US DoJ has found another Chinese target

The US Department of Justice is reportedly on the verge of putting the brakes on a Google and Facebook funded Pacific subsea cable over national security concerns over a Chinese partner.

According to the Wall Street Journal, the distrust between Washington and Beijing is on the verge of spreading to another company with links to the Chinese Government. The cable will be roughly 8,000 miles long, connecting Los Angeles with Hong Kong, with an initial estimated design capacity of 120 Tbps. It has been plugged as the longest and one of the fastest worldwide.

The objective of this subsea cable is to provide more diversity and resiliency across the Pacific. Most cables across the Atlantic land in Japan, though by taking a more direct route, theoretically better performance can be realised.

In itself, this all sounds reasonable, especially if companies like Google and Facebook want to increase their presence in the region, but this isn’t what officials have issue with. It is a Chinese company called Dr Peng Telecommunication and Media Group.

Cable Network

For those who aren’t familiar with Dr Peng, this company is one of the major players in the Chinese connectivity market. In years gone, Dr Peng used to be the market leader in the broadband space, though as the state-owned entities diversified into fixed line, margins and market share was squeezed. Today, Dr Peng, China Mobile, China Unicom and China Telecom control more than 90% of the broadband market.

With the three well-known CSPs putting more pressure on the broadband market, Dr Peng has looked to get out of the segment and diversify into new areas. This includes offering connectivity and customer care services to other telcos, it currently owns 15 data centres across China, and also, investments in subsea cables.

This is where the Department of Justice is finding issue with the trans-Pacific subsea cable. Like Huawei, Dr Peng’s ties to the Chinese Government has been deemed too close. The DoJ is citing national security concerns as the reason to put the brakes on deployment.

The deployment of this cable is currently being undertaken by Pacific Light Data Communication (PLDC), a wholly owned by Dr Peng Holding Hong Kong Limited and China Culture Silicon Valley Limited. PLDC is partnering Google and Facebook for investment in this subsea cable.

Once again, collateral damage to US firms has been ignored in the pursuit of national security. It is also perhaps another indication of the animosity between Washington and Silicon Valley. The occupant of the White House is not exactly on the friendliest of terms with the residents of Mountain View, so it should hardly come as a surprise this was not much of a consideration.

For Google and Facebook, this is unlikely to be welcome news. Offering better connections between the US and South East Asia presents significant opportunities to grow exposure and revenues in some fast-growing markets, such as Philippines, Malaysia or Indonesia. If the US firms do not capitalise, someone else will.

It seems that if this cable is to continue on its path, the parties involved would have to prove there is no way the Chinese Government could monitor, alter or stop internet traffic which would flow through it. Proving this resilience and security is going to be a very difficult task.

Another element to consider is the impact to the on-going conflict between Washington and Beijing. The Chinese Government has taken exception to US aggression against Huawei, and it is unlikely to be thrilled about another Chinese company being scrutinised in such a manner as it prevents it doing business.

For those who might have hoped an end to the trade-war might be in sight, the US Department of Justice might be about to add some more fuel to the flames.

FTC Chair kicks off race to tackle big tech before it’s too late

A race seems to be heating up in the US. On one side, government officials are looking to tackle the influence of big tech, and on the other, Silicon Valley is trying to make it as difficult as possible.

Speaking to the Financial Times, Chairman of the FTC Joseph Simons has stated he believes efforts from Facebook CEO Mark Zuckerberg to more intrinsically integrate the different platforms could seriously complicate his own investigation. Back in July, it was unveiled the FTC was conducting a probe to understand whether competition has been negatively impacted by the social media giant.

However, Facebook has gone on the offensive and Simons is clearly not thrilled about it.

“If they’re maintaining separate business structures and infrastructure, it’s much easier to have a divestiture in that circumstance than in where they’re completely enmeshed, and all the eggs are scrambled,” said Simons.

This is the issue which the FTC is facing; Facebook is more closely integrating the separate brands. From a commercial perspective, this will allow the social media giant to cross-pollinate the platforms, potentially increasing revenues and enhancing the data-analytics machine, though it will also make divestments much more difficult to enforce.

Looking across the big names in Silicon Valley, this is a common business practice. The commercial benefits are of course very obvious, but it could be viewed as a defensive strategy in preparation for any snooping from government agencies.

