National

The Federal Communications Commission on Monday said it had approved Verizon's $6 billion purchase of wireless company TracFone, after the companies agreed to conditions meant to protect consumers.

Why it matters: The FCC was the last regulatory hurdle for Verizon, which expects to close the transaction in the coming days.

Catch up quick: Public interest groups had opposed the deal over concerns it could reduce access to affordable phone service. They withdrew their objections this summer after Verizon committed to continuing to offer TracFone's current services to low-income customers via the government's Lifeline program.

The Lifeline program, administered by the FCC, provides a $9.25 monthly subsidy to companies that provide phone or broadband service to low-income consumers, generally at no out-of-pocket cost to the customer.

Driving the news: The FCC said Verizon made several commitments to secure agency approval, including:

Offering TracFone's Lifeline services for at least seven years.

Offering a 5G plan and cost-effective 5G devices to existing and new Lifeline customers.

Submitting publicly available reports with information on Lifeline and non-Lifeline customers for seven years.

Between the lines: TracFone has a large Lifeline customer base, but Verizon has not been a major player in the program.

Verizon's move into the prepaid market with TracFone will position it to compete against AT&T's Cricket and T-Mobile's MetroPCS.

What they're saying: "The deal will provide customers with the best of both worlds: more choices, better services and new features thanks to Verizon’s investment and innovation," Kathy Grillo, Verizon senior vice president of public policy and government affairs, said in a statement.

FCC approves Verizon's $6B purchase of TracFone

Groups had initially opposed the deal over concerns it could reduce access to affordable phone service.

A photo illustration of a smartphone with the Verizon logo on the screen.

Photo illustration: Mateusz Slodkowski via Getty Images

Federal Communications Commission (FCC)

From the Valley to D.C., Big Tech players like Facebook, Google and Amazon are under more scrutiny than ever as new technology develops and privacy and antitrust concerns grow in lockstep with companies’ ambitions.

Technology

President Biden signed into law Thursday a bill that requires the Federal Communications Commission (FCC) to secure telecommunications systems against potential foreign threats to national security. 

Why it matters: In recent years, lawmakers have increasingly voiced concerns about Chinese telecom giants' operations in the U.S., and possible surveillance by the Chinese government. 

Details: Under the new law, the FCC is barred from considering authorization for products made by companies on its "covered list," which includes Huawei and ZTE.

The designation blocks U.S. companies from using FCC funds to purchase communications equipment and services that the U.S. government considers a national security threat.

The bill received near-unanimous support in Congress. It was sponsored by Sens. Marco Rubio (R-Fla.) and Ed Markey (D-Mass.), along with House Minority Whip Steve Scalise (R-La.) and Rep. Anna Eshoo (D-Calif.).

What they're saying: "[O]ur bipartisan legislation will keep compromised equipment out of U.S. telecommunications networks and ensure our technology is safe for consumers and secure for the United States," Markey said in a statement after the measure passed the Senate in October.

The law will protect the U.S. from equipment that "pose an unacceptable risk to national security," the White House said in a statement Thursday.

Don't forget: Former President Trump repeatedly sanctioned Huawei and other major Chinese tech companies throughout his term.

Biden signs bill to secure telecoms against national security threats

U.S. companies are now blocked from using FCC funds to purchase services from Chinese companies like Huawei.

Photo of the Huawei logo hung up as a sign overlooking an exhibition room

The Huawei booth at the China International Fair for Trade in Services on Sept. 6 in Beijing. Photo: Lu Junming/Costfoto/Barcroft Media via Getty Images

Joe Biden

China

China is becoming the most formidable rival America has faced, and the risk of confrontation with Russia, North Korea or Iran still looms. Authoritarians are rising, the chaotic Afghanistan exit revealed the limits of U.S. power, and the pandemic, climate change and other critical challenges continue to pose grave threats.

World

President Biden has made the COVID-19 crisis and a post-Trump return to national unity and traditional democratic ideals his top priorities. From vaccinations to stimulus to schools, Biden is seeking bipartisan compromise while showing a willingness to use executive authority and bare Democratic majorities in the U.S. House and Senate to implement his policies. Republican leaders are navigating deep party divisions over if and how to move beyond former President Trump.

