Hillicon Valley: DOJ approves T-Mobile-Sprint merger | Trump targets Google, Apple | Privacy groups seek to intervene in Facebook settlement | Democrats seize on Mueller hearings in election security push
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Welcome! Follow the cyber team, Olivia Beavers (@olivia_beavers) and Maggie Miller (@magmill95), and the tech team, Harper Neidig (@hneidig) and Emily Birnbaum (@birnbaum_e).
T-MOBILE, SPRINT GET DOJ GREEN LIGHT: The Department of Justice on Friday announced it has approved the $26 billion T-Mobile–Sprint merger, paving the way towards a deal that will combine two of the country’s largest mobile carriers into one company with more than 80 million U.S. customers.
The department’s approval means both federal agencies overseeing the merger have given it their blessing, though a legal challenge by state attorneys general could still block the deal from going through.
The DOJ’s plan requires T-Mobile and Sprint to hand over assets including wireless spectrum and subscribers to Dish, a satellite television company that has been tapped to create a mobile network to compete with the merged company.
The DOJ came to the agreement with the state attorneys general for Nebraska, Kansas, Ohio, Oklahoma and South Dakota, none of which are involved in the separate lawsuit from the states to block the merger.
During a press conference announcing the deal, DOJ antitrust chief Makan Delrahim argued the remedies will help set up Dish as a strong competitor, calling it a potentially “disruptive force.”
“In our view and in our judgements, this remedy package is actually better than the status quo because consumers will benefit, the economy will benefit and frankly we’ll probably have more competition than we have today,” he said.
Under the deal with DOJ, T-Mobile and Sprint are required to divest Sprint’s prepaid businesses including Boost Mobile, Virgin Mobile and Sprint prepaid, to Dish. It would also be allowed to use T-Mobile’s network during a seven-year transition period “while Dish builds out its own 5G network,” according to DOJ.
PRIVACY GROUPS WANT REVIEW OF FACEBOOK SETTLEMENT: A privacy group is asking a federal judge to carefully review the Federal Trade Commission’s (FTC) $5 billion privacy settlement with Facebook and to hear from public interest organizations before approving the agreement.
The Electronic Privacy Information Center (EPIC) filed a motion to intervene with the U.S. District Court for the District of Columbia on Friday, arguing that it has legal grounds to brief the court because it helped drive the FTC to take action against Facebook through a series of complaints against the company.
“If the proposed settlement is adopted, EPIC’s prior complaints at the FTC will be dismissed,” the group said in its filing. “Thus, EPIC has a clear interest in the outcome of this case.”
The settlement has been roundly criticized by privacy advocates and Facebook’s growing chorus of critics on Capitol Hill since it was announced on Wednesday.
In addition to the $5 billion fine, the deal requires Facebook to submit to increased monitoring and to install a committee within its board of directors to review the social network’s privacy practices.
But critics say that the agreement falls short because it doesn’t hold executives like CEO Mark Zuckerberg accountable for Facebook’s behavior and it does nothing to actually restrict Facebook’s ability to abuse user privacy.
“The proposed Consent Decree does not adequately address the consumer privacy complaints raised against Facebook by the FTC, numerous consumer privacy groups like EPIC, and individuals,” EPIC’s court filing reads. “EPIC’s arguments will assist the Court in reviewing the proposed Consent Decree and achieving a just and equitable adjudication in this case.”
TRUMP TARGETS…
…GOOGLE: President Trump on Friday suggested his administration would investigate Google’s work in China for potential national security issues just days after his top Treasury official said the government had looked into the company and found no cause for such concerns.
“There may or may not be National Security concerns with regard to Google and their relationship with China,” Trump tweeted Friday morning. “If there is a problem, we will find out about it. I sincerely hope there is not!!!”
The message appeared to contradict what Treasury Secretary Steven Mnuchin told CNBC on Wednesday when he said that Google had allayed their concerns, saying that their work in China was “minimal.”
“The president and I did diligence on this issue and we’re not aware of any areas where Google working with the Chinese government in a way that in any way raises concerns,” Mnuchin said.
… AND APPLE: President Trump on Friday rejected Apple’s request to exempt parts of its new Mac Pro from import tariffs after the company said it is planning to move some production to China.
“Apple will not be given Tariff waivers, or relief, for Mac Pro parts that are made in China,” Trump tweeted. “Make them in the USA, no Tariffs!”
Apple shares dipped immediately after Trump’s tweet.
In filings made public this week, Apple asked the U.S. trade representative’s office to exclude components of Apple’s new Mac Pro from the list of products that could be hit by tariffs of 25 percent amid Trump’s ongoing trade war with Beijing.
The Mac Pro has been manufactured in the U.S. for the past several years, but Apple last month moved production of the devices to China.
…AND FRANCE: President Trump vowed Friday to take “substantial reciprocal action” against France after President Emmanuel Macron signed into law a tax targeting technology giants like Amazon and Google.
“France just put a digital tax on our great American technology companies,” Trump tweeted. “If anybody taxes them, it should be their home Country, the USA. We will announce a substantial reciprocal action on Macron’s foolishness shortly. I’ve always said American wine is better than French wine!”
Macron this week signed the digital services tax, which imposes a 3 percent tax on the annual revenues of technology companies that make at least 750 million euros annually and provide services to users in the country.
The tax would affect several companies, including U.S.-based tech giants like Apple, Google, Facebook and Amazon.
“The United States is extremely disappointed by France’s decision to adopt a digital services tax at the expense of U.S. companies and workers,” White House deputy press secretary Judd Deere said in a statement.