At Google, with the benefit of hindsight, some regulators and politicians might have wanted to have block the acquisitions of Android, YouTube or artificial intelligence firm DeepMind. These acquisitions have led Google to become one of the most influential companies on the planet, though it does appear regulators at the time did not have the vision to understand the long-term impact. Now the services are so deeply embedded and inter-twined it is perhaps unfeasible to consider divestments.

Amazon is another company some of these politicians would love to tackle, but how do you go about breaking-up such a complex business, where the moving parts are becoming increasingly reliant on each-other?

Going back almost two decades, this is not the first-time regulators have attempted to tackle an overly influential player. Thanks to dominance in the PC arena, Microsoft was deemed to be negatively influencing competition when it came to software and applications. Despite Microsoft being forced to settle the case with the Department of Justice in 2001, the concessions stopped far short of a company break-up.

As part of the settlement, Microsoft agreed to make it easier competitors to get their software more closely integrated with the Windows OS, by breaking the company into two separate units, one to produce the operating system, and one to produce other software components. This was a tough pill for Microsoft to swallow, but it was a favourable outcome for the internet giant.

One view on this outcome is that Microsoft managed to structure its business in such a way it became almost impossible to split-up. If the technology giants of today can learn some lessons from Microsoft, they might well be able to circumnavigate any aggression from the US government.

Although the FTC is stealing the headlines here, it is not the only party looking to tackle the influence of Silicon Valley.

The House Judiciary Committee’s subcommittee that deals with antitrust has already summoned Apple, Amazon, Facebook and Google to testify. This investigation is also looking at the potential negative impact these monstrously large companies are having on competition. A couple of weeks later, the Department of Justice also opened its own probe.

Of course, there are also posturing politicians who are aiming to plug for PR points by slamming Silicon Valley. This is a very popular strategy, with the likes of Virginia Senator Mark Warner and Presidential hopeful Elizabeth Warren taking a firm stance. President Trump has rarely been a friend of Silicon Valley either.

Another interest element to consider are the lawyers. Reports have emerged this morning to suggest as many as 20 State Attorney Generals will also be launching their own investigation. The threat of legal action could be very worrying for Silicon Valley, with a number of the lawyers already suggesting they do not like the way the digital economy is evolving, with the concentration of power one of the biggest problems.

The US has generally tolerated monopolies or an unreasonable concentration of power in economic verticals to a point, generally until infrastructure has been sorted, though the pain threshold might be getting to close. This has been seen with a break-up of Standard Oil’s monopoly, as well as splitting the Bell System, a corporation which was a monopoly in some regions for more than a century, into the Baby Bells across North America in the 1980s.

The internet giants will never publicly state they are participating in strategies which in-effect act as a hindrance to government agencies, but it must be a pleasant by-product. First and foremost, the internet giants will want to integrate different products and services for commercial reasons, operational efficiencies or increased revenues for example, however one eye will be cast on these investigations.

It does appear there is an arms race emerging. Government agencies and ambitious politicians are collecting ammunition for an assault on Silicon Valley, and the internet giants are shoring up defences to ensure a continuation of the status quo. This is a battle for power, and its one the US Government could very feasibly lose.

Justice Department green-lights T-Mobile US/Sprint merger

This might sound like the end of the road for one of the most protracted merger processes in recent memory, but T-Mobile US and Sprint will still have to deal with the backlog of legal challenges.

Although this is certainly a win for the duo, it did look ominous for quite a while and there are still a few legal challenges which will have to be dealt with. That said, this is a victory for T-Mobile US and Sprint, and a positive step-forward in the ambition to tackle the market dominance of AT&T and Verizon.

“With this merger and accompanying divestiture, we are expanding output significantly by ensuring that large amounts of currently unused or underused spectrum are made available to American consumers in the form of high quality 5G networks,” said Assistant Attorney General Makan Delrahim of the Justice Department’s Antitrust Division.

“Today’s settlement will provide Dish with the assets and transitional services required to become a facilities-based mobile network operator that can provide a full range of mobile wireless services nationwide.”

In short, without the divestment of Sprint’s prepaid mobile business to Dish, the deal would not have gone ahead. What this announcement now creates is a merger player with a larger horde of spectrum ready to tackle the 5G era and a fourth player which can start to make use of the spectrum licenses it has been quietly accumulating over the last few years.

