Week in Review: December 28, 2016

Google Signs Internet Deal with Cuba On Monday, December 12, Alphabet Chairman Eric Schmidt signed a deal with ETECSA President Mayra Arevich Marin to speed up Google services in Cuba, concluding months of talks between Google and Cuba. La Empresa de Telecomunicaciones de Cuba SA (ETECSA) is a state-run telecommunications provider that has a monopoly over Cuba’s internet. With a population of 11.2 million, Cuba is one of the world’s most isolated nations based on Internet usage. The United Nations Development Program (UNDP) reports that only 3.4% of Cuban homes had either Internet or Intranet access in 2015. Access to the Internet is incredibly expensive and at-home connections are illegal. Moreover, the small amount of Cuban Internet usage is heavily censored and surveilled by the state. According to the Associated Press, the Google Cuba deal will not expand Internet access in the country but rather, simply reduce latency to Google services, such as YouTube. The speed for non-Google services will not be affected. Over the past couple of years, Google has expanded services in Cuba to include Chrome, Google Analytics, and Play Store. Through the deal, Google plans to install servers on the island, allowing the Google Cache network to locally cache content and hastening load times up to 10 times faster. An internet-infrastructure analyst at Dynamic Network Services Inc. Doug Madory finds that the Google Cache network is already being used in Greenland, Somalia, Yemen, and the Gaza Strip. Countries that do not contain Google servers include China, Iran, Syria, and North Korea to name a few. However, according to a local telecom technician, the new deal will not be able to improve reception of Gmail, a core Google service, because email depends on local bandwidth. The incentives for the company are clear – faster services mean that users are able to interact more with the products. More Google searches and YouTube queries allows the company to sell more advertisements to the citizens of Cuba. There is still no direct Internet link between the United States and Cuba; Google data must travel through Venezuela before it reaches Cuba. Due to national security concerns, Cuba has refused to create a more comprehensive Internet infrastructure via cable. For the past two years, the Obama administration has been building the United States’ diplomatic and commercial ties to the country. There are concerns about the undoing of US-Cuba relations with the new administration but this deal represents one of many that the Obama administration hopes will normalize relations between the two countries.

US Supreme Court Upholds Internet Sales Tax in Colorado On December 12, the U.S. Supreme Court upheld a Colorado law that imposed requirements on Internet retailers in order to recoup sales taxes from Internet purchases. The law mandates that Internet retailers must provide the names, addresses, and purchase amounts to tax authorities; notify customers of their obligation to pay taxes on their purchases; and present purchase summaries to customers, who spend more than $500 in a year. Customers are supposed to pay the internet tax themselves but they rarely do. The Direct Marketing Association (DMA) contended unsuccessfully that the Colorado tax, dubbed the Amazon tax, is a violation of the U.S. Commerce Clause, which prohibits undue burdens on state commerce. The Colorado ruling goes against the