Former Google chief executive Eric Schmidt says the novel coronavirus pandemic is raising the stakes for the federal government to expand broadband access.
As he takes on a new role leading a commission tasked with “reimagining” the post-coronavirus economy at the invitation of New York Gov. Andrew Cuomo (D), Schmidt says the broad stay-at-home orders in response to the virus dramatically accelerated people’s adoption of online services like telehealth. He's calling on Congress to ensure there’s more funding for rural broadband in the next stimulus package.
“All of a sudden, the Internet is no longer optional,” Schmidt said yesterday in an interview with CBS's “Face the Nation.” “You can't participate in this new economy without access to the Internet."
House Democrats are pushing to include $80 billion in broadband expansion in the next coronavirus relief package. However, it's unclear if Republicans, who also have expressed concerns about the digital divide particularly in rural areas, will support such a large investment in a longtime Democratic priority.
NEWS: @EricSchmidt tells @margbrennan that internet access is essential to the post-#Coronavirus world, suggests Congress increase rural broadband funding in any future stimulus package:— Face The Nation (@FaceTheNation) May 10, 2020
“You can't participate in this new economy without the internet,” he says. pic.twitter.com/bOqvY3h54G
Schmidt is leveraging his bully pulpit as tech billionaires take on a greater role in state-level coronavirus responses.
Cuomo has also tapped Microsoft founder Bill Gates's philanthropic foundation to help with reimagining education in the state. And California Gov. Gavin Newsom (D) has praised Facebook chief executive Mark Zuckerberg for supporting the state in its quest for data about the effectiveness of its stay-at-home orders.
Schmidt's call underscores how tech leaders are poised to potentially amass even more political power during the coronavirus pandemic and advocate for policies like expanded Internet that could be beneficial for the industry. That's worrying some critics who don't think that unelected billionaires should be making major decisions about responding to the virus.
From New York Senate deputy majority leader Mike Gianaris (D):
This is not good.— Sen. Mike Gianaris (@SenGianaris) May 6, 2020
First Bill Gates and now Eric Schmidt. These are not people who should determine for us how best to provide services to everyday New Yorkers.
Instead, we should tax them more so people whose job it is to decide state policy can do so more effectively https://t.co/UPGGTzw5ip
Yet the commission could be a unique opportunity for Schmidt to increasingly build his image as a bridge between government and the private sector. He's been on a mission to modernize the U.S. military through his work on advisory boards focused on innovation at the Department of Defense. Now he's in a position to play a similar role in the pandemic response.
Schmidt, who reportedly quietly left his technical adviser role at Alphabet in February, has a bold vision for how the coronavirus will change the U.S. economy. Here are some takeaways from yesterday's interview:
1. Businesses are going to have to “rethink” how they operate.
Schmidt predicts that major changes are coming to office spaces and transportation to make people feel more comfortable returning to work.
“We're going to have to figure out how to get people into buildings that they're fearful of,” he said. “My guess is we'll have more demand for office space, not less, because people will want social distancing. We're going to have to think about hub-and-spoke systems where local people don't travel so far because they don't want to be in public transit for so long.”
2. Work arrangements will have to be more flexible.
There's no one-size-fits-all approach to coming back to the office, according to Schmidt.
“If you think of it as an employer, you have a bunch of employees, some of whom are dying to get back to the office, and some people who are afraid that if they go to the office, they will die,” he said.
“So imagine that there are three or four people. One will go to the office. One will stay home. Some will go to some local or near their town working environment,” he added.
3. More businesses and people may move outside of cities.
Schmidt says there are parallels between the current moment and some businesses' decisions to shift operations outside of the city in the wake of the 9/11 attacks.
“It will change the pattern. We've had this situation where people move to super cities in these incredibly concentrated ways. That will change in the next few years. You don't need to be in the super city in order to participate in the excitement of these super cities.”
4. Telehealth visits will continue because they're more convenient for patients.
Schmidt is predicting a seismic shift in the way health care is delivered as people get used to remote doctors visits during the health crisis. Telehealth will be a key area of focus for his commission.
“Eighty percent of the visits to doctors are right now in telehealth,” he said. “People have been wanting this to happen for years. Now using remote monitoring, we can actually measure everybody and do it remotely. And then only if you have to, you go in to see the doctor.”
