Data Sheet—T-Mobile CEO John Legere Emerges From Capitol Hill Grilling Unscathed

June 29, 2018, 1:24 PM UTC

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Maybe you weren’t impressed with the dozens of members of Congress who tried to pin down Facebook CEO Mark Zuckerberg back in April. Lawmakers each had only a few minutes to ask questions and some seemed wildly ill-informed, at best, about how Facebook operated.

Many fewer viewers, no doubt, tuned in to C-Span on Thursday to watch the Senate Judiciary Committee’s subcommittee on antitrust grill T-Mobile CEO John Legere about his proposed merger with rival Sprint (you can catch the replay here). They would have been considerably more impressed. Just three lawmakers—Sen. Mike Lee, Sen. Amy Klobuchar, and Sen. Richard Blumenthal—spent more than two hours quizzing Legere and other witnesses and going through the deal’s promised benefits with a fine tooth comb.

Legere, appearing in a black T-Mobile-logoed sports coat and a magenta T-Mobile tee shirt, was unflappable. “T-Mobile is a proud disruptor,” he declared at the outset, setting a tone that would continue for the entire session. “It is in our DNA. It is what drives my magenta-wearing employees. It is our brand.”

And if a boxing referee adjudicated the hearing, they might say no one laid a glove on Legere. But the senators certainly tried. All three lawmakers brought up apt historical comparisons and asked Legere and his partner in the deal, Sprint executive chairman Marcelo Claure, to account for past contradictory statements. Noting that Legere was now counting cable companies like Comcast as key competitors in the market, Sen. Lee noted “you appear to have walked back some statements you made as recently as February.” Legere, who back then said the cable companies would “fail horribly, miserably, so bad,” danced around the issue. “I’m glad you brought this up,” he began, going on to explain that he meant the cable companies hadn’t been competing up to their potential, but now had over half a million customers and “analysts” said they’d grab 5 million within two years. “They’re becoming a viable player.”

Finding the weakest part of T-Mobile’s case was left to witness and longtime antitrust veteran Gene Kimmelman (whose impressive list of former jobs includes chief counsel to the very subcommittee where he was testifying and chief counsel at the Justice Department’s antitrust division). In short, the carriers claimed they had to merge because competition was failing in the wireless market, with T-Mobile and Sprint unable to do much damage to market titans AT&T and Verizon. But at the same time, Kimmelman said, the carriers also argued that if they merged there would be robust competition from many new entrants like Comcast and Google. “I kind of don’t think you can have it both ways,” he observed deep into the hearing. “There’s a problem here in the whole presentation of what’s going on.”

A few other economic experts testified, too, but didn’t add much. As a side note, I still don’t understand how American Enterprise Institute visiting scholar Roslyn Layton, while under oath, offered this whopper: “T-Mobile’s Binge On was wildly popular earning it million of customers. What was the response of the prior FCC and now the California legislature? Shut down the program consumers love.” The prior FCC under Obama-appointed chair Tom Wheeler reviewed and approved of Binge On. And the California legislature added an exception for such programs last week to a bill it is still considering.

At the end of the day, marathon racer Legere successfully ran through the gauntlet of objections and emerged unscathed. The question now is whether regulators at the Justice Department will agree.


Crash and burn. Speaking of wireless market machinations, Verizon is killing off its once-highly-touted video service Go90. Or as Variety reporter Todd Spangler, who broke the news, quipped: "Go90 is officially being eighty-sixed." The millennial-friendly, YouTube-like app which launched in 2015 (and Verizon described as the "Viacom of tomorrow") never caught on with customers.

Crash and burn, the sequel. The price of bitcoin was falling again on Friday, the fourth straight day of decline. Now down 70% from its high near $20,000 in December, the plunge is almost as severe as the 78% drop in the Nasdaq Composite Index when the Internet bubble popped, Bloomberg notes.

Keep it secret, keep it safe. California passed a sweeping privacy law that gives consumers in the state the right to demand that their data be deleted and to bar companies from selling their data without cutting them off from services or charging higher prices. Under the new law, which takes effect in 2020, consumers may be able to sue for up to $750 when their data is leaked or stolen, while the state attorney general can sue for intentional violations of privacy for up to $7,500. Expect a furious lobbying battle for the next two years from the Internet industry to repeal or weaken the law.

Music makes the world go round. Want to make a snazzier video story on Instagram without alarming the copyright police? Now the Facebook-owned service has licensed thousands of popular songs that users will be allowed to add as background music–completely legally.

Free for all. How can Google catch up to the popularity of Amazon's Alexa line of smart, voice-controlled digital assistants? How about by giving away its Google Home device to every home in America. That's the strategy proposed on Thursday by Morgan Stanley analyst Brian Nowak. "Google needs more devices/smart speakers in people’s homes,” Nowak wrote in a research report. Giving away over $3 billion worth of hardware would be a “small price to pay.”

Stocking up. Ride hailing service Lyft raised $600 million in a venture capital deal that valued the Uber rival at $15 billion, double the company's valuation from a little over a year ago. Mutual fund giant Fidelity Investments was the lead investor.

