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Libertarianism & Antitrust: A Brief Comment

by on June 7, 2011 · 6 comments

Over at his blog, our old TLF colleague Tim Lee has been discussing the AT&T – T-Mobile merger and the ways libertarians should think about antitrust more generally.  In his latest post, he pushes back against a brief comment I posted on a previous essay. You can head over to his site and read that exchange and then see my latest comment. But I thought I would also post it here for those interested.

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Tim… My thinking on antitrust is very much shaped by the choice between ex ante vs. ex post regulation. How much faith should we place in sector-specific regulators to get things right through preemptive, prophylactic regulation versus allowing things to play out and then — on the rare occasions when intolerable monopolies over essential goods develop — letting antitrust regulators devise a remedy?

More than any other economic value, I care about experimentation. I am completely under the sway of the Austrian School of thinking about markets and competition as an ongoing experiment, an evolutionary journey, a discovery process.  How are we to know if intolerable monopolies over essential goods will actually develop unless we let things play out?

As I argued in my critiques of the Lessig/Zittrain/Wu school of thinking, we need to be a bit more humble and have a little faith that ongoing experimentation and discovery will help us evolve into a better equilibrium. It’s during what some regard as a market’s darkest hour when some of the most exciting forms of disruptive technologies and innovation are developing. [I’ve elaborated more on this point in this lengthy discussion about Gary Reback’s recent book on antitrust.] Continue reading →

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How Should Libertarians Think about The Master Switch?

by on November 29, 2010 · 2 comments

Former TLF blogger Tim Lee returns with this guest post. Find him most of the time at the Bottom-Up blog.

Thanks to Jim Harper for inviting me to return to TLF to offer some thoughts on the recent Adam Thierer–Tim Wu smackdown. I’ve recently finished finished reading The Master Switch, and I didn’t have have my friend Adam’s viscerally negative reactions.

To be clear, on the policy questions raised by The Master Switch, Adam and I are largely on the same page. Wu exaggerates the extent to which traditional media has become more “closed” since 1980, he is too pessimistic about the future of the Internet, and the policy agenda he sketches in his final chapter is likely to do more harm than good. I plan to say more about these issues in future writings; for now I’d like to comment on the shape of the discussion that’s taken place so far here at TLF, and to point out what I think Adam is missing about The Master Switch.

Here’s the thing: my copy of the book is 319 pages long. Adam’s critique focuses almost entirely on the final third of the book, (pages 205-319) in which Wu tells the history of the last 30 years and makes some tentative policy suggestions. If Wu had published pages 205-319 as a stand-alone monograph, I would have been cheering along with Adam’s response to it.

But what about the first 200-some pages of the book? A reader of Adam’s epic 6-part critique is mostly left in the dark about their contents. And that’s a shame, because in my view those pages not only contain the best part of the book, but they’re also the most libertarian-friendly parts.

Those pages tell the history of the American communications industries—telephone, cinema, radio, television, and cable—between 1876 and 1980. Adam only discusses this history in one of his six posts. There, he characterizes Wu as blaming market forces for the monopolization of the telephone industry. That’s not how I read the chapter in question. Continue reading →

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Cyberbullying . . . and Mighty Entertaining!

by on November 8, 2010 · 1 comment

At BIGGOVERNMENT.com, Seton Motley takes the effort to regulate Internet service provision in the name of neutrality and stomps on it with both feet.

If this were high school (and politics really sort of is), Net Neutrality would be sitting alone at lunch — shunned even by the members of the marching band and the audio-visual club. Having had its lunch money taken, it would have only enough for milk (and would sadly be unable to open the container). It would be planning to take its aunt to prom.

His brief, unkind history takes the push for Internet regulation from its bright beginnings in 2006 through a four-year-long fade. It ends with the PR catastrophe the Progressive Change Campaign Committee produced when it signed 95 Democratic candidates onto a “Network Neutrality Pledge” and they all lost.

That fiasco doesn’t reveal anything about the merits of the proposal to turn Internet service providers into federally regulated public utilities. But it is emblematic of the immaturity and amateurishness of the push for net neutrality regulation. The effort never fixed on an actual, defined problem. Instead it rotated through corporate missteps with text message services, with web sites, and sometimes with actual Internet service. The movement was long on slogans and short on concrete proposals.

Proponents of net neutrality regulation never answered the conundrum posed by “regulatory capture”—that the FCC they wanted to “control” ISPs might end up controlled by them. They never countered the point that technologists and marketplace actors would husband the behavior of ISPs, a point made ably by Tim Lee in his paper, The Durable Internet.

Motley caps off his cyberbullying of the Internet regulation effort with an Examiner piece today noting that the Progressive Change Campaign Committee raised a pitiful $300 for its efforts.

[W]ith the PCCC’s feeble efforts and Tuesday’s historic pro-freedom Congressional demographic shift – the free market, free speech assault that is Net Neutrality now lies broken on the ash heap of Internet and tech history. To which we say – good riddance to bad rubbish.

If the push for net neutrality regulation survives, it will have to regroup/grow up, identify a concrete problem and a defensible solution, and then carry that credible message beyond its own echo chamber. All in all, the movement to regulate net neutrality seems to have been “playing at” advocacy rather than seriously advocating.

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More on Net Neutrality Regulation: Suppose Free Press Called a Crisis and Nobody Noticed?…

by on April 6, 2010 · 9 comments

In the wake of yesterday’s ruling in the D.C. Circuit that the FCC had exceeded its authority in attempting to regulate access to the Internet, I did a number of radio interviews and a radio debate with Derek Turner of Free Press, a leading advocate of Internet regulation.

The debate was a brief, fair exchange of views. I was struck, though, to hear Turner refer to the situation as a “crisis.” Sure enough, in a Free Press release, Turner says three times that the ruling creates a “crisis.”

Recall that in 2007 Comcast degraded the service it provided to a tiny group of customers using a bandwidth-hogging protocol called BitTorrent. Recall also that before the FCC acted, Comcast had stopped doing this, relenting to customer complaints, negative attention in news stories, and such.

In the wake of the D.C. Circuit ruling and the crisis it has created, Internet users can expect the following changes to their Internet service:
None.

Wow. With crises like these, who needs tranquility?

“As a result of this decision, the FCC has virtually no power to stop Comcast from blocking Web sites,” the release intones.

That would be worrisome, though still not much of a crisis—except that Comcast would be undercutting its own business by doing that. Did you know also that no federal regulation bars people from burning their furniture in the backyard? That’s the same kind of problem.

As Tim Lee points out in his paper, “The Durable Internet,” consumer pressures are likely in almost all cases to rein in undesirable ISP practices. Computer scientist Lee presents examples of how ownership of communications platforms does not imply control. If an ISP persists in maintaining a harmful practice contrary to consumer demand—and consumers can’t express their desires by switching to another service—we can talk then.

In the meantime, this “crisis” has me slightly drowsy and eager to go outside and enjoy the spring weather.

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Apple, Content Platforms & Editorial Discretion

by on February 23, 2010 · 6 comments

I posted a rant here over the weekend about those who were engaging in what I believed was excessive whining about Apple’s moves to restrict pornographic content in the Apple Apps Store. (see: “Apple’s App Store, Porn & ‘Censorship‘”) It received a surprising number of comments and featured a back and forth between me and our old TLF blogging colleague Tim Lee. Tim has continued the discussion over on his personal blog and argued that:

[T]he key thing to focus on isn’t the abstract question of whether porn on iPhones is good or bad. The key thing to recognize is how fundamentally broken the process itself is. “Overtly sexual content” is a concept that seems clear in the abstract but gets leaky once you have to actually classify tens of thousands of applications. Apple is going to make mistakes, and when they do hapless developers are going to find their apps blocked, often with little explanation or recourse. Also, Apple is going to change its mind periodically, and when they do the affected developers are going to find their hard-earned apps rendered worthless overnight. This is no way to run a technology platform. It’s unfair to developers and it doesn’t scale. And this is precisely why it would be better for everyone if Apple could come up with an application distribution scheme that didn’t require so much central planning.

