IRELAND - The Apple Wars

"European Union: Apple owes Ireland nearly $15 billion in back taxes" PBS NewsHour 8/30/2016

This is also a Greed File.

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SUMMARY:  After uncovering an illegal deal, the European Union ruled that Apple pay over $14.5 billion in back taxes to Ireland.  The EU's antitrust regulator found that the country and the tech giant had made an agreement that allowed Apple to pay less than 1 percent in corporate tax for over a decade.  Apple plans to appeal the decision.  Hari Sreenivasan speaks with EU Commissioner Margrethe Vestager.

HARI SREENIVASAN (NewsHour):  The European Commission ruled today that Ireland must collect $14.5 billion in back taxes from Apple.  The announcement fueled new tensions between the U.S. and Europe over the role of multinational corporations, how they are taxed, and whether it should be considered a subsidy.

The antitrust regulator for the EU said Ireland had given Apple a sweetheart tax deal for well over a decade, with special laws that effectively allowed Apple to pay less than 1 percent corporate tax.  The EU accused Apple of setting up two companies in Ireland with a head office that only exists on paper.  The profits from European stores all go to the Ireland head office and are essentially untaxed.

Apple said it would appeal the decision and denied the characterization.  In a statement, the company's chief executive, Tim Cook, said the European Commission is trying to — quote — “rewrite Apple's history in Europe, ignore Ireland's tax laws and upend the international tax system in the process.”  The company has more than $200 billion in cash.

I spoke with Commissioner Margrethe Vestager, who announced the decision.

Ms.  Vestager, thanks for joining us.

First off, what gave Apple an edge in Ireland that was unfair in the eyes of the EU?

MARGRETHE VESTAGER, European Commission:  Well, we have a long longstanding prohibition of state aid, which means benefits, advantages to a selected company.

And that may come in any form, as a piece of land, a favorable loan, a grant or a tax benefit.  And, of course, any member state can have their own tax legislation.  We would never question that.  But the thing is that you cannot give a specific company a benefit or an advantage which is not open to other companies.

HARI SREENIVASAN:  Is there evidence that this was specific to Apple and not to all the other companies that are doing business in Ireland?

MARGRETHE VESTAGER:  Yes, it is.

This arrangement is due to two things which are none of our concern, how Apple is organized and the Irish tax legislation.  But the thing that is specific is two tax rulings — are two tax rulings that are directed specifically to Apple.

And tax rulings are, by nature, specific because they are directed from the government or from the authorities to a specific company.  And this is only for them.  It is not for other companies.

CRACKED - iPhone vs FBI

aka 'The Right to Hide Criminals Case'

"FBI cracks the locked iPhone, but legal questions remain unanswered" PBS NewsHour 3/29/2016

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SUMMARY:  A conflict between tech giant Apple and the FBI over the encrypted iPhone of one of the San Bernardino shooters came to a moot point when Justice Department officials announced they had cracked the phone's security without Apple's help.  Gwen Ifill talks to Devlin Barrett of The Wall Street Journal and Fred Kaplan of Slate for more on how the FBI got what it wanted and what happens now.

GWEN IFILL (NewsHour):  A pitched battle between the Obama Justice Department and one of the world's biggest tech companies appeared to end abruptly this week, when the government decided to drop its insistence that Apple crack the code for an iPhone used in the San Bernardino shootings.

Apple had refused, insisting such cooperation would constitute a major breach of privacy.  The impending standoff ended yesterday when the government announced it had been able to crack the phone after all, without Apple's help.

But questions remain.

For that, we turn to Devlin Barrett, who covers the Justice Department for The Wall Street Journal, and Fred Kaplan, a columnist with Slate.  He's the author of “The Dark Territory: The Secret History of Cyber War.”

Devlin, starting with you, did one or the other of the parties in this case back away, just back up?

DEVLIN BARRETT, The Wall Street Journal:  The government backed away.  The government said — but it also got what it wanted, in a sense, because it got into the phone it had been trying to get into for months.

I think what you saw happen was that the government spent two months saying it can't get into this phone without Apple, and then at the last minute, essentially, it said, actually, someone has just come to us and told us that we can get into it without Apple, and that's what happened.

GWEN IFILL:  So, Fred Kaplan, the obvious question for so many of us is, who broke into the phone for them, and how did they find them, and had they — would they have been able to find them before without all of this legal mishmash?

FRED KAPLAN, Slate:  Well, it seems to be an Israeli cyber-security firm called Cellebrite, which consists mainly of retired professionals from the — an outfit called Unit 822, which is a — the cyber-warfare branch of the Israeli intelligence agency, sort of the Israeli NSA.

You can imagine.  Here's the FBI saying, we can't break into this phone.  Here's Apple saying, we don't want anybody to break into this phone.  This is the most secure phone out there.  You have got hundreds, maybe thousands of hackers around the world who look at this and say, hmm, let me give this a try.

And, you know, the law that the FBI was invoking to get Apple to open it themselves, which is a 1789 law called the 'All Writs Act,' states that if somebody else can do it, if you can find some way to do it without demanding that a company like Apple do it, then you have to drop your suit.

And that's why the FBI withdrew.  They had to.  They really didn't want to.  They thought that they had a good case here and were ultimately trying to test a new legal principle to accommodate for this new stronger era of encryption.

IMO:  This is a case where the actual effects privacy-rights fanatics is to allow criminals to hide.  That is just WRONG!  There is no Constitutional right to have criminals hide.



RELATED:  Breaking into iPhone may help find Louisiana killer

LAW - Apple's Obstruction of Justice

"Judge's order to Apple over attacker phone encryption unlocks privacy concerns" PBS NewsHour 2/17/2016

IMO there is NO Constructional Right to allow hiding of criminal activity, especially when there is a warrant.  Privacy should not used as an issue to hide criminals and terrorists.

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SUMMARY:  Since the San Bernardino attack, the FBI has been trying to read the contents of a cell phone used by attacker Syed Farook, made impossible by encryption.  Now Apple CEO Tim Cook is rejecting a federal court order to create software to unlock the device.  Gwen Ifill talks to Stewart Baker, former assistant secretary of Homeland Security, and Nate Cardozo of the Electronic Frontier Foundation.

GWEN IFILL (NewsHour):  The battle over privacy vs. security is back front and center, as Apple digs in against the FBI and the courts over the issue of access to data on its phones.

December 2, 2015, that's the day Syed Farook and his wife, Tashfeen Malik, went on a murderous rampage in San Bernardino, California, killing 14 people.  Hours later, they were, in turn, killed by police.  Ever since, the FBI has been trying to read the contents of a cell phone Farook used.

JAMES COMEY, FBI Director:  We still have one of those killers' phones that we have not been able to open.  And it's been over two months now.  We're still working on it.

GWEN IFILL:  Last week, FBI Director James Comey told a Senate hearing that the Apple iPhone's encryption has made it impossible for the agency to access its content.

Now a federal judge in California has ordered the company to create software that will do just that.  But Apple CEO Tim Cook forcefully rejected that order early yesterday, writing in a letter addressed to Apple customers: “In the wrong hands, this software, which doesn't exist today, would have the potential to unlock any iPhone in someone's physical possession.”

White House Press Secretary Josh Earnest disputed that, saying the government wants access only to the single device associated with Farook.

JOSH EARNEST, White House Press Secretary:  We're not asking Apple to redesign its products or to create a new back door to its products.  This is a much more specific request that the Department of Justice has put forward.

GWEN IFILL:  Apple stepped up its protections after NSA leaker (aka traitor) Edward Snowden exposed government surveillance of phone traffic in 2013.

One feature can even erase the iPhone's contents after 10 failed attempts to unlock it.  Prosecutors say they are worried that this feature could be on the phone Farook used.  And unless Apple devises a way to unlock it, they could lose all its data.  The company now has five days to make its formal response in court.

Note that Nate Cardozo could be making a prejudicial assumption, that the FBI is asking Apple to turn over a way to access this iPhone.  That need not be the way it happens.  Apple could create the way to disable the one feature, the FBI would take the iPhone in question TO APPLE and have them do it.  The FBI would NOT get the software and Apple would not have to put the code on any iPhone.



