The Big Story: Lawmakers scrutinize Chinese social media app TikTok. The Senate Judiciary Subcommittee on Crime and Terrorism held a hearing on Tuesday to examine how technology companies might be exposing user data to “criminals, China, and other bad actors,” with lawmakers spending much of the time lambasting popular social media app TikTok for not sending a representative to testify before the panel.
Lawmakers and government officials have grown increasingly concerned about ties between tech companies like TikTok and the Chinese government. It was reported last week that the Committee on Foreign Investment in the United States contacted TikTok’s parent — Chinese IT company ByteDance — to express concerns that the acquisition of social media app Musical.ly represented a national security concern.
While lawmakers also discussed other tech platforms during the hearing, TikTok received the majority of lawmaker ire because the app originates in China and could potentially be susceptible to interference from Beijing. A TikTok representative told the subcommittee in a letter that the company does not store U.S. users’ data in China, and does not remove content at the behest of the Chinese government.
Policy Roundup:
U.S. needs to boost AI efforts. An interim report released by the National Security Commission on Artificial Intelligence on Monday found that the federal government needs to build a better relationship with U.S.-based technology companies in order to ensure that the country’s artificial intelligence capabilities continue to outpace China’s growing AI industry. During the National Security Commission on AI’s conference the same day, Senate Minority Leader Chuck Schumer (D-N.Y.) announced that a bipartisan proposal for $100 billion in funding for AI research was moving through Congress to help improve the country’s development efforts on the emerging technology.
Democrats in House introduce data privacy bill. Reps. Zoe Lofgren (D-Calif.) and Anna Eshoo (D-Calif.) introduced data privacy legislation that would empower a newly-created federal agency to manage how large tech companies collect and use data from U.S. consumers. The bill—The Online Privacy Act—comes as lawmakers in both the House and Senate continue to work on bipartisan legislation that would create a federal data privacy framework.
YouTubers call for changes to FTC settlement. A group of video creators who produce children’s content for YouTube are appealing the Federal Trade Commission’s recent settlement with the video platform that includes a commitment to not run “personalized” ads on videos aimed at young children.
Cyberattacks drive consumers away from small businesses. A survey released this week by the Cyber Readiness Institute found that three-quarters of U.S. consumers are less likely to make online purchases from small businesses that have experienced cyberattacks. Almost two-thirds of the respondents expected small businesses to offer the same cyber protections as larger competitors, despite their disparate sizes.
Engine submits comments on importance of high-quality patents. Engine submitted comments this week to the Senate Judiciary’s subcommittee on intellectual property following the panel’s Oct. 30th hearing to consider what Congress can do to prevent the issuance of low-quality patents. We stressed that lawmakers should prioritize patent quality and work to improve confidence in the U.S. patent system, noting that “patent quality is essential to the state of innovation.”
FTC’s Simmons, DOJ’s Delrahim to appear before House panel. FTC Chairman Joe Simmons and Department of Justice antitrust chief Makan Delrahim will reportedly appear at a House Judiciary antitrust subcommittee hearing at 2 p.m. next Wednesday, November 13. The hearing is the fourth one in the subcommittee’s ongoing investigation into the market power of large online platforms.
Chinese trade deal might come this month. Commerce Secretary Wilbur Ross told reporters he was optimistic that the Trump administration would reach a “Phase One” trade deal with China sometime this month, adding that U.S. companies would likely receive licenses “very shortly” to continue selling components to Chinese telecoms firm Huawei.
Trade deals and liability protections. Sen. Ted Cruz (R-Texas) urged U.S. Trade Representative Robert Lighthizer in a letter to remove Section 230-like language from international trade deals like USMCA, saying in part that “big tech is not living up to its end of the legislative bargain” when it comes to moderating online content. As we pointed out in an op-ed last month, however, the inclusion of Section 230-like language in international trade deals has an extremely positive impact on startups, ensuring that “companies of all sizes can more seamlessly compete across the world.”
Startup Roundup:
#StartupsEverywhere: Denton, Texas. Move over, Houston. Another Texas city is making waves in space. Kubos is bringing outer space down to earth in Denton, Texas with open source software solutions for satellite mission control. We spoke with Kubos’ CEO and co-founder, Marshall Culpepper, to get some insight into his exciting company and the Denton startup ecosystem.