5. The government will need to update its computer systems.
The surge in unemployment requests has exposed how ill-prepared government computer systems were for an economic crisis. Schmidt says the problems underscore the need for an overhaul, especially as state and local governments will need more advanced systems to tackle new challenges such as transportation planning in a pandemic.
“They're still using COBOL systems, which is a system I programmed in 45 years ago,” Schmidt said. “And those systems, you know, the programmers are no longer with us.”
6. Tech companies will move more manufacturing back to the United States.
Schmidt says the current crisis has underscored that global supply chains are not as resilient as once believed. He thinks that will cause more companies, especially high-tech manufacturers, to bring those operations back to American shores. His comments come as the Wall Street Journal reports the Trump administration and companies such as Intel are growing more concerned about relying on factories in Asia.
“We have better control,” he said. “It's important from a standpoint of- of our own economics. It's also important for national security. We want to make sure that our critical infrastructure is owned and controlled by America, right? Never bet against America. We are the innovators in our world. We should be able to do this well. ”
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Tesla sued Alameda County for prohibiting it from manufacturing electric cars during the pandemic.
The company is seeking an injunction that will allow it to continue to operate its Fremont manufacturing plant. The suit, filed in the U.S. District Court for the Northern District of California, alleged that the county where its manufacturing plant is located violated the due process and equal protection clauses of the Fourteenth Amendment, my colleagues Faiz Siddiqui and Tony Romm write.
Earlier on Saturday, Tesla chief executive Elon Musk unleashed a series of erratic tweets saying he planned to move Tesla’s headquarters and future programs to Texas and Nevada. He said it's possible the company would maintain some operations in Fremont depending “on how Tesla is treated in the future.”
Tesla is filing a lawsuit against Alameda County immediately. The unelected & ignorant “Interim Health Officer” of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!— Elon Musk (@elonmusk) May 9, 2020
Tesla said Saturday it would resume production at its facility, with social distancing measures and on-site temperature screenings in place. The company said the county's rules are inconsistent with guidance at the state level, and it says that state rules should supersede county regulations.
“We will continue to put people back to work in a safe and responsible manner,” Tesla's statement said. “However, the County’s position left us no choice but to take legal action to ensure that Tesla and its employees can get back to work.”
County officials said they had a good working relationship with the carmaker, but Tesla alleged in its lawsuit that the county's public health official was not responding to calls or emails. The county issued the following statement earlier in the day:
“We need to continue to work together so those sacrifices don’t go to waste and that we maintain our gains,” the Alameda County Public Health Department said. “It is our collective responsibility to move through the phases of reopening and loosening the restrictions of the Shelter-in-Place Order in the safest way possible, guided by data and science.”
Shopify, Target, Costco and other Amazon rivals could benefit from business turmoil related to the coronavirus.
Several e-commerce companies are seeing revenue grow faster than Amazon as consumers increasingly shop online due to widespread stay-at-home orders, Bloomberg's Tae Kim writes.
Shopify said aggregated online sales of its merchant customer base grew 46 percent in the first quarter and accelerated further in April. Wayfair reported revenue growth of about 90 percent so far in its second quarter. And Target said its online business had risen more than 275 percent month-to-date as of April 23.
Meanwhile, Amazon has reported a 26 percent growth in revenue. Though the company no doubt has also benefited from a surge in coronavirus-related demand, it's also suffered from logistics challenges and had to rapidly hire 175,000 people to keep pace. Amazon is also dealing with criticism of workplace safety issues. Amazon head Jeff Bezos owns The Washington Post.
Inside the industry
Bartering is on the rise as crowded grocery stores run out of essentials such as paper products and produce.
Bartering groups are cropping up on social networks such as Facebook, Nextdoor and Twitter, my colleague Rachel Lerman writes. Those participating say it keeps them out of crowded shops and saves money as unemployment surges. It also is a way to feel helpful during the pandemic.
In Fresno, Calif., Ashley Hughes traded marmalade for some lemons from a neighbor.
“It was a very unique way to connect with someone during a time when a lot of us are feeling alone,” Hughes said.
- Alexandra Reeve Givens is starting today as president & CEO of the Center for Democracy & Technology. She previously worked at Georgetown Law's Institute for Technology Law and Policy.
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SNL takes on the virtual graduation: