WEBVTT - Meta Trial, Google Hearing, House Tax Vote 0:00:15.720 --> 0:00:18.320 Hello, and welcome to the Votes and Verdicts podcast, hosted 0:00:18.320 --> 0:00:21.400 by the Litigation and Policy team here at Bloomberg Intelligence, 0:00:21.760 --> 0:00:25.560 the investment research platform of Bloomberg LP. Bloomberg Intelligence has 0:00:25.560 --> 0:00:28.479 five hundred analysts and strategists working across the globe and 0:00:28.520 --> 0:00:31.640 focused on all major markets. Our coverage includes over two 0:00:31.640 --> 0:00:34.239 thousand equities and credits and have outlooks on more than 0:00:34.320 --> 0:00:38.479 ninety industries, one hundred market industries, currencies and commodities. This 0:00:38.520 --> 0:00:42.320 podcast series examines the intersection of business policy and law. 0:00:42.720 --> 0:00:45.720 I'm Nathan Dean, an analysts with Bloomberg Intelligence covering policy, 0:00:45.760 --> 0:00:47.680 and I'll be the host of today's episode, which we 0:00:47.720 --> 0:00:51.920 are recording on April tenth, twenty twenty five. So today 0:00:51.920 --> 0:00:54.600 we're going to start with two court cases slash hearings 0:00:54.600 --> 0:00:56.360 that we're covering, and then we'll end up with an 0:00:56.440 --> 0:00:59.440 update on what we've seen in the congressional based as 0:00:59.440 --> 0:01:01.360 we can buy. Now, if you're listening to us, you 0:01:01.520 --> 0:01:04.399 know that President Donald Trump has temporarily dodged tariffs for 0:01:05.240 --> 0:01:07.880 He's put it at ten percent for most countries, but 0:01:07.920 --> 0:01:10.560 obviously he's hit China with harder with one hundred and 0:01:10.600 --> 0:01:12.600 twenty five percent. While we're not going to talk about 0:01:12.600 --> 0:01:15.560 tariffs in today's episode, if you do have a Bloomberg terminal, 0:01:15.600 --> 0:01:18.720 we continue to suggest that you type BI tariff or 0:01:18.800 --> 0:01:21.880 BI tariffs go into your turminal to get all the 0:01:21.920 --> 0:01:24.120 updates of what our analysts are thinking in terms of 0:01:24.160 --> 0:01:27.120 tariffs and the upcoming earning seasons and how it will 0:01:27.160 --> 0:01:29.880 all play out. So with that, let's turn back to 0:01:29.920 --> 0:01:31.720 the courts, and I'm going to bring in Jennifer Ree, 0:01:31.720 --> 0:01:34.760 our senior anti trust analyst. Jen when we were talking 0:01:34.800 --> 0:01:37.039 about what to talk about on this call, you said 0:01:37.040 --> 0:01:39.480 in our ib chat, I can preview the upcoming hearing 0:01:39.520 --> 0:01:42.920 on remedies in the DOJ versus Google search matter. So 0:01:43.000 --> 0:01:45.840 let's go with that question first. Can you preview the 0:01:45.920 --> 0:01:49.040 upcoming hearing on remedies and the DOJ Google search matter 0:01:49.240 --> 0:01:50.960 and explain what the case is for those of us, 0:01:51.040 --> 0:01:52.640 including me, that don't know what it's about. 0:01:53.600 --> 0:01:56.520 Yes, sure, Nathan, and right, good to not talk about 0:01:56.560 --> 0:01:58.600 tariffs or think about tariffs for a few minutes. Right, 0:01:59.760 --> 0:02:02.280 So Google is about to go back into court against 0:02:02.320 --> 0:02:04.880 the Department of Justice. That's on April twenty one, for 0:02:04.920 --> 0:02:08.520 about three weeks. So just as the background What this 0:02:08.720 --> 0:02:11.200 is is the second phase of a matter that was 0:02:11.240 --> 0:02:14.000 actually tried back in the end of twenty twenty three, 0:02:14.320 --> 0:02:16.520 and this was the Department of Justice and a group 0:02:16.560 --> 0:02:21.560 of states challenging Google for illegal alleged illegal monopoly maintenance 0:02:21.639 --> 0:02:26.120 of its search engine and search text advertising. That closing 0:02:26.200 --> 0:02:28.400 arguments for that were in May, and then there was 0:02:28.440 --> 0:02:32.440 a decision last August against the DOJ again holding that 0:02:32.520 --> 0:02:36.639 it illegally maintained its monopolies for search and search text advertising. 