With help from Leah Nylen and John Hendel
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— What to do about China? How President Joe Biden will tackle the tech race at the center of the U.S.-China competition is already becoming one of the biggest and most urgent open questions facing his administration.
— As Biden promises the “most diverse” Cabinet ever: Acting FTC Chair Rebecca Kelly Slaughter said the agency and DOJ antitrust division’s track records on diversity were “abysmal and appalling.”
— Welcome week: The tech-focused House Energy and Commerce Committee is gathering this week to introduce new members and leaders — several of whom are already outspoken on Section 230 and antitrust.
GREETINGS, TECHLINGS: IT’S TUESDAY. WELCOME TO MORNING TECH! I’m your host, Alexandra Levine.
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TECH TALK BETWEEN D.C. AND DAVOS PUTS CHINA UNDER THE MICROSCOPE — The Monday back-and-forth on tech between Chinese President Xi Jinping and the Biden White House underscores just how challenging navigating U.S.-China relations will be for the new administration.
— Xi says: “Science, technology and innovation is a key engine for human progress,” the Chinese leader said during a Davos event. “China will create an open, fair, equitable and non-discriminatory scientific environment that is beneficial to all.” In his virtual address to the World Economic Forum, he also warned Biden against teaming up with the EU to box China out of global trade and technology networks.
— Psaki says: Pressed for the White House’s reaction, White House press secretary Jen Psaki said that authoritarian China doesn’t play by those rules and that its conduct, in fact, hurts American workers. “China has been willing to do whatever it takes to gain a technological advantage — stealing intellectual property, engaging in industrial espionage, and forcing technology transfer,” she said at a Monday afternoon briefing. “Our view — the president’s view — is we need to play a better defense, which must include holding China accountable for its unfair and illegal practices. … He’s firmly committed to making sure that Chinese companies cannot misappropriate and misuse American data.” This could mean that Chinese-owned tech companies like TikTok, one of several targets of the Trump administration, won’t see U.S. government scrutiny easing up anytime soon.
Psaki added that the White House intends to engage more with Congress to devise an adequate, strategic approach to address these issues. Lawmakers on both sides of the aisle agree that more must be done to protect American users’ information on Chinese apps.
NAMING NAMES AT THE FTC — Maribeth Petrizzi, who has run the FTC’s compliance office since 2019 (following two decades in the Justice Department’s antitrust division), will serve as acting director of the FTC’s competition bureau, my colleague Leah Nylen reports. Longtime FTC veteran Daniel Kaufman will become acting head of the consumer protection bureau.
FTC LEADER: THERE’S AN ‘APPALLING’ LACK OF DIVERSITY IN ANTITRUST — Slaughter, in one of her first public appearances as acting FTC chair, had some strong criticism of the record of her own agency, and the Justice Department’s antitrust division, on race. “The numbers are abysmal and appalling,” Slaughter said Monday during a discussion about how antitrust enforcement can be used to fight systemic racism. “It is an important thing we need to take on aggressively. Clearly what we have been doing hasn’t been working.”
— Only three commissioners in the FTC’s 107-year history have been Black, along with one former assistant attorney general for antitrust (Charles James, who served in both Bush administrations). And the statistics aren’t any better at the staff level, according to news outfit FTC:Watch: just 4 percent of the FTC’s antitrust prosecutors are Black, with 2.9 percent over at the Justice Department. Democrats have been pushing Biden — who has vowed to have the “most diverse” Cabinet in U.S. history — to ensure that includes his picks for key technology posts.
COMPETITION CORNER: APPLE, GOOGLE FACE MORE HEAT OVER APP STORES — The tech giants are facing new complaints both about what they allow in their app stores and what they keep out. On Monday, the nonprofit Coalition for a Safer Web sued Google for continuing to allow downloads of Telegram even though, the group alleges, the messaging app was used to “coordinate and incite violence” related to the Jan. 6 Capitol riot. The nonprofit sued Apple last week over the same issue. The suits accuse Apple and Google of violating California’s unfair competition law by allowing Telegram in their app stores despite the platform’s alleged facilitation of hate speech, violence and terrorist content.