Sen. Dianne Feinstein calls on Apple to obey court order

CORPORATE CLOSET - CEO Opens the Door

"Apple’s CEO helps open the corporate closet" PBS NewsHour 10/30/2014

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GWEN IFILL (NewsHour):  Celebrities, athletes and politicians have increasingly gone public about their sexual orientation.  But the corporate closet has mostly remained closed.

Today, Apple’s CEO, Tim Cook, opened that door a but more, declaring in an essay for Bloomberg Businessweek he is gay.

“While I have never denied my sexuality, I haven’t publicly acknowledged it either until now,” he wrote.  “So let me be clear.  I’m proud to be gay and I consider being gay among the greatest gifts God has given me.”

Cook becomes the most prominent business leader to come out, but what difference will it make?

Kara Swisher, who has long covered the tech industry and is co-executive editor of the tech news website re/code, joins me now.

So, Kara, in this day and age, why does what Tim Cook had to say matter?

KARA SWISHER, re/code:  Well, he is the most prominent executive in tech, and he’s running the most valuable company in the world.

And so he has a lot of prominence, and this is a big deal for him to come out and say that.  And the fact that no Fortune 500 executive has done this is a milestone.

GWEN IFILL:  So, why now?  Tell us about Tim Cook.

KARA SWISHER:  I don’t think there was an occasion.  He didn’t just decide, like, wake up this morning.

This is something — he’s been out among his friends, as he wrote, but he had never acknowledged it in public.  And people have been talking about it in Silicon Valley a lot.  There was a lot of hubbub a couple of months ago when a CNBC exchange discussed it.  Everybody knows he’s gay and stuff like that.

And I think he just wanted — he’s been moving slowly towards it.  He’s been making — he appeared at the Gay Pride Festival here in San Francisco this year.  He made a speech just recently about gay and lesbian rights related to Alabama, where here’s from.

So he’s been moving towards this very clearly.  And I think probably he just woke up and said enough.  I will just acknowledge it and say it and it’s not a big deal.  And me holding back probably makes it more of a big deal.

TECHNOLOGY - Apple Pay and Others

Ya...  Sure...  With all the hacking of smartphones, banking sites, stores, and more lets, add another easy way to steal your money.  If you use these apps, you better not loose your phone.

"Will Apple Pay phase out the wallet?" PBS NewsHour 10/20/2014

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GWEN IFILL (NewsHour):  If you happen to be one of the millions who bought a new Apple iPhone in recent weeks, or you are waiting for your upgrade to arrive, you may feel like your wallet is getting a little lighter, and not just because of the price of the phone.

In an era of electronic payments, technology is turning the wallet in your pocket digital.

Hari Sreenivasan has our conversation, recorded in our New York studios.

HARI SREENIVASAN (NewsHour):  Paying for something with your phone isn’t necessarily a new idea.  I have been using mine to pay for cabs for the past year.  But, today, Apple launches its mobile payment platform called Apple Pay.

And here to help us understand how the arrival of Apple into this arena changes the game is Arik Hesseldahl, a senior editor at technology news site Re/code.

So, why is it a big deal that Apple decides to do something that Google has been doing for a while?

ARIK HESSELDAHL, Re/code:  Well, partially because, with the Google experience, it has been inconsistent.  There has been a lot of resistance from the carriers.

For instance, Verizon has its own payment plans and has resisted Google’s infrastructure, Google’s plan.  And so it has been an inconsistent and an uneven experience on the Google platform.  With apple, we have a completely unified experience.

Apple has also — it’s been a lumbering giant in payments for a long time.  There are more credit card accounts associated in the iTunes infrastructure than on Amazon or PayPal.  And so it has only been a matter of time for the technology to come and the experience to show up and make it easy for consumers to use.

HARI SREENIVASAN:  So besides Apple and Google, you also hear Wal-Mart and PayPal.  All these people are getting into this arena.  Why is it so important for them to control the actual transaction?  What do they get out of it?

ARIK HESSELDAHL:  There’s a lot of money.

They are multibillion-dollar businesses.  First Data is one and there are numerous other payment processors build multibillion-dollar business on essentially pennies and fractions of pennies.  There is always money to be made on the swipe of a card or in this case now the wave of a phone.