0:02:36.880 --> 0:02:38.840 All that is are those are the ads that come 0:02:38.880 --> 0:02:40.840 up when you actually do a search on Google, and 0:02:40.880 --> 0:02:42.880 there's some that are text and some that are images. 0:02:43.080 --> 0:02:44.960 These are the ones that are text, and it kind 0:02:44.960 --> 0:02:46.840 of goes hand in hand with search. If you have 0:02:46.960 --> 0:02:49.160 most of the searches, you're going to be selling most 0:02:49.200 --> 0:02:52.840 of the search text advertising. So how did Google do this? 0:02:53.440 --> 0:02:58.120 Mostly what the judge said was that Google's payment to 0:02:58.240 --> 0:03:01.600 third parties for default positions for Google Search at most 0:03:01.840 --> 0:03:06.000 search access points blocked out its competitors. So what they 0:03:06.040 --> 0:03:08.400 mean is that Google was paying about twenty billion a 0:03:08.440 --> 0:03:11.440 year to Apple so that Google Search was set is 0:03:11.480 --> 0:03:14.160 the default behind Safari. If you open up Safari, you 0:03:14.200 --> 0:03:18.640 do a search you're actually using Google search engine and 0:03:18.760 --> 0:03:24.160 also Android device phone device makers, so they want to 0:03:24.200 --> 0:03:26.840 license Android, they want to make an Android mobile phone. Well, 0:03:26.880 --> 0:03:28.760 Google would say, but you got to put Google Search 0:03:28.800 --> 0:03:31.440 front and center, and you can't install any of our 0:03:31.480 --> 0:03:34.320 search engine competitors, like being our duc dot Go. So 0:03:34.520 --> 0:03:37.240 by doing this, the court said, Google kind of tied 0:03:37.360 --> 0:03:40.480 up the vast majority of search access points. Really, all 0:03:40.480 --> 0:03:42.720 you're left with is Microsoft, because Google's not going to 0:03:42.720 --> 0:03:45.480 get an agreement with Microsoft to put it behind you know, 0:03:45.560 --> 0:03:48.720 Internet Explore. I guess now it's called Edge because Microsoft's 0:03:48.720 --> 0:03:52.280 going to put being there. So now what's happening is 0:03:52.320 --> 0:03:54.440 the next hearing is to say, all right, you're guilty. 0:03:54.480 --> 0:03:56.480 What are we going to do about it? What's the remedy? 0:03:57.400 --> 0:03:59.880 And the Department of Justice has really asked for all 0:03:59.840 --> 0:04:03.880 lot a long list of sort of drastic and complex remedies. 0:04:04.280 --> 0:04:07.040 I think they're very much swinging for the fences. These 0:04:07.080 --> 0:04:10.120 remedies sound scary. I don't believe they expect to get 0:04:10.200 --> 0:04:13.040 quite a few of them, particularly the most drastic. But look, 0:04:13.280 --> 0:04:15.600 when it's a negotiation, you've got to put everything out 0:04:15.640 --> 0:04:18.160 there to be happy with the middle ground. Right, So 0:04:18.279 --> 0:04:20.719 first I think the most obvious one is they're saying, hey, 0:04:20.760 --> 0:04:23.479 no more payments for this default position. You've got to 0:04:23.480 --> 0:04:25.760 open up this market to some of your competitors. And 0:04:25.800 --> 0:04:29.360 that means you also can't make payments or other inducements 0:04:29.400 --> 0:04:33.080 to pro hit it anybody from pre installing as a 0:04:33.120 --> 0:04:35.440 default one of your competitors. And so this would be 0:04:35.480 --> 0:04:39.599 no payments to Apple, no payments to Mozilla for Firefox, 0:04:39.640 --> 0:04:41.800 to telecoms, to Android makers. 0:04:41.480 --> 0:04:41.960 Et cetera. 