The CTIA found that the number of wireless subscriber connections has surpassed the number of people in the U.S. and its territories. It also found a 111 percent increase in wireless data traffic.

While the situation is by all means challenging, the massive eruption of content that sparked it is both encouraging and exciting.

“We’re in this exciting arms race where the creation of content is happening so fast it’s exceeding even these amazing improvements in computing power, these amazing improvements in storage capacity, and particularly, these amazing improvements in connectivity,” said Bruce Mehlman, the former Assistant Secretary of Commerce for Tech Policy and the Co-Chair of the Internet Innovation Alliance.

To help solve this problem of congestion, Congress is currently examining legislation that would free up more spectrum from broadcast radio and television companies. While everyone agrees that more spectrum is needed, the dispute is over how it would be distributed and, specifically, the FCC’s role in this process.

In the past, the FCC has had a very active position in managing the auctions. In other words, it has had the power to place restrictions on auctions or conditions on spectrum based on the bidders’ market dominance and spectrum holdings.

However, the bill that’s currently in the House would remove this power from the FCC, which is a move that is sparking a lot of debate. Former FCC Chairman Reed Hundt recently called the proposed bill “the single worst telecom bill” he’d ever seen.

The House argues that previous government allocations are the reason that the current “spectrum crunch” is happening. It also believes that limitations in auctions would result in less revenue to help reduce the federal deficit.

As Mehlman explained to us, Congress is remembering what happened in the controversial 2008 spectrum auctions as well as the recent failed merger of AT&T and T-Mobile. He sides with policymakers on this issue because he believes the previous restrictions are to blame for the current problems.

In a post on the Internet Innovation Alliance, Mehlman wrote:

Many in Congress fear FCC micromanagement and seek open auction rules free from FCC interference. The FCC, of course, objects to Congressional micromanagement of their micromanagement, seeking maximum flexibility to set auction rules.

The irony here is that these auctions are needed because the last time this spectrum was assigned, policy makers limited its potential use and transfer. Thus much of the spectrum is under-utilized and our economy suffers for it.

In our recent interview, he expressed concern that the same issues would continue if the FCC were permitted to keep its authority.

“The biggest challenge is if the FCC gets its way and follows through with what many in the House fear they might do, which is limit who’s allowed to compete, I think the very spectrum crunch these very auctions are expected to alleviate doesn’t get alleviated… then problems continue,” pointed out Mehlman.

“I think most people would concede the reason there’s inefficient use of spectrum is because of old government decisions on who could and could not use spectrum,” he continued. “Logically, you want less government constraints in the future.”

Some mobile companies are perfectly happy with the FCC’s authority over the auctions as a group of them led by Sprint and T-Mobile sent a letter to lawmakers asking that the Commission’s position remain the same. AT&T and Verizon are not part of this support since they believe the FCC would favor the smaller carriers.

Incidentally, not everyone agrees that auctions would solve the issue. Rick Whitt, Google’s Washington Managing Counsel, recently indicated that auctions would not completely eliminate the spectrum crunch saying, “Auctions will fall short of meeting that gap.”

Mehlman told us that he agrees with Whitt in that content will likely be created faster than bandwidth can be apportioned. But, he believes that this provides an even greater urgency to get policy in place that would encourage an open marketplace.

“Having everybody eligible to acquire the spectrum and to subsequently sell the spectrum to a higher and better user is letting the market allocate the spectrum,” he said. “If we had done that the first time, we would have less congestion, we’d have more high speed wireless, and, I think, we’d have the same amount of competition.”

“We don’t have a problem with lack of competition, we have a problem with a lack of investment, [and] we have a problem with a lack of spectrum aggregation to meet the marketplace needs,” he added.

Even though Sinclair Broadcast Group CEO David Smith said it was doubtful that Republicans and Democrats would be able to agree on legislation for a broadcast television auction this year, Mehlman thinks it is a possibility. As he explained, this legislation is part of larger jobs bill that both sides want to see pass.