Politics & Policy

The Federal Communications Commission voted Tuesday to revoke authorization for China Telecom's U.S. subsidiary to operate in America, citing national security concerns.

Why it matters: The state-owned China Telecom is one of the largest telecommunications companies based in China. It has provided services in the U.S. for nearly 20 years but must now cease operations within 60 days. 

What they're saying: The subsidiary China Telecom Americas "is subject to exploitation, influence, and control by the Chinese government and is highly likely to be forced to comply with Chinese government requests without sufficient legal procedures subject to independent judicial oversight," the FCC said in a release.

The Chinese government could use the subsidiary to "access, store, disrupt, and/or misroute U.S. communications, which in turn allow them to engage in espionage and other harmful activities."

China Telecom Americas' conduct with the FCC and other U.S. government agencies also demonstrated "a lack of candor, trustworthiness, and reliability," the commission added.

The FCC requested information from the company last year, but it said China Telecom Americas failed to rebut "serious concerns" raised by the executive branch about its presence in the U.S.

China Telecom Americas did not immediately respond to a request for comment.

Worth noting: The move could set a playbook for the FCC to revoke authorization for other companies with ties to China's government, Politico reports.

Go deeper: FCC member targets Chinese drone giant

FCC votes to halt China Telecom operations in U.S.

The company's U.S. subsidiary is "subject to exploitation, influence, and control by the Chinese government," the FCC said.

Photo of a large blue and red seal that says "Federal Communications Commission"

A meeting room in the Federal Communications Commission headquarters. Photo: Andrew Harrer/Bloomberg via Getty Images

Surveillance

After a record economic expansion, the coronavirus pandemic sent the U.S. economy into a recession as unemployment soared to staggering heights. The country now faces urgent questions about how much stimulus is needed for reeling consumers and businesses, and what a recovery might look like.

Economy & Business

Axios Future

Better sensors, more intelligent AI, and the coming wave of 5G wireless could finally fulfill the promise of the smart city.

Why it matters: How we organize, run and power our cities will be increasingly important in the years ahead, as urbanization expands and the damaging effects of climate change compound.

A smarter city can be a more sustainable and livable one, but connecting where we live carries privacy threats as well as the risks of more disruptive cyberattacks.

By the numbers: Even with the pandemic suburban boom, 80% of Americans live in urban areas, up from 64% in 1950. The percentage is projected by the UN to rise to 89% by 2050. 

Pre-COVID, 3 million people a week around the world were moving to cities — which brings challenges around overburdened infrastructure and equity. 

Between the lines: Those millions of people create a deluge of data through their actions and behaviors — 16.5 zettabytes this year alone, Sameer Sharma, global GM for IOT Solutions at Intel, told me in a recent Axios event. 

That amounts to about 250 billion times more data than a 64 GB iPhone can hold, and until recently, much of that data went to waste. 

As cities add sensors to capture that data — and in the future, 5G wireless to capture even more — and harness AI to draw insights from it, they can bring meaningful intelligence to both the day-to-day operations and longer-term planning of an urban area.

That will have a direct impact on real-world problems. Sidewalk Infrastructure Partners, a spinoff of Alphabet's smart-city arm Sidewalk Labs, helped create North America's first virtual power plant, which pays customers to reduce energy use at moments of high demand, eliminating the need to add more physical power generation.

Details: Smarter cities can start at the neighborhood planning level. Sidewalk Labs has developed a tool called Delve that uses AI to rapidly generate dozens of different design patterns for a development, which can then be scored for density, walkability, energy use and more.

On the screen, the product looks like the computer game SimCity come to life, and it can "contract months of planning time into a few days" for developers, says Douwe Osinga, co-head of Delve.

More detailed data collection can also help cities better manage sudden crises. Intel works with Chicago to harness video analytics and phone use to provide real-time insight into public transit use, which allowed the city to manage capacity as COVID-19 shifted transit patterns.

