Hillicon Valley: Tech giants poised to weather coronavirus damage | Record Facebook-FTC deal approved | Bipartisan 5G bill introduced

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Welcome! Follow our cyber reporter, Maggie Miller (@magmill95), and tech reporter, Chris Mills Rodrigo (@chrisismills), for more coverage.

TECH GIANTS RESILIENT: Major tech companies are seeing demand skyrocket during the pandemic, positioning an already powerful industry to withstand the devastating effects of the coronavirus on the U.S. economy.

Sales are surging for many of the biggest names in tech as most Americans are under stay-at-home orders, making them more reliant on Silicon Valley’s services.

“Overall, the tech industry is extremely well positioned to be resilient and successful during this period,” said Eric Schiffer, CEO of the private investment firm Patriarch Equity. “One of the reasons is this global catastrophe that is translating into such economic pain is in many ways an inflection point for the further digitization of the world.”

“You’re seeing that reflected in the variance between the Nasdaq and the S&P — investors recognize it,” he added.

The Nasdaq composite, which includes many tech firms, has significantly outperformed broader indexes like the S&P 500 and Dow Jones Industrial Average during the downturn. Next week, Wall Street will get its first glimpse at the growing strength of individual tech companies in the COVID-19 era, as Amazon, Apple, Facebook and Google report their quarterly earnings.

An opportunity to dull criticism: The resilience of big tech companies amid the coronavirus pandemic comes on the heels of growing backlash against Silicon Valley, dubbed the “techlash.”

While many lawmakers and regulatory officials at the state and local level have vowed to pursue antitrust and oversight just as strongly after the pandemic is over, this period has given companies a chance to improve their public image.

Apple and Google, for example, are developing a contact-tracing system that may prove essential to curbing the spread of the coronavirus, while Amazon is hiring at a time when unemployment across the country is surging.

Read more about specific companies.

 

FTC-FACEBOOK DEAL APPROVED (FINALLY): A federal judge approved the $5 billion Federal Trade Commission (FTC) fine that Facebook agreed to pay last year over privacy violations stemming from the Cambridge Analytica scandal.

The settlement — reached in July and the largest in the FTC’s history — came after a lengthy investigation into Facebook.

The $5 billion agreement was criticized by lawmakers and other critics of Facebook who said the amount was too small given Facebook’s massive profits, and that it let the platform off too easily.

Several advocacy groups, including Public Citizen, Common Sense Media and the U.S. Public Interest Research Group, had tried to stop the courts from approving the settlement.

U.S. District Court Judge Timothy Kelly, a Trump appointee, acknowledged the concerns in his opinion Thursday, saying they call into question laws governing technology companies.

However, he wrote, “those concerns are largely for Congress; they are not relevant here. Mindful of its proper role, and especially considering the deference to which the Executive’s enforcement discretion is entitled, the Court will grant the consent motion and enter the order as proposed.”

The FTC’s investigation was launched in March 2018 after reports that data from tens of millions of Facebook users was shared with Cambridge Analytica. The probe had focused on whether the social media giant violated a 2011 consent agreement with the FTC requiring greater privacy protections and transparency for users.

Read more here.

 

NEW 5G BILL: A bipartisan group of House lawmakers on Friday introduced legislation to financially boost American fifth generation, or 5G, wireless technologies following concerns that Chinese telecommunications groups such as Huawei or ZTE pose national security threats.

The USA Telecommunications Act would set aside $750 million within a grant program overseen by the Department of Commerce’s National Telecommunications and Information Administration (NTIA) to help support the deployment and use of 5G networks in the U.S. 

The bill would also establish an advisory committee that would include the Federal Communications Commission (FCC) and other federal agencies as well as representatives from the public and private sectors to advise on the grant funding.

Sponsors of the bill include House Energy and Commerce Committee Chairman Frank Pallone Jr. (D-N.J.) and ranking member Greg Walden (R-Ore.), along with Reps. Brett Guthrie (R-Ky.) and Doris Matsui (D-Calif.).

“The ‘USA Telecommunications Act of 2020’ will encourage more competition in the network equipment market and help lower costs for trusted equipment over the long term,” the sponsors said Friday in a joint statement. “By promoting a more competitive market of trusted alternatives to suspect 5G equipment, we can more easily secure our critical networks and bring like-minded countries with us.”

