Overnight Tech: Netflix scores win over Postal Service

LEDE: The U.S. Postal Service cannot remove its cap and hike prices on the mailers that Netflix and GameFly use to ship their rentals to customers, the U.S. Court of Appeals for the D.C. Circuit ruled Tuesday.

A three-judge panel ruled that the post office dominates the market in the round-trip mailers used by Netflix and others because companies like Fed Ex and UPS do not offer similar services. Because of that, the Postal Service cannot remove the "statutory price ceiling" on those shipments.

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The court rejected the Postal Service's argument that the market should include more than just DVD mailers. The post office said the court should consider stores, kiosks and, most importantly, streaming video. By that measurement, the Post Office had argued it does not control the movie and game distribution market.

The ruling is a win for GameFly and Netflix, even though Netflix in particular has been moving away from physical DVD rentals for years. In the past year, Netflix has dropped nearly 1 million DVD-by-mail members. Still, the company made $80 million in profit from 4.9 million DVD customers in the fourth quarter of last year.

Click here for the court's ruling.

OBAMA'S INTERNET CALL IN CUBA: President Obama on Tuesday reiterated that he has called on Congress to lift the embargo on Cuba. But during a speech in the country, he said the embargo isn't what is preventing the country from expanding Internet service there.

"The Internet should be available across the island, so that Cubans can connect to the wider world and to one of the greatest engines of growth in human history," he said. "There's no limitation from the United States on the ability of Cuba to take these steps. It's up to you."

Click here for Obama's remarks.

And here's The Hill's Jordan Fabian on how Obama's Cuba trip was overshadowed by Brussels.

FREE CALLING TO BELGIUM: In light of recent attacks, all the major U.S. wireless carriers temporarily removed charges for calls and texts to Brussels. In the wake of the explosions in Belgium, officials there urged people in the country to use texting or apps that run over the Internet because of the spectrum crunch that happens during emergencies.

HOW NEWS SPREAD ON TWITTER: The Washington Post has a graphic showing how news of the Belgian explosions filtered through Twitter early Tuesday morning. Chatter was mild throughout the morning before spiking in the 7 a.m. hour.

BILL WOULD TAKE ON PATENT TROLLS AT TRADE COMMISSION: A bipartisan pair of lawmakers reintroduced their bill aimed at thwarting patent trolls at the International Trade Commission. Among other things, the bill would allow the commission to weigh the public interest benefit at any time during a case. The legislation was sponsored by Reps. Tony Cardenas (D-Calif.) and Blake FarentholdBlake FarentholdIt's not just journalists getting sued for free speech Why we need a free speech law to stop Trump-style legal threats Overnight Cybersecurity: House to offer bill on government hacking powers MORE (R-Texas). Broader patent litigation reform has been stalled since making it out of committee last year.

FACEBOOK ENDING ITS BLACKBERRY RUN: Facebook announced that its social media service and Facebook messenger will stop supporting the BlackBerry operating system later this year," according to TechCrunch It follows a similar announcement from WhatsApp last month. BlackBerry only has a sliver of the market, but it still used regularly in the federal government.

ON TAP:

At 8:45 a.m., the Free State Foundation will hold its annual telecom policy conference.

At 2 p.m., the Open Technology Institute will hold a panel on Lifeline.

IN CASE YOU MISSED IT:

Congress must move on an encryption bill in the wake of the terror attacks in Brussels, House Homeland Security Committee Chairman Michael McCaul (R-Texas) told reporters on Tuesday.

Hillary ClintonHillary Rodham ClintonIs Moscow trying to influence Trump-Clinton race? Kaine: Nobody should ever say they're ready to be president O'Malley gives Trump a nickname: 'Chicken Donald' MORE on Tuesday urged the United States to do more to counter the Islamic State in Iraq and Syria (ISIS) on social media

The Federal Trade Commission's Julie Brill is slated to leave the agency at the end of the month, opening up the second vacancy on the five-person panel.  

There could be late changes to the Federal Communications Commission's planned overhaul of its phone subsidy program for low-income Americans, one FCC commissioner hinted Tuesday.

The Department of Defense (DOD) shut down private email access on its servers for about 48 hours on Friday over cybersecurity concerns, The Washington Examiner reports.

Please send tips and comments to David McCabe, dmccabe@thehill.com and Mario Trujillo, mtrujillo@thehill.com Follow us on Twitter: @HilliconValley@dmccabe@_mariotrujillo