The other side: Smarter cities are built on data collection, which brings with it concerns about both cybersecurity and privacy.

Sidewalk Labs last year abandoned its plan to create a smart neighborhood in Toronto. It attributed the decision to economic uncertainty, but the project faced significant pushback over data privacy concerns.

Yes, but: "If you want to see technology and industry advance, [city officials] are going to have to take a leap of faith in working with industry," Pittsburgh Mayor Bill Peduto told me.

Peduto has leveraged the AI expertise in Pittsburgh's university and startup scene to test out autonomous vehicles on city streets and create a network of smarter traffic signals to reduce congestion and idling time. 

What to watch: The rollout of 5G wireless connectivity to cities, which will allow far-denser data connections between the millions of internet-enabled devices and sensors active within an urban area. 

The ability of cities to intelligently manage electrical grids or traffic patterns will "radically change once you activate 5G connectivity," says Jonathan Winer, co-CEO of Sidewalk Infrastructure Partners.

The bottom line: The future of the world is still an urban one, but the nature of that future will depend in part on whether cities can grow smart as well as grow big.

Go deeper: Watch our Get Smart by Axios video short course about 5G

The smart city comes of age

Cities are growing bigger. Now they need to grow smarter

Illustration of a skyscraper wearing glasses. 

Smart cities

Axios What's Next

This is THOR, Verizon's Tactical Humanitarian Operations Response vehicle, which the communications giant calls a 5G-enabled Swiss Army Knife on wheels.

Why it matters: It's a prototype of a vehicle that the Verizon Response Team — which handles major emergencies — could send to a disaster zone like a wildfire or hurricane to establish communications when other networks are down. It enables emergency responders from multiple agencies to communicate more easily. 

Details: Built on a modified Ford F650 chassis, THOR can provide its own mobile network, along with commercial satellite options and radio communications.

It can be operated remotely from a tablet and comes with a drone that can fly ahead to provide aerial views for situational awareness.

Fun fact: Verizon's Response Team has a menagerie of field equipment they call The Barnyard: COWs (Cell On Wheels), COLTs (Cell On Light Trucks), CROWs (Cellular Repeater On Wheels) and GOATs (Generator On A Trailer).

Verizon's 5G-equipped vehicle is built for disaster

THOR, the Tactical Humanitarian Operations Response vehicle, can drive into tornadoes, hurricanes and wildfires.

Image of Verizon's communication and disaster response prototype vehicle called THOR

Verizon's Swiss Army Knife for communication and disaster response. Photo: Verizon

Telecom

Axios Login

Japanese telecom giant NTT is using the Olympics to show off a new generation of technologies that can transport the sporting experience to wherever fans are, instead of making them come to games.

Why it matters: Technology like this would have solved tons of problems this year, when no spectators are allowed at the actual Olympic venues. Unfortunately, it's all available only in demo form right now.

In one example, NTT is using augmented reality technology called Kirari to transport badminton matches taking place today and tomorrow at the Musashino Forest Sport Plaza to the National Museum of Emerging Science and Innovation, 22 miles away.

In another, NTT is using fibre-optic cables to allow real-time remote cheering. It previously tested the technology for table tennis and had planned to use it with another sport at the Olympics. 

Yes, but: The remote cheering demonstration is ready to run but still up in the air, since Tokyo's state of emergency means it isn't safe for Japanese fans to gather and cheer at the remote location.

Between the lines: The technology for both remote experiences is fully developed today, says NTT's Shingo Kinoshita, but making it cost efficient will take some time.

With remote cheering, for example, NTT hopes to eventually be able to use 5G or 6G cellular networks to deliver a similar experience without the need for a fixed fiber-optic connection.

Kirari, the hologram technology, has been tested beyond sports, including at SXSW in Austin to show the potential to merge in-person and remote artists in a single performance.

Not all of NTT's work was focused on transporting experiences over great distances. In a project with Intel, it aimed to improve the viewing experience for fans at the sailing venue. 

The companies have set up a 50-meter-wide 12K monitor at the water's edge so those on land can view the race without having to use binoculars. The footage is stitched together from moving images captured from three ships and a drone.

