Though President Donald Trump “initiated these tariff actions, in part, to address the issue of intellectual property rights for American businesses in trade with China,” TCL warned effects may be more widespread. “Rather than be sanctioned under 301 tariffs, TCL’s partnership with Roku should serve as a model for ensuring the proper protection and compensation of American creators and owners of intellectual property for products manufactured in China.” If TCL North America can’t win the exclusions it seeks from 15 percent List 4A Trade Act Section 301 tariffs it has paid since Sept. 1 on flat-panel TV imports from China, it wants the Trump administration to weigh “reallocating” TVs to List 4B where there’s no current tariff exposure. TCL filed exemption requests Thursday at the Office of the U.S. Trade Representative docket on 8528.72.64.30, 8528.72.64.40 and 8528.72.64.60 classifications. The “sole available source of LCD panels and supporting material components is China,” said the applications.
The order Sonos seeks on Google smart speakers would disproportionately harm Americans with disabilities, advocates warned. They want the International Trade Commission to reject the proposed import ban. Sonos alleges Google “misappropriation” of five Sonos patents (see 2001070041). Google denies that. Smart speakers “provide a significant opportunity for improving the accessibility of the home and even office environments,” commented the American Foundation for the Blind. They “may provide important content, such as on-demand weather reports, news, music, and podcasts, to individuals who do not use computers or smartphones,” AFB said. “This benefit may be especially important to people who are still acquiring assistive technology skills.” Groups including Public Knowledge and R Street Institute worry U.S. "consumer and economic welfare" would be hurt by banned imports of “mobile phones, tablets, and laptops” covered in the proposed exclusion order, they told the ITC. They cited the breadth of the Sonos-sought order, "narrow nature of the asserted patent claims, and the availability of full relief under the U.S. patent law." The ITC "should recognize that the interest in enforcing complainant’s patent rights is only weakly implicated in this requested investigation," said the groups. The Center for Democracy & Technology said blind and visually impaired individuals rely on voice-activated speakers “to make their homes work efficiently.” Seniors "who depend on voice-activated speakers are particularly sensitive to market exclusion orders that deprive them of the benefits of competition,” CDT wrote. The Computer & Communications Industry Association and Developer's Alliance criticized what they said was the overly wide scope of the proposed import ban. "Excluding personal mobile electronic devices such as those identified in the complaint risks depriving American consumers of basic modern communication tools, even though those devices are not themselves alleged to contain any infringing functionality," they said.
Clarity Products seeks exclusion from tariffs it pays on the amplified cordless phones imported from China under the 8517.11.00.00 subheading, posted the Tennessee vendor Thursday in the Office of the U.S. Trade Representative docket. The phones’ audio systems also have “frequency adjustment, noise suppression and multiband compression to help those with hearing loss,” said Clarity. Chinese manufacturers of “regular” cordless phones could do “small production runs” for Clarity at “economical prices,” it said. Clarity is “researching moving production to Malaysia and Vietnam, but this is unviable at this time given the company’s small volumes,” it said. It “explored” making amplified phones in a production facility it runs in Chattanooga, “but it is not economical,” it said. If Clarity lands the exemption, it would be entitled to refunds of the 15 percent tariffs retroactive to Sept. 1 when List 4A took effect. USTR is scheduled to roll back List 4A to 7.5 percent Feb. 14 (see 2001160022).
Netflix missed by 30 percent its target for U.S. paid net subscriber additions in Q4, the first quarter in which it faced head-to-head competition from the November launches of Apple TV Plus and Disney Plus, Netflix reported Tuesday. Netflix had 420,000 net paid U.S. adds in the quarter, compared with Oct. 16's 600,000 projection. It had 1.53 million net paid adds in the U.S. in Q4 a year earlier. It exceeded sub growth forecasts internationally, where Apple and Disney weren't a competitive factor, pulling in 8.33 million net paid adds in Q4, versus the 7 million it predicted three months ago. That outdid the 7.31 million net adds it had internationally in Q4 2018. The “low membership growth” domestically was “probably due" in part to the "US competitive launches,” said Netflix. “We are working hard to improve our service to combat these factors and push net adds higher.” It nevertheless is forecasting Q1 global paid net adds of 7 million, versus 9.6 million in Q1 2019, reflecting "the continued, slightly elevated churn levels we are seeing in the US." In the increasingly competitive landscape, “we have a big head start in streaming and will work to build on that by focusing on the same thing we have focused on for the past 22 years -- pleasing members,” it said. “We believe if we do that well, Netflix will continue to prosper.” Despite the “big debut” Q4 of Disney Plus and Apple TV Plus, “our viewing per membership grew both globally and in the US on a year over year basis, consistent with recent quarters,” it said. Netflix stock rose after regular U.S. trading, up 2.5 percent to $346.40 at 5:22 p.m.
