Today, Berin Szoka and I both testified at the first of three Federal Trade Commission workshops on “Exploring Privacy.” Today’s all-day event featured five panel discussions, and remarks by FTC Chairman Jon Leibowitz, Commissioner Pamela Jones Harbour, and David C. Vladeck, Director of the FTC’s Bureau of Consumer Protection. Our TLF co-blogging colleague Jim Harper also testified on the first panel of the day on “Benefits and Risks of Collecting, Using, and Retaining Consumer Data.” I was on the second panel of the day on “Consumer Expectations and Disclosures.” And Berin was on the third panel on “Online Behavioral Advertising.” The fourth panel was on “Information Brokers” and the fifth panel was on “Exploring Existing Regulatory Frameworks.” On my panel, we discussed the usefulness of privacy polls and surveys. I attempted to make a few simple points when asked for my opinions:
- While privacy polls and surveys may offer us some interesting insights into how some in the public think about advertising and privacy in the abstract, ultimately, they are no substitute for real-world experiments in which people make real choices, in real time, often with real money, and face many real trade-offs. [See this paper.]
- Moreover, such polls and surveys fail to account for the fact that consumers are empowered with real privacy controls so they can make the privacy choices that are right for them, rather than a one-size-fits-all choice imposed by someone else. [See this ongoing series and this paper.]
- (1) & (2) are especially the case since privacy is a highly subjective condition. [See this paper by Jim Harper.]
- It remains unclear what the harms are that we are trying to protect consumers against. [See this paper and this blog post.]
- Because of (1), (2), (3), and (4) we need to understand that rational ignorance may often be at work here. Many consumers likely won’t feel the need to read privacy policies or take steps to “protect their privacy” online.
Continue reading →
It’s truly amazing how fast mobile broadband demand is expanding. A couple of things caught my eye yesterday that really drove that home. First, I was reading Bernstein Research’s weekly (subscription-only) newsletter and Craig Moffett, one of America’s top media and communications analysts, summarized the growing mobile bandwidth crunch as follows:
To fully grasp the challenge facing wireless providers as we make the transition from wireless voice to wireless data, it is helpful to put some ballpark numbers around current usage levels. Today, the average voice-only customer consumes something like 50 megabytes of data every month. For that, they pay about $40, or about $0.80 per megabyte. That’s 70% of wireless industry revenues. Text messaging generates another $10 per month for a minuscule amount of data (in fact, arguably no throughput at all, since text messaging travels in a signaling band rather than in the carrier band itself). Let’s call it $1,000 per megabyte. That’s another 15% of industry revenues. On a blended basis, then, that’s $1.00 per megabyte for 85% of industry revenues.
And then there’s the iPhone. By some estimates, the average iPhone user consumes as much as 800 megabytes per month. Take out their 50 Mb for voice and you’re looking at 750 Mb of data… for an additional $30. For the mathematically challenged, that’s a princely sum of… wait for it… four cents per megabyte. Worse, we noted that the FCC’s wireless net neutrality policies posed the risk of “bandwidth arbitrage,” where low bandwidth services (at $1.00 per megabyte) would be replaced with free or almost free applications that ride on $0.04 per megabyte data plans, and where carriers’ hands would be tied to prevent it. Taking a business that is currently getting $1.00 per megabyte down to just $0.04 per megabyte is, well, hard. And lest anyone think that this threat is idle fear-mongering, Google’s acquisition last week of Gizmo5, a wireless VoIP specialist, should give one pause.
Those are stunning numbers. And then I saw this new filing by CTIA listing some other statistics about growing mobile broadband demand:
Continue reading →
Last night here on the TLF, Bret Swanson raised a number of objections with this FCC-commissioned report about international broadband comparisons, which was conducted by some folks at Harvard University’s Berkman Center. Meanwhile, over at the Digital Society blog, George Ou also offers a hard-nosed look at the Berkman broadband report and concludes “The underlying data cited by Berkman study is simply too flawed to be of any use.” I recommend everyone check out both essays. It will be interesting to hear how the Berkman folks respond. Some of these international broadband comparisons are really fishy. [Here's a podcast we did on that issue two years ago.]