A 50-meter-wide display brings the sailing action closer to those watching from land.

A 50-meter-wide display brings the sailing action closer to those watching from land. Photo: NTT

There may not be fans, but the display is still there to help media, coaches, officials and others to see the action on the water.

A separate, smaller 12K display was set up in the main press center to also allow media to view the sailing action without having to head out to the venue.

The big picture: The Olympics are typically used as a testbed for new technologies and the Tokyo Games were no exception. 

However, the COVID-19 pandemic and uncertainty over the status of the Games meant a number of technology projects from NTT and other companies didn't get to make their Olympic debut in Tokyo.

The other side: Having an extra year to prepare meant that the cameras used to capture the badminton action were upgraded to a higher frame rate and resolution, improving the realism, Kinoshita said.

Japan tests teleporting games and "remote cheering"

NTT's experiments with holograms of Olympic action could have been a godsend for the fan-less COVID games.

Japan's NTT is using augmented reality holograms to transport an event taking place at the Olympics to a museum elsewhere in Tokyo.

NTT is using augmented reality holograms to transport an Olympic badminton match to the National Museum of Emerging Science and Innovation. Photo: NTT

2021 Olympics

Column / Signal Boost

Beijing Winter Olympics

Shifts in technology and media are changing the way we play, watch and understand sports. Business models are adapting and social change is forcing those in charge of teams and leagues to reconsider decades-old practices.

Sports

Jessica Rosenworcel, acting chairperson of the Federal Communications Commission, told an Axios virtual event that the key to helping close the digital divide is to focus on 5G midband spectrum, not millimeter wave.

Why it matters: Research shows that closing the gap in broadband access could add hundreds of thousands of jobs and tens of billions of dollars in economic output, Axios' Bryan Walsh writes. 

What she's saying: Rosenworcel said that the FCC made a mistake a few years ago when it focused all of its energy in the early 5G days on millimeter wave. 

"If we just relied on millimeter wave spectrum, we'd actually grow the digital divide with 5G," she said. "The good news is in the last year and the last several months, we really recognized that we have to pivot from millimeter wave spectrum to midband spectrum." 

"So, moving a big band spectrum, which propagates further – and further is exactly what we need to do – and the good news is we're doing it right now." 

Acting FCC chair says 5G midband spectrum key to closing digital divide

"If we just relied on millimeter wave spectrum, we'd actually grow the digital divide with 5G."

Axios reporter Kim Hart and Jessica Rosenworcel

Blues Wireless, the latest startup from Lotus and Microsoft veteran Ray Ozzie, is announcing $22 million in Series A funding today.

Why it matters: The company, whose launch Axios first reported back in 2019, aims to build 5G modules that can easily add wireless connectivity to all manner of devices.

The round was led by Sequoia Capital and Lachy Groom, with Bill Gates increasing his existing investment in the company.

The company previously had raised $11 million in a seed round.

Between the lines: Blues Wireless announced its first product, Notecard, late last year.

What they're saying: "We offer a simple, affordable solution to a complex and costly problem: helping companies connect their products to the cloud, securely and with minimal effort,” Ozzie said in a statement.

Ozzie is among the pioneers of PC software, creating Lotus Notes, an early program for helping corporate employees manage email and calendar tasks.

In 2005, he sold his startup Groove Networks to Microsoft and rose to succeed Bill Gates as the company's chief software architect before leaving at the end of 2010. 

In 2015, he sold another company, voice communications startup Talko, to Microsoft.

Go deeper: The economic benefits of closing the digital divide

Ray Ozzie's Blues Wireless raises $22 million to add 5G to everything

The union workers who build the nation's internet networks have a huge stake in how Congress decides to divvy up infrastructure funding— and they want strings attached to make sure they're not left on the sidelines.

Why it matters: The telecom workers' union sees an ally in President Joe Biden for its pressure campaign to ensure union members will play a role in infrastructure-funded jobs.