Tech and business groups hailed Thursday’s Senate 89-10 ratification of the U.S.-Canada-Mexico Agreement. The measure awaits President Donald Trump’s signature. Canada's parliament isn't expected to ratify it until February. Mexico OK'd it in June. Senate approval is an “historic bipartisan victory for all Americans, especially manufacturers, farmers, and service providers,” said the U.S. Chamber of Commerce. The agreement’s digital trade provisions will help the future of the content industry “look brighter, particularly in Mexico,” said the Motion Picture Association. USMCA “will modernize trade among our closest trading partners and pave the way for continued prosperity across the borders of North America,” said the National Retail Federation. The agreement “will help ensure that more products researched, designed, and made in America -- including semiconductors -- can flow to customers" worldwide, said the Semiconductor Industry Association. “Businesses in all sectors rely on the free movement of data across borders, and the USMCA is a strong step towards creating international consensus on how that data should be treated,” said BSA|The Software Alliance. USMCA brings “North American commerce into the digital age with robust rules that will prove critical to the continued growth of the Internet economy,” said the Computer & Communications Industry Association. Sen. Bernie Sanders, I-Vt., (see 2001150080) joined eight Democrats, including Minority Leader Chuck Schumer, D-N.Y., to vote against USCMA. Sen. Pat Toomey, R-Pa., was the only Republican to vote no.
Permitting T-Mobile to buy Sprint would defy the “loud and clear message” of Congress and courts to “trust competition,” said plaintiff states’ outside counsel, Glenn Pomerantz of Munger Tolles, in the bench trial’s closing argument Wednesday in U.S. District Court in the Southern District of New York. T-Mobile lawyer David Gelfand, with Cleary Gottlieb, countered that the states “fell far short” at trial of their “burden” of proving the deal would be anticompetitive. He said the transaction will do “exactly the opposite” and “greatly improve competition.”
Sharp Japan’s “prior pending applications” to trademark “NXT-GEN” as a name and logo for consumer TVs and monitors were "abandoned and no longer pose as a potential bar” to CTA’s attempt to register the “NEXTGEN TV” logo for ATSC 3.0 consumer goods, said an “examiner’s amendment” posted Tuesday at the Patent and Trademark Office. Sharp’s December 2018 applications got provisional PTO approval, but PTO declared them dead after Sharp let lapse the Jan. 4 deadline for filing the required statements of use that would have cleared the trademarks to final registration (see 2001080031). Sharp and CTA haven’t commented on whether they coordinated PTO activities to let the NEXTGEN TV logo application go forward.
France’s digital services tax (see 1912030002) sets a “troubling precedent” because the DST “unnecessarily departs from progress towards stable, long lasting international income tax policies,” and “disproportionately impacts U.S.-headquartered companies.” So testified Sam Rizzo, Information Technology Industry Council director-policy, before an Office of the U.S. Trade Representative hearing Tuesday on Trade Act Section 301, per a transcript released Friday. The tech industry worries about “an accelerating trend toward the unilateral adoption of DSTs” in other countries, said Rizzo. U.S. “policy responses” need to be “about more” than the French DST, he said. “It is about preventing the wide-scale application of targeted, unilateral taxes.” USTR proposed retaliatory tariffs of up to 100 percent on some French non-tech imports.
U.S. smartphone importers shifted toward Vietnam and from China in November, the last full month before then-U.S. scheduled imposition of 15 percent tariffs on Chinese handsets, said new Census Bureau data we accessed Thursday through the International Trade Commission. The Trump administration suspended the levies Dec. 13, less than 48 hours before they were to take effect (see 1912130062). China was 73.7 percent of the 21.1 million smartphones imported to the U.S. from all countries in November, down 5.8 points sequentially. The U.S. imported 4.6 million smartphones from Vietnam in November, a 21 percent increase sequentially and a 65 percent jump from November 2018.
The Patent and Trademark Office declared dead two December 2018 applications from Sharp’s Japanese parent company to trademark “NXT-GEN” for consumer TVs and monitors, agency records show. Both applications, one for a plain-text trademark, the other for a stylized logo, got provisional PTO approval June 4, pending Sharp’s filing of a statement of use (SOU) within six months or a request for a deadline extension. PTO ruled the applications abandoned Monday after Sharp filed neither by the Jan. 4 deadline. Agency rules require the SOU to prevent companies from hoarding trademarks they have no intention to commercialize in order just to keep them out of competitors' hands. Abandonment of the Sharp applications appears to render moot a possible controversy in CTA’s effort to register the NEXTGEN TV logo as a certification mark for ATSC 3.0 consumer products (see 1910020024). CTA risked “potential refusal” of its Sept. 25 trademark request because Sharp’s NXT-GEN filings were “prior-pending applications,” and there would have been “a likelihood of confusion between the marks,” the agency notified CTA Friday, three days before Sharp's applications died. Had they survived, CTA’s application would have faced “suspension” at the agency pending “final disposition” of the Sharp docket, said PTO. Sharp didn’t comment Wednesday on why it let its applications lapse, nor did CTA on averting the possible controversy.