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Key Issues

Cybersecurity & Privacy

US officials say report of Chinese hacking proves need for cybersecurity bill.  Lawmakers and the White House said on Tuesday that a report accusing a Chinese military unit of orchestrating hacking attacks against U.S. computer systems shows the need for cybersecurity legislation.  (The Hill)

China's cyberwar: Intrusions are the new normal.  Security firm Mandiant delivers compelling evidence that the Chinese military is behind a torrent of intrusions targeting the networks of U.S.-based companies. Here's what happens next.  (CNET)

China’s Cybergames.  Though President Obama is taking steps to deter hacking into computer networks, negotiations with Beijing are also needed.  (NYT editorial)

China's Online Thieves.  Beijing's cyberattacks are a major problem for the world economy.  (WSJ editorial)

The looming certainty of a cyber Pearl Harbor.  "America is already engaged in cyberwar with countless enemies," writes former Rep. Peter Hoekstra, senior adviser in Dickstein Shapiro’s Public Policy & Law Practice.  (Politico Pro column)

China says U.S. hacking accusations lack technical proof.  Accusations by a U.S. computer security company that a secretive Chinese military unit is likely behind a series of hacking attacks are scientifically flawed and hence unreliable, China's Defence Ministry said on Wednesday.  (Reuters)

Shame a Potent Force in China Hacking Fight.  Despite repeated denials, Beijing must soon face up to concerns over China-originated hacking activity, to maintain credibility and goodwill toward its rise as a global power, says Duncan Clark of investment consultancy BDA China.  (WSJ)

 W.H. cyber policy to be slow after Chinese hacks.  President Barack Obama’s high-profile cybersecurity order last week faces a brutal reality with news of the latest case of Chinese cyber espionage: The U.S. government has work to do to keep up with the attackers.  (Politico Pro)

Malware Attacks Said to Come From Eastern Europe.  At least 40 companies including Apple Inc., Facebook Inc. and Twitter Inc. were targeted in malware attacks linked to an Eastern European gang of hackers that is trying steal company secrets, two people familiar with the matter said.  (Bloomberg)


Baucus, Camp press on with tax reform.  The two powerful committee chairmen are moving full-speed ahead with plans to overhaul the Tax Code despite the fact that nearly everyone in Washington thinks such major reform is very unlikely this year.  (Politico)

Tax Executives: Congress Won't Revamp Business Taxes. Odds of a fundamental rewrite of the business tax system have plummeted since last year, according to an annual survey of corporate tax executives.  The survey shows that only a few think that a tax overhaul will be enacted in 2013.  Last year, 31% of respondents believed Congress would pass a tax revamp in 2013. (WSJ)

Need for realism in corporate tax reform.  George Osborne and his French and German counterparts’ initiative to move towards a reformed global corporate tax regime (Letters, February 16) certainly makes sense from a global economy perspective, and they are right that the current international corporation tax system is outdated.  (FT)

"Amazon tax" payoff starts to arrive in some U.S. states.  Sales tax from Internet commerce, a prize pursued for years by U.S. state governments, is starting to arrive in California and a few other states, providing millions of dollars in new revenue, though not as much as a benchmark study once forecast. (Reuters)


Obama reaches out to Senate GOP.  The president calls Graham, McCain and Rubio to discuss immigration reform.  (Politico)

Llosa: Immigration Reform Must Look Beyond Today.  The U.S. immigration reform proposals put forward by President Barack Obama and the Senate’s “Gang of Eight” are a step in the right direction. But they miss the lesson of experience: The future matters just as much as the present.  (Bloomberg column)

US immigration law fallout.  Businesses in Alabama are reeling after an immigration law drove away thousands.  (FT)

Rich-poor spending gap on schools hurts kids, report says.  America is failing too many of its children in public schools because it doesn’t spread the opportunity for a good education fairly to all, according to a report for the government released Tuesday.  (McClatchy-Tribune)

Global Trade & the Economy

Whether Abe Will Say 'Yes' To TPP Depends On U.S. Flexibility, Adviser Says.  Any decision by Japanese Prime Minister Shinzo Abe on joining the Trans-Pacific Partnership (TPP) during his visit to Washington this week will depend upon whether President Obama is willing to be “flexible” in allowing Japan certain exclusions under a final agreement, according to one of Abe's senior economic advisers.  (Inside US Trade)

U.S. TPP Negotiator Sees Slow Progress In Market Access Talks With Vietnam.  The chief negotiator for the United States in the Trans-Pacific Partnership (TPP) talks last week acknowledged that Vietnam is the country with which the U.S. faces the toughest bilateral negotiations on goods market access because they raise very sensitive issues for both sides.  (Inside US Trade)

Unions hope US-EU trade talks can be lever to change labor laws.  Unions want to use negotiations on a deal as leverage to win stronger labor laws here.  (The Hill)

China’s Foreign Direct Investment Declines for Eighth Month.  China’s foreign direct investment fell for an eighth month in January, a sign that the recovery in the world’s second-largest economy has yet to revive confidence among overseas companies.  (Bloomberg)


Sprint CEO on the hunt for more spectrum in a data-hungry marketplace.  U.S. carrier Sprint is on the hunt for more spectrum as data demand continues to rise.  (ZDNet)

