gig economy” has a serious problem. Under cross-examination yesterday, former GrubHub deliveryman Raef Lawson admitted that he lied on his applications to GrubHub, got paid for shifts he barely worked, and took steps to avoid doing some deliveries.

As Amazon Pushes Forward With Robots, Workers Find New Roles
Nick Wingfield, The New York Times

Nissa Scott started working at the cavernous Amazon warehouse in southern New Jersey late last year, stacking plastic bins the size of small ottomans. It was not, she says, the most stimulating activity.

Dollar Gains as Korea Fears, Irma Abate; Oil Rises: Markets Wrap
Samuel Potter, Bloomberg

The dollar gained, Treasuries retreated and stocks advanced as an appetite for risk returned to global markets after an anticipated North Korean missile test failed to materialize and Hurricane Irma struck the U.S. with less force than feared. Gold, the yen and Swiss franc all fell.

Intellectual Property and Antitrust

Bain, SK Hynix group ups bid for Toshiba chip unit to $22 billion: sources
Staff, Reuters

A group including Bain Capital and South Korea’s SK Hynix has raised its offer for Toshiba Corp’s  chip business to 2.4 trillion yen ($22.3 billion) including a 200 billion yen investment in infrastructure, sources familiar with the matter said. The offer by the consortium, which is led by the U.S. private equity group and the South Korean chipmaker as well as Japanese state-backed investors, was higher than an initial offer of around 1.94 trillion yen, according to the sources who requested anonymity because the talks were confidential.

Telecom, Wireless and TV

T-Mobile to Test First ‘Narrowband’ Network in Shadow of New iPhone
Drew FitzGerald, The Wall Street Journal

The U.S. already holds more cellphone accounts than adult Americans, so wireless companies are starting to turn their attention to other targets. The telecom sector is betting the “Internet of Things”–an expected wave of cars, homes and businesses each equipped with dozens if not hundreds of online gadgets—will provide its next growth spurt.

SES Bets on New Fleet of Smaller, Flexible Boeing Satellites
Robert Wall and Andy Pasztor, The Wall Street Journal

Satellite-services provider SES SA on Monday intends to announce a deal for a new fleet of smaller, easily reprogrammable Boeing Co. satellites, reflecting widespread industry uncertainty about demand for global internet connectivity. The Luxembourg-based company, the world’s largest commercial communication satellites operator, is opting for a less-expensive, lower-altitude design to seek an edge in the intensifying battle to beam web access to remote regions.

Mobile Technology and Social Media

Zuckerberg to Testify in Shareholder Suit on Voting Rights
Sarah Frier and Jef Feeley, Bloomberg

Mark Zuckerberg is heading back to court. Facebook Inc.’s chief executive officer is expected to testify later this month in a shareholder lawsuit over voting power, according to a person familiar with the plans.

Even more US adults now getting news from social media, says Pew
Natasha Lomas, TechCrunch

New research by Pew suggests there has been another increase in the proportion of U.S. adults getting news via social media platforms. In May last year the researcher reported that 62 per cent of American adults were obtaining news from tech platforms, saying 18 per cent were doing so often.

Apple May Test The Bounds Of Iphone Love With A $1,000 Model
Michael Liedtke, The Associated Press

Apple is expected to sell its fanciest iPhone yet for $1,000, crossing into a new financial frontier that will test how much consumers are willing to pay for a device that’s become an indispensable part of modern life. The unveiling of a dramatically redesigned iPhone will likely be the marquee moment Tuesday when Apple hosts its first product event at its new spaceship-like headquarters in Cupertino, California.

Cybersecurity and Privacy

House Commerce Committee to hold hearing on Equifax breach
Harper Neidig, The Hill

The House Energy and Commerce Committee will hold a hearing to examine the massive Equifax data breach that exposed the sensitive information of 143 million people to hackers. “This unprecedented data breach could impact tens of millions of Americans and raises serious questions about the security of our personal information online,” Rep. Greg Walden (R-Ore.), the panel’s chairman, said in a statement Friday.

Equifax finally responds to swirling concerns over consumers’ legal rights
Brian Fung, The Washington Post

Buried in the terms of service is language that appears to bar those who enroll in an Equifax credit monitoring program from participating in any class-action lawsuits that may arise from the incident. Here’s the relevant passage of the terms of service.

China’s Ever-Tighter Web Controls Jolt Companies, Scientists
Joe McDonald, The Associated Press

Frank Chen’s e-commerce business has nothing to do with politics but he worries it might be sunk by the Communist Party’s latest effort to control what the Chinese public sees online. Chen’s 25-employee company sells clothes and appliances to Americans and Europeans through platforms including Facebook, one of thousands of websites blocked by China’s web filters.

Equifax Customer Complaints Continue to Pile Up
AnnaMaria Andriotis, The Wall Street Journal

Equifax Inc. struggled over the weekend with its response to its massive data breach as consumers continued to criticize the credit-reporting company’s efforts and cited ongoing problems with a website set up to help them. Regulators, meanwhile, are urging consumers to freeze their credit reports, a move some lenders fear could ding credit growth even as the finance industry struggles with the question of how to contain the potential for widespread fraud that could affect millions of Americans.

Opinions, Editorials and Perspectives

Why China Crushed Bitcoin
Panos Mourdoukoutas, Forbes

Bitcoin’s buzz is gone, for now. It was crushed by the heavy-handed intervention of the Chinese government, which is cooling off investor enthusiasm for the digital currency.

These Are Not the Robots We Were Promised
Nicholas Carr, The New York Times

From the moment we humans first imagined having mechanical servants at our beck and call, we’ve assumed they would be constructed in our own image. Outfitted with arms and legs, heads and torsos, they would perform everyday tasks that we’d otherwise have to do ourselves.

The Future of Home Wi-Fi Is Fast, Expensive, Exotic
Christopher Mims, The Wall Street Journal

Do you remember the first time you wirelessly surfed the web from a laptop? What about when you first watched a movie on a wirelessly connected TV?

Research Reports

News Use Across Social Media Platforms 2017
Elisa Shearer And Jeffrey Gottfried, Pew Research Center

As of August 2017, two-thirds (67%) of Americans report that they get at least some of their news on social media – with two-in-ten doing so often, according to a new survey from Pew Research Center. This is a modest increase since early 2016, when (during the height of the presidential primaries) 62% of U.S. adults reported getting news from social media.