After a frustrating year in Congress, tech groups plan merger

ITAA, AeA are in talks to consolidate

WASHINGTON -- Tech industry lobbying groups are consolidating to improve their clout and ability to get Congress to act on stalled issues, notably the expired research and development tax credit and workforce concerns, such as the H-1B visa.

The tech groups also want to create an organization that is as powerful and as recognized in Washington as the Recording Industry Association of America. The groups say the only way to accomplish that is to end the duplication through a trade group merger.

Christopher Hansen, president and CEO of the AeA (formerly known as the American Electronics Association), said tech companies have been "a little frustrated" with the duplication. Tech firms "have to pay dues to too many organizations and realize that their voice has become diluted," he said.

The Information Technology Association of America and the AeA said today they are in merger talks, and if that merger goes through, it will likely go a long way to centralize the tech industry's lobbying efforts.

Phil Bond, president and CEO of the ITAA, said the merger of the AeA and ITAA would give the groups "a louder, more unified and more effective voice." The ITAA has already completed mergers with two other tech groups this year, the Government Electronics and Information Technology Association and the Cyber Security Industry Alliance.

But there will be limits to what the ITAA and the AeA want to achieve. Although tech-lobbying groups share similar views on many of the key policy issues in Congress, they're split on antitrust concerns. The Software & Information Industry Association, for instance, has been active in backing the U.S. government's antitrust efforts against Microsoft Corp.

The Computer & Communications Industry Association (CCIA) supports the antitrust investigations against Intel Corp. Last month, the CCIA joined a lawsuit with The New York Times, The Washington Post and other media groups asking a federal court in Delaware to unseal records in the Advanced Micro Devices Inc. and Intel antitrust lawsuit.

But these have been frustrating times as well for tech groups. The research and development tax credit expired in December, and while Congress has let it lapse before making it retroactive, there are concerns that the lack of action creates an opening for other countries to attract U.S. research. The tech industry has also hit a wall with Congress over the H-1B issue and its effort to increase the overall cap from 85,000 since the failure of a comprehensive immigration reform bill earlier this year.

Bond said the ITAA and AeA have broad agreement on issues concerning free trade, taxes, access to tech talent and education, and regulations. With a change looming in the White House and on many congressional committees, now is the time to act, he said.

Lawmakers understand that tech innovation drives economic growth, Bond said. "We need to tell that story better, and we need a bigger voice to do that," he said.

Harris Miller, who was executive director of the ITAA for more than a decade before leaving in 2006, said he sees little chance of friction in a merger of the AeA and ITAA. "There is a high degree of overlap and commonality in their positions."

The two trade groups differ on what issues they focus on. The AeA has historically focused more on hardware issues, such as environmental concerns and manufacturing requirements, while the ITAA has its roots in the software industry. The net effect of all these different groups has been confusion and a lack of clout on Capitol Hill, Miller said.

Copyright © 2008 IDG Communications, Inc.

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