LOUISIANA SCHOOLS HIT BY CYBERATTACKS: Louisiana Gov. John Bel Edwards (D) declared a state-wide emergency this week following cyberattacks on several school districts.
The declaration comes after three local school districts were hit by what local media have described as ransomware attacks, where hackers take over and encrypt vital cyber systems and demand a ransom to release the data.
The state-wide emergency declaration allows for state resources and cyber assistance to be given to these school districts from the Louisiana National Guard, the Louisiana State Police and the Office of Technology Services.
According to the governor’s office, the state is also cooperating with the FBI, state agencies and higher education partners.
The school systems in Sabine, Morehouse and Ouachita parishes in northern Louisiana were all hit by malware attacks this week, with the governor’s office in contact with other school districts in the state to assess how far the malware has spread.
GOP SPLIT OVER JEDI CONTRACT: Republican lawmakers this week issued dueling letters over the Department of Defense’s (DOD) $10 billion “war cloud” contract, with one group calling for the deal to be delayed amid concerns that it favors Amazon above other companies, while others insisted the cloud-computing contract should be wrapped up by this summer.
In a letter obtained by The Hill, a dozen GOP lawmakers urged President Trump to delay the war cloud contract over long-standing allegations that the contract is biased toward Amazon.
In a separate letter on Thursday obtained by The Hill, two members of the House Armed Services Committee — Reps. Jim Banks (R-Ind.) and Rep. Paul Cook (R-Calif.) — argued the contract should be awarded as soon as possible for national security purposes.
“This contract has already been delayed a year for investigations and court filings,” Banks and Cook wrote. “Further delays make DOD fall behind and DOD needs this technology now. The cloud makes the military a more lethal, agile and innovative force.”
The letters, both addressed to Trump, are the latest attempts by lawmakers to weigh in on how the contract — also known as JEDI — was constructed and how it will be doled out.
Nearly all of the lawmakers involved in the discussions have received thousands of dollars in campaign donations from Amazon and Microsoft, the two top contenders for the JEDI contract. And some have received contributions from Oracle, a smaller competitor that has launched an aggressive campaign to open up the cloud-computing deal to other companies.
MUELLER BOOSTS DEMS’ PUSH FOR ELECTION SECURITY: Democrats calling for action on election security legislation got a boost from Robert Mueller this week after the former special counsel issued a dire warning to lawmakers about Russia’s intentions for 2020.
Mueller emphasized during Wednesday’s hearings that in addition to interfering in the 2016 presidential election, the Kremlin is laying the groundwork “as we sit here” for a repeat performance next year.
Interference in the last presidential election did not consist of a “single attempt,” but instead entailed a large social media disinformation campaign and hacking operations, the former FBI director said.
“Over the course of my career, I’ve seen a number of challenges to our democracy. The Russian government’s effort to interfere in our election is among the most serious.”
Mueller’s 448-page report, released in April, detailed how Russian actors hacked into the Democratic National Committee, engineered a social media disinformation campaign that favored President Trump and conducted “computer intrusion operations” against those working on former Secretary of State Hillary Clinton’s Democratic presidential campaign.
Those findings were bolstered Thursday when the Senate Intelligence Committee released the first volume of its lengthy investigation into Russian interference in the 2016 presidential election. The panel found that “the Russian government directed extensive activity, beginning in at least 2014 and carrying into at least 2017, against U.S. election infrastructure at the state and local level.”
WANNA CELEBRATE: A British cybersecurity expert who helped stop the spread of the international WannaCry virus was sentenced Friday to time served by a U.S. district judge stemming from charges that he wrote other malware several years prior.
According to the Associated Press, Marcus Hutchins was also sentenced to a year of supervised release by U.S. District Judge J.P. Stadtmueller, a Reagan appointee. Hutchins pleaded guilty earlier this year to developing and conspiring to distribute a type of malware called Kronos between 2012 and 2015.
While Hutchins was sentenced to time served, he could have faced up to ten years in prison and $500,000 in fines. He served a few days in jail after being arrested in 2017 but was then freed on bail on the condition that he remain in the U.S. while his case was pending.
Hutchins was arrested in connection to the malware charges months after he found what experts term as the “kill switch” for a debilitating international virus known as WannaCry. This was a ransomware virus that targeted computers running the Microsoft Windows operating system, and locked them down pending payments in the form of bitcoin.
According to the AP, in sentencing Hutchins on Friday, Stadtmueller said the WannaCry virus Hutchins helped stop was more damaging than the original malware he wrote.
EDUCATION ON MISINFORMATION: A group of Senate Democrats on Friday introduced legislation aimed at educating the public on how to identify misinformation on social media platforms and to limit the impact of foreign influence campaigns during elections.
The Digital Citizenship and Media Literacy Act would create a grant program at the Department of Education to assist states in developing media literacy programs and fund existing initiatives in this area across grades K-12.
The grant funds would also be available for the development of media literacy education guidelines, and for hiring teachers with a background in media literacy or training educators on this issue.
Sen. Amy Klobuchar’s (D-Minn.) office, in introducing the legislation, cited the findings of former special counsel Robert Mueller from his 22-month investigation into Russian efforts to interfere in the 2016 presidential elections.
AN OP-ED TO CHEW ON: NASA’s forgotten plan to land people on Mars in the 1980s.
A LIGHTER CLICK: A sight for sore eyes.
NOTABLE LINKS FROM AROUND THE WEB:
Apple contractors ‘regularly hear confidential details’ on Siri recordings. (The Guardian)
The T-Mobile-Sprint merger could mean the end of the physical SIM card. (The Verge)
Huge LinkedIn loophole puts user security at risk. (Mashable)
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