0:04:43.240 --> 0:04:47.000 And they also can't use their ownership of Android to 0:04:47.080 --> 0:04:50.760 also push for sort of other Google products or the 0:04:50.760 --> 0:04:54.080 bundling of its other products. They also have to give 0:04:54.120 --> 0:04:56.200 prior notice to the DJ. This is what the DJ 0:04:56.360 --> 0:04:58.839 is asking for. This hasn't been decided yet for investments 0:04:58.880 --> 0:05:01.960 or partnerships with IT and any search competitors or company 0:05:02.000 --> 0:05:06.120 that controls a search access point for a generative AI product. Now, 0:05:06.320 --> 0:05:08.200 it doesn't mean that Google won't be able to make 0:05:08.240 --> 0:05:10.040 these investments. It just means they're going to have to 0:05:10.080 --> 0:05:12.560 go to the DJ first and pretty much give it 0:05:12.600 --> 0:05:15.359 the right to approve or disapprove or maybe place conditions 0:05:15.360 --> 0:05:19.200 on the investment. Now, the big one divest Chrome. DJ 0:05:19.360 --> 0:05:22.680 says this is necessary to break up this monopoly and 0:05:23.000 --> 0:05:26.280 to really open up the marketplace and possibly down the 0:05:26.360 --> 0:05:29.760 road Android if Google abuses its ownership of and Android 0:05:29.839 --> 0:05:34.320 in ways that you know, counter the injunction. Now, the 0:05:34.360 --> 0:05:37.960 other options are some data sharing with qualified competitors. This 0:05:38.200 --> 0:05:42.440 includes things like search indexes, add data, some user side 0:05:42.480 --> 0:05:46.839 data so long as user privacy is protected, choice screens, 0:05:46.880 --> 0:05:49.400 which has been used in Europe on existing in New 0:05:49.440 --> 0:05:52.520 Android to Bose devices and in Google Chrome. And then 0:05:52.640 --> 0:05:56.040 last I think, also allowing publishers or content content creators 0:05:56.040 --> 0:05:58.800 to easily opt out from having their content used for 0:05:58.920 --> 0:06:02.240 search index or to train an AI model. So this 0:06:02.320 --> 0:06:04.840 is what they're asking for. I don't think they're going 0:06:04.880 --> 0:06:07.839 to get most of that, Nathan, but that's what the 0:06:07.880 --> 0:06:10.239 hearing is going to be about. It'll be both sides 0:06:10.279 --> 0:06:13.480 presenting evidence as to why these are the necessary remedies 0:06:13.480 --> 0:06:16.440 in Google providing evidence and testimony as to why they 0:06:16.440 --> 0:06:20.200 don't make sense and they could have bad, unintended consequences 0:06:20.240 --> 0:06:23.279 for consumers. I think the most likely remedy will be 0:06:23.320 --> 0:06:26.440 the first one, just saying hey, no more payments for default. 0:06:26.880 --> 0:06:31.480 I think maybe choice screens could be implemented something like that, 0:06:31.640 --> 0:06:34.000 and maybe some data sharing. I'm not so sure about 0:06:34.040 --> 0:06:37.240 that one. I was to say, I primarily think it'll 0:06:37.240 --> 0:06:40.240 be limited because this judge is adhering to Microsoft, which 0:06:40.279 --> 0:06:42.719 sets a precedent forum. It's in hit that circuit, and 0:06:42.760 --> 0:06:46.680 the Microsoft court really counseled against to have caution with 0:06:46.720 --> 0:06:47.800 these kinds of remedies. 0:06:48.240 --> 0:06:50.279 So, just to make sure I got it right, you 0:06:50.279 --> 0:06:51.760 said this was going to be three weeks. 0:06:52.200 --> 0:06:55.040 Three weeks but nonconsecutive, So it'll start April twenty one, 0:06:55.040 --> 0:06:57.240 but it won't wrap up until May, and then closing 0:06:57.320 --> 0:06:59.440 arguments will be later on May thirtieth. 0:06:59.600 --> 0:07:02.240 So how do you advise a Bloomberg client or is 0:07:02.279 --> 0:07:05.760 anybody listening right now if they wanted to try follow this? 0:07:05.880 --> 0:07:06.880 What are you know? 0:07:07.000 --> 0:07:08.800 Is there like a rhythm to this? How are you 0:07:08.839 --> 0:07:09.360 covering this? 0:07:09.560 --> 0:07:09.640 Like? 0:07:09.680 --> 0:07:11.560 How would you advise them that they monitor this? 0:07:12.160 --> 0:07:12.320 Well? 0:07:12.360 --> 0:07:15.000 I think it's really important not to be reactionary because 0:07:15.040 --> 0:07:17.720 the news will be, you know, play by play each 0:07:17.800 --> 0:07:21.120 day saying something happened great, that something happened bad, and 0:07:21.160 --> 0:07:23.280 then the judge will issue is decision, and I think 0:07:23.320 --> 0:07:26.120 the market will react. What everybody should think about is 0:07:26.120 --> 0:07:28.400 the fact that once that decision is issued, no matter 0:07:28.440 --> 0:07:31.640 what it is, Google will appeal both liability and the 0:07:31.680 --> 0:07:35.040 remedy decision, and probably the remedy will be stayed depending 0:07:35.080 --> 0:07:37.240 the appeal. Meaning there's not really going to be an 0:07:37.280 --> 0:07:40.360 impact for another year or two and people need to 0:07:40.400 --> 0:07:42.920 keep that in mind. And our appellate courts tend to 0:07:42.920 --> 0:07:45.960 be conservative. So if this judge does do something drastic, 0:07:46.000 --> 0:07:47.960 I think Google has a shot at getting it pulled back. 0:07:48.320 --> 0:07:50.080 Well that's good insight and good to note. 0:07:50.120 --> 0:07:52.800 Okay, so let's let's turn it over to Justin Treesy, 0:07:52.880 --> 0:07:55.080 our other anti trust analyst. We have a mad A 0:07:55.160 --> 0:07:57.760 trial coming up. What's at stake? What are you looking 0:07:57.800 --> 0:07:59.800 for in the Meida world? 0:08:00.200 --> 0:08:02.760 Yeah? Yes, so I think as far as anti trust 0:08:02.880 --> 0:08:05.280 trials go, Nathan, this one here has got every bit 0:08:05.280 --> 0:08:07.800 of drama and intrigue I think you could want. Right, So, 0:08:08.040 --> 0:08:10.600 what the government here, the FTC is looking for is 0:08:10.600 --> 0:08:15.360 a divestiture of Instagram and WhatsApp two properties of metas 0:08:15.400 --> 0:08:19.400 like closed a long time ago. Right, Whatsappen was closed 0:08:19.440 --> 0:08:22.640 back in twenty fourteen, Instagram back in twenty twelve. So 0:08:22.840 --> 0:08:25.360 really long standing operations here that are now under the 0:08:25.400 --> 0:08:28.560 meta umbrella. Zuckerberg is coming to testify this trial of 0:08:28.640 --> 0:08:31.800 things precede as planned the trials before. Judge James Bosburgh's 0:08:31.800 --> 0:08:33.840 been in the news like crazy lately with regard to 0:08:33.840 --> 0:08:35.840 a lot of things coming out from the administration. So 0:08:36.160 --> 0:08:39.319 all those facets make for a really interesting case. But 0:08:39.320 --> 0:08:40.880 at the end of the day here, like I said, 0:08:40.920 --> 0:08:44.360 these deals closed a long time ago, over over a decade. 0:08:44.360 --> 0:08:47.480 At this point, state claims against Meta around these anti 0:08:47.480 --> 0:08:50.520 trust issues were already dismissed and what the FDC is 0:08:50.520 --> 0:08:52.880 because they were brought too late. But that same requirement 0:08:52.920 --> 0:08:55.320 doesn't apply to the federal government when it's bringing these 0:08:55.400 --> 0:08:58.520 kinds of cases. So what's that issue here is that, 0:08:58.600 --> 0:09:01.079 you know, really what the govern is saying is that 0:09:01.120 --> 0:09:04.679 these purchases made by Meta were done really for anti 0:09:04.720 --> 0:09:07.680 competitive reasons and claus it's anti competitive harm to the 0:09:07.679 --> 0:09:11.400 marketplace and to consumers, basically alleging that the reason behind 0:09:11.400 --> 0:09:14.160 these purchases was to really nip competition in the bud 0:09:14.240 --> 0:09:16.560 before I had a chance to grow and flourish to 0:09:16.559 --> 0:09:19.560 compete against Meta directly. But you know, I think we 0:09:19.640 --> 0:09:21.440 can expect to this trial here, Meta is going to 0:09:21.480 --> 0:09:24.960 really offer all these pro competitive business justifications for why 0:09:25.200 --> 0:09:28.360 these acquisitions were good for the marketplace and the FDC 0:09:28.880 --> 0:09:31.600 from an anti trust law perspective, we really think that 0:09:31.640 --> 0:09:34.360 the claim, the way it's bringing the case about what 0:09:34.400 --> 0:09:37.160 the relevant product market is, it's really discounting a lot 0:09:37.200 --> 0:09:39.960 of realities in the marketplace and how it operates today, 0:09:40.280 --> 0:09:43.040 and that if that market can't be sustained at trial, 0:09:43.280 --> 0:09:46.040 it's pretty much game over for the FTC. So all 0:09:46.120 --> 0:09:47.760 of that's coming to kind of coming together and as 0:09:47.800 --> 0:09:51.880 toue here for the trial beginning next week, and I'll say, 0:09:51.960 --> 0:09:55.200 ultimately from our perspective right now, we really give Meta 0:09:55.240 --> 0:09:57.679 the edge. There's this sixty percent chance we think at 0:09:57.720 --> 0:10:00.440 this point anyway that it is victoria us and all 0:10:00.440 --> 0:10:03.640 the claims in defending all the claims against it. But again, 0:10:03.679 --> 0:10:05.720 you know, it's trial and anything can really roll out 0:10:05.760 --> 0:10:07.320 one way or the other, and you just don't know 0:10:07.360 --> 0:10:09.000 sometimes until things get underway. 