Startup News Digest: 3/31/17

Our weekly take on some of the biggest stories in startup and tech policy. To receive this weekly digest in your inbox, sign up at

Engine Examines the Limits of Filtering. In a congressional briefing on Tuesday, Engine Executive Director, Evan Engstrom, and Princeton University professor Nick Feamster introduced the report they co-authored exploring various content filtering technologies and the impact that their mandatory application could have on startups. Feamster, a computer scientist, explained the primary modes of filtering and each of their shortcomings in identifying copyright infringing material. Engstrom addressed the implications for startups if policymakers moved to require the use of these technologies. Not only would companies suffer because of the limited ability of the current methods to accurately filter infringing content, he said, but they would also be unable to afford the extremely high price required for full-scale operation of the filtering technology. The full report, which elaborates on the speakers’ remarks, can be found here.

The Supreme Court Considers Patent Case Venue Issues. The country’s highest court kicked off its week with the long awaited TC Heartland v. Kraft Foods Group Brands, a case that has the potential to change the venue rules that have contributed to increases in patent trolling and become the face of America's broken patent system. In its argument, TC Heartland asserted that patent infringement cases should only be filed “where the defendant resides.” This position was bolstered by a number of amicus briefs, including one filed by Engine and another by 32 tech companies, both of which argued that venue rules have been abused by groups with no interests beyond licensing and litigating patents. For their part, the justices seemed relatively unswayed by the argument that the eastern district of Texas hears over a quarter of the patent infringement cases in the U.S. each year. While overturning 25 years of precedent would be a bold move by the court, its record of friendliness towards patent defendants makes it very possible.

Net Neutrality Up Next After Repeal of Privacy Rules. While the Republican agenda has faced a number of setbacks recently, this week the party succeeded in killing the Federal Communications Commission’s (FCC) privacy rules, which were put in place at the tail end of the Obama Administration to regulate the way internet service providers (ISPs) handle consumers’ private information. After the bill to repeal the rules passed the Senate last week, a House vote on Tuesday essentially sealed the deal and the bill now awaits signature from President Trump (which is basically inevitable). Many view this overturning of the Obama-era privacy rules as the first step in a broader plan by the new Administration and Republican-controlled Congress to further deregulate broadband companies. Up next on the chopping block? The 2015 Open Internet Order. On Thursday, White House spokesman, Sean Spicer, indicated that the Administration's next priority will be rolling back net neutrality. This will be more logistically and politically complicated than repealing the privacy rules, and any any efforts to undermine an open internet should anticipate persistent pushback from the startup community and countless other groups. We’re tracking.

New Report Shows Startup Economy Expanding. On Thursday, TechNet and the Progressive Policy Institute released a new report examining the impact of startups on job growth and highlighting the increasing geographic dispersion of startup communities across the U.S. Specifically, the paper argues that startup dynamism is growing: “the rate of net establishment formation — which includes both new business creation and the expansion of existing firms — started to accelerate in 2015 and continued through 2016.” Additionally, the report finds that the “dynamism gap” between the large cities and the rest of the country is narrowing, supporting the assertion that vibrant startup ecosystems are emerging in every corner of the country. In order to support these local entrepreneurial communities, the two organizations argue that public policy should support increasing access to capital and talent, opening up access to markets, and improving the regulatory environment. Read the full report and see their list of the top 25 emerging startup ecosystems here.

This Week’s #StartupsEverywhere Profile: Bill Kenney in Connecticut. We’re doing #StartupsEverywhere a little differently this week. Instead of looking at a specific city or region, we’re profiling a state. That’s because Bill Kenney, founder of the CT Entrepreneurial Event Calendar, CT Entrepreneurial Mentor Cooperative, and CT Entrepreneur Awards, is focused on making the entire state of Connecticut a hub for entrepreneurship and economic independence. “While there are various regional and institutional efforts across the state, my goal is to foster collaboration and interconnection among these entities.” Learn more about what’s happening in Connecticut’s startup ecosystem by reading the full interview here.