Needham lowered its March-quarter revenue estimates for Apple by 13% Tuesday based on coronavirus-related supply chain bottlenecks and lower demand from China. Greater China generated about 15% of Apple’s December quarter revenue and typically is 15-20% of the company’s sales. Apple’s Feb. 17 revenue-forecast downgrade (see 2002180004), plus new coronavirus "hot spots" in Italy, Iran and South Korea, "suggest that lowering our AAPL estimates is the more prudent choice,” said analyst Laura Martin. She now assumes normal supply and demand will resume by June 1, not March as she previously assumed. The longer coronavirus disruptions continue past the first of June, “the greater the threat to AAPL's Sept new product launches (including its 5G phone) and Christmas selling season revenue, which represented about 32% of annual revs in each of the past 3 years,” she wrote investors. Needham’s estimates assume coronavirus disruptions -- including supply chain and demand weakness -- don’t affect the September or December quarters: “This assumption may prove too optimistic,” said Martin. Due to low inventories and supply chain disruption, Needham lowered March and June estimates for unit sales of AirPods and iPhone 11s; it also expects a delay in the launch of the rumored, smaller iPhone, the SE 2, “from its originally scheduled March Q launch.” Apple hosts an event on March 31 but didn't comment now. Monday, HP said the virus is affecting it, too (see report, this issue.)
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A Commerce Department agency plans the first meeting of its Emerging Technology Technical Advisory Committee this spring, amid delays issuing prospective members security clearances. A Bureau of Industry and Security spokesperson emailed that the agency remains “on target” to have the meeting before summer. Commerce officials originally scheduled the meeting for December, and then January, delaying it each time. ETTAC applicants are impatient, and trade lawyers have heard little information, they said in interviews last week. Adrienne Braumiller, a trade lawyer with Braumiller Law Group and member of BIS’ Regulations and Procedures TAC, has “no clear understanding” of why the process has taken so long, calling it “rather protracted and lengthy.” Doug Jacobson of Jacobson Burton heard about “numerous delays in the process” but hasn't heard why. ETTAC’s “primary focus” will be to identify emerging technologies with dual-use applications, says its charter. Those efforts will inform Commerce restricting sales of emerging technologies, which faced delays (see 1911070026). Commerce has released two sets of controls on emerging technologies without ETTAC input.
T-Mobile and Sprint amended terms of their merger agreement through a unanimous vote by the companies’ boards, they said Thursday. The deal extends the outside date for closing to July 1, though carriers aim to close the deal as early as April 1, they said. A separate arrangement entered into by SoftBank Group will result in an effective exchange ratio of about 11 Sprint shares for each T-Mobile share after closing, an increase from the originally agreed 9.75 shares. SoftBank agreed to surrender about 48.8 million T-Mobile shares acquired in the transaction to New T-Mobile, making SoftBank’s effective ratio 11.31 Sprint shares per T-Mobile share, the carriers said. Other Sprint shareholders will continue to get about 9.75 Sprint shares for each T-Mobile share, they said. After SoftBank surrenders shares, Deutsche Telekom expects to hold about 43% of the new company’s shares, and SoftBank 24%, with the remaining third held by public shareholders, they said. “T-Mobile has agreed to re-issue to SoftBank the previously surrendered shares upon the achievement of certain stock price milestones by New T-Mobile during a specified measurement period, and subject to certain additional terms, as outlined in the letter agreement that will be filed by each of T-Mobile and Sprint with the SEC.”
Google's "verbatim copying” of Oracle computer code into a “competing commercial product” wasn’t fair use, the Trump administration said in a Supreme Court filing Wednesday (see 2002190058). Also siding with Oracle in separate filings were USTelecom, the Motion Picture Association, the RIAA, the National Music Publishers' Association and the Copyright Alliance.
DOJ is considering whether Section 230 creates the right incentives for platforms to maintain a safe internet, said Attorney General William Barr Wednesday. Tech companies are no longer underdog upstarts but titans of U.S. industry, he said during a workshop on Section 230 of the Communications Decency Act: “Given this changing technological landscape, valid questions have been raised on whether Section 230’s broad immunity is still necessary, at least in its current form.”
