Overnight Tech: Trump blocks Broadcom deal over national security | Judge lets breach victims sue Yahoo | Black Caucus presses tech lobby on diversity | Amazon worries rivals with bid for Pentagon job

Overnight Tech: Trump blocks Broadcom deal over national security | Judge lets breach victims sue Yahoo | Black Caucus presses tech lobby on diversity | Amazon worries rivals with bid for Pentagon job
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TRUMP BLOCKS BROADCOM DEAL: President TrumpDonald John TrumpArizona GOP Senate candidate defends bus tour with far-right activist Alyssa Milano protests Kavanaugh in 'Handmaid's Tale' costume Bomb in deadly Yemen school bus attack was manufactured by US firm: report MORE on Monday blocked what would have been the biggest tech deal in history, saying Singapore-based Broadcom's hostile takeover bid for U.S.-firm Qualcomm posed a threat to national security.

The announcement came just hours after Broadcom CEO Hock Tan met with officials from the Committee on Foreign Investment in the U.S. (CFIUS) to make his case for the deal, according to a source familiar with the meeting.

CFIUS had launched an investigation into the national security implications of the deal last week over concerns that it would hamper U.S. efforts to develop 5G wireless networks and other emerging technologies. CFIUS on Monday recommended that the president veto the deal.

In a letter to both companies' attorneys last week, the interagency panel said that it was concerned that Broadcom's takeover would put at risk U.S. efforts to build next-generation wireless networks, thereby giving Chinese firms the opportunity to take the lead.

"While the United States remains dominant in the standards-setting space currently, China would likely compete robustly to fill any void left by Qualcomm as a result of this hostile takeover," the letter read. "Given well-known U.S. national security concerns about Huawei and other Chinese telecommunications companies, a shift to Chinese dominance in 5G would have substantial negative national security consequences for the United States."

Broadcom did not immediately respond to requests for comment Monday night, but in the past week it tried to aggressively push back on concerns that it has any plans to hamper Qualcomm's research and development investments. It announced a $1.5 billion innovation fund, promised to build out Qualcomm's work in 5G and assured Congress that it would not sell any assets to foreign entities.

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BROADCOM'S REVERSAL OF FORTUNE: President Trump's decision to block Singapore tech giant Broadcom's hostile takeover of Qualcomm is a dramatic reversal of fortune for the company.

The decision comes just months after CEO Hock Tan stood alongside President Trump to announce that it would be relocating to the U.S. in a move it said would bring thousands of jobs and billions in revenue.

"He's a highly, highly respected man, a great, great executive," Trump said during the November announcement. "The job he's done is an incredible job. But what he's doing is committing to massive amounts of American jobs."

A few days later, Broadcom announced an unsolicited $130 billion offer for Qualcomm, setting off a months-long feud between the two companies as the latter fought back against the hostile takeover.

Click here to recap Broadcom's long, uphill fight.

 

JUDGE CLEARS WAY FOR YAHOO BREACH LAWSUITS: A federal judge ruled that individuals affected by the Yahoo data breaches can sue the company.

Judge Lucy Koh of the U.S. District Court for the Northern District of California on Friday ruled against a motion from Verizon, which bought some of Yahoo's businesses, seeking to dismiss breach claims from users.

Reuters first reported the ruling.

Among the suits were claims alleging negligence and breach of contract.

The Yahoo breaches occurred in 2013 and 2014 but were not revealed until 2016. Users argued the breach cost them money by requiring the purchase of identity-theft prevention services and that Yahoo should have disclosed the breach sooner.

Read more here.

 

AMAZON BID FOR PENTAGON CONTRACT WORRIES RIVALS: Antitrust critics fear that a winner-take-all contract for the Defense Department's cloud computing needs could help tech giant Amazon corner the government contract market even further.

The winner of the contract, which the DOD updated its position on last week, in its current form would give one company control over serving the Pentagon's cloud computing system as it switches over from an older IT system. The agency predicts that the contract will be worth billions.

Amazon competitors like IBM and Microsoft have been pushing for a multi-party contract that would split cloud-computing services between several companies. They argue that leaving the contract in the hands of a single provider unnecessarily increases cybersecurity risks.

"It's certainly an indication that Amazon has enormous political power," said Stacy Mitchell of the Institute for Local Self-Reliance, a research group that advocates for local businesses and tracks Amazon's movements in government. "They have translated their corporate power and wealth into political power."

Read more here.

 

BLACK CAUCUS PRESSES TECH LOBBY ON DIVERSITY: The Congressional Black Caucus (CBC) is pushing tech and telecom lobbying groups that represent major firms like Google, Facebook, AT&T and Verizon to make their policy teams more diverse.

"On behalf of the Congressional Black Caucus, we write today to express our concerns with the diversity recruitment efforts of the member companies within your associations," members of the caucus wrote in a Feb. 22 letter obtained by The Hill.

The letter was addressed to the Internet Association, USTelecom, the National Cable & Telecommunications Association and CTIA. The CBC pressed the lobbying groups for information on how many black board members they and their member companies have.

Read more here.

 

DROPBOX FILES FOR IPO: The cloud storage company Dropbox on Monday filed to issue public stock at a valuation of roughly $7 billion.

The figure is well below the company's $10 billion valuation in 2014. Analysts attribute the decline to Dropbox's slower-than-desired growth.

Since Dropbox was founded it has had to faced new competition from smaller cloud storage competitor Box, as well as major technology firms like Google, Microsoft and others, who introduced similar products.

The company reported $1.17 billion in revenue in 2017, a 31 percent jump from 2016.

Read more here.

 

LONGREAD OF THE DAY: The New Yorker digs deep into Reddit. The story covers how the website has grappled with problems like the PizzaGate conspiracy theory and Russian manipulation. But in the article Reddit appears more open about Russian interference than other social platforms.

"I'm confident that Reddit could sway elections," Reddit CEO Steve Huffman says in the story. "We wouldn't do it, of course. And I don't know how many times we could get away with it. But, if we really wanted to, I'm sure Reddit could have swayed at least this election, this once."

And check out our story from late last year on why Reddit is uniquely vulnerable to manipulation by malicious governments in a way that Facebook and Twitter are not.

 

ON TAP:

The Senate Commerce Committee will hold a hearing on broadband infrastructure at 10:00 a.m.

The Bipartisan Policy Center will host an event on the internet of things at 10:30 a.m.

 

IN CASE YOU MISSED IT:

Experts are sounding the alarm about new cyber activity from Iran, as hackers become more emboldened and skilled at carrying out surveillance operations and other attacks outside the country's borders. The Hill's Morgan Chalfant has the details.

New York Times op-ed makes the case that YouTube has been one of the most efficient radicalizing tools of the 21st century.

Tim Berners-Lee, the inventor of the World Wide Web, pens an op-ed for The Guardian on how regulating technology companies is necessary to prevent data from being "weaponized."

The Guardian: The "Right To Be Forgotten," gets another court case in the U.K.

Op-ed from The Hill: Weakening encryption is not a solution to election hacking.