Monday, November 30, 2020

Free State Foundation President Randolph May's Media Statement on FCC Chairman Pai's Departure

The following statement may be attributed to Free State Foundation President Randolph May:



“I’ve been involved in communications law and policy for four decades now, and I have no hesitation in saying that Ajit Pai has been one of the most consequential FCC Chairman that I have observed. As Chairman Pai said in the announcement of his impending departure, he has “not shied away from making tough choices.” Pai fought — and, indeed, he had to fight — to reduce regulation where it was no longer needed in light of marketplace and technological developments, and he led the way in taking important actions to help get broadband deployed in unserved areas. Perhaps most consequential of all was Pai’s leadership, supported by his colleagues Commissioners Michael O’Rielly and Brendan Carr, in reversing the Obama FCC’s imposition of public utility-like regulation on Internet providers. The idea that broadband providers should be regulated under the same common carrier regime as Ma Bell and legacy voice telephone companies doesn’t make sense.

There were occasions, unfortunately, when Chairman Pai and his family were subject to nasty personal attacks because of the positions he took, for example, in leading the Commission to adopt the Restoring Internet Freedom Order. This should never have happened and shouldn’t happen again. But Chairman Pai didn’t back down. Rather he responded to those unjustifiable attacks with grace and aplomb. That’s a worthy legacy too."



Friday, November 27, 2020

State Digital Advertising Taxes Threaten the Economic Recovery

Today is Black Friday. In a normal year, throngs of eager bargain hunters would have started to form lines outside of brick-and-mortar businesses early this morning/late last night. As we all know well, however, 2020 is no ordinary year. Fortunately, online commerce is here to save the day.

But as I wrote in an April 30 Perspectives from FSF Scholars, taxes that single out digital advertising threaten the Internet-based activity that buoys our economy during these challenging times.

Nevertheless, states continue to eye e-commerce as a potential new revenue source.

In March, Free State Foundation President Randolph J. May and I criticized Maryland's digital ad tax in a blog post and Baltimore Sun op-ed. Governor Larry Hogan vetoed that bill in May, but "[t]he General Assembly, where Democrats hold a veto-proof majority, will take up whether to sustain or overturn the veto when it reconvenes in January."

2021 could see similar attempts in other states. In Washington, the not-yet-introduced H-0028.1 would increase taxes on digital advertising services by treating them as "digital automated services" rather than "advertising services." Other states considering similar bills include Nebraska, New York, and West Virginia.

We will continue to monitor and provide updates on such efforts.

Wednesday, November 25, 2020

Thanksgiving 2020

There are good reasons, of course, we may wish to forget the year 2020, which need not be recited here. Indeed, the jokes about ushering 2020 out the door are already legion, like this one: "I'm going to stay up on New Year's Eve this year. Not to see the New Year in, but to make sure this one leaves." Or this one: "The dumbest thing I ever did was to purchase a 2020 planner."

But Thanksgiving, by definition, is not a time of forgetting, but rather of remembering. The act of giving thanks – and counting blessings – necessarily requires remembrance.

On this particular Thanksgiving, especially in the midst of our current travails, we should not forget that this is the 400th anniversary of the Mayflower voyage, the founding of Plymouth Colony, and the signing, on November 11, 1620, of the Mayflower Compact. Less than half of the 102 passengers aboard the Mayflower were members of the English separatist group that earlier had fled to Leyden in the Netherlands in search of religious freedom. It was only later that the entire group became known as Pilgrims.

The Mayflower Compact, brief as it is, is worthy of more attention than it has received on this 400th anniversary, during a year in which so much attention has been focused on America's supposed ills rather than the ideas and ideals embodied in its foundational principles. The Mayflower's original destination was near the mouth of the Hudson River. But when rough seas blew the Mayflower off-course and the Pilgrims landed at what is now Plymouth, they understood that they were in territory beyond the authority that they had been granted. Hence the need for an agreement – which we now call the Mayflower Compact and which the Pilgrims called a "covenant" – to govern their affairs. The covenant was signed by all 41 of the male passengers aboard the Mayflower.

The agreement declares the Pilgrims' purpose "to covenant & combine ourselves together into a civill body politick, for our better ordering, & preservation & furtherance of the ends" of planting a colony. And it continues, "to enacte, constitute, and frame shuch just & equall lawes, ordinances, Acts, constitutions, & offices, from time to time, as shall be thought most meete & convenient for the generall good of the Colonie: unto which we promise all submission and obedience." I've retained the original spelling here, but hopefully the meaning is clear.

The Compact is simple but nevertheless foundational as a declaration of self-government. Those combining together in a "civil body politic" agree to submit to the rule of law under "just and equal" laws, not merely any laws.