0:10:09.400 --> 0:10:12.360 So two questions for you. One is WhatsApp still thing. 0:10:13.800 --> 0:10:16.240 Yeah, that's a good question, you know. And what's really 0:10:16.240 --> 0:10:18.840 interesting here, right is that you know, Meta paid or 0:10:18.880 --> 0:10:21.840 Facebook at the time, paid nineteen billion dollars to close 0:10:21.840 --> 0:10:24.360 that deal to acquire WhatsApp back in twenty fourteen. 0:10:24.400 --> 0:10:25.720 And only one billion. 0:10:25.400 --> 0:10:28.800 Dollars to purchase Instagram, So, you know, really interesting from 0:10:28.800 --> 0:10:31.160 that financial perspective, the way the deal's kind. 0:10:31.000 --> 0:10:32.040 Of rolled out back then. 0:10:32.520 --> 0:10:32.720 You know. 0:10:32.760 --> 0:10:34.679 But I think one other thing, you know, I haven't 0:10:34.720 --> 0:10:36.840 mentioned too is, you know, there's all this talk now 0:10:36.880 --> 0:10:40.080 too about Zuckerberg meeting with President Trump and maybe, you know, 0:10:40.160 --> 0:10:42.360 trying to support the trial from even taking place and 0:10:42.400 --> 0:10:44.520 make some kind of a settlement with the government. I 0:10:44.520 --> 0:10:46.480 think that's still unlikely, but when we're seeing things like 0:10:46.520 --> 0:10:48.960 that in the headlines, obviously, that raises the chances of 0:10:49.000 --> 0:10:51.360 some kind of a deal more than where it was 0:10:51.400 --> 0:10:52.600 even you know, a month ago. 0:10:52.679 --> 0:10:54.959 I would say, you know, and I almost said that, 0:10:55.040 --> 0:10:56.880 I said that in jest, but that was actually a 0:10:56.920 --> 0:10:59.439 really great answer to a question that was said in 0:10:59.520 --> 0:11:02.480 jest by My other question is is that you said 0:11:02.520 --> 0:11:06.000 sixty percent chance. Can you just give us one or 0:11:06.000 --> 0:11:09.640 two things that could potentially happen next week or during 0:11:09.679 --> 0:11:12.480 this trial that would immediately flip you into the forty 0:11:12.520 --> 0:11:14.880 percent category. If there's something like is there like a 0:11:14.920 --> 0:11:17.640 code word the judge would say, or anything that would 0:11:17.640 --> 0:11:18.520 make you go, ohh. 0:11:18.640 --> 0:11:20.160 I got to change this back to my note. 0:11:20.280 --> 0:11:23.040 Yeah, you know, so that's a really great question, and 0:11:23.080 --> 0:11:25.520 I would say, you know, really what's on the line 0:11:25.520 --> 0:11:27.959 here with what I said about the FTC and whether 0:11:28.000 --> 0:11:30.760 it defied the product marketed issue here the right way? 0:11:31.160 --> 0:11:33.120 You know, I think that that's really going to be 0:11:33.240 --> 0:11:35.240 part and parcel to how the case rolls out. And 0:11:35.360 --> 0:11:38.839 last week, you know, I attended a technology tutorial that 0:11:38.840 --> 0:11:42.080 that Meta present different Judge Boseberg, who during that tutorial 0:11:42.120 --> 0:11:44.960 set he's never used any of these social media products 0:11:45.000 --> 0:11:47.920 ever before, and aside from his his kids actually showing 0:11:48.000 --> 0:11:51.079 him posts that they had made using Facebook or Instagram 0:11:51.080 --> 0:11:53.680 over the years, he has no relationship with these technological 0:11:53.760 --> 0:11:56.600 tools at all. So that's going to be interesting to see. 0:11:56.760 --> 0:11:59.080 But during this tutorial that they that they held last 0:11:59.120 --> 0:12:02.800 Friday in DC, you know, Metta really did a great job. 0:12:02.840 --> 0:12:05.760 I