Driving the news: The Communications Workers of America, which counts 300,000 members in the broadband industry, is launching a new lobbying campaign Thursday — the Build Broadband Better campaign — to secure three key requirements in the broadband portion of the infrastructure package.

Prohibit companies that receive federal funding for broadband from interfering with union organizing.

Ban companies from using federal funds to hire subcontractors for broadband buildout as a way of avoiding collective bargaining.

Require that the companies pay the prevailing wage.

What they're saying: "You've got to make sure that when you're doing this, you're using the right folks to put it in," CWA President Chris Shelton told Axios. "And by the right folks, I mean unionized, qualified folks that know how to do this."

Flashback: The campaign builds on lessons learned from the economic recovery in the Obama administration.

"One thing we've experienced through the Recovery Act in the Obama administration is that you really need strings attached to this money for it to get the outcome that we want, if we're going to be investing tens of billions of dollars," CWA government affairs director Dan Mauer told Axios.

CWA members in some cases helped companies secure funding, only for their employers to hire non-CWA members to do the work, he said.

The big picture: Across the economy, the labor market is facing an unusual moment where employees seem to have more power and employers are struggling to fill jobs.

Tilson Technology Management, a Portland, Maine-based company that builds fiber, towers and other infrastructure, has about 140 open positions and has increased its rate for entry-level tower climbers from $17 an hour to $20 to $21 an hour.

"In this type of environment, the labor shortage itself is preventing us from actually taking on more work and work that is available," Tilson executive vice president of workforce Adria Horn told Axios.

What's next: Telecom trade groups, including the Wireless Infrastructure Association, have called for Congress to expand support for a registered apprentice initiative in the broadband industry to address labor shortages.

Yes, but: Shelton says major telecom companies have laid off roughly 45,000 CWA members in the last four years that he says could do the work necessary for broadband deployment.

CWA does not represent tower climbers, Shelton said, and an Economic Policy Institute report from October found that the share of telecom workers represented by a union has fallen from 60% in the 1970s to about 16%.

Meanwhile, Shelton said he's hopeful his union's requests will be included in the infrastructure package.

"Biden is pro, pro union and also is pro, pro getting this done, because he understands broadband is like water or electricity — it has to be done," Shelton said. "And the way to do it — the fastest and the best way — is using union people to do it."

Exclusive: Union flexes muscle for internet funding

Telecom union workers want strings attached to to broadband funding to make sure they aren't left behind.

Illustration of the flex muscle emoji with a dollar sign tattoo.

Broadband

Jobs

New Qualcomm CEO Cristiano Amon laid out his plans for the semiconductor giant in a media roundtable on his first day on the job.

The big picture: Amon sees Qualcomm benefiting from the shift to remote work, as demand grows for higher-end computing and cloud infrastructure on multiple platforms, including in augmented reality, connected cars and virtual reality.

What they're saying: Amon, who headed Qualcomm's 5G business before starting as the new CEO on July 1, said that his "No. 1 challenge is how do we get credit for being a company that is very relevant to the digital transformation of industries beyond mobile."

"Cars are becoming computers on wheels. They have the mechanical chassis, and now they need this new digital chassis. That's where the technology is going, and they'll become a hub for services, not only about computational capacity but the connectivity that goes alongside it."

 On how Qualcomm will handle the remote work revolution:

"We hope to get back to the office, and we're going to do it in phases. As we get to the beginning of the school year, we're going to go to a hybrid work environment that we're going to keep. There's so many things you can do remotely, but I think there are elements of the company culture that people get when they're working together face to face."

On whether we'll see AR glasses by next year: 

"The answer is yes. ... We are convinced that once you have the 5G network built, the phone is going to evolve to allow the element of augmented reality glasses. If you look at what's happening with (VR), we're getting to scale. I think it's just the beginning of an inflection point, and we're going to see that happening on augmented reality glasses as well."

On how better technology could support remote work:

"Imagine you're putting on AR glasses and you can do a 3D reconstruction of your room, and on that, you can place objects around them — one of which could be a rendering of the person you're going to have a Zoom meeting with. It's going to be another step function in the improvement of the quality of remote interaction."