For Dish, deadlines were fast approaching. After securing various spectrum licenses in the mid- and high-band frequencies, authorities were starting to get a bit irate with the lack of action. Spectrum is a valuable resource in the digital economy and a threat had been made; make use of the assets or hand them back. The acquisition of the boost brand should allow Dish to make a run at the mobile world. It will now have seven years to make use of the T-Mobile/Sprint network while it deploys its own.

Of course, while the end is in sight there are still another couple of headaches to deal with.

Several State Attorney Generals have aired their grievances and filed a lawsuit opposing the deal. The primary concern here was the reduction of national telcos from four to three, though it seems they are still not happy with concessions made to create a fourth player in Dish.

“The promises made by Dish and T-Mobile in this deal are the kinds of promises only robust competition can guarantee,” said New York Attorney General Letitia James, who has led the opposition.

“We have serious concerns that cobbling together this new fourth mobile player, with the government picking winners and losers, will not address the merger’s harm to consumers, workers, and innovation.”

The coalition of State Attorney Generals have reaffirmed their opposition to the merger, questioning whether the formation of a new MNO which has no experience in managing a mobile network is a suitable replacement for Sprint. Elsewhere, the Rural Wireless Association is also opposing the approval.

“Expecting Dish, a start-up mobile carrier in its infancy, to be able to compete as a fourth nationwide network, with divested wireless assets from Sprint and T-Mobile and Boost MVNO customers, and subject only to a handful of requirements that will expire, spells disaster for American consumers,” the RWA said in a statement.

“Three years is not nearly enough time to launch a facilities-based network. Clearly, DOJ has no idea what it takes to build a competitive nationwide mobile network.”

Gaining approval from the Department of Justice might have been one of the more difficult tasks on this quest, but this is not the end of the road for T-Mobile US and Sprint.

DoJ ready to greenlight Sprint/T-Mobile US merger – report

It has been one of the most protracted merger approval processes in recent memories, but source close to the US Department of Justice believe a positive decision is on the horizon for Sprint and T-Mobile US.

With Dish seemingly waiting in the wings to purchase Sprint’s prepaid brand Boost, the Department of Justice might well be on the verge of approving the $26 billion merger. According to the Wall Street Journal, a decision could be made public this week, though the budding duo would still have to face legal challenges from several State Attorney General’s before experiencing the merger euphoria.

After months of regulatory and antitrust objections to the deal, the Department of Justice might well be finally convinced. Aside from off-loading Boost to create a fourth nationwide player in the US, the duo would also have to commit to a three-year roadmap for 5G deployment as well as promising no tariff increases during the period.

Originally it did appear the Department of Justice did not share the enthusiasm as the FCC for the deal, though this report seemingly demonstrates somewhat of a U-turn. What is worth noting is all of these reports and rumours are nothing more than hearsay, though it will be welcome news from the T-Mobile US and Sprint executives who have been fighting against the tide for months.

That said, the deal with Dish appears to be central to this approval.

Earlier this week, it was suggested Dish had come to an agreement with Sprint to purchase the Boost brand for $5 billion. As part of the deal, Dish would become a connectivity customer of the newly merged business as it constructed its own network.

This would appear to be a very sensible report as Dish is under pressure to make use of the spectrum assets it has been collected over the last few years. Deadline day is quickly approaching for Dish to demonstrate it will make use of the licences otherwise it would be forced to hand back the valuable assets.

Hopefully the end of this saga is close as any further delays could start to have detrimental impacts on the 5G rollout plans of the two separate organizations. Both T-Mobile US and Sprint are keen to link up as this would create a more consolidated challenge to the leadership position of AT&T and Verizon in the mobile segment.

That said, objections from various parties have suggested reducing the number of nationwide MNOs from three to four would negatively impact competition, while others have also pointed to recent market trends.

In a joint lawsuit against the merger, several State Attorney Generals have pointed to decreasing prices for mobile contracts over the last few years, arguing that the system works. Some might suggest fixing something which isn’t broken is not the best path; if the current level of competition is benefitting the consumer, why should anyone consider changing it.

These reports are nothing more than rumour for the moment, and there are the lawsuits to consider, but it does appear this prolonged saga might be coming to a close sooner rather than later.

DoJ antitrust chief readies for battle against big tech

There have been plenty of whispers in the back alleys of Silicon Valley of the antitrust boogeyman and now the nightmares are turning into reality.