4G auction raises less than forecast.  Telecoms regulator Ofcom announces the winners of its 4G mobile auction, which raises a lower-than-expected £2.34bn for the Treasury.  (BBC)

Vodafone Challenges India's Plan to Auction Bandwidth.  Vodafone Group's India unit said it has filed a petition in an Indian court challenging the Indian government's decision to sell telecommunications airwaves in three lucrative service areas.  (WSJ)

Environment & Sustainability

Carbon Plunges as EU Delays Vote on Fast-Track Market Fix.  Carbon prices plunged the most in more than three weeks after the European Parliament’s environment committee postponed a decision to seek fast-track approval for a plan to fix a record surplus of emission permits.  (Bloomberg)

Gallium Nitride: Tech behind the headlines.  Energy efficiency is critical in IT, which is why gallium nitride innovations are valuable as these help lower power consumption and function as a good power amplifier for applications such as mobile phones and base stations.  (ZDNet)

NREL eyes intersection of EVs, green power and the grid.  The National Renewable Energy Laboratory is working to propel electric vehicles into the fast lane.  (


Seeds of Innovation -- The Supremes and patents.  Small farmers make sympathetic plaintiffs, but in Monsanto v. Bowman MON -1.59% argued Tuesday at the Supreme Court they would also make bad law.  The case has implications beyond agriculture to biotech and any business that depends heavily on patents. (WSJ editorial)

Breakthrough Prize announced by Silicon Valley entrepreneurs.  Mark Zuckerberg of Facebook, Sergey Brin of Google and venture capitalist Yuri Milner set up foundation to reward excellence in life sciences with 11 individual prizes of $3m.  (The Guardian)

Tech Business

Can China Create Its Own Silicon Valley?  Duncan Clark of BDA China talks about the changing business environment for Chinese technology companies at The Wall Street Journal's Unleashing Innovation conference in Singapore.  (WSJ)

Foxconn freezes recruitment in China.  Electronics group cuts production of Apple’s iPhone 5.  (FT)

Nanotubes Seen as Alternative When Silicon Chips Hit Their Limits.  Carbon nanotubes may prove to be the material of the future when today’s silicon-based chips reach their fundamental physical limits.  (NYT)

HTC Bets on ’One’ to Break Vicious Cycle of Slumping Sales.  HTC Corp. released its most important smartphone for the year as investors wait to see if HTC One can revive fortunes at a company that’s seen its market share and revenue more than halve in 18 months.  (Bloomberg)

Every company now a digital business.  A global report by Accenture highlights the need for businesses to adopt a new digital mindset to harness the true potential of technology, whether it is social media, cloud computing or analytics.  (ZDNet)

ITI Member News

Microsoft Skype Unit Nears $2B in Annual Sales.  Microsoft Corp.’s Skype unit, which includes Lync software for corporate instant messaging and Internet calling, is approaching $2 billion in annual sales.

The division is getting close to the size of Microsoft’s SharePoint business, which focuses on tools that help employees collaborate.  (Bloomberg)

Microsoft Says Has 60M Users.  Microsoft Corp. said its free Web-based e-mail service has gained 60 million active users in its first six months, with a third of those switching from Google Inc.’s Gmail.  (Bloomberg)

Microsoft's first Windows 8 update halfway to completion.  Alleged screenshots of Windows Blue have hit the Web just as Microsoft is said to have reached the halfway mark in the development of the Windows refresh expected this year.  (CNET)

Gates: early mobile strategy was 'mistake'.  Microsoft chairman misses chance to give CEO total support and says both are 'not satisfied in terms of breakthrough things'.  (The Guardian)

Sony set to make pre-emptive strike on Microsoft with PS4.  Sony Corp is expected to showcase a new PlayStation console on Wednesday in a pre-emptive strike against Microsoft Corp's bid to make its Xbox the world's leading hub for household entertainment.  (Reuters)

Dell Inc.’s revenue, earnings drop in fiscal 4th quarter.  Dell Inc. finished its fiscal year on a down note with lower profits and revenue tied to continued competitive challenges in its personal computer business.  (Austin American Statesman)

Google Works on Plan for Retail Stores.  Google has been developing plans to launch retail stores in the U.S., in another sign the company is studying Apple's playbook in building a consumer-electronics brand.  (WSJ)

Google Tops Record $800 as Mobile Search Gains.  Google Inc., operator of the world’s largest Web-search engine, surpassed $800 for the first time as mobile computing bolsters growth.  The shares advanced 1.8 percent to $806.85 in New York, for the highest closing price since the company went public in August 2004.  (Bloomberg)

Apple in court over Einhorn objections.  Apple argued in a Manhattan courtroom on Tuesday that next week’s shareholder vote on governance changes should go ahead, against the objections of activist shareholder Greenlight Capital.  David Einhorn, Greenlight’s founder, launched legal action against Apple this month, arguing that “bundling” a vote on several changes to its articles of incorporation broke Securities and Exchange Commission rules.  (FT)

Apple Is Building Something Bigger Than a TV.  Given the beating Apple has taken lately—with many questioning its future—it's important to understand how much television means to Apple.  (CNBC)

1600 Penn.

The President has no public events on his schedule, however he will be interviewed by a series of local television reporters in an attempt to drive progress in Congress to address the looming spending cuts that would be mandated by the sequester.

Today on the Hill

The House and Senate are in recess this week.  Both return to work on February 25.