The Compact was not a full-blown plan of government. That would await the Constitution of 1787. But it was a foundation upon which future advances in self-government would be built. And in light of the principles established in November 1620 on the Mayflower, the Compact is an important part of the American story.

Fully half of the Mayflower's Pilgrims died of disease and starvation in their first winter in the New World. So there was reason enough for those who survived to assemble in the autumn of 1621 for a feast of "Thanksgiving" with the Pokanoket Wampanoags, who had shared advice on planting and harvesting.

The year 2020 will always be associated with this pandemic, which has caused so much suffering. But in America, as always, we have much for which to be grateful on this Thanksgiving. The prospect of a highly effective vaccine developed in record time, along with the quickening availability of more proven therapeutics, is reason enough to be hopeful – and thankful.

Of course, for many, our Thanksgiving holiday necessarily will be much different this year than ever before, or even than we had envisioned a couple of weeks ago. But amidst whatever other thoughts we entertain this Thanksgiving, recalling the Mayflower Compact should be cause for celebrating the 400th anniversary of an agreement articulating what became fundamental American principles – rule by consent of the governed under just and equal laws.

In closing, it is worth recalling this Thanksgiving, as much now as when James Madison published Federalist No. 14 on November 30, 1787, his plea to his fellow countrymen: "Harken not to the unnatural voice which tells you that the people of America, knit together as they are by so many cords of affection, can no longer live together as members of the same family."

May this Thanksgiving help bring us all closer to our families, friends, and countrymen, bound together by what Madison called our "many cords of affection." 

With best wishes,

Monday, November 23, 2020

Senate Committee Passes Bill Requiring Mid-Band Spectrum for 5G

On November 18, the Senate Committee on Commerce, Science, and Transportation passed S. 4803 – the "Beat CHINA for 5G Act" – by a voice vote. If signed into law, the Act would require the FCC to begin a competitive bidding auction for commercially-licensed use of the 3.45-3.55 GHz band before the end of 2021. As Free State Foundation scholars have emphasized repeatedly, there is an urgent need for more mid-band spectrum for 5G. The 100 MHz of mid-band spectrum identified in S.4803 would help expand 5G network services in the U.S. The FCC has already commenced a proceeding on the 3.45-3.55 GHz band, and the Act would ensure that the auction takes place. A companion bill – H.R. 8548 – has been introduced in the House of Representatives.

Friday, November 20, 2020

Trump Administration Releases its Joint Strategic Plan for IP Enforcement

On November 9, the Intellectual Property Enforcement Coordinator (IPEC) released the 2020 to 2023 Joint Strategic Plan by coordinated federal agencies for promoting and protecting intellectual property (IP) rights. 

The IPEC-developed plan provides an overview of recent and ongoing strategic efforts by the Trump Administration in all areas of IP policy, including copyrights. And it addresses domestic IP policy issues as well as initiatives to ensure that Americans' IP rights receive protections internationally. Included in the Joint Strategic Plan are efforts to better secure copyrights from infringement – particularly online infringement:

The [U.S.-China] Phase One Agreement requires China to provide effective and expeditious action against infringement in the online environment, including by requiring expeditious takedowns and by ensuring the validity of notices and counter notices. It also requires China to take effective action against e-commerce platforms that fail to take necessary measures against infringement. The United States and China agreed to address additional intellectual property issues, including with regard to unauthorized camcording of motion pictures and copyright protection for sporting event broadcasts, in future negotiations... 


The Justice Department and the Department of Homeland Security will continue to aggressively investigate and prosecute individuals and corporations that engage in large-scale online copyright piracy (through illicit streaming services and anti-circumvention devices), which not only violates the rights of copyright holders but also often involves the commission of other serious crimes such as money laundering and tax evasion… In addition, the Justice Department, DHS, and other Federal agencies (as appropriate) will also continue to work with foreign law enforcement and other governmental offices to prosecute and otherwise prevent large-scale online copyright piracy, including the large-scale online pirates that are identified in USTR’s annual List of Notorious Markets... 


The Department of Homeland Security (U.S. Customs and Border Protection (CBP)) will continue to modernize, update and expand the existing e-Recordation program, which provides right holders the opportunity to record their registered trademarks and copyrights to receive enhanced border enforcement of the IP. DHS will continue to provide education and outreach to the industry regarding the critical importance of obtaining trademark and copyright recordations in order to stem the flow of infringing goods into the United States. DHS will continue to educate personnel at all Ports of Entry on the importance of IP enforcement, and arm them with the necessary tools to detect and interdict infringing goods at the border...