Not quite how we imagined. Another highly valued startup made news on Friday. Chinese smartphone maker Xiaomi went public on the Hong Kong Exchange, but at a valuation of only $54 billion, about half what it was originally seeking. Revenue has been growing rapidly, but apparently investors weren't impressed with the company's minuscule profit margins.


A few longer reads that I came across this week that may be appealing for your weekend reading pleasure:

The Biggest Digital Heist in History Isn’t Over Yet (Bloomberg Businessweek)
As night fell in Taipei on July 10, 2016, most people in the city were hunkered down to ride out the end of a typhoon. Not Sergey Berezovsky and Vladimir Berkman. The two Russians made their way through the rain to an ATM at First Commercial Bank, one of Taiwan’s top lenders. Wearing hats and antipollution masks, they loitered at the machine for a moment. Then, as the astonished couple in line behind them later told the police, the ATM started disgorging cash without either man touching it. The men shoved the bills into a satchel and brushed past them. As the Russians drove off in a black sedan, the couple spotted something on the ground: One of the guys had dropped his bank card.

Artificial Consciousness: How to Give a Robot a Soul (Futurism)
The Terminator was written to frighten us; WALL-E was written to make us cry. Robots can’t do the terrifying or heartbreaking things we see in movies, but still the question lingers: What if they could? Granted, the technology we have today isn’t anywhere near sophisticated enough to do any of that. But people keep asking. At the heart of those discussions lies the question: can machines become conscious? Could they even develop — or be programmed to contain — a soul? At the very least, could an algorithm contain something resembling a soul?

How to Make Everything Ourselves: Open Modular Hardware (Low-Tech Magazine)
The long lasting success of LEGO, Meccano and Erector (which appeared on the market in 1947, 1902 and 1911 respectively) is based on the fact that those rules have never changed. All new buildings blocks that were added in the course of the years are compatible with the existing ones. Today, kids can expand their collection of these toys with that of their parents or grandparents, and they are worth as much on the second hand market as they are worth new. The same principle could be applied to everyday objects, from coffeemakers to furniture, gadgets, cars and renewable energy systems. All you need is a standardisation in design. The design rules can be very simple, as is the case with Grid Beam.

Adrian Piper’s Self-Imposed Exile From America—and From Race Itself (New York Times Magazine)
Adrian Piper, the conceptual artist and analytic philosopher, is almost as well known for what she has stopped doing as for what she has done. By 1985, she had given up alcohol, meat and sex. In 2005, she took a leave of absence from her job at Wellesley, sold her home on Cape Cod and shipped all of her belongings to Germany. On a lecture tour in the United States the next year, she discovered a mark on her plane ticket that suggested, to her, that she’d been placed on a watch list; she has not set foot in America since. Then, in 2012, on her 64th birthday, she “retired from being black.”


With Amazon raising the price of its free shipping and more Prime program yet again, it's time to revisit the age old question: is it still worth it? Adam Clark Estes at Gizmodo is having doubts, even though he wrote a similar column endorsing the service two years ago. But revelations of Amazon's business practices have put the company in a different light, he writes:

The craziest thing is that I keep re-convincing myself that Amazon Prime is the best deal in tech. That’s an old Gizmodo conclusion, one that we’ve stood by for the better part of a decade. Prime is also a deal that keeps getting sweeter. Just this week, Amazon announced that Prime members will soon get discounts at Whole Foods stores nationwide, including free two-hour delivery in some states. How sweet it is! New discounts on overpriced groceries seem better than no discounts on regular groceries, so why wouldn’t I be tempted to walk the pristine aisles of my local Whole Foods looking for a yellow sticker or a blue Prime sign the next time I need to stock up?

It’s not so much that Prime is a good deal. It’s that Prime is a great trick. When I look back at my spending over the past five years, my profile perfectly matches up with that of the typical Prime member. According to Consumer Intelligence Research Partners (CIRP), Prime customers spend more than twice as much money on Amazon goods than non-members, and when Amazon hikes the price of membership, those Prime customers actually spend even more. That’s the business model. Historically, Amazon has actually lost money on perks like free two-day shipping, but the company is making up for it not only by impelling Prime customers to buy more stuff but also, increasingly, by encouraging them to buy goods from Amazon’s private label brands, which get promoted above other brands in searches on the site. Some say this represents a devious type of monopolistic business practices. I’m inclined to agree.


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Honda's Trailblazing ASIMO Robot Is Walking Off Into the Sunset By David Meyer

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How E-Sports Betting Could Explode By Jonathan Sperling

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Commentary: Two Things That Need to Happen for Driverless Cars to Go Mainstream By Eric Ellis


Science fiction author Harlan Ellison, best known for writing the famous Star Trek episode script “The City on the Edge of Forever,” died at age 84. Science fiction fan Glenn Fleishman has a round up of five of Ellison's best works. The short story collections are particularly great.

This edition of Data Sheet was curated by Aaron Pressman. Find past issues, and sign up for other Fortune newsletters.

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