Should auctions be open, or should the FCC have a say? What do you think? We’d love to hear your thoughts.

The bill was introduced recently into the Senate by Senator Kirsten Gillibrand of New York. It’s goal is “to require reporting on the capacity of foreign countries to combat cybercrime, to develop action plans to improve the capacity of certain countries to combat cybercrime, and for other purposes.” What are those other purposes? Let’s read the proposed bill and find out!

After the introduction and definitions of various parts of the bill, it gets into what the bill is all about. Section three is called the “Annual Report” and it requires the head of whatever new Federal agency is made to combat cybercrime to report to Congress. They are to report on “the extent and nature of activities relating to cybercrime that are attributable to persons or property based in the country and impact the United States Government, United States persons, or United States electronic commerce.” They are also to report on the “effectiveness of the laws” and “measures taken by the government to protect consumers from cybercrime.”

Section four, titled “Utilization of Foreign Assistance Programs” deals with how the U.S. will cooperate with foreign countries in battling cybercrime. The bill says that the President will give priority to improving “the effectiveness and capacity of the legal and judicial systems and the capabilities of law enforcement agencies with respect to cybercrime.”

The countries that will receive the most aid are those that the U.S. determines to have “a low capacity to combat cybercrime.”

The bill would also let the U.S. provide foreign countries with the tools to improve “critical infrastructure, telecommunications systems, financial industry, legal or judicial systems, or law enforcement capabilities of that country” to combat cybercrime.

Section five, titled “Action Plans for Combating Cybercrimes for Countries of Cyber Concern” says that after the report mentioned in section two is made to Congress that the President must create an action plan that will assist “the government of that country to improve the capacity of the country to combat cybercrime.”

There is also a provision that says the President will have to reassess the countries that have been placed under action plans. Countries may be removed and placed on action plans at will if they cease or become countries of “cyber concern.”

The President will be required, under section five, to meet with the leaders of each country of “cyber concern” to formulate action plans to combat cybercrime.

If a country fails to meet an action plan benchmark, which is one year after the action plan has been developed, the U.S. is given three courses of action to punish the country into complying with its request – block any new financing or loans for the countries in question, restrict trade to the countries in question and restrict foreign assistance.

Thankfully, there is an exception that states “the President may not suspend, restrict, prohibit, or withdraw assistance … that is provided for humanitarian or disaster relief or for projects related to building capacity or actions to combat cybercrime.”

The President is allowed to waive the requirement of an action plan if the President “determines that such a waiver is in the national interest of the United States” and “submits to Congress a report describing the reasons for the determination.”

Section six only details the responsibilities of the Secretary of State to designate a “high-level employee of the Department of State” to coordinate the combating of cybercrime on a state and international level.

Section seven details that the President appoint an “employee of the United States Government with primary responsibility with respect to matters relating to cybercrime policy.” This employee must also “consult with industry groups in the United States, civil society organizations, and other organizations with an interest in combating cybercrime.”

Finally at the end, section eight demands that the President take into account “the efforts of the government of that country to combat cybercrime” before finalizing or modifying any trade agreements.

This bill seems like the U.S. wants to be the head coordinator of a global cybercrimes unit. The fact that the bill gives the President the power to freeze funds and trade to countries that do not comply is somewhat worrying. The bill was referred to committee and could be up for a vote whenever they feel like it. We’ll keep you up to date on any changes.

The entire bill can be found on Open Congress. Read it for more information and become informed.

Do you think that the U.S. is trying to become an international cybercrime police force? Or is this just a step in the right direction in stopping cybercrime? Let us know in the comments.

There are many issues involved with President Obama’s signing of the Anti-Counterfeiting Trade Agreement — which occurred in September 2011 — and whether or not it should be treated as an executive agreement or an actual treaty between the agreeing countries. With an executive agreement, the President does not require the approval of the Senate, whereas, with a treaty, Senate approval is required. That, however, is not the issue, especially when you consider the initial zeal with which the both houses of the U.S. Government supported SOPA and PIPA.