think it's showing these similarities between things like feeds 0:12:05.760 --> 0:12:09.240 when you open an app on even YouTube or TikTok 0:12:09.240 --> 0:12:12.679 for example, which the FTC left out of this product 0:12:12.720 --> 0:12:16.439 market as competitors that are operating in this personal social 0:12:16.480 --> 0:12:19.960 media network services space. So that being the case, that's 0:12:19.960 --> 0:12:22.360 what I'm watching for. If it seems like Meta is 0:12:22.400 --> 0:12:25.280 really convincing the court that the property is like that 0:12:25.280 --> 0:12:28.000 that the FTC left out of the product market actually 0:12:28.080 --> 0:12:31.400 are competing with those that are in the product market 0:12:31.400 --> 0:12:33.680 for Facebook. That's really going to push things even further 0:12:33.720 --> 0:12:36.319 into Meta's favor. I think at the trial itself. 0:12:36.840 --> 0:12:37.560 That sounds good. 0:12:37.600 --> 0:12:40.520 Okay, So let's say goodbye to our New York based 0:12:40.520 --> 0:12:43.560 friends and let's move to one of our Washingtonian based analysts, 0:12:43.600 --> 0:12:48.080 Matt Schattenhelm. Matt, you were watching Congress this week, you 0:12:48.120 --> 0:12:51.040 were watching the Senate Commerce Committee. We saw action on 0:12:51.080 --> 0:12:54.640 two Trump nominees, one for the National Telecommunications and Information 0:12:54.760 --> 0:12:57.560 Administration that you may have to explain to our listeners 0:12:57.600 --> 0:13:00.720 what the NTIA actually does, and there for the Federal 0:13:00.720 --> 0:13:03.480 Communications Commission. So can you walk us through what happened 0:13:04.520 --> 0:13:07.280 and what does that mean for the TMT cover companies. 0:13:06.880 --> 0:13:09.080 That you're covering. Yeah, thanks Nathan. 0:13:09.200 --> 0:13:15.120 Yeah, So to development Wednesday of April ninth on Trump 0:13:15.200 --> 0:13:18.760 nominees that are important in the TMT space. So, yeah, 0:13:18.920 --> 0:13:24.000 nt i A is the federal agency, a small federal 0:13:24.040 --> 0:13:29.280 agency that's responsible for managing the federal government spectrum. But 0:13:29.400 --> 0:13:36.040 it's also particularly important because it's managing a broadband funding 0:13:36.160 --> 0:13:41.680 program A forty two billion dollar broadband funding program that 0:13:42.120 --> 0:13:45.080 the that that started under the Biden administration but never 0:13:45.120 --> 0:13:50.280 got around actually passing out the money. And the Trump 0:13:50.320 --> 0:13:54.240 nominee who was before the Senate Commerce Committee, aar L Roth, 0:13:56.559 --> 0:14:00.480 has been appointed to lead that agency and one of 0:14:00.520 --> 0:14:05.240 the big projects on her plate is finishing the distribution 0:14:05.400 --> 0:14:10.600 of the forty two billion dollars in funding. And there's 0:14:10.640 --> 0:14:15.760 been a big push from Republicans to revamp how the 0:14:15.760 --> 0:14:24.400 Biden administration structured that program, and instead of prioritizing fiber projects, 0:14:25.680 --> 0:14:29.240 there's been a push to make it more technology neutral. 0:14:29.800 --> 0:14:32.280 And what that would mean as a practical matter is 0:14:32.320 --> 0:14:35.680 that a much larger percentage of that forty two billion 0:14:35.760 --> 0:14:41.760 dollars could go to satellite companies like Elon, Musk, Starlink, 0:14:42.400 --> 0:14:45.680 and so it would be a likely and negative for 0:14:46.040 --> 0:14:50.480 fiber based companies like cable operators who would be going 0:14:50.520 --> 0:14:55.119 after that money. So Ariel Roth, the nominee, has championed 0:14:55.120 --> 0:15:01.000 that cause of being technologically neutral as opposed to simply 0:15:01.680 --> 0:15:06.200 prioritizing fiber. She got a vote from the Senate Commerce 0:15:06.200 --> 0:15:10.160 Committee on Wednesday that cleared her from that important first step, 0:15:10.760 --> 0:15:14.120 and so now she awaits a final vote on the 0:15:14.200 --> 0:15:18.640 Senate floor. As soon as that happens, she can move 0:15:18.640 --> 0:15:23.000 ahead with this important work on the broadband funding project. 