June 2010

On this week’s episode of the podcast, Adrian Johns, professor in the Department of History at the University of Chicago, expert on the history of science and the history of the book, and author of the new book, Piracy: The Intellectual Property Wars from Guttenberg to Gates, discusses the history of intellectual property and piracy.  He discusses origins of copyright law in London, the first pirates, and today’s digital piracy.  He also addresses the future of books and potential tipping points that could prompt changes in copyright law, citing the Google Books project and pharmaceuticals in the developing world.

Related Readings

Do check out the interview, and consider subscribing to the show on iTunes. Past guests have included Clay Shirky on cognitive surplus, Nick Carr on what the internet is doing to our brains, Gina Trapani and Anil Dash on crowdsourcing, James Grimmelman on online harassment and the Google Books case, Michael Geist on ACTA, Tom Hazlett on spectrum reform, and Tyler Cowen on just about everything.

So what are you waiting for? Subscribe!

Not surprisingly, FCC Commissioners voted 3 to 2 today to open a Notice of Inquiry on changing the classification of broadband Internet access from an “information service” under Title I of the Communications Act to “telecommunications” under Title II.  (Title II was written for telephone service, and most of its provisions pre-date the breakup of the former AT&T monopoly.)  The story has been widely reported, including posts from The Washington Post, CNET, Computerworld, and The Hill.

As CNET’s Marguerite Reardon counts it, at least 282 members of Congress have already asked the FCC not to proceed with this strategy, including 74 Democrats.

I have written extensively about why a Title II regime is a very bad idea, even before the FCC began hinting it would make this attempt.  I’ve argued that the move is on extremely shaky legal grounds, usurps the authority of Congress in ways that challenge fundamental Constitutional principles of agency law, would cause serious harm to the Internet’s vibrant ecosystem, and would undermine the Commission’s worthy goals in implementing the National Broadband Plan.  No need to repeat any of these arguments here.  Reclassification is wrong on the facts, and wrong on the law. Continue reading →

A fun little tidbit from Huffington Post today. Cook County Commissioner Robert Steele penned an op-ed revealing that Free Press, strong advocates for Net Neutrality regulation, is pushing its agenda on minority communities in order to gin up support for further regulation of the Internet. I’m sure there is no connection with today’s FCC decision to move forward with its Notice of Inquiry on reclassifying the Internet to fits Chairman Genachowski’s controversial “third way.”

Take a minute to read the entire piece by Commissioner Steele, but one of the more salient points is this,

“My first thought when reading this [Free Press] email was, ‘what do these folks know about the needs and wants of communities of color, especially on an issue as impactful as Net Neutrality?'”

In assessing a couple of recent surveys on broadband adoption among minority communities (especially African-American and Hispanic), a couple of things become evident. First, the nation is facing an adoption problem, not an access problem. Those who are not connected to broadband are in this position largely due to their own choice. The FCC’s own report shows that, while African-Americans and Hispanics trail the average in broadband access, the gaps have narrowed just in the last year.

Not only that, but when it comes to the African-American community, it is the older folks who are not connecting (both minority and non-minorities). Those in the minority community under the age of 30 have basically the same broadband adoption rates as whites, which mean younger adults are recognizing the benefits of broadband. The same can be said about educated households, but then, educated households have a higher income level than non-educated and higher income is another factor towards higher adoption rates.

Another interesting factoid is that the minority groups are more likely to access the Internet via a handheld device. This means that mobile broadband growth may very well help pick up the slack in the “digital divide.” It seems more and more are relying on their smartphones to handle their Internet needs.

Really though, the bottom line is that people in low-income households, and those who tend to be older, are the ones that by-and-large do not want to connect to the Internet. There is nothing in Genachowski’s “third way” regulatory scheme, nor in anything that Free Press is pushing, that will help bridge this gap.

It’s a shame that Free Press is using racial division as a motivation to push unnecessary government regulation.

“When I use a word, it means just what I choose it to mean — neither more nor less,”  Humpty-Dumpty said.     The famous egg could have worked for the Federal Communications Commission, which today took the first step toward re-defining broadband service as telecommunications.

 The decision comes only two months after a federal court — rather definitively – ruled that the agency had no authority to apply net neutrality rules to Internet service providers.  But it only took a few weeks for Chairman Genachowski to come up with a plan B:  re-classifying broadband service as telecommunications service.   At today’s meeting, the Commission — on a 3-2 vote — adopted a notice of inquiry on doing  just that.   Never mind that the initial that broadband is not telecom was the result of a years-long inquiry by the Commission.   If the FCC says a computer is really a telephone, then it is.  Lewis Carroll would be proud.  Continue reading →

The Entertainment Software Association, which represents the video game industry, has just released its latest “Essential Facts about the Computer and Video Game Industry” publication.  It’s a handy annual resource that I always look forward to reading. There are many interesting facts and figures found in the report, but here a few worth calling out from the data they have aggregated:

  • 93% of the time parents are present at the time games are purchased or rented
  • 64% of parents believe games are a positive part of their children’s lives
  • 86% of the time children receive their parents’ permission before purchasing or renting a game
  • 48% of parents play computer and video games with their children at least weekly
  • 97% of parents report always or sometimes monitoring the games their children play
  • 76% of parents believe that the parental controls available in all new video game consoles are useful

The survey also bolsters the findings of many other polls and reports which have found that parents employ a variety of what I have labeled “household media rules” to monitor or control their children’s media consumption: Continue reading →

Today, the Federal Communications Commission (FCC) voted along party lines to adopt a Notice of Inquiry opening a new proceeding to regulate the Internet by reclassifying it under Title II of the Communications Act. FCC Chairman Julius Genachowski calls this his “Third Way” plan. In a PFF press release, I issued the following response:

In its ongoing ‘by-any-means-necessary’ quest to regulate the Internet via Net Neutrality mandates, Chairman Genachowski’s FCC continues to flaunt the rule of law and magically invent its own authority as it goes along. If this Chairman wants to bring the Net under his thumb and regulate broadband networks like plain-vanilla public utilities, he should ask Congress for the authority to pursue such imperial ambitions. As the law stands today, the FCC has no such authority. Indeed, the unambiguously deregulatory thrust of the Telecom Act of 1996 stands in stark contrast to Chairman Genachowski’s outdated vision for Big Government Broadband.

The FCC stands on the cusp of killing one of the great deregulatory success stories of modern economic history by reviving the discredited regulatory industrial policies of the 19th Century. The revisionism about that epoch is dead wrong: Price controls and protected markets limited choice and stifled innovation. With the agency rolling back the regulatory clock in this fashion, today marks the beginning of the Internet’s “Lost Decade” of stymied investment, innovation, and job creation as all sides wage battle over the legality of reclassification and its implementation.

This is a post for all those broadband fans out there who want to talk about something today besides the Federal Communication’s Commission’s decision to take comments on which legal classification it should use to regulate broadband.

A recent FCC survey revealed that 80 percent of home broadband users do not know the speed of their broadband service. I can easily imagine how this statistic could be spun to “prove” that consumers are woefully uninformed and the broadband market must be plagued with “market failures” because consumers do not have even the basic information they need to make intelligent decisions.

Before we go down that road, let me explain, based on my own experience, why this is a non-issue.

I’m part of that 80 percent. I do not know the speed of my broadband service at home.  I know that when I signed up several years ago, I selected the slowest and cheapest broadband speed the provider offered.  I also know that this speed is still plenty fast for anything we need to do at home (and usually faster than the speed at my university office). I remain blissfully ignorant of the actual speed, even though it would be very easy for me to find out by looking at the materials I received when I signed up or checking the provider’s web site online.

In economic jargon, I am “rationally ignorant” of my home broadband speed. I don’t know (or remember) the speed, but to me this information is not worth the 45 seconds it would take me to find out. And that also means any FCC initiatives to “improve consumer information” or “educate” me about it will not, for me, be worth the time and money the FCC might spend on them.

If some of our Internet applications were not working in a satisfactory manner, we would probably do an online speed test, check to see what other speeds our provider offers, and check offers from competing providers. All of these steps would be easy and would require no FCC policy initiatives to facilitate (beyond making sure that the providers aren’t lying about what speeds they will provide).

I’m probably not alone.  The same survey reveals that 50 percent of Americans are satisfied with their broadband speeds, and another 41 percent are “somewhat satisfied.” So, 91 percent of consumers are more or less satisfied, even though 80 percent don’t know their speeds.

It would have been quite useful and instructive if the FCC survey had included an additional question: “Is your broadband speed adequate for the Internet applications you want to use?” And then cross-tabulate the responses with the responses on knowledge of broadband speed. Wanna bet that a substantial majority of people who do not know their speed would also have said that it is adequate?

Surely there are some broadband customers who use applications that require specific (fast) speeds, and these customers have a greater need to know what speed they’re receiving. That’s why providers tell prospective customers what speed tiers they offer. And that’s why one can find multiple web-based speed tests. This information is not hard to find if you want it.

But for some of us, it just ain’t worth it. And shame on anyone who tries to use my willful ignorance as an excuse for some new policy initiative. Rational ignorance is bliss, and I’m a bliss-ter.

A “funny until you realize it’s real” story out of San Francisco today (courtesy of the NY Times) where the city will soon require cell phone retailers to display the amount of radiation in each phone that is for sale on their shelves.

Even though this concern has been debunked time and again — the article mentions the latest major study that found no supporting evidence linking cancer to cell phone usage — the city believes that, though there are plenty of resources for those wishing to research radiation for particular cell phones, the city “thinks that for the consumer…it ought to be easier to find.”

Continue reading →

PFF has just published the transcript for an event we hosted last month asking “What Should the Next Communications Act Look Like?”  The event featured (in order of appearance) Link Hoewing of Verizon, Walter McCormick of US Telecom, Peter Pitsch of Intel, Barbara Esbin, Ray Gifford of Wilkinson, Barker, Knauer, and Michael Calabrese of the New America Foundation. It was a terrific discussion and it couldn’t have been more timely in light of recent regulatory developments at the FCC.  The folks at NextGenWeb were kind enough to make a video of the event and post it online along with a writeup, so I’ve included that video along with the event transcript down below the fold. Continue reading →

So, I’m sitting here at today’s Federal Trade Commission (FTC) workshop, “Will Journalism Survive the Internet Age?” and several panelists have argued that private “professional” media is toast, not just because of the rise of the Net and digital media, but also because the inherent cross-subsidy that advertising has traditionally provided is drying up.  It very well could be the case that both statements are true and that private media operators are in some trouble because of it. But what nobody seems to be acknowledging is that our government is currently on the regulatory warpath against advertