Jul 1, 2021

Axios Login

Thanks to everyone who attended yesterday's Axios event on LGBTQ rights. If you didn't get a chance to tune in, you can watch it on-demand here. And that is the last time I will mention it in this intro.

Today's newsletter is 1,270 words, a 5-minute read.

1 big thing: The fight for broadband cash heats up

Illustration: Sarah Grillo/Axios

The bipartisan infrastructure bill framework sets aside $65 billion for broadband — but the real fight for internet dollars is just beginning, Axios' Margaret Harding McGill reports.

Why it matters: That record infusion of funding, spurred by the pandemic's spotlight on the digital divide, has the potential to make the White House's goal of connecting all Americans a reality — unless it gets mired in squabbling.

What's happening: The way that $65 billion will be divvied up is still very much in flux as the Senate considers how to turn the framework into legislation.

  • "When you have a large pot of money, people are going to try to nibble away at it," Sen. Angus King (I-Maine) told Axios. "Of course, the larger question is we've got to get this built."
  • It's still far from clear if the bipartisan infrastructure plan will pass and, if so, how details may change.

Details: One key position King has staked out is that $40 billion of the funding should go to states to use for broadband, as envisioned by his bipartisan BRIDGE Act with Sens. Rob Portman (R-Ohio) and Michael Bennet (D-Colo.).

  • "The states know best what their problems are, where the gaps are and how best to address them," King said. "One of the problems with the FCC is their maps are lousy."

The other side: The FCC's latest mechanism for awarding broadband funding — reverse auctions in which providers compete against each other to win subsidies — gives taxpayers "more bang for the buck," said Ross Lieberman, senior vice president for government affairs at broadband company trade group ACA Connects.

What to watch: A key question is how policymakers will address the affordability and adoption issues at play in the digital divide.

  • A study commissioned by ACA found that, while roughly 12 million households lack access to the internet, 30 million households do not subscribe to home broadband.
  • King says he'd like to see the bipartisan bill include money for digital equity, but doesn't believe a long-term subsidy to help pay for consumers' internet is the answer.
  • "Frankly, I'm concerned about simply subsidizing rates because I don't think it's sustainable," King told Axios. "Economics and history tells us that all that will happen in that case is that the rates will eventually go up to absorb whatever the subsidy is and the rate-payer is no better off."

The bottom line: How and where the billions of dollars are spent could be the difference between success and failure in achieving universal broadband access.

2. Federal judge blocks Florida social media law

Illustration: Sarah Grillo/Axios

A federal judge has temporarily blocked a Florida law that would have forced social media companies to carry speech even if it violated their rules.

Why it matters: The law, which many experts expected to be declared unconstitutional, was set to go into effect Thursday.

Between the lines: While proponents aimed to position the law as protecting free speech rights, the judge in the case noted that the First Amendment only prevents the government from limiting speech, not private entities.

  • The law also requires social media companies not to take down content from media companies of a certain size and allows for the fining of companies who permanently ban political candidates.
  • Parts of the law are contradictory, Judge Robert Hinkle found, adding that the law was "riddled with imprecision and ambiguity."

Yes, but: The court acknowledges it is less clear just how social media companies should be treated on speech issues more broadly.

  • "The plaintiffs say, in effect, that they should be treated like any other speaker," the judge said in the ruling. "The State says, in contrast, that social-media providers are more like common carriers, transporting information from one person to another much as a train transports people or products from one city to another. The truth is in the middle."

What they're saying: Computer and Communications Industry Association president Matt Schruers, whose trade group was among those who sued to block the law, said the ruling was "encouraging."

"Florida's statute is an extraordinary overreach, designed to penalize private businesses for their perceived lack of deference to the Government’s political ideology. The court's ruling is a win for internet users and the First Amendment."
— Matt Schruers
3. "Farmville" maker Zynga takes aim at consoles

Photo illustration: Axios Visuals. Photos: Zynga

A resurgent Zynga is much more than the company that got everyone playing "Farmville" on Facebook many years ago, company president Bernard Kim tells Axios' Stephen Totilo.

Why it matters: One of the best-known social gaming companies has transformed itself into a mobile giant and is also setting its sights on consoles.

  • "I don't think we are a team that likes to dabble," Kim said. "If we're going to go into something, we're going in to win."

The big picture: Zynga's transformation is part of a familiar pattern in gaming, where console game makers seek to expand into mobile and vice versa.

Between the lines: Thanks to aggressive acquisitions in recent years and a prolific publishing slate of more than 100 active games, Zynga's mobile presence is huge, but somewhat obscured.

  • Its top-performing game, "Empire & Puzzles," isn’t even branded to Zynga (it's listed under its developer Small Giant, which Zynga bought 80% of for more than $560 million in late 2018).
4. Illuminarium promises "VR without the glasses"

Illuminarium's WILD Safari show. Credit: Illuminarium Experiences

A new, high-tech consumer entertainment experience opening today in Atlanta promises to transport users to exotic destinations with the aid of immersive video, touch feedback and more, as Bryan Walsh reports in the new Axios What's Next newsletter (sign up).

Why it matters: Illuminarium — which is set to expand to other cities in coming months and years — is a bet that consumers are ready to come back for in-person entertainment, and that the latest in visual technology can come close to replicating some of the experience of traveling to some of the world's most remote locations.

What's happening: Visitors who come to Atlanta's Illuminarium will enter a 7,500-square-foot space ringed by screens as high as 22 feet, where they'll be enveloped in video and sound recorded on location for the center's first show, WILD Safari.

  • Throughout the 50-minute show, says Illuminarium Experiences founder Alan Greenberg, "you are going to see it as if you are there, hear it as if you are there, feel in your bones through the haptic system in the floor, even smell it in the air .... This is VR without the glasses."

Between the lines: Greenberg — a serial entrepreneur who served as publisher of Esquire in the 1980s — believes Illuminarium will benefit from the pent-up demand for in-person experiences in the post-COVID age.

What's next: The company has already begun building its second Illuminarium in Las Vegas, with plans to open there by around the end of the year, and has further expansion plans in Miami, Chicago and Mexico City.

5. Take note

On Tap

Trading Places

  • Sasha Constanza-Chock said they are leaving MIT for a new post as director of research and design for the Algorithmic Justice League.

ICYMI

  • Amazon wants FTC chair Lina Khan recused from any antitrust investigation of the company, arguing her past statements create the appearance that she has prejudged it. (Axios)
  • Financial regulators revealed details of a disciplinary action against Robinhood that chronicles how the brokerage app harmed millions of customers. (Axios)
  • Maine has passed the country's strictest ban on government use of facial recognition. (ACLU)
  • Instagram head Adam Mosseri said the platform is preparing to show full-screen recommended videos. (CNBC)
6. After you Login

To celebrate the opening of it new store on New York's Fifth Avenue, Lego produced this musical using Broadway talent. I was invited but unable to go, and I think you know how sad that I was to miss it.