0:15:23.400 --> 0:15:26.920 So and the other one that also in the same 0:15:27.680 --> 0:15:32.200 hearing the Senate Commerce Committee took up was the FCC 0:15:32.720 --> 0:15:36.720 nominee from President Trump, Olivia Trustee. Right now, the FCC 0:15:36.920 --> 0:15:40.680 is divided two to two, two Republicans to two Democrats, 0:15:40.720 --> 0:15:43.040 and she would break that tie and make it three 0:15:43.080 --> 0:15:48.960 to two for Republicans. And why that's really important is 0:15:49.040 --> 0:15:52.880 because none of the controversial stuff can get through until 0:15:52.880 --> 0:15:55.880 the Republicans have a majority. And high on the list 0:15:56.000 --> 0:16:04.440 of potential importance controversial things is broad broadcast deregulation. Uh 0:16:04.520 --> 0:16:10.000 TV broadcasters have been subject to strict ownership limits for 0:16:10.240 --> 0:16:15.840 decades that other competing companies in the video space internet 0:16:15.920 --> 0:16:19.360 streamers don't face, and broadcasters have said, look, this is 0:16:19.400 --> 0:16:21.480 crazy that we're still subject to these limits. 0:16:22.040 --> 0:16:23.720 UH you should ease them. 0:16:24.000 --> 0:16:27.040 And I think Brendan Kahr at the FCC is going 0:16:27.120 --> 0:16:28.800 to be on board with that, and we're going to 0:16:28.800 --> 0:16:33.160 see some pretty significant rule makings from the FCC to 0:16:33.160 --> 0:16:36.360 ease those rules. Olivia trust is likely going to be 0:16:36.400 --> 0:16:38.480 a vote in support of those rulemakings. 0:16:38.520 --> 0:16:38.840 She had. 0:16:39.040 --> 0:16:42.120 She had a question yes at the hearing that that 0:16:42.240 --> 0:16:45.880 touched on that and she and she seemed generally supportive 0:16:45.920 --> 0:16:52.840 of a deregulatory approach. So the hearing before the committee 0:16:52.880 --> 0:16:56.400 on Wednesday went well for her. Uh, some pushback from 0:16:56.480 --> 0:16:59.360 from Democrats on some issues, but not real strong. So 0:16:59.400 --> 0:17:01.320 she shouldn't have a lot of trouble getting through. 0:17:01.840 --> 0:17:03.680 And like then Ariel Roth. 0:17:03.600 --> 0:17:06.639 She'll get a vote from the full Senate and she 0:17:06.680 --> 0:17:09.840 should be on board at the FCC in the second 0:17:09.880 --> 0:17:10.760 quarter of the year. 0:17:10.920 --> 0:17:11.800 No, that sounds good. 0:17:12.080 --> 0:17:13.800 And you know, I was watching a couple of hearing 0:17:13.880 --> 0:17:16.960 myself this week. You know, we had obviously the US 0:17:17.000 --> 0:17:20.720 Trade Representative Jamison Greer testifying to Senate Finance in the 0:17:20.720 --> 0:17:23.800 House fin Ways and Means Committee, but it was on tariffs, 0:17:23.840 --> 0:17:26.560 and obviously lots of things happening on tariffs. 0:17:26.560 --> 0:17:27.320 I'll just leave it that. 0:17:28.280 --> 0:17:31.000 But just today we saw Senate in the Senate Banking 0:17:31.040 --> 0:17:34.560 Committee Michelle Bowman, who is President Trump's nominee to be 0:17:34.640 --> 0:17:37.920 the next FED Vice Chair for supervision. She testified with 0:17:38.000 --> 0:17:40.800 along with four other individuals. She actually only got a 0:17:40.840 --> 0:17:44.880 couple of questions, nothing really groundbreaking or that would dramatically 0:17:45.000 --> 0:17:48.119 change her outlooks. So I anticipate she'll get confirmed in 0:17:48.200 --> 0:17:50.000 the next couple of weeks, and I think the Senate's 0:17:50.000 --> 0:17:51.560 going to be spending a lot of time to try 0:17:51.640 --> 0:17:54.240 and get a lot more of these regulatory leaders into 0:17:54.480 --> 0:17:56.960 office over the next few weeks once they come back 0:17:57.000 --> 0:17:58.119 from their Easter recess. 