I followed up with a comment over there, but just thought I would repost it here, in which I argue that Tim is underestimating how difficult this task of defining acceptable content is and that he is also downplaying Apple’s legitimate editorial discretion to establish standards for the community platform they provide. I’m also uncomfortable with Tim’s constant use of “central planning” rhetoric to describe almost any private, proprietary model of institutional governance or platform development he doesn’t seem to agree with, but I have not elaborated on that point here. Anyway, here’s how I responded over on his blog: Continue reading →

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Mobile Micropayments: Forcing Me to Reconsider the Conventional Wisdom

by on December 18, 2009 · 3 comments

I’ve always generally agreed with the conventional wisdom about micropayments as a method of funding online content or services: Namely, they won’t work.  Clay Shirky, Tim Lee, and many others have made the case that micropayments face numerous obstacles to widespread adoption.  The primary issue seems to be the “mental transaction cost” problem: People don’t want to be diverted–even for just a few seconds–from what they are doing to pay a fee, no matter how small.  [That is why advertising continues to be the primary monetization engine of the Internet and digital services.]

android-market-12-15-09That being said, I keep finding examples of how micropayments do work in some contexts and it has kept me wondering if there’s still a chance for micropayments to work in other contexts (like funding media content).  For example, I mentioned here before how shocked I was when I went back and looked at my eBay transactions for the past couple of years and realized how many “small-dollar” purchases I had made via PayPal (mostly dumb stickers and other little trinkets). And the micropayment model also seems to be doing reasonably well in the online music world. In January 2009, Apple reported that the iTunes Music Store had sold over 6 billion tracks.

And then there are mobile application stores.  Just recently I picked up a Droid and I’ve been taking advantage of the rapidly growing Android marketplace, which recently hit the 20,000 apps mark. Like Apple’s 100,000-strong App Store, there’s a nice mix of paid and free apps, and even though I’m downloading mostly freebies, I’ve started buying more paid apps. Many of them are “upsells” from free apps I downloaded. In most cases, they are just 99 cents. A few examples of paid apps I’ve downloaded or considered buying: Stocks Pro, Mortgage Calc Pro, Currency Guide, Photo Vault, Weather Bug Elite, and Find My Phone. And there are all sorts of games, clocks, calendars, ringtones, heath apps, sports stuff, utilities, and more that are 99 cents or $1.99.  Some are more expensive, of course.

Continue reading →

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Net Neutrality Regulation & the First Amendment

by on December 9, 2009 · 31 comments

One of the more troubling aspects of the contentious debate over Net neutrality regulation is the way some proponents have sought to cast Net neutrality as “the Internet’s First Amendment.” As a die-hard free speech advocate, I find this truly outrageous and a complete contortion of the true purpose of the First Amendment.  As I have argued here before, it is incredibly dangerous thinking that puts our real First Amendment liberties at stake by empowering a regulatory agency with more means of controlling online speech and expression. Simply stated, the Internet’s First Amendment is the First Amendment, not some new, top-down, heavy-handed regulatory regime that puts the Federal Communications Commission in control of the Digital Economy.

On this point, I wanted to bring two things to your attention. The first is an outstanding address delivered today by Kyle McSlarrow, President & CEO of the National Cable & Telecommunications Association, at a Media Institute event here in Washington, DC.  And the second is this new paper by my PFF colleague Barbara Esbin.

McSlarrow’s speech was entitled, “Net Neutrality: First Amendment Rhetoric in Search of the Constitution” and it squarely addressed the fundamental fallacy set forth by the Net neutralitistas when it comes to the First Amendment. “Whatever our present-day policy disagreements about net neutrality, or even differing politics, let’s not forget that the First Amendment is framed as a shield for citizens, not a sword for government,” he argued. “By its plain terms and history, the First Amendment is a limitation on government power, not an empowerment of government,” McSlarrow said. “And… if there’s one thing the Supreme Court has made clear, it’s that rules that directly restrict protected speech cannot be justified by a government interest that is merely hypothetical.”