Speaking at an industry conference in Israel, Assistant Attorney General Makan Delrahim outlined his views on competitiveness in the technology industry. Those who were anticipating an antitrust battle in the US can feel suitably vindicated, as Delrahim effectively confirms he has Google and Apple firmly in the crosshairs.

“The digital economy is a fact of life, but it is not all things to all people,” said Delrahim. “There has been robust public discussion about whether the broader economy, undoubtedly transformed by digital technologies, is working well for everyone.”

Although this is not necessarily shocking news, it is a nuanced confirmation of the up-coming assault against big tech.

Last week, the US took the first tentative steps towards addressing the influence of technology on today’s society. The House Antitrust Subcommittee announced the launch of a bipartisan investigation into competition in digital markets, potentially offering a threat to solid foundation of the technology giants. Diluting the dominance of big tech is going to be a very difficult task, but it does appear the groundwork is being laid.

In this speech, Delrahim is effectively outlining the Department of Justice’s plan, as well as the justification for tackling big tech.

“Where there are credible concerns that a transaction or business practice is anticompetitive, timely and effective antitrust enforcement is imperative,” said Delrahim.

“…After all, the government’s successful antitrust case against Microsoft arguably paved the way for companies like Google, Yahoo, and Apple to enter the market with their own desktop and mobile products.”

Microsoft’s dominance of the technology world in the 90s should not be underplayed and perhaps can be very accurately likened to Google’s influence today. Although the US Government was not successful in breaking-up Microsoft as an organization, it did manage to dilute its power and broaden the spread of wealth. When a company starts to dictate play in the way Microsoft did, the US Government starts to get a bit twitchy.

This is the issue which the likes of Google, Amazon and Apple are facing today. Such is the success of the business, through the creation of best-in-class products and strategic acquisitions to stutter the progress of competitors, the fortunes of the technology industry are incredibly concentrated. This is what Delrahim and his colleagues want to address.

Specifics are often lost in such conference speeches, but an interesting point raised by Delrahim focused on “network effects”. In short, an organization has such control over the supporting ecosystem competition is suffocated before it has any genuine chance to be competitive. Perhaps this is done through acquiring nascent competitors or manipulating the ecosystem.

Although there have been some hints of strategy from Delrahim, the specifics are still evading the industry. That said, it is becoming increasingly clear that the US Government wants to dilute the power and influence of big tech.

T-Mobile/Sprint merger might be heading towards a ‘no’ – report

The merger approval process is heading towards the business-end of proceedings, and the omens are not looking particularly healthy for T-Mobile US and Sprint.

The longer the process takes to complete, the more of a feeling there is the transaction might be denied. As it stands, the FCC has seemingly lit the green light, though it does not appear the Department of Justice (DoJ) is on the same page.

According to reports from Bloomberg, the DoJ is considering additional concessions which would force T-Mobile US and Sprint to create a fourth national MNO to preserve competition. How this would be achieved is not detailed, but it is difficult to see how the duo would be happy with this outcome.

If reports turn out to be true, the concessions bar might be set too high for the parties to be comfortable. This is of course assuming the DoJ is happy with the plans laid out by T-Mobile US and Sprint to satisfy the alleged concession.

The long-standing justification for this merger is to create a more competitive alternative to AT&T and Verizon. To do this, T-Mobile US and Sprint executives have argued combining the network and spectrum assets is imperative. This is where the details of how a fourth nationwide player are needed.

A fair assumption would be the DoJ would insist T-Mobile US and Sprint would spin-off some of their assets to create this fourth alternative. Considering the vast investment which would have to be made, both monetary and time, to establish another MNO from the ground up, it is realistically the only option.

However, spinning-off network and spectrum assets to create a fourth nationwide MNO would most likely weaken the position of the newly combined business. Surely this would undermine the initial justification for the merger? If the merged business does not have access to all the current assets of the pair, would it still be in the same league as AT&T and Verizon?

Critics of the deal are already suspicious of the claims the merged business would be able to satisfy the coverage obligations of the FCC, 97% 5G coverage within three years with no price increases, and what would they say if the DoJ forces the pair to release assets?

These reports also compound theories about the different approaches from the FCC and the DoJ. It would appear the two approving agencies are offering different opinions on a merger for the first time. This can perhaps be explained by the objectives of the agencies.

For the FCC, it does appear improving mobile coverage and quality of experience is the main objective, while the DoJ is focused on preserving competition and choice for the consumer. While there might be some common ground between the two objectives, there is also room for opposing opinions.

For T-Mobile US and Sprint, the situation is not looking the healthiest. Accepting these reported concessions might be difficult if the pair are to remain true to their stated objectives, and that is of course assuming the DoJ accept the response on how they will meet the obligations.

It’s all starting to look a little messy for T-Mobile US and Sprint, and we are starting to get stronger feelings no will be the answer at the end of this prolonged saga.

DoJ doesn’t share FCC enthusiasm for T-Mobile/Sprint – report

The FCC might have a skip in its step after securing concessions from T-Mobile US and Sprint ahead of the proposed merger, but the Department of Justice is not convinced.

Following the approval from FCC Chairman Ajir Pai, and the vote of support from Commissioner Brendan Carr, Sprint share price rose almost 19%. The long-awaited merger to create a genuine challenger to AT&T and Verizon on a national scale looked to be heading in the right direction, only for the DoJ to be the fly in the ointment.

According to Bloomberg, the DoJ believes the concessions made by the pair do not go far enough. This is a move which breaks with tradition, generally the FCC and the DoJ sing from the same hymn sheet when it comes to acquisitions and mergers, though it appears antitrust investigators are still concerned over the threat to competition.

This is perhaps the nuance between the two departments. The DoJ, and various Attorney Generals throughout the US, are primarily concerned with competition, while the FCC rhetoric has been more focused on securing a more efficient and broader 5G rollout.

The concessions have taken the form of three commitments. Firstly, T-Mobile suggests 97% of the population could be covered by 5G within three years. Secondly, Sprint’s prepaid brand Boost would be sold to preserve competition. And finally, there would be no price increases while the 5G network is being deployed.

Of course, there is a very real risk to competition. Taking the number of national telcos from four down to three will mean less choice in the market. Less choice means less opportunity for disruption, even if the hatred from T-Mobile US CEO John Legere towards AT&T and Verizon is effectively teemed from his ears. There are too many examples through history of abuses when it comes to competition for some to be completely comfortable.

You also have to weigh up the current cost of mobile connectivity in the US. Although much has been done to help the consumer, ARPU is still notably more than in Europe, where competition is significantly higher. According to Moneysavingpro.com, the average postpaid contract in the US is as much as $80.25 compared to $30.06 in the UK. US consumers are already feeling the sharp end of the competition stick, and few would want to risk this difference to increase further.

The question is how much pain the consumer can tolerate in pursuit of leadership in the 5G race. Carr has spoken of his primary role at the FCC being focused on creating a leadership position for the US in the 5G era and part of this will depend on getting 5G in the hands of the consumer as quickly as possible. The sooner consumers have 5G, the sooner US firms can scale new services and products before assaulting the international markets. This is a playbook taken from the very successful 4G era.

With the US taking a leadership position in the 4G world, companies like Google, Amazon, Uber, AirBnB and Lyft thrived. These are companies which would have existed without the 4G euphoria, but success was compounded because of the connectivity gains. We are likely to see the same trend in the 5G world, with new products and services being designed for 5G connectivity. The question which remains is where they will call home.

This is the equation the FCC and the DoJ have to balance. The need to protect the consumer against the drive towards future economic success on the global stage. There is not going to be a perfect answer for this one, the US is gambling on the future success of the economy after all.

Huawei facing US trade secret theft indictment and ZTE-style ban

The US Department of Justice is rumoured to be pursuing charges relating to trade secrets theft against Huawei, while four politicians have tabled a bill for a ban similar to what ZTE faced last year.

Leaving the Department of Justice for the moment, a bi-partisan collection of politicians have tabled the so-called ‘Telecommunications Denial Order Enforcement Act’, a proposed bill which would compel the White House to ban Huawei from using US components and IP within its supply chain. The ban would be the same punishment ZTE faced early last year.

“Huawei and ZTE are two sides of the same coin,” said Democratic Senator Chris Van Hollen. “Both companies have repeatedly violated US laws, represent a significant risk to American national security interests, and need to be held accountable. Moving forward, we must combat China’s theft of advanced US technology and their brazen violation of US law.”

Aside from Van Hollen, Republican Senator Tom Cotton, as well as Representatives Mike Gallagher (Republican) and Ruben Gallego (Democrat) are also supporting the proposed bill. This should hardly come as a surprise as the ZTE ban was imposed for violating the exact same trade sanctions which Huawei has allegedly ignored.