0:17:58.680 --> 0:18:00.879 On April twenty eighth, Son, thank you very much for 0:18:00.960 --> 0:18:02.399 your piece. Really appreciate it. 0:18:02.880 --> 0:18:04.680 And I'm going to end here by talking a little 0:18:04.680 --> 0:18:08.360 bit about what we just saw this morning, again recording 0:18:08.440 --> 0:18:10.560 this on April tent in terms of the House adoption 0:18:10.720 --> 0:18:14.040 of the Senate Budget resolution plan to extend the Trump 0:18:14.080 --> 0:18:16.960 era tax cuts. So the situation is this is that 0:18:17.440 --> 0:18:20.159 here we are April tenth. Now the House and the 0:18:20.200 --> 0:18:24.320 Senate have both passed the Senate Resolution for extending the 0:18:24.359 --> 0:18:27.000 Trump era tax cuts to in order to extend these 0:18:27.080 --> 0:18:31.440 tax cuts, this was originally from twenty seventeen, which used reconciliation. 0:18:31.560 --> 0:18:32.280 That's time to do that. 0:18:33.280 --> 0:18:35.679 You're looking around four to four and after trillion dollars, 0:18:36.480 --> 0:18:38.800 you know, the Senate resolution calls for an additional one 0:18:38.840 --> 0:18:42.240 point five trillion dollars in terms of additional tax cuts. 0:18:42.960 --> 0:18:46.520 So four point three to four point five current status 0:18:46.600 --> 0:18:50.520 status quo extensions one point five and additional tax cuts. 0:18:51.040 --> 0:18:52.919 But then under the. 0:18:53.000 --> 0:18:58.320 Idea of reconciliation, these tech cuts, these tax extensions have 0:18:58.480 --> 0:19:02.920 to be offset. Now, if you are on the Senate 0:19:03.000 --> 0:19:07.720 Republican side, you know they're adopting this new procedural process, 0:19:07.800 --> 0:19:10.600 if you will, we're rather than trying to offset it 0:19:10.720 --> 0:19:13.800 and pass it in terms of trying to find like 0:19:13.880 --> 0:19:17.639 for like moneies, they're essentially saying that the current policy 0:19:17.800 --> 0:19:19.760 is the current policy, and therefore the cost of it 0:19:20.119 --> 0:19:23.000 is essentially zero. So you go from four point three 0:19:23.040 --> 0:19:26.159 to four point five trillion dollars to zero. Now, the 0:19:26.280 --> 0:19:29.600 House wasn't exactly on board with this idea because in 0:19:29.760 --> 0:19:32.400 terms of the cost estimates for both of these plans, 0:19:33.000 --> 0:19:35.960 the House originally wanted to cut two trillion dollars worth 0:19:36.040 --> 0:19:39.440 of things, so think of things like Medicaid that benefits 0:19:39.520 --> 0:19:43.040 the Inflation Reduction Act, and the Senate plan had four 0:19:43.240 --> 0:19:46.720 billion with a B as a floor for cuts, meaning 0:19:46.760 --> 0:19:50.119 they would cut at least four billion, but mostly higher. Now, 0:19:50.200 --> 0:19:52.480 this was somewhat challenging for a lot of the House 0:19:52.520 --> 0:19:54.840 Republicans to come on board with. They weren't too thrilled 0:19:54.880 --> 0:19:58.399 about this. We saw President Trump on April ninth, way in, 0:19:58.560 --> 0:20:01.680 we saw Speaker John sin s way in just this 0:20:01.880 --> 0:20:04.960 morning on April tenth. But the House ultimately did adopt 0:20:05.560 --> 0:20:09.040 the vote. The budget had one Republican voting against it, 0:20:09.560 --> 0:20:11.440 and it was two hundred and sixteen to two hundred 0:20:11.480 --> 0:20:14.160 and fourteen due to the fact that there were two 0:20:14.200 --> 0:20:17.280 Democratic lawmakers who have passed over the last couple of months. 0:20:17.359 --> 0:20:19.639 And they have open seats. So where are we going 0:20:19.760 --> 0:20:21.840 right now? Well, this is not a bill, This is 0:20:22.000 --> 0:20:22.960 not legislation. 0:20:23.119 --> 0:20:26.159 This doesn't have any specific language in this, but this 0:20:26.359 --> 0:20:28.600 does allow the momentum to keep going, and this does 0:20:28.680 --> 0:20:33.240 allow for both parties to negotiate on the specifics. Now, 0:20:33.480 --> 0:20:36.280 if you ask me, and because you're listening to this episode, 0:20:36.320 --> 0:20:38.520 you are asking me, you know, what do I think 0:20:38.640 --> 0:20:41.200 is going to happen? I think Congress and by means 0:20:41.240 --> 0:20:45.719 the Republicans, are going to pass this resolution sometime between 0:20:45.880 --> 0:20:49.560