The legislation is meant to provide funding to counter the influence of Chinese telecom groups like Huawei and ZTE on 5G systems. There has been strong bipartisan pushback against the two companies from both Capitol Hill and the White House over the past year, with the Department of Commerce essentially blacklisting Huawei by adding it to its “entity list” in 2019.

Read more here.

 

FACEBOOK v. ZOOM: Facebook launched a new live video conferencing service on Friday, as millions of people remain confined to their homes amid the coronavirus pandemic.

The Messenger Rooms service lets up to 50 users participate in a video chat at once, a feature similar to Zoom and Houseparty, two apps that have exploded in popularity over the last few months.

“Video presence isn’t just about calling someone,” Facebook CEO Mark Zuckerberg said during a livestream on Friday.

“It is starting to be a fundamental building block of a private social platform with lots of new use cases,” he said.

Messenger Rooms will be free and won’t have a time limit, the social media giant announced.

Zoom can accommodate up to 1,000 people in each call but limits calls to 40 minutes without a paid subscription.

Facebook also announced Friday that is it doubling the capacity of video calls on WhatsApp from four to eight participants and incorporating video calls into Facebook Dating.

Read more here.

 

FCC VULNERABILITIES DISCOVERED: The Government Accountability Office (GAO) on Friday urged the Federal Communications Commission (FCC) to take steps to boost the security of its comment submission process after a review revealed dozens of cyber vulnerabilities. 

In a report compiled by the GAO, which was originally finalized in September but made public Friday, the agency detailed 136 recommendations for how the FCC could improve its Electronic Comment Filing System (ECFS). 

This system is used by the public to propose changes to regulations, and was overwhelmed in May 2017 following a surge in comments being submitted, temporarily disrupting the electronic comment system.

The GAO undertook its review of the FCC’s security for the ECFS following this incident after requests from numerous Democratic lawmakers.

“GAO identified program and control deficiencies in the core security functions related to identifying risk, protecting systems from threats and vulnerabilities, detecting and responding to cyber security events, and recovering system operations,” the government watchdog wrote in the report.

The GAO gave credit to the FCC for addressing 63 percent of its recommendations since September, but warned that the agency was at risk until all the identified problems are dealt with.

“Until FCC fully implements these recommendations and resolves the associated deficiencies, its information systems and information will remain at increased risk of misuse, improper disclosure or modification, and loss,” the GAO warned. 

Read more here.

 

NEW VOTING CONCERNS: Two House lawmakers on Friday zeroed in on new election security threats posed by an increase in mail-in voting due to the COVID-19 pandemic. 

Reps. John Katko (R-N.Y.) and Kathleen Rice (D-N.Y.) wrote letters to the Election Assistance Commission (EAC) and to the New York State Board of Elections following the signing of an executive order by New York Gov. Andrew Cuomo (D) ordering state officials to send absentee ballot request forms to every voter in the state. 

Katko and Rice raised questions around new election security concerns that moving to vote-by-mail exposed, and urged the agencies to clarify steps being taken to preserve the public’s confidence in elections.

Katko, who is the top Republican on the House Homeland Security Committee’s cybersecurity panel, said in a statement he was particularly interested in steps taken to combat disinformation and other election interference efforts. 

“The NYS Board of Elections and U.S. Election Assistance Commission must detail for the public the steps they are taking to protect against interference and disinformation campaigns, as well as how they will identify and address potential threats to the upcoming elections,” Katko said. 

Rice, a member of the cybersecurity subcommittee, said in a separate statement that her goal was to ensure the upcoming primary and general elections were “conducted safely and securely” despite the chaos caused by the ongoing pandemic. 

Read more here.

 

Lighter click: Bong Joon-ho hive rise up

An op-ed to chew on: Train workers now — and upgrade infrastructure — for the post-pandemic digital future

NOTABLE LINKS FROM AROUND THE WEB: 

Zoom’s Biggest Rivals Are Coming for It (New York Times / Mike Isaac and Sheera Frenkel)

Apple, Google tweak contact tracing specs as launch nears (Axios / Ina Fried)

Facebook ads, conspiracy theorists pushed bleach consumption and UV ray cures (NBC News / Ben Collins and Brandy Zadrozny)

How the 5G coronavirus conspiracy theory went from fringe to mainstream (Recode / Rebecca Heilweil)