The saga surrounding the ZTE ban was short-lived, incredibly volatile and almost fatal. After being found violating trade sanctions, US Department of Commerce’s Bureau of Industry and Security (BIS) imposed a denial of export privileges order against the firm, denying it access to any US suppliers. President Trump stepped in to save the firm, which looked doomed as a result of the ban, before Congress blocked his efforts. Eventually a resolution was reached, though ZTE has been skating on thin ice since.

If precedent is anything to go by, Huawei should face the same punishment should it be found guilty of the same activities. Last month, Huawei CFO Meng Wanzhou was arrested in Canada, accused of violating the same trade sanctions with Iran using a suspect firm known as Skycom. Meng has been released on bail and awaits trial, though it appears the four politicians are already presuming guilt. Or maybe they are just being prepared.

Perhaps this is a sign the politicians do not believe President Trump is committed to precedent and appropriate action. The actions against ZTE smelt suspiciously like one of Trump’s strategic moves in the on-going trade war with China, though perhaps he did not realise he would have to do the same 12 months later, potentially antagonising the Chinese government with a move which is not in the grand plan.

The politicians might be tabling this bill to make sure Trump can’t find a reason not to ban Huawei. Following the arrest, Trump seemed to suggest in an interview with Reuters that he would be willing to make the Canadian charges go away if it would help him the US in its dispute with China.

“If I think it’s good for the country, if I think it’s good for what will be certainly the largest trade deal ever made – which is a very important thing – what’s good for national security – I would certainly intervene if I thought it was necessary,” Trump stated.

Not only does this completely undermine the standing of the Canadian judicial system, but also suggests Trump is willing to bend (or break) rules to bring the Chinese government to its knees. Perhaps Congress does need to be proactive to make sure the President follows the rules, taking appropriate action instead of whatever ludicrous idea floats in the breadth between his ears.

What is worth noting is the stance of Huawei executives. Clearly, they do not agree with anything which is going on, but both Rotating Chairman Guo Ping and Rotating CEO Ken Hu put across messages stating the resilience of the business. Ping and Hu suggested a ban would not impact the Huawei supply chain in the same manner as it did ZTE.

Heading back to the Department of Justice, the Wall Street Journal has reported the agency is pursing charges against Huawei concerning theft of trade secrets.

An indictment should be heading over to the Huawei offices in the near future, focusing on allegations the firm stole robotic mobile-testing technology from T-Mobile. The technology, known as Tappy, mimics human fingers and is used to test smartphones. A civil case between T-Mobile and Huawei over the technology was filed in 2014, though after a criminal investigation the Department of Justice feels it is appropriate to step in and raise criminal charges.

This case is a separate concern from all the other chaos which has surrounded the firm in recent months, though it will be just as concerning as the punishments can be incredibly severe.

The primary federal law that prohibits trade secret theft is the Economic Espionage Act of 1996, which allows the US the U.S. Attorney General to prosecute a person, organization, or company that intentionally steals, copies, or receives trade secrets. If the case if brought against an individual, the punishment could be as much as 10 years in prison or a $500,000 fine. However, we suspect the government would want to punish the firm not an individual, as Huawei would simply claim that person did not represent the company culture, in-line with White House aggression against China.

If a conviction is made against a company the fine can be increased to $5 million. However, if the Attorney General can prove the theft was made on behalf of a foreign government, this would be considered the silver bullet for the White House, corporate fines can be doubled, imprisonment could be 15 years and proceeds derived from the theft can be seized.

In short, Huawei has found itself in another uncomfortable position in the US. It does not appear 2019 is going to be any better than 2018 on the US side of the pond for Huawei.

AT&T suggests Dish and DoJ are collaborating

With AT&T’s WarnerMedia and Dish arguing over a distribution deal, one AT&T executive has suggested Dish and the Department of Justice are collaborating to reverse the green light on the Time Warner acquisition.

The conspiracy theory is hitting new highs here. AT&T is effectively accusing Dish of actively working to create a no-deal situation in negotiations with WarnerMedia over rights to air HBO content. Although having HBO and Cinemax channels go dark on the Dish service would have a negative impact on business, it does coincidentally work well for the Justice Departments case appeal against the Time Warner merger.