USTelecom met with FCC Wireline Deputy Bureau Chief Lisa Hone and an aide to FCC Chairman Ajit Pai on its effort to develop a consensus proposal on 8YY revisions as the agency seeks to transition many rate elements to bill and keep (see 1809050027). The group "emphasized the need for a suitable recovery mechanism that would allow carriers to recover 8YY originating access revenues as intercarrier compensation reforms are implemented," it said in a filing posted Tuesday in docket 18-156. Those mechanisms should differ for price cap and rate-of-return ILECs, it added.
SAN FRANCISCO -- Observers are split on whether the 9th U.S. Circuit Court of Appeals will side with the FTC or Qualcomm in a key tech antitrust decision expected in the coming months (see 2002130058). Qualcomm, Intel, Ericsson and Samsung didn’t comment Friday, after the previous day's oral argument. We interviewed experts following oral argument.
Telecom carriers and equipment vendors are addressing confusion over who must comply with Kari's Law rules that were to take effect Monday (see 1802160032). The law requires multi-line telephone systems to give direct access to 911 without the need to dial a prefix. The MLTS must notify a representative, such as the front desk or security, once 911 is dialed. "This is a reminder to building managers and others responsible for multi-line telephone systems that they must adhere to the new requirements," FCC Chairman Ajit Pai said Friday. "There's some confusion for enterprise customers," said Tricia McConnell, Bandwidth 911 product marketing manager. "They're responsible for compliance, but they don't know what compliance means." MLTS managers such as hotels and corporate campuses must ensure someone on site or monitoring operations there knows when a 911 call has been placed, to greet first responders and direct them to where the call originated. In a large complex, building security might also provide preliminary assistance to the caller before first responders arrive, McConnell said. Outbound emergency calls can't be screened by building security before they're sent to 911 operators, however, McConnell said. In the past, some hotels might have screened such calls to protect employees or for fear of misdials, she said, but as of the compliance date, "that's no longer acceptable." As the compliance date approached, carriers "focused on helping their customers provision these MLTS with the direct-dialing and notification capabilities required," emailed Incompas Policy Adviser Chris Shipley. "They are also working with their enterprise and business customers to clearly identify who is responsible for the system's day-to-day management and operation, particularly with larger companies that are interested in exercising greater control." Requirements also apply to government agencies and nonprofits using MLTS, and to cloud-based and VoIP and traditional circuit-based systems, Hogan Lovells blogged Feb. 10: MLTS operating before the compliance deadline don't need to meet the new rules unless they're modified after the compliance date. Most business customers aren't looking to meet only minimum standards, McConnell said. Recent talks about Kari's Law are driving meaningful conversations on how organizations respond in an emergency, she said. Some larger companies may consider coming into compliance sooner than required under the law because "no company wants to be outed on social media for restricting access to 911," McConnell said. There are other E-911 laws in roughly half the states, McConnell said: Bandwidth is pushing for a federal law.
Senate Commerce Committee Chairman Roger Wicker, R-Miss., told reporters Thursday he reached a deal to allow the chamber to pass the Secure and Trusted Communications Networks Act (HR-4998) by unanimous consent (UC) after the upcoming Presidents Day recess. The House-passed bill would allocate at least $1 billion to help U.S. communications providers remove from their networks Chinese equipment determined to threaten national security. Meanwhile, Huawei faces 16 DOJ charges it violated the Racketeer Influenced and Corrupt Organizations Act and stole trade secrets from six U.S. companies (see 2002130030).
The goal is to produce a draft bill this year to update the Digital Millennium Copyright Act, said Senate Intellectual Property Subcommittee Chairman Thom Tillis, R-N.C., Tuesday. “I have low expectations we can get it done in this Congress. But I think we can get a generally accepted baseline and continue to work with the House to move it on a bicameral basis,” he told us before Tuesday’s hearing on DMCA. “It hasn’t been touched since Chumbawamba was topping the charts” in 1998.