Bits Blog: Tech Pushes to Keep Its Spoils in Immigration Bill

Charles Dharapak/Associated Press Steve Case, co-founder of America Online and now chief executive of the investment firm Revolution, spoke about immigration reform outside the White House on Tuesday.

Keen to hold on to its winnings in a landmark Senate immigration bill, the technology industry this week put on what one lobbyist called “a full court press” on Capitol Hill, dispatching executives and entrepreneurs to buttonhole lawmakers and rallying people in the industry to dispatch e-mails, telephone calls and Twitter messages to Congress.

Human resource department heads from eight of the country’s largest technology companies popped into the offices of more than a dozen members of Congress. A new group called Engine Advocacy, which has focused on a so-called start-up visa for foreign entrepreneurs, sent its representatives to the Hill and set up a new online platform, called www.keepushere.org, to encourage techies to send Twitter posts to members of Congress. And yet another industry-led coalition, called Partnership for a New American Economy, and supported by New York City’s mayor, Michael Bloomberg, was rallying supporters to aim at crucial senators, state by state, to support the bill with a “virtual march.”

.@senatorboxer I’m from CA. #iMarch b/c #immigration reform helps UC STEM programs & creates jobs. http://t.co/0Es5di4fsg

— Dave McClure (@davemcclure) 22 May 13

The efforts all point to a wave of unprecedented effort by Silicon Valley firms to make sure the overhaul of the federal immigration law goes in their favor. The omnibus bill, which arrived on the full Senate floor this week after intense negotiations in the Judiciary Committee, contains several provisions directed specifically at the technology sector. It makes it easier for foreign students who get science and engineering degrees at American universities to get permanent residency, creates a new temporary visa for entrepreneurs, and in the most contested clause, vastly expands how many temporary contract workers can be brought into this country under so-called H-1B visas, while also raising the minimum wages they must be paid.

I just pledged to call my Senator on June 18th to ask for support on comprehensive immigration reform http://t.co/N8vpzuv7YP #KeepUsHere

— Swaroop Kolli (@swaroopkolli) 12 Jun 13

The delicate political agreement could still fall apart, and for Silicon Valley, the temporary work visas expansion is by far the most delicate piece. Labor groups say the law should require these companies to hire Americans first. Industry groups call that undue regulatory interference. Both sides have tried to muster evidence to back their claims. And this week, the industry upped the ante by bringing human resources managers directly to Washington to persuade Congress of their need to bring in foreign workers to fill job openings. Organized by the Information Technology Industry Council, a trade group that includes companies like Apple and Oracle, the hiring managers told lawmakers that the demand for talent is so competitive that they sometimes blatantly poach from one another.

There are likely to be more calls on the Senate floor to require companies to show that they are making efforts to hire Americans.

Meanwhile, Senator Jerry Moran, Republican of Kansas, introduced an amendment Wednesday to lower the investments that an entrepreneur would need to get permanent residency. The current bill requires a foreign entrepreneur to raise $100,000 in investments to gain a temporary visa and $500,000 for permanent residency. Among other things, the amendment would lower those thresholds: anyone who raises $250,000 in investments would be eligible for permanent residence.

The biggest push is yet to come. All eyes are on what the industry’s newest, most well-financed lobby, Fwd.us, backed by Facebook’s Mark Zuckerberg, will do next. It has stepped into the immigration fight with expensive television advertisements for key Republicans who backed the immigration bill in the Senate Judiciary. Those ads included a television spot that praised the Keystone XL pipeline, a pet project of key Republican senators, and it cost Fwd.us support from some of its backers in Silicon Valley. It remains to be seen what kinds of political advertisements the group will bankroll next, and who they will back.

U.S. Pushes Agencies to Free Up Spectrum

Without additional airwaves for consumer and business use, administration officials say, the “skyrocketing demand of consumer and broadband business users” for wireless service for smartphones, tablets and other devices will soon outgrow the supply.

For consumers, the initiative could allow cellphone and wireless broadband companies to eventually increase the reliability of their networks, meaning fewer dropped calls and shorter delays in loading video and other large files.

It also could create jobs, the administration says. It cites industry studies reporting that since 2007, more than 500,000 jobs have been created in what is known as the App Economy — the business of creating and selling applications and programs that take advantage of faster Internet speeds and more advanced devices.

The administration said it would invest $40 million in the next year and $60 million more over the next five years to find ways for government agencies to share lightly used airwaves that are under federal control with private wireless communications companies.

Mr. Obama directed federal agencies to make more capacity available by enhancing the efficiency of their spectrum use and to recommend ways of using financial or other incentives to increase sharing of airwaves by government agencies.

“The number of wireless devices is exploding, and that means increasing demands on the spectrum upon which they all rely,” Gene B. Sperling, director of the National Economic Council, said in a White House blog post on Friday. “The federal government helps manage that resource, and we know we can do a better job of unleashing innovation by ensuring more of it is shared, unlicensed for innovations like Wi-Fi, and better used by our departments and agencies.”

One roadblock to that seemingly unlimited growth potential, however, is the reluctance of some parts of the government to part with any of their vast holdings of the nation’s electromagnetic spectrum — the airwaves used by cellphone and wireless communications companies.

In 2010, Mr. Obama directed government agencies to work to free up 500 megahertz of spectrum from federal and private sector sources. Those efforts have been embraced by numerous federal departments, administration officials say.

But a few others, including the Defense Department, have expressed wariness not only at sharing or giving up any of their designated frequencies, but even at revealing the amount and location of airwaves they control. Doing so could compromise national security, Pentagon officials say.

An administration official cited one hypothetical example where an executive department might use a certain frequency for about 12 hours a week of training activities. One agency might be willing to confine its use to prescribed hours, and allow commercial users to share the airwaves at other times, while another department might say it needs the flexibility to be able to use the airwaves at any time.

The Defense Department has said it supports the president’s goals of freeing up spectrum, but noted that an increasingly electronically armed military had its own rising needs for spectrum. The administration emphasized that any new plans to free spectrum should not interfere with “mission-critical capabilities” of military and other government departments.

Nevertheless, the intransigency of some departments has frustrated lawmakers.

“I have long called for a thorough inventory of all public spectrum assets in order to gauge usage and improve efficiency, and have been frustrated by how this debate has dragged out over the past four years,” Senator Mark Warner, a Virginia Democrat, said Friday. “Federal agencies should have the spectrum they need to protect the public, but no one should be warehousing spectrum.”

The Commerce Department has identified more than 300 megahertz of spectrum controlled by the federal government that could be set aside for other uses. The remainder of the 500 megahertz defined as the goal by the administration would come from the so-called incentive auctions that were authorized as part of the 2012 Middle Class Tax Relief and Job Creation Act.

That law provided for the government to share the proceeds of auctions of newly cleared spectrum with television broadcasters who would willingly sell some or all of their spectrum licenses.

Perhaps the most interesting and highly charged recommendation in the president’s directive is one ordering recommendations for incentives that could be used to persuade government departments to share or give up spectrum.

A study released last year by a presidential advisory council on science and technology recommended that the government create a “synthetic” currency that could be used to entice federal agencies. The system would in effect increase an agency’s budget if it gave up or shared its airwaves.

Commissioner Jessica Rosenworcel of the Federal Communications Commission, who has also been advocating such a system since joining the agency in May 2012, about the time the advisory council’s report was released, said federal spectrum policy should be built “on carrots, not sticks.”

“Our traditional three-step process for reallocating federal spectrum — clearing federal users, relocating them, and then auctioning the cleared spectrum for new use — is reaching its limits,” she said. The new initiatives, however, “are a significant step toward meeting the country’s spectrum needs.”

Fear of Amazon Pushes Stores to Offer Same-Day Shipping

This holiday season, same-day shipping has replaced free shipping as the new must-have promotion. It’s logistically complicated and money-losing — and may not even be a service that consumers want or need, analysts say. But retailers from Walmart to small shops like Shoptiques are willing to take the risk. Even the Postal Service has introduced a same-day option for retailers. And the reason is simple: fear of Amazon.com.

Amazon, the world’s biggest online retailer, has hinted that it will expand its same-day shipping service, giving customers the immediate gratification that has been the biggest advantage of brick-and-mortar stores.

For small outfits like Shoptiques, it is not an easy proposition. The courier who showed up at Ms. Wu’s office was the company’s head of boutique operations, who has put aside her regular job this holiday season to make deliveries by hand. Bigger retailers, like Toys “R” Us, Macy’s and Target, have worked with eBay to deliver items the same day, as have other old-line stores. Google has begun testing a local delivery service with several chains.

“There’s lots going on in this space, and it’s all driven by Amazon,” said Tom Allason, founder and chief executive of Shutl, a British same-day delivery service that will expand to the United States next year. “It’s not really being driven by consumers at the moment.”

The same-day delivery idea was a spectacular failure during the dot.com boom. Companies like Kozmo.com and Webvan went under because the services simply cost too much to be profitable. Amazon has offered same-day shipping since 2009, but with limits — only in big cities near Amazon warehouses on certain items ordered in the morning.

The geographical limits exist because Amazon had built warehouses far from major cities to avoid charging sales tax in certain states. But it has now given in on the sales tax fight, and in return, is erecting warehouses near cities like San Francisco, which analysts say is paving the way for faster, more widespread same-day delivery and spurring competitors.

“It’s the old idiom, ‘time is money,’ ” said Lina Shustarovich, an eBay spokeswoman. “How much time are you saving by not going to the store? People want it now, they want it fast.”

Walmart, which is the nation’s biggest retailer but sells just a fraction of what Amazon does online, is testing same-day shipping during the holiday season in five markets. Generally, it gives shoppers a four-hour delivery window and charges $10 for same- or next-day delivery. The idea is “to give customers convenience, by way of combining our online shopping with the local presence of stores,” said Amy Lester, a Walmart spokeswoman for global commerce.

But, Ms. Lester said, the test is showing that consumers often pick next-day delivery rather than same day. She declined to give a specific figure for same-day orders, but said thousands of same- and next-day orders had been placed.

Net-a-Porter, the designer apparel e-commerce site, said its same-day service is quite popular. Its $25 delivery service in the London and New York areas pays for itself, said Alison Loehnis, its managing director. But its clients are accustomed to paying for concierge service, like the customer who ordered clothing to be delivered the same day to her private jet before a vacation.

With the eBay Now iPhone app, introduced this year in San Francisco and New York, customers choose items from physical stores and eBay sends a courier to the store to pick it up and drop it off — at an apartment, office, coffee shop or bar — for a $5 fee.

EBay declined to say whether it loses money on the orders, but analysts who study logistics say it is not profitable.

“The goal with this pilot was never to monetize,” Ms. Shustarovich said. But in the future, it could make money, she said, for example if retailers pay eBay a fee for bringing them customers.

The Postal Service is testing a same-day service in San Francisco that is meant to offset its declining carrier business, a spokesman said. Consumers can order items until 2 p.m. from 1-800-Flowers.com, the first retailer offering the service, and a Postal Service employee will pick up the package and deliver it between 4 and 8 p.m.

Smaller companies are trying different approaches.

TaskRabbit, which offers à la carte personal assistant services, noticed last summer that delivering items from local stores was the most popular task requested.

Now, it charges $10 for delivery from local stores, starting in San Francisco.

This article has been revised to reflect the following correction:

Correction: December 27, 2012

A photo caption with an earlier version of this post misspelled the given name of an employee of Shoptiques.com who was making a same-day delivery. She is Arianna Simpson, not Arriana.

F.T.C. Pushes Antitrust Inquiry Against Google Into January

WASHINGTON — Google was prepared to start the holidays early this week, by settling its antitrust dispute with federal regulators without a harsh punishment.

But in shelving its inquiry until January, the Federal Trade Commission has put stronger penalties back on the bargaining table, people briefed on the investigation who were not authorized to speak publicly about it said Wednesday.

For two years, the F.T.C. has been looking into whether Google abuses its market power by favoring its own services over rivals in search results. Google and the agency had been planning to sign a settlement this week that would have said Google would change some of its behavior but that would not have been subject to court action.

The agency may now demand a consent decree — a formal order detailing anticompetitive behavior and an agreement that if the company does the same thing again, it could be fined and subject to court sanctions. Google has instead offered voluntary concessions.

But the people briefed, and others close to the negotiations, said the agency was unlikely to take a second look at one of the major issues — Google’s dominance in specialized search, like travel and local reviews — because the legal hurdles remain high.

Google has long said that it does not believe it has broken antitrust laws and that the agency’s case against it is weak. Jill Hazelbaker, a Google spokeswoman, said that it continued to cooperate with the F.T.C. but declined to comment further.

Cecelia Prewett, an F.T.C. spokeswoman, declined to comment.

Competitors of Google called for the agency to use the additional time to take harsher legal action against Google. Failing to do so would hurt consumers in many ways, including by allowing Google too much control over private data, said Pamela Jones Harbour, a former F.T.C. commissioner and a lawyer representing Microsoft.

Supporters of Google said its case had already been made.

“If in 19 months they did not offer the kind of evidence and facts to support a case or conclude the behavior was such that it was posing legal difficulties, then frankly another couple weeks isn’t going to make a difference,” said Ed Black, chief executive of the Computer and Communications Industry Association, of which Google is a member.

Regulators’ decision to delay resolution of the case offered a glimpse of the tense negotiations and a series of missteps that have bedeviled the negotiations.

As details of a possible settlement appeared in news reports over the last week, Google’s competitors began arguing that a settlement without court-enforced sanctions was meaningless.

At the F.T.C., people close to the agency said, commissioners grew irked that they were being portrayed as spineless. In a parallel investigation, European regulators were said to be wringing a more stringent agreement from Google.

But it was unclear that Jon D. Leibowitz, the F.T.C. chairman, could get the two votes necessary to approve a tougher case against Google.

The five commissioners had yet to vote on possible sanctions. Julie Brill, a Democrat commissioner, supported strong antitrust action, while Edith Ramirez, the commission’s other Democrat, has resisted the strictest sanctions, said the people who have been briefed on the inquiry.

J. Thomas Rosch, a Republican, questioned whether the agency had the evidence to bring a case on search manipulation, but also expressed skepticism at a settlement that did not involve a consent decree, the people briefed said. Maureen K. Ohlhausen, the other Republican commissioner, opposed the government’s interference in private enterprise, they said.

Each of the commissioners and an F.T.C. spokeswoman declined to respond to queries about their views on the settlement.

Throughout the deliberations, both sides have complained about leaks to the news media of details of private meetings and settlement terms.

Edward Wyatt reported from Washington and Claire Cain Miller from San Francisco.

This article has been revised to reflect the following correction:

Correction: December 21, 2012

An article on Thursday about the Federal Trade Commission’s investigation of Google misspelled the surname of the commission’s chairman. He is Jon Leibowitz, not Liebowitz.