The United States will continue to support and encourage the broader and more regularized adoption of voluntary "Trusted Notifier" agreements involving Internet domain registries. These agreements have proven effective in removing websites that engage in large-scale copyright piracy, as has been demonstrated in the implementation of the agreements that the MPAA (now, the MPA) entered into in 2016 with the Radix and Donut registries.

We will likely have more to say on the Joint Strategic Plan – particularly its call for further examination of the copyright "notice-and-takedown" system for removing expeditiously infringing content from Internet websites. Free State Foundation President Randolph May and I wrote about the need for reforms to the "notice-and-takedown" provision in the Digital Millennium Copyright Act in our June 2020 Perspectives from FSF Scholars paper, "Copyright Office Report Should Spur Modernizing the DMCA."

Thursday, November 19, 2020

House Passes Bill to Modernize Federal Spectrum IT

On November 17, the U.S. House of Representatives passed H.R. 7310 – the Spectrum IT Modernization Act of 2020 – by a voice vote. The Act would require NTIA to submit a plan for modernizing its spectrum information technology systems and also require federal agencies that use federally-assigned spectrum to submit to plans for modernizing as well as increasing the effectiveness their own infrastructure.  

Under the bill, the NTIA would report to the Congress on its own management of spectrum infrastructure. Additionally, each agency that uses federally assigned spectrum would submit a plan to the NTIA describing its plans to modernize its infrastructure to use it more effectively. Additionally, the Act would require the Comptroller General of the United States to conduct oversight of NTIA's spectrum IT modernization and report to Congress annually on the implementation of NTIA's plan.

In House floor remarks on the Act, H.R. 7310's sponsor and House Energy and Commerce Committee Chairman Frank Pallone stated that the bill would ensure that systems for using federal spectrum are compatible and interoperable between federal agencies. Ranking Committee member Greg Walden, in his floor remarks, called the Act "a good government bill."


By all accounts, H.R. 7310 is a reasonable and worthwhile measure that would bring about improvements in federal agencies' use and coordination of spectrum. The Senate version of the Act, S.  3717, has been favorably reported by the Senate Committee on Commerce, Science, and Transportation. 

Wednesday, November 18, 2020

MEDIA ADVISORY: FCC's Actions Today Display Commendable Bipartisan Unity

The following statement may be attributed to Free State Foundation President Randolph May regarding today's actions by the FCC:

In a series of votes today, the FCC took some important steps to advance sound communications policy. Probably the most consequential action was the adoption of an order that immediately makes available additional spectrum for next-generation WiFi in the 5.9 GHZ spectrum band, while also reserving spectrum to be used to improve auto safety. While it is not to be expected that the commissioners always will agree across party lines on all consequential matters, nor should they, today's actions show that on many matters, especially those that are more technically and engineering-oriented such as spectrum allocations, they can and do agree on a bipartisan basis. In today's environment, and given the importance of more ubiquitous broadband connectivity and 5G deployment to the nation's social and economic well-being, this is worthy of note, and commendation.

Tuesday, November 17, 2020

A Troubling Allegation of Taxpayer-Funded Broadband Overbuilding

With a recent tweet (see below), FCC Commissioner Michael O'Rielly focused attention on a family-owned ISP's claim that government subsidies have been allocated to overbuild its existing broadband service footprint. The expansion of network infrastructure to areas in fact unserved is a worthy goal, one likely to receive increased attention in the months ahead. But sound policy should foster, not threaten, the central role that private investment performs in the deployment of high-speed Internet access to all Americans.

Late last week, the FCC released updated broadband deployment data based upon Form 477 filings. The number of unserved Americans decreased by 46 percent from 2016 to 2019, to 14.5 million. That is largely the result of private investment by broadband providers totaling $1.7 trillion between 1996 and 2018 – including $80 billion in 2018 alone.

As Free State Foundation scholars have argued time and again, however, the use of taxpayer dollars to subsidize networks that compete with privately funded providers undermines future investment incentives and threatens the continued expansion of access to unserved areas.

In a post written for the ACA Connects blog, Robert Jacobson, co-owner (with his wife and son) of Tongue River Communications in Ranchester, Wyoming, describes a concerning instance of the use of CARES Act funding to construct competing network facilities where it already provides service satisfying – indeed, exceeding – the FCCs definition of "broadband (25/3 Mbps).

According to Mr. Jacobson, these subsidies "could put Tongue River Communications on the brink of ruin in no time at all."

While I can't vouch for the veracity of his allegations, to the extent that they are accurate, they serve as a compelling example why government intervention must be limited to those areas where the economics have proven too challenging for private industry. Broadband service providers, large and small, have connected the vast majority of Americans. Government policies should encourage them to continue those efforts.