 The bottom line: Still, Amon noted, "we're social animals, so I think people will continue to interact with each other face to face."

New Qualcomm CEO on the future of work and his company

Amon, who took over on July 1, says tech will improve the remote experience, but still values in-office work.

Photo illustration of Cristiano Amon and a computer chip

Photo illustration: Annelise Capossela/Axios. Photo: Miquel Benitez/Miquel Benitez via Getty Images

Qualcomm

Coronavirus-related economic disruption and uncertainty could yet slow the pace of 5G deployment in the U.S. — but for now, the major carriers say they're moving full speed ahead.

Why it matters: The pandemic has highlighted the importance of connectivity as businesses shift to remote work and schools move classes online, making network performance more vital than ever.

What's happening: The major wireless carriers say the coronavirus has not altered the pace of their 5G rollouts, but industry observers and federal officials question how long that will remain true. 

"As a logical matter, I would expect a slowdown," said former Federal Communications Commission official Blair Levin, now a policy adviser for New Street Research.

Levin cited concerns about construction crew members working close to each other; disruptions to supply chains; and consumers' ability and willingness to pay for pricey 5G plans and new phones amid staggering unemployment rates.

Companies may say they're moving ahead, Levin said, "but we’re really early into it, and the notion that consumers are going to pay a premium in an economic downturn is counterintuitive to me."

There may also be fewer 5G-ready devices as a result of the pandemic.

Only a tiny fraction of the phones bought last year supported 5G networks. This year, most new high-end phones were (and still are) expected to support 5G. But with fewer people buying new phones amid the pandemic, that could still mean fewer 5G-ready devices this year.

The big wild card is Apple. The company had been gearing up to launch a 5G phone this year, but things could yet change, says industry consultant Chetan Sharma. The largely Chinese-based supply chain should be ready for the usual fall launch, but Sharma said Apple might decide to delay things if it doesn't see a big enough market for a 5G-capable iPhone.

FCC Commissioner Jessica Rosenworcel said she's pleased that U.S. carriers are moving forward with their 5G plans right now.

"But we need to keep in mind that a mix of factors — delayed standards, deferred [airwaves] auctions, and supply chain issues — could slow this in the future," Rosenworcel said in a statement. "Still, for the long haul I’m optimistic because this crisis is accelerating the digitization of everything and we are counting on connectivity for so much more in modern life."

The FCC pushed back the start of an upcoming wireless spectrum auction to July due to the pandemic.

What they're saying: The carriers insist it's business as usual for their 5G plans.

AT&T noted that federal guidelines have identified telecom workers as essential, and the company is on track with its plans to launch 5G nationwide before July.  "We’re still marching down the path we’ve been talking about," AT&T's Scott Mair, president of technology & operations, told Axios.

T-Mobile and Verizon both said they are moving ahead with 5G build plans, with Verizon recently projecting that it will spend up to $500 million more on capital expenditures this year than originally anticipated.

"They’re just plugging along with the deployment schedules," said wireless analyst Roger Entner. "I think this crisis shows how important telecommunications is."

Between the lines: Some carriers may be in a better position than others to keep moving forward. Sharma noted that for T-Mobile, for example, only a software update is required to add support for Sprint's mid-band 2.5GHz spectrum. 

Many of the carriers, he said, are trying to get masks and other protection gear to ensure workers can continue installing new equipment where needed.

Where things could get slow, Sharma said, is in places where operators need to add new cell sites, given those typically require city approval, which could be harder to get during the shutdown.

Yes, but: The picture is more mixed internationally. 

China is already home to most of the world's 5G subscribers and remains an early adopter of the technology.

Japan and South Korea were also among the first to launch 5G networks, although a Reuters report suggests that the pandemic has dimmed consumer interest in Korea.

Europe was already largely behind in 5G adoption and, with a number of countries hard hit by the virus, the crisis could further delay the rollout there.

5G rollout advances despite pandemic, but hazards loom

Supply chain disruptions and a broader downturn hitting wireless sales are among several potential pitfalls.

Illustration of a cell phone wearing a medical mask

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