Absolutely correct. And these views are buttressed by the comments of Barbara Esbin in her new paper, in which she argues that “Net Neutrality is not the First Amendment for the Internet.”  She continues: Continue reading →

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Is Apple’s “Top-Down” App Store Really a Barrier to Innovation?

by on October 8, 2009 · 8 comments

Over at his new blog, our old TLF colleague Tim Lee has an interesting post up about “The Problem with Top-Down ‘App Stores’” in which he argues that “when app store approval becomes mandatory, it becomes a major impediment to the success of high-tech platforms.”  But I have to wonder if the facts support that assertion. Here’s how I commented on his site:

Tim… What I don’t hear you articulating here is your vision of what a “bottom-up” app store would look like and why it would really produce vastly superior results. Nor do I hear you saying anything about the legitimate concerns that the handset makers might have about the security or stability factors associated with certain applications. I’m not saying those problems are extensive, but at the margins they could be real depending on the nature of the program and how it interacts with the handset and/or network. Second, there needs to be some sense of proportionality here, at least about the iPhone (I can’t speak for the Palm experience). In just a little over a year, there’s been 2 billion downloads of over 85,000 apps from over 125,000 developers. So, when you talk about Apple’s approval process being “plagued by.. problems” and “rejections for trivial or non-sensical reasons” and “long delays in the review process have become a staple of the tech blogosphere” I think you are giving the impression that this is somehow the norm when it is very much the exception to the rule. Perhaps you would be willing to itemize the examples for us. Once you do, I’d appreciate you doing the math on what that looks like as a percentage of the total 85,000 apps that are already out there on the market today. I am willing to bet the result is something like 0.000001%. Again, a sense of proportionality is really key here. While I am not an Apple fan and agree they have a bit too much of a control streak for my tastes, it’s hard to argue with results. In this case, a closed, top-down system has produced some fairly spectacular results.

I’m sure Tim will have more to say so head over to his blog for more discussion.

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The Technology Liberation Front Turns 5 Today!

by on August 14, 2009 · 15 comments

TLF at 5 logoFive years ago today the Technology Liberation Front (the “TLF”) got underway with this post.  The idea for the TLF came about after I asked some tech policy wonks whether it was worth put together a blog dedicated to covering Internet-related issues from a cyber-libertarian perspective.  The model I had in mind was a “Volokh Conspiracy for Tech Issues,” if you will. I wanted to bring together a collection of sharp, liberty-loving wonks (most of whom worked in the think tank world) to talk about their research on this front and to give them a place to post their views on breaking tech policy developments.  It was to be a sort of central clearinghouse for libertarian-oriented tech policy analysis and advocacy.

At first, Tim Lee and I debated whether it even made sense to have that sort of narrow focus, but I think the passage of time and the rise of plenty of competition on this front shows that it was worthwhile.  And I’ve been very pleased with the tag-team effort of all our TLF contributors and the way—without anyone planning it, in true libertarian fashion—we’ve sort of developed a nice division of labor on various tech policy issues.

Perhaps a few stats are in order on this occasion to mark our progress 5 years in. The best indication of our success is the fact that our Pagerank (Google’s logarithmic scale of website importance based on links to that site) has reached 7/10—the same score shared by the Volokh Conspiracy (our model), as well as Techmeme (the leading tech news aggregator), the Cato Institute, CDT, etc. (For comparison: ArsTechnica and EFF are 8s.) Unfortunately, we’ve only been using Google Analytics for three of the past five years, so it’s impossible to get a authoritative accounting of traffic growth since Day 1. But here are few markers:

So, what’s our #1 post of all-time? Continue reading →

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TPW 43: Public Access to Court Records

by on March 6, 2009 · 13 comments

Conversations about how the Internet can be used to increase the openness and accountability of government usually focuses on the Executive and Legislative branches of the Federal government.  But on this week’s episode of Technology Policy Weekly, I hosted a discussion of the equally vital issue of public access to court records, joined by:

We discussed a wide range of issues, including:

  • Why lay people should care—this is ultimately about reducing the legal profession’s monopoly over access to the courts!
  • The philosophical reasons why better access to court records is important – little things like democracy, fairness, consistency, equality, the rule of law, etc.
  • The copyrightability of legal records
  • The history of the problem & what can be done about it

There are several ways to listen to the 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!

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