— Meanwhile, the iPhonemaker is also accused of antitrust violations for rejecting Covid-related apps from its store. In a federal antitrust complaint filed last week, developers of a Covid tracking system say Apple unfairly refused their app, Coronavirus Reporter. A German app developer on Friday also filed antitrust complaints with European and U.S. antitrust authorities over Apple’s rejection of a game designed to show how social distancing and mask-use could minimize coronavirus spread.
COME ONE, COME ALL, ON ENERGY AND COMMERCE — The House Energy and Commerce Committee, one of the key congressional panels driving tech and telecom policy, is convening this week to introduce new members, adopt the subcommittees and announce their leaders. (That meeting, originally slated for today, is now scheduled for Thursday.) Here are some of the Democrats and Republicans who will be coming on board and leading the subcommittees. Collectively, they’ve focused on issues from 5G and broadband to data privacy, antitrust, social media misinformation and content moderation. We already know the committee’s newly elected GOP lead, Cathy McMorris Rodgers (Wash.), views Section 230 as the top target on House Republicans’ tech agenda.
SPEAKING OF 230: REAGAN’S EX-FCC CHAIR CALLS FOR IT TO BE ABOLISHED — Former FCC Chair Mark Fowler — eyeing tech companies’ recent show of titanic power and spats entangling platforms like right-leaning Parler and Rumble — now tells my colleague John Hendel that he thinks the 1996 statute should be killed. That law shields all online companies from liability over content their users post and gives platforms leeway to moderate it.
— That was then: Fowler had, however, expressed great sympathy for the aims of 230 in an interview with POLITICO late last year. At the time, he believed that “inadvertently the Congress pretty much got 230 right because it seems to have worked very well,” he told John then, citing what he deemed the impossibility of a platform like YouTube vetting all the content uploaded in real-time. “Without 230, we really don’t have a third-party marketplace of ideas.”
— This is now: Following that interview’s publication this month, Fowler now tells John that his concerns around speech intrusion have led him to believe that Congress needs to nix 230 altogether and put the tech platforms under the same model that applies to print media. Wholesale abolition is the only answer, he said, fearing that any attempts to amend the law would create more government meddling in free speech. Both Biden and former President Donald Trump have favored outright killing the shield, albeit for different reasons.
— A change in heart: Fowler acknowledged that his views have evolved and blamed Section 230 for creating oligopolies in the tech sector, which he said likely requires antitrust attention as well as a brief phase-out of the liability shield’s protections.
Randall Stephenson, former CEO of AT&T, will serve a one-year stint as a consultant for the company for $1 million, per Reuters. … Some new GOP House Judiciary Committee assignments, via my colleague Olivia Beavers.
And some appointments in the office of acting FCC Chair Jessica Rosenworcel: Travis Litman as acting chief of staff; Kate Black, acting chief policy advisor; Umair Javed, acting chief counsel; D’wana Terry, acting director of the office of workplace diversity; Sanford Williams, acting director of the office of business communications opportunities; Trent Harkrader, acting deputy bureau chief for the Wireline Competition Bureau; Holly Saurer, acting legal advisor for media; David Strickland, acting legal advisor for consumer, enforcement and international; Ramesh Nagarajan, acting legal advisor for wireline; Ethan Lucarelli, acting legal advisor for wireless and public safety; Aurelle Porter, acting staff assistant; and Andi Roane, acting confidential assistant. Rosenworcel also tapped P. Michele Ellison as acting general counsel and Joel Taubenblatt as acting chief of the Wireless Telecommunications Bureau.
And ICYMI: Here are Rosenworcel’s first remarks as acting chair, from Monday.
Another tech giant pulls its donations: “Google will not make contributions from its political action committee this cycle to any member of Congress who voted against certifying the results of the presidential election, following the deadly Capitol riot,” Axios reports.
Birdwatch: “Twitter unveiled a feature Monday meant to bolster its efforts to combat misinformation and disinformation by tapping users in a fashion similar to Wikipedia to flag potentially misleading tweets,” NBC News reports.
You’ve got mail: The Task Force on American Innovation is urging the new administration to boost federal investments in American scientific research for competitive, economic and national security reasons — particularly through the National Science Foundation, NASA, and the departments of Energy, Defense and Commerce.
Prop 22 in 117: Dozens of advocacy organizations joined a National Employment Law Project letter urging leaders of the 117th Congress to ensure gig workers for app-based companies like Uber, Lyft, DoorDash and Instacart have access to essential federal labor protections and basic employment benefits.
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