One quick point… Like Bret, I also found it shocking that–even though the report reads like an ode to forced access regulation–the Berkman folks didn’t spend much time discussing the result of America’s previous open-access regime. “The gaping, jaw-dropping irony of the report,” Bret argues, “was its failure even to mention the chief outcome of America’s previous open-access regime: the telecom/tech crash of 2000-02. We tried this before. And it didn’t work!” Indeed, America’s regulatory experiment with forced access regulation involved a lot of well intentioned laws and regulation, and too many acronyms to count–CLECs, TELRIC, UNE-P, etc– but it did not result in serious, facilities-based competition. Instead it offered us the fiction of competition through network-sharing, or what Peter Huber once referred to as building “networks out of paper.” The results were disastrous for investment during that period since regulatory uncertainly led to a lot of stunted innovation.
In sum, sharing is not competing. You can socialize and commoditize old pipes for awhile and get decent results in the short-term, but you’ll sacrifice long-run investment and innovation if you do. [For more background, see my recent essay on "The Fiction of Forced Access 'Competition' Revisited" and this old Cato piece on "UNE-P and the Future of Telecom "Competition" as well as Jeff Eisenach's PFF white paper, "Broadband Policy: Does the U.S. Have It Right After All?"]
The smell of high-tech regulation is increasingly in the air these days and many lawmakers and some activist groups now have the mobile marketplace in their regulatory cross-hairs. Critics make a variety of claims about the wireless market supposedly lacking competition, choice, innovation, or reasonable pricing. Consequently, they want to wrap America’s wireless sector in a sea of red tape. Two important new studies thoroughly debunk these assertions and set the record straight regarding the state of wireless competition and innovation in the U.S. today. These reports are must-reading for Washington policymakers and FCC officials who are currently contemplating regulatory action.
First, Gerald Faulhaber and Dave Farber have a new report out entitled “Innovation in the Wireless Ecosystem: A Customer-Centric Framework.” Here’s what Faulhaber and Farber find:
the three segments of the wireless marketplace (applications, devices, and core network) have exhibited very substantial innovation and investment since its inception. Perhaps more interesting, innovation in each segment is highly dependent upon innovation in the other segments. For example, new applications depend upon both advances in device hardware capabilities and advances in spectral efficiency of the core network to provide the network capacity to serve those applications. Further, we find that the three segments of the industry are also highly competitive. There are many players in each segment, each of which aggressively seeks out customers through new technology and new business methods. The results of this competition are manifest: (i) firms are driven to innovate and invest in order to win in the competitive marketplace; (ii) new business models have emerged that give customers more choice; and (iii) firms have opened new areas such as wireless broadband and laptop wireless in order to expand their strategic options.
They continue on to address the policy issues in play here and discuss the “consumer-centric” approach they recommend that the FCC adopt: Continue reading →
Interesting piece here from Slate’s Farhad Manjoo on why AT&T should dump unlimited data plans and end what he calls the “iPhone all-you-can-eat buffet.” He notes that: “The typical smartphone customer consumes about 40 to 80 megabytes of wireless capacity a month. The typical iPhone customer uses 400 MB a month. AT&T’s network is getting crushed by that demand.” Because “some iPhone owners are hogging the network” and causing “a slowed-down wireless network,” Manjoo recommends a congestion pricing model as a method of balancing supply and demand:
How would my plan work? I propose charging $10 a month for each 100 MB you upload or download on your phone, with a maximum of $40 per month. In other words, people who use 400 MB or more per month will pay $40 for their plan, or $10 more than they pay now. Everybody else will pay their current rate—or less, as little as $10 a month. To summarize: If you don’t use your iPhone very much, your current monthly rates will go down; if you use it a lot, your rates will increase. (Of course, only your usage of AT&T’s cellular network would count toward your plan; what you do on Wi-Fi wouldn’t matter.)
To understand the advantages of tiered pricing, let’s look at AT&T’s current strategy of spending billions to build more network space. Why won’t this work? For the same reason building more roads doesn’t reduce traffic—more capacity increases the attractiveness of driving, which brings a lot more cars to the road, which leads to more gridlock.
