Aug 25, 2021

Axios Login

The big fall launches are still a little ways off, but the new product season is already starting: Google last week announced a Pixel 5a, while Google-owned Fitbit today announced the Charge 5 — an updated fitness tracker with a color screen.

Situational awareness: Creator platform OnlyFans said it was suspending its announced plan to drop all sexually explicit content by October.

Today's newsletter is 1,317 words, a 5-minute read.

1 big thing: Broadband plan leaves FCC out in cold

Illustration: Aïda Amer/Axios

As the federal government readies to spend tens of billions of dollars on broadband upgrades, the Federal Communications Commission — the agency that has traditionally doled out subsidies for internet connections — is on the sidelines, Axios' Margaret Harding McGill reports.

Driving the news: The bipartisan infrastructure bill recently approved by the Senate commits $42.5 billion to broadband deployment and related projects, but the money would flow to the states, with oversight from the Commerce Department.

The intrigue: The broadband money got routed around the FCC for several reasons, according to insiders familiar with the process.

  • The White House will be able to exert greater control over how the money is awarded if the Commerce Department is in charge, rather than an independent agency like the FCC.
  • Sources noted that Commerce Secretary Gina Raimondo was a key player in the infrastructure negotiations.
  • The FCC has also come under fire recently for how it handled awarding $9 billion for broadband in rural areas in 2020.

What happened: Critics say the program, known as the Rural Digital Opportunity Fund (RDOF), was rushed in order to begin before the end of the Trump administration.

  • Problems with the accuracy of the FCC's broadband maps led to complaints about funds being awarded to provide broadband in parking lots.
  • There are also concerns that the agency did not thoroughly vet companies before allowing them into the auction, leading to questions about whether providers who won subsidies will be able to deliver service.
  • "If the RDOF had been more successful, I think the FCC would've had a very significant role [in the new funding]," Blair Levin, a non-resident fellow with Brookings Institution, told Axios. "On the other hand, I think if we're talking about this magnitude of money, the senators, many of whom are former governors, wanted governors to have more power."

What's next: The FCC said in July it's taking steps to "clean up" the program.

  • The agency sent letters to 97 companies that won funding in questionable locations to allow them to withdraw without penalties.
  • "For those applicants who are dragging their feet or can't meet their obligations, follow the rules or we will disqualify you and move on," acting chairwoman Jessica Rosenworcel said in a statement last month.
  • The agency budgeted up to $16 billion for the program, but only awarded $9 billion. The extra money can be spent on a second phase of the program.

What they're saying: "The FCC stands ready to help get 100% of Americans connected in any way that Congress sees fit," an FCC spokesperson told Axios Tuesday.

What's next: House Democrats are expected to approve the bill as is rather than blow up the Senate's hard-won compromise — but not until after they also pass a much bigger, Democrats-only "soft infrastructure" bill.

2. Charted: Apple during the Tim Cook era
Expand chart
Data: FactSet; Chart: Axios Visuals

It's been 10 years since Tim Cook officially became the CEO of Apple, now the most valuable public company on the planet.

Here's a look at the Cook era by the numbers, thanks to Axios Closer's Courtenay Brown:

  • 100+: The number of acquisitions under Cook, per CNN — including the $3 billion Beats purchase.
  • $111 billion: Apple's sales in its most recent, record-breaking holiday quarter. That's quadruple the revenue in the same quarter in 2011, The Verge reports.
  • 47%: The share of revenue last year that came from the company's flagship product — the iPhone, first unveiled by Steve Jobs.

My thought bubble: Apple's product line hasn't grown substantially over the last decade, but its revenue has skyrocketed. That's due partly to modest new entries like the Apple Watch and AirPods, but even more to growth in the iPhone business, as well as, more recently, its expansion into services.

What's next: Cook's legacy is likely to hinge on whether he can transform Apple's longer-term bets on health care or autonomous vehicles into significant new businesses.

3. California expands Activision Blizzard suit

California has expanded its anti-discrimination lawsuit against Activision Blizzard on behalf of female full-time employees to also include temporary workers, Axios' Stephen Totilo and Megan Farokhmanesh report.

  • The state's Department of Fair Employment and Housing also alleges the game maker has interfered with its investigation.

Why it matters: While Activision Blizzard has attempted to show over the past month that it is addressing issues raised in the suit, the DFEH is turning up the heat.

A spokesperson for Activision Blizzard said the company has "complied with every proper request in support of its review even as we had been implementing reforms to ensure our workplaces are welcoming and safe for every employee."

Between the lines: The amended complaint was filed Monday and redefines the "group" it says was wronged by the gaming giant.

  • A copy reviewed by Axios specifically mentions that California's protections against anti-harassment, equal pay and other equal employment opportunity protections "exist for employees and contingent or temporary workers."
  • Throughout the lawsuit, the word "employees" has been changed to "workers" in reference to harassment, sex discrimination regarding pay and other allegations.

The DFEH also says Activision Blizzard has stymied its efforts through NDAs, requiring employees to speak with the company ahead of contacting the DFEH, and its involvement with WilmerHale, a law firm the game maker said will investigate misconduct issues.

  • The suit claims that this "directly interferes" with DFEH's ability to "investigate, prosecute, and remedy workplace discrimination and harassment violations on behalf of employees and contingent or temporary workers."

The big picture: The change comes after stories revealed toxic conditions faced by Activision Blizzard contract workers.

  • Stories shared with Axios from the ABK Worker's Alliance specifically from the quality assurance and customer service departments paint a picture of brutal overtime paired with little pay.
4. $5M FCC fine for right-wing duo's election calls

The Federal Communications Commission Tuesday proposed a $5 million fine against right-wing activists Jacob Wohl and Jack Burkman for allegedly making illegal robocalls discouraging mail voting ahead of the 2020 election, Margaret reports.

The big picture: The record-setting penalty from the FCC comes as the pair faces criminal charges of voter suppression in Michigan and a federal lawsuit in New York accusing them of making 85,000 robocalls to Black Americans in an attempt to keep them from voting.

Driving the news: The FCC says Wohl and Burkman made over 1,000 pre-recorded calls to wireless phones without receiving consent for those calls, in violation of the Telephone Consumer Protection Act.

  • The messages said if the voters cast their ballot by mail, their "personal information will be part of a public database that will be used by police departments to track down old warrants and be used by credit card companies to collect outstanding debts," according to an FCC news release.
  • The FCC fine is not final, as Wohl and Burkman will be able to respond to the agency's accusations before the commission votes to finalize the penalty.

Context: The Lawyers' Committee for Civil Rights Under Law and the law firm Orrick, Herrington & Sutcliffe in October 2020 filed a lawsuit and temporary restraining order against the pair in New York.

5. Take note

On Tap

Trading Places

  • Margaret Mitchell, the former co-head of Google's accountable AI unit, is joining Hugging Face. Mitchell was fired from Google in February following an investigation into her use of corporate e-mail after the company forced out Timnit Gebru, the other AI unit co-head.
  • San Francisco email startup Superhuman has hired Facebook and Dropbox product leader A.J. Frank as its first head of product.

ICYMI

  • T-Mobile offers the fastest 5G service in the most places, according to PC Magazine's latest testing.
  • Alaska Airlines had to evacuate a flight once a passenger's phone ignited after landing. The phone was apparently burned beyond recognition, but its owner told Seattle airport authorities that it was a Samsung A21. (The Verge)
6. After you Login

As we head into product launch season, it's a good time to revisit Dwight's epic launch of the triangle-shaped Pyramid tablet on "The Office."