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Cisco Statement on FCC Decision to Regulate the Internet

“When the FCC Chairman’s office originally unveiled open Internet rules last year, Cisco cheered the proposal, because we support an open Internet and believe that balanced rules that protect consumers and prevent anti-competitive behavior are necessary and appropriate.

Unfortunately, the rules adopted by the FCC today bear little resemblance to the original proposal. They impose far-reaching Title II regulation on Internet access and services. We believe this will inhibit investment in wired and wireless broadband and limit consumer choice in new and innovative services relating to telemedicine, distance learning, and the Internet of Everything.

Over the coming days and weeks, we will study the new rules to see how they impact broadband investment. But we view the decision to impose heavy-handed regulation, rather than a balanced approach, as a missed opportunity.

Ultimately, this issue will be decided by the Courts and Congress, which will have the final say on the matter.”

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Statement of Mark Chandler on the IEEE Decision on Patent Clarifications

“Today’s decision by the IEEE Board of Directors is a significant victory for consumers and for those who want a reasonable and stable patent system that supports innovation.

In making this decision, the IEEE supported those companies who are willing to both grant and receive licenses for patents required for use in IEEE standards on reasonable terms.  We congratulate the IEEE for resisting pressure from the few who wanted to use the patent system to force unreasonable costs on makers and users of everyday products like smartphones and wireless routers.

Today’s decision will help ensure that owners of patents required to implement standards won’t be able to use their leverage to obtain unreasonable royalties.

Cisco will work with the IEEE and other stakeholders to ensure that the new clarifications are implemented in a fair and equitable manner.”

Statement of Mary Brown on new FCC Rules on 911

The FCC today unanimously adopted new rules that will require improved location data to be delivered to 911 call centers from wireless phones.

This decision is an important step forward in generating a dispatchable address from wireless phones located indoors, helping ensure that first responders can reach victims as quickly as possible. When fully implemented, technologies like these will help save lives. But there is considerable work to be done, and Cisco will work with first responders, service providers, the FCC and enterprises to help reach this goal.

There are many technologies that have a role to play when a consumer dials 911 from his or her mobile phone, and chief among those technologies is Wi-Fi.  In fact, because Wi-Fi Access Points are associated with a civic, dispatchable address, Wi-Fi generated location data from residential locations will play an important role in achieving the goals established by the FCC for locating 911 wireless callers.

Various market sources indicate Wi-Fi penetration of US households is almost 60 percent. Households with fixed line broadband use Wi-Fi more heavily, with Wi-Fi penetration at 80 percent.  Consistent with historical growth in the market, Cisco expects Wi-Fi household penetration to continue to increase, and believes Wi-Fi can be an important tool toward finding callers.

Enterprises can help, too, because emergencies also happen at work.  A recent Cisco survey of enterprises with more than 100 employees shows that 80 percent of companies either have Wi-Fi everywhere or in designated areas.

Technology is available today to connect enterprise Wi-Fi location data to first responders, and Cisco will enthusiastically support industry and first responders in implementing the FCC’s decision.”

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Coordinated Malware Eradication Coalition Clarification

In 2014, Cisco joined the Coordinated Malware Eradication (CME) coalition, where multiple companies cooperate to stop the growing malware threat that all customers are experiencing.  In one case, Cisco researched and published malware and activity that was using a remote access tool (RAT) called ZxShell (also known as Sensocode).

Our public blog posts may be found here:
•              Threat Spotlight: Group 72
•              Threat Spotlight: Group 72, Opening the ZxShell

The Cisco team did the ZxShell technical analysis because Novetta, Inc., who is also part of the CME, began researching a new threat in September 2014, and reached out to other member companies to help.  Novetta asked Cisco to analyze the ZxShell malware only, understand its technical nature and capability only, and publish our results – our technical results are published in the second blog post above.  This was Novetta’s only request.  Novetta referenced our technical results, but they did not ask, nor did we participate, cooperate, or contribute in the researching, identifying, or naming of who developed the malware or deployed the malware.

We are disappointed that the appearance of Cisco’s logo on the cover of the Novetta report may suggest that Cisco endorses all of the report conclusions, including conclusions that China was behind the activity described in the report.  We only endorse our findings about the technical attributes of ZxShell; the rest of Novetta’s report is unrelated to Cisco and the conclusions are their own.

We focus on protecting our customers through technical analysis of the attacks, and creating protections against them.

Cyber-attacks are global and the attacks must be stopped.  Our fundamental security objective is to protect all customers, be transparent, and be their trusted partner.  We hope this clears up any misconceptions.

Why We are United for Patent Reform

Last week marked the first steps forward for a broad-based coalition of businesses who are working together to fight wanton abuse of the patent litigation system by patent assertion entities (PAEs).

The coalition – United for Patent Reform – is comprised of grocery, hotel, retail, restaurant and technology associations and companies including Cisco. Our mission: to fight for patent reform legislation in Congress that will stop litigation factories that take advantages of anomalies in the patent system to extort financial settlements out of businesses large and small.

Simply put, patent assertion entities – companies who neither invent nor produce products, but simply buy patents for litigation value – file lawsuits or send intimidating demand letters, knowing that many defendants will pay to avoid litigation costs alone, or will pay to avoid the risk of losing a large sum in a lottery-like litigation system plagued by high costs and uncertain outcomes.

Opponents of reform claim that recent court decisions – particularly by the US Supreme Court, which in recent years has reversed a number of lower court decisions by unanimous or near unanimous votes –have solved the problem.  They point especially to the decision last spring in Alice v CLS Bank, which in fact affects only a very narrow segment of the patent world.

The overall numbers, in fact, show just that the problem continues to persist.

  • The PAEs themselves, which exist solely for litigation, continue to invest and buy based on the reality of continued business as usual.  In fact, according to Allied Security Trust, a leading analyst of the market, patent assertion entities bought just as many patents in the first 6 months of 2014 as they did in all of 2013.
  • The total number of defendants in cases brought by patent assertion entities remain within ten percent of recent years and still many multiples larger than a decade ago. The total number of defendants sued is comparable to 2012 and 2010.  (2011 and 2013 were marked by significant action toward patent reform, which drove up the numbers.)  The numbers of cases in 2014 were triple those of 2006.
  • This is not just a problem for a few large companies.  Nearly half of the NPE defendants of 2014 were companies with less than $100 million of revenue.

As our coalition’s membership illustrates, this is a problem that includes businesses of all shapes and sizes.  In both 2013 and 2014, half of the defendants were not tech companies.

This cries out for Congressional action.

United for Patent Reform released a letter last Thursday outlining our seven core principles:

  • Demand letter transparency
  • More specificity in making patent allegations
  • Protections against suits against innocent end users rather than against the company that built the supposedly infringing product
  • Litigation procedures efficiency
  • Putting burden of litigation costs on those who bring suits that prove to be for extortion value only or where parties demand inefficient, costly litigation procedures
  • Encouragement of litigation alternatives

Over the next weeks and months, Cisco, in conjunction with United for Patent Reform and its member companies, will make the case for patent reform in the hope that Congress will approve meaningful reforms soon.

This is imperative if we’re to break the outlandish and exploitive business model that has encouraged patent assertion entities to thrive.