Congestion pricing and metering is something I’ve written quite a bit about here in the context of wireline broadband (1, 2, 3), but Manjoo is equally correct that it could be applied for wireless data plans. It has the added value of taking pressure off lawmakers to impose Net neutrality regulation since pricing of the pipe becomes an effective substitute for most other forms of network management. In other words, price, don’t block bandwidth-hogging customers and applications. The problem, Manjoo explains: Continue reading →
Jeff Jonas has published an important post: “Your Movements Speak for Themselves: Space-Time Travel Data is Analytic Super-Food!”
More than you probably realize, your mobile device is a digital sensor, creating records of your whereabouts and movements:
Mobile devices in America are generating something like 600 billion geo-spatially tagged transactions per day. Every call, text message, email and data transfer handled by your mobile device creates a transaction with your space-time coordinate (to roughly 60 meters accuracy if there are three cell towers in range), whether you have GPS or not. Got a Blackberry? Every few minutes, it sends a heartbeat, creating a transaction whether you are using the phone or not. If the device is GPS-enabled and you’re using a location-based service your location is accurate to somewhere between 10 and 30 meters. Using Wi-Fi? It is accurate below 10 meters.
The process of deploying this data to markedly improve our lives is underway. A friend of Jonas’ says that space-time travel data used to reveal traffic tie-ups shaves two to four hours off his commute each week. When it is put to full use, “the world we live in will fundamentally change. Organizations and citizens alike will operate with substantially more efficiency. There will be less carbon emissions, increased longevity, and fewer deaths.”
This progress is not without cost:
Continue reading →
What Unites Advocates of Speech Controls & Privacy Regulation? [pdf]
by Adam Thierer & Berin Szoka
The Progress & Freedom Foundation, Progress on Point No. 16.19
Anyone who has spent time following debates about speech and privacy regulation comes to recognize the striking parallels between these two policy arenas. In this paper we will highlight the common rhetoric, proposals, and tactics that unite these regulatory movements. Moreover, we will argue that, at root, what often animates calls for regulation of both speech and privacy are two remarkably elitist beliefs:
- People are too ignorant (or simply too busy) to be trusted to make wise decisions for themselves (or their children); and/or,
- All or most people share essentially the same values or concerns and, therefore, “community standards” should trump household (or individual) standards.
While our use of the term “elitism” may unduly offend some understandably sensitive to populist demagoguery, our aim here is not to launch a broadside against elitism as Time magazine culture critic William H. Henry once defined it: “The willingness to assert unyieldingly that one idea, contribution or attainment is better than another.”[1] Rather, our aim here is to critique that elitism which rises to the level of political condescension and legal sanction. We attack not so much the beliefs of some leaders, activists, or intellectuals that they have a better idea of what it in the public’s best interest than the public itself does, but rather the imposition of those beliefs through coercive, top-down mandates.
That sort of elitism—elitism enforced by law—is often the objective of speech and privacy regulatory advocates. Our goal is to identify the common themes that unite these regulatory movements, explain why such political elitism is unwarranted, and make it clear how it threatens individual liberty as well as the future of free and open Internet. As an alternative to this elitist vision, we advocate an empowerment agenda: fostering an environment in which users have the tools and information they need to make decisions for themselves and their families. Continue reading →
Well, here we go again. Harvard’s Jonathan Zittrain has penned another gloomy essay about how “freedom is at risk in the cloud” and the future of the Internet is in peril because nefarious digital schemers like Apple, Facebook, and Google are supposedly out to lock you into their services and take away your digital rights. And so, as I have done here many times before (see 1, 2, 3, 4, 5 + video!), I will offer a response arguing that Jonathan’s cyber-Chicken Little-ism is largely unwarranted.
Zittrain’s latest piece is entitled “Lost in the Cloud” and it appears in today’s New York Times. It closely tracks the arguments he has set forth in his book The Future of the Internet–And How to Stop It, which I named the most important technology policy book of 2008, but not because I agreed with its central thesis. Zittrain’s book and his new NYT essay are the ultimate exposition of Lessigite technological pessimism. I don’t know what they put in the water up at the Berkman Center to make these guys so remarkably cranky and despondent about the future of of the Internet, but starting with Lawrence Lessig’s Code in 1999 and running through to Zittrain’s Future of the Internet we have been forced to endure endless Tales of the Coming Techno-Apocalypse from these guys. Back in the late 90s, Prof. Lessig warned us that AOL and some other companies would soon take over the new digital frontier since “Left to itself, cyberspace will become a perfect tool of control.” Ah yes, how was it that we threw off the chains of our techno-oppressors and freed ourselves from that wicked walled garden hell? Oh yeah, we clicked our mouses and left! And that was pretty much the end of AOL’s “perfect control” fantasies. [See my recent debate with Prof. Lessig over at Cato Unbound for more about this "illusion of perfect control," as I have labeled it.]