WarnerMedia have been in negotiations over the right to air content, with it claiming it offered to extend the previous contract while negotiating but Dish declined. As a result, HBO content has disappeared from the Dish service.

“Dish’s proposals and actions made it clear they never intended to seriously negotiate an agreement,” said Simon Sutton, HBO President and Chief Revenue Officer, in a statement to Reuters.

With the appeal based on the grounds the AT&T acquisition of Time Warner would offer it undue control and influence in the industry, stagnant negotiations certainly add credibility to the objections from the Department of Justice. Manipulating the playing field however, as AT&T is accusing Dish of, is a serious no-no when it comes to the courts.

“This behaviour, unfortunately, is consistent with what the Department of Justice predicted would result from the merger,” said a representative of the Department of Justice. “We are hopeful the Court of Appeals will correct the errors of the District Court.”

“The Department of Justice collaborated closely with Dish in its unsuccessful lawsuit to block our merger,” WarnerMedia responded. “That collaboration continues to this day with Dish’s tactical decision to drop HBO – not the other way around. DOJ failed to prove its claims about HBO at trial and then abandoned them on appeal.”

The $85 billion acquisition of Time Warner proved to be a messy affair for AT&T. While some would have expected some resistance from the industry, the objections of President Trump seems to have encouraged the Department of Justice to chase down every lead, and make life as difficult as possible. The Department of Justice’s appeal against the approval of the deal, is effectively built on the assumption Judge Richard Leon didn’t know what he was talking about.

Publicity stunt? Monopolistic ambition? Nefarious schemes? Whatever the basis of this story, more fuel has been added onto one of the longest running sagas in the telco industry.

Justice Department eyes up social media probe over competition

Department of Justice spokesman Devin O’Malley has raised the prospect of an investigation into whether the social media giants are impacting competition through ‘intentionally stifling the free exchange of ideas’.

In a statement following the Senate Intelligence Committee grilling, O’Malley outlined plans to meet with state attorneys general to discuss the concerns over the next couple of weeks in Washington. While this does not necessarily mean a full investigation or any legal action, the social media giants are receiving plenty of unappreciated attention currently.

“The attorney general has convened a meeting with a number of state attorneys general this month to discuss a growing concern that these companies may be hurting competition and intentionally stifling the free exchange of ideas on their platforms,” said O’Malley.

Attorney General Jeff Sessions has apparently taken on President Trump’s battle against the social media giants. Aside from the Senate Intelligence Committee questioning the effectiveness of social media giants in providing an unbiased and uninfluenced platform for free speech and news, Trump is going tweeting crazy as well.

Trump’s latest target is Google as the President accuses the search platform of political bias. The remarks have escalated the conservative campaign against the internet industry, accusing the technology company of burying Republican orientated news in search results while offering more prominence to the opposition. While the ‘everyone is evil except me’ rhetoric from the President is starting to become boring, we are waiting to see whether the irony of one of the social media giants creating unprecedented exposure for his vile opinions will ever hit home.

Of course, while these are sub-plots, yet to emerge as major thorns for the social media companies, the current saga is focused on the Senate Intelligence Committee. Yesterday saw Facebook COO Sheryl Sandberg and Twitter CEO Jack Dorsey face the grilling, attempting to justify their actions. The questions focused on efforts to keep Russia, Iran and others from disrupting elections and causing other problems. Some Senators found it difficult to believe there isn’t a political bias on the platforms, but that is to be expected.

The current political climate is such that temper tantrums will be thrown and accusations dished out if there is any minor disagreement to propaganda. The concept of the press questioning claims and presenting their analysis to allow citizens to make up their own minds seems to have disappeared. And we thought government was run by mature adults.

While these two internet heavyweights seemingly performed admirably in defending their positions, Google’s empty chair took more than its fair share of criticism. Rather than facing the questions of the Senators, Google decided to skip the hearing after alternative representatives were rebuffed. Instead of defending itself, Senators took aim and fired. Google has largely enjoyed a good relationship with both parties in the US political shark tank, though how this snub impacts the relationship remains to be seen.

With the Senate Intelligence Committee attacking the social media giants from the front, the Oval Office using their own platforms to attack in the virtual world and the Department of Justice gathering support on the horizon, it is looking like another couple of uncomfortable months. We suspect the US political system has already decided who is to blame, but a series of investigations and hearings are needed to justify the accusation. You know, the normal way to identify guilt.