Until the protestation blackouts, that is.

As for ACTA, there hasn’t been a great deal of push back from the Senate concerning President Obama’s signature, although, perhaps there should be. As TechDirt points out:

The law is clear that the only things that can be covered by executive agreements are things that involve items that are solely under the President’s mandate. That is, you can’t sign an executive agreement that impacts the things Congress has control over. But here’s the thing: intellectual property, in Article 1, Section 8 of the Constitution, is an issue given to Congress, not the President.

Does this mean President Obama overstepped his boundaries by signing ACTA? If you follow the letter of the law, as laid out by TechDirt, then yes, yes he did.

Perhaps that what explains one of the latest White House petitions, asking for ACTA to be submitted to the Senate for “Ratification as Required by the Constitution for Trade Agreements.” As you can see, the petition takes the position that ACTA is indeed a treaty and because of that, President Obama’s signature is not enough for the United States to be apart of. From the petition’s page:

The Administration has opposed SOPA and PIPA due to the damage these laws could do to the Internet. But many view the Anti-Counterfeiting Trace Agreement (ACTA) to be far worse.

This Administration supported the negotiation of ACTA in secret with a selected group of nations and with input from many corporate interests. The public and consumers were excluded from this process. FOIA requests were denied because of “National Security” concerns.

We object to the Administration’s negotiation of ACTA in secret, and approval of ACTA by Executive Agreement.

Considering the White House’s stance on both SOPA and PIPA, not to mention, Vice President Biden’s own words about regulating the Internet, which are available in the following video:

Of course, if ACTA does have to go to the Senate before its ratified, will it meet any resistance? Any at all?

One way that the online poker community is trying to get its message out is through social media. As Rich Muny, the Vice President of Player Relations at the Poker Players Alliance (PPA), explained to WebProNews, interaction on social networks is very natural for poker players since the Internet is where they play their game.

Since the 2008 election, many politicians see that a presence in social media is important. In return, the poker industry is using this trend to get their message out. Muny told us that the perception is that all online gaming efforts are driven by lobbyists and not the players. However, through social media, the players themselves are able to show that they support legislation.

Social media outlets have also helped poker players provide education to lawmakers not only on legislative matters, but also on other areas involving the game of online poker.

“There’s education for legislation, education for what we’re seeking, education for what it does, and education on the fact that a lot of people support the right to play,” said Muny.

He calls the impact of social media “astounding” and said that it is especially important that poker celebrities such as Doyle Brunson, Phil Hellmuth, and Daniel Negreanu are actively participating in the conversation as well. Even if these stars don’t address the legislation issues specifically, they still help to create buzz around online poker. What’s more, organizations like the PPA can capitalize on the buzz to create further awareness.

Muny said that the social media efforts have been a “very effective” means for getting lots of information out quickly. The PPA even has a daily action plan that includes preset tweets and Facebook posts that target the exact legislators that need to be reached.

Muny told us that the online poker community hopes that its message is heard and that online poker will be regulated in the near future.

The newspaper raised privacy concerns and reported that the social giant “‘eavesdrops’ on its users to gather information about their political opinions, sexuality, religious beliefs – and even their whereabouts.”

Facebook has a personalized advertising model that allows advertisers to target their audience based on various factors including location, demographics, likes, keywords, and other information it receives on users including registration data and information that users share on the platform. However, Facebook does not permit advertisers to know who its users are and also keeps its performance reports anonymous.

Should Facebook’s advertising model be questioned? Let us know your thoughts.

This type of advertising model is not only what Facebook uses to make money, but it is also the model that many other Web companies utilize. Nonetheless, Facebook seems to be the primary focus of this effort.

In a response to WebProNews, a Facebook spokesperson told us:

“The Sunday Telegraph article is inaccurate, sensational and misrepresents both how Facebook’s advertising model works and the current advertising privacy debate across Europe. By using Facebook, a free service, people agree to see ads that are valuable to them. Crucially people give their consent to be shown relevant ads by agreeing to our terms when they sign up – unlike other online advertising models. We also make clear that we do not share personal information with advertisers without their consent.  We have spent considerable time and effort building an ads model which allows people to see relevant advertising whilst respecting their privacy: https://www.facebook.com/about/privacy/advertising.“

“We are fully compliant with EU law, have our international headquarters in Dublin and unlike some other online services, we do not use tracking technology to serve adverts. Our system only provides advertisers with anonymised and aggregated information for the purpose of targeting ads. We do not share people’s names with an advertiser without a person’s explicit consent and we never sell personal information to third parties.”

If the EC agrees to implement this legislation when it meets in January, Facebook could face legal action or a significant fine. To make matters worse, the European Union’s data protection working party is meeting next week to analyze the social network and discuss how it should be audited.

Incidentally, this European news comes just as Facebook reached a settlement with the FTC over user privacy. Through the settlement, the social network is required to give users a clear and prominent notice before it changes the way data is shared.

In a blog post about the settlement, CEO Mark Zuckerberg acknowledged that mistakes had been made but promised better privacy and more user control going forward.

“I’m the first to admit that we’ve made a bunch of mistakes… But we can also always do better. I’m committed to making Facebook the leader in transparency and control around privacy.”

In the post, he also announced two new corporate privacy officer roles. Erin Egan was appointed to the Chief Privacy Officer of Policy, and Michael Richter was appointed to the Chief Privacy Officer of Products.

Does Facebook’s money-making model raise a privacy issue, or is the EC making invalid claims?

As a result, a lot of the affiliates in the state lost most, if not all, of their revenue. Nick Loper, who was among the affiliate victims, spoke to WebProNews back in August and told us that he lost 70 percent of his revenue almost immediately after the law went into effect. He ended up moving to Nevada and starting completely over.

The motive for California’s law was driven primarily by its struggling financial situation. Because many other states are facing similar scenarios with large budget deficits, they too are contemplating related actions. It’s understandable why states want to impose these taxes, but does that make it right?

Can these interstate tax propositions actually solve the tax problem? What do you think?

Adam Thierer, a senior research fellow with the Technology Policy Project at the Mercatus Center at George Mason University, doesn’t think that they would. He co-wrote a report with Veronique de Rugy on this topic, and as he explained to WebProNews, the tax issue is very complex and far-reaching.

“The debate about Internet taxation is really an interesting debate, because the sales tax only being a state and local tax is not something that can be easily applied to something that’s interstate in nature, which the Internet and Internet sales clearly are,” he said.

Even before Internet taxes became an issue, states have wanted to impose taxes on interstate companies that provide catalog and mail order services. However, they have not been able to do so because of their constitutional restraints. According to Theirer, the Supreme Court has provided limitations in this area because the states can’t put “discriminatory or unfair burdens” on companies that they don’t have any authority over.

Congress is now trying to get these limitations reversed with new legislation. In August, the “Main Street Fairness Act” was introduced to the Senate. It, in essence, calls for a set of federal guidelines that would dictate how states could collect sales taxes from online retailers.

A second bill, called the “Marketplace Equity Act of 2011,” and was introduced to the House last week. It is similar to the one introduced in the Senate but is a little different since it would give states the authority to require retailers, both on and offline, to collect sales taxes even when customers are located in states where the companies have no physical presence.

“What both these measures try to do is find a way to, essentially, authorize a state-based system of taxation for the Internet,” said Thierer.

“The reason, again, that the courts have not thus far allowed it is because, really, the complexity question. It’s not just that the states don’t have authority over interstate vendors; it’s that if they went to actually impose these taxes, it would create a huge burden on interstate sales and trade.”

States are aware that tax systems are complex, and many of them have joined the Streamlined Sales Tax Governing Board to simplify the processes. They are working to not only explain rates, but they are also working to clarify definitions such as the difference between a cookie and candy bar. This might seem of minimal value on the surface, but as Thierer explained to us, each of these items is taxed very differently.