But Zittrain is the equivalent of the St. Peter upon which the Church of Lessigism has been built and, like any good disciple, he’s still vociferously preaching to the unconverted and using fire and brimstone sermons to warn of our impending digital damnation. In fact, he’s taken it to all new extremes. In Future of the Internet, Jonathan argues that we run the risk of seeing the glorious days of the generative, open Net and digital devices give way to more “sterile, tethered devices” and closed networks. The future that he hopes to “stop” is one in which Apple, TiVo, Facebook, and Google — the central villains in his drama — are supposedly ceded too much authority over our daily lives because of a combination of (a) their wicked ways and (b) our ignorant ones.
Continue reading →
In episode #44 of “Tech Policy Weekly,” Berin Szoka and Adam Thierer engage in a debate with Internet security expert Chris Soghoian, who is a student fellow at the Berkman Center for Internet & Society at Harvard University. He is also a Ph.D. candidate at Indiana University’s School of Informatics.
Chris is an up-and-coming star in the field of cyberlaw and technology policy as he has quickly made a name for himself in debates over privacy policy, data security, and government surveillance. He straddles the line between academic and activist, and the role he often plays in many tech policy debates is somewhat akin to what Ralph Nader has done in many other fields through the years. Except, in this case, instead of “Unsafe at Any Speed” it’s more like “Unsafe at Any Setting,” since Chris is often raising a stink about what he regards as unjust or unreasonable privacy or security settings that various online websites or service providers use.
On the show, Chris talks about two of his recent crusades to get certain online providers to change their default settings to improve user security or privacy: (1) His effort this week to get major email providers—and Google in particular—to change their default security settings on their email offerings; and (2) his earlier crusade to create permanent opt-out cookies to stop behavioral advertising by advertising networks.
There are several ways to listen to today’s TLF Podcast. You can press play on the player below to listen right now, or download the MP3 file. You can also subscribe to the podcast by clicking on the button for your preferred service. (And do us a favor, Digg this podcast!)
Continue reading →
The first meeting of the Online Safety Technology Working Group (OSTWG) took place today and I just wanted to provide interested parties with relevant info and links in case they want to keep track of the task force’s work. As I mentioned back in late April, this new task force was established by the “Protecting Children in the 21st Century Act,” (part of the ‘‘Broadband Data Improvement Act’,’ Pub. L. No. 110-385) and it will report to the Assistant Secretary of Commerce for Communications and Information at the U.S. Department of Commerce’s National Telecommunications and Information Administration (NTIA).
I’m happy to be serving on this new working group and I am particularly honored to be serving as the chairman of 1 of the 4 subcommittees. The four subcommittees will address: data retention, child pornography, educational efforts, and parental controls technologies. I am chairing that last subcommittee on parental controls. The task force has about 35 members and we have a year to conduct our research and report back to Congress. Here are some relevant links from the NTIA website that provide additional details about this task force:
Of course, this is certainly not the first task force to explore online safety issues. There was the COPA Commission (2000), the “Thornburgh Commission” report (2002), the U.K. “Byron Commission” report (2008), the Harvard Berkman Center’s Internet Safety Technical Task Force (2008), and the NCTA-iKeepSafe-CommonSenseMedia “Point Smart, Click Safe” working group, which is due to issue its final report shortly. [Full disclosure: I was a member of that last two task forces as well.] I’m currently working on a short paper that attempts to summarize the remarkably similar findings of these important child safety working groups. Generally speaking, they all concluded that education and empowerment, not regulation, were the real keys to moving forward and making our kids safer online.
Comments 
Posted in: Advertising & Marketing, Privacy, Security & Government Surveillance 
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.