He went on to say that, even if the systems were clarified, there would still be issues with this approach. He told us that states want to tax one another’s imports instead of taxing their own exports, which is a process that he calls a “tax cartel.”

“The wrong answer, in my opinion, is to essentially tax everybody up to a higher level,” said Thierer. “The better approach would probably be to tax downward and find a way to have a more competitive tax arrangement, so that we don’t set this collusionary approach that some states want to use.”

“I think that that would create a troubling disincentive to actually seeing more tax competition,” he added.

Thierer also pointed out his frustration with Amazon being at the center of this debate, saying that he was “very troubled” by it. He not only thinks that Amazon is pulling the spotlight away from other online retailers, but he is also disturbed that it is making deals with politicians in order to eliminate its tax own burden. The online retailer has been negotiating with states to avoid or delay paying taxes in exchange for investment and jobs in those states.

“In theory, that sounds great,” said Theirer. “I really do wonder about Amazon’s ability to deliver on it, but at the end of the day, this is really just politics, and it’s not the kind of solution that is ultimately going to serve the broader marketplace or consumers.”

Theirer believes that there is a better approach to the tax issue than the approach that both the states and Amazon are taking. In the report, Theirer and de Rugy propose 3 potential solutions to the tax problem. One option would be to abolish sales taxes entirely. For this to work, states would have to rely on income, property, and various other taxes.

On the other extreme, a second option would be to have a nationwide sales tax that would give states a certain portion of the income. Thierer, however, doesn’t think either of these methods is ideal. Instead, he is advocating an “origin-based sourcing rule” that would apply the structure of offline sales taxes to the Internet.

As he explained, it’s the idea of taxing consumers at the origin of sale, not at the destination, which is what the states want to do.

“The states and localities want to have a destination-based system where they try to figure out where everybody’s going to consume their online goods… that’s what creates the complexity and the costs associated with the plan that they desire,” said Thierer.

On the other hand, he believes his idea would, “create tax competition eliminate the constitutional tax headaches associated with the states’ current plan, and it would make sure that we don’t have a confusing, complicated array of rates and systems for interstate vendors to contend.”

It’s clear that the Internet tax issue is complex, but the big question at the end of the day is – do any of these approaches actually provide a solution to the problem? If so, would you be more apt to follow states’ proposal or Thierer’s proposal?

Do you have ideas for what should be done about Internet-related taxes? Let us know in the comments.

Did California’s tax law impact you? Please share.

The law, which is often referred to as the “Amazon Tax Law,” requires online retailers to pay taxes on their affiliate advertising. Almost immediately after this law went into effect, online retailers, such as Amazon, cut ties with affiliate marketers in the state.

According to Loper, this action meant that a half dozen of his largest advertisers on ShoesRUs terminated their relationship with him, leaving him shy of 70 percent of his revenue.

“It was, essentially, out of business overnight,” he said.

The California law was intended to help the state with its struggling financial issues and to also reduce the competitive advantage that many brick and mortars believe online retailers have over them. Loper, however, does not think that either of these goals has been fulfilled.

“Neither of those groups are better off today than they were before the law passed,” he told us. “The state’s not getting any revenue and the playing field, per se, still has not been equalized.”

Loper also pointed out that he would have never thought such a law would be implemented in a state that is the home of so many tech companies and the Silicon Valley. But, since it was, he had no choice but to move from California to Nevada to start a new business.

His new site is a comparison shopping site for shoes called ShoeSniper and is similar to his previous site. He chose Nevada because it does not have an online sales tax. Fortunately for him, he has already regained nearly all of his former advertising relationships.

Interestingly, as the debate surrounding online sales tax debate continues, more states are considering taking actions similar to the law that California recently passed. What’s even more interesting is that Congress is contemplating action at a federal level. Senator Dick Durbin (D-IL), recently introduced the “Main Street Fairness Act,” which Amazon, incidentally, supports. The House has introduced a similar bill as well.

Would  you like to see the online sales tax issues solved at a state level or federal level?

States, however, would still be able to “opt out if they don’t want to participate,” according to the press release. It also stated, “The lawmakers believe this is an issue of personal freedom and that the government shouldn’t stop people from playing a game of skill.”

Do you agree with the lawmakers and believe that this bill is based on “personal freedom”? We’d love to know.

It’s no secret that the online poker industry has had a troubled past, which was evidenced by the recent “Black Friday” event when the FBI shut down three popular online poker sites for alleged bank fraud. Because of this event and other controversies around online poker, Representative Barton (R-TX) introduced the bill in hopes of providing clarity to the industry.

According to Eli Lehrer, the Vice President of The Heartland Institute, the proposed bill makes “common sense.” He said, “It contains some common sense protections against people being defrauded, which right now in the current netherworld of online gambling is all too common and way to easy.”

On the topic of the taxes the bill would impose, Lehrer pointed out, “At a time when we need more revenue and there’s an enormous resistance to raising taxes of any sort, it cannot be bad idea.”

Incidentally, the Internet Gambling Regulation and Tax Enforcement Act was also introduced recently, which focuses on all Internet gambling and not just poker. Lehrer believes that it is actually a “better idea” because it has more freedom and creates more revenue. It does not, however, have bipartisan support, which is not the case with Barton’s bill.

Lehrer said that bipartisan support is especially noteworthy given the current divisions in Congress.

“Anything significant that gets bipartisan support is a big deal,” he added.

As for the passing of this bill, Lehrer told us the chances are “possible” but were “by no means guaranteed.”

In, what may be a blow against the bill, the American Gaming Association is not in support of the bill. It is reportedly working on its own version of legislation for online poker.

Would you like to see this bill pass?

WebProNews previously discussed Google’s participation in the process, which saw Google hire a Las Vegas-based lobbyist to promote Assembly Bill 511. Clearly, the lobbying was successful, although the details of what methods were used are scarce, although, it wouldn’t be surprising if some Nevada officials were having the time of their lives in Vegas, all on Google’s dime. Greasing the wheels, and all that.

As for the legislation itself, Forbes quotes Ryan Calo, a Stanford professor who says the legislation is a big step towards autonomous vehicular operation:

The law charges the Nevada DOT with setting safety and performance standards and requires it to designate areas where driverless cars may be tested.

While this is a long way towards the flying cars of the future, it’s refreshing to see the future embraced on such a practical level. The new law also makes it hard not to watch the end of Back to the Future and actually have some hope renewed.

If passed, the bill would have required these companies to make their user settings private by default. Although it didn’t pass, it was brought before the Senate 3 times. The final 2 votes both came in at 16-21, which defeated the bill.

As consumers, would you like for these services to make their settings private by default? Let us know.

State Senate Majority Leader Ellen Corbett introduced the bill and was very adamant on pushing it through. However, tech companies were also very influential in their opposition to it. They feared that users would quit the registration process, since it would take a long time to customize all their settings.

Tammy Cota, who is the executive director for the Internet Alliance, told WebProNews that legislators often forget that these sites have a global reach involving hundreds of thousands of users. The bill would have required these businesses to pay $10,000 per incident of noncompliance, which could have ran into a substantial amount of money given the large number of users.

Cota, who was pleased that the bill did not pass, said there was “no need for it.”

Although this was a state law, online privacy has been getting a lot of attention from Washington as well with U.S. Senators McCain and Kerry’s Commercial Privacy Bill of Rights Act of 2011 and Congresswoman Jackie Speier’s Do Not Track Me Online Act of 2011. With all this spotlight, legislators seem very interested in imposing some type of law regarding Internet privacy.

Cota also told us that Senator Corbett would likely revise her bill in an effort to bring it to vote again.

Should online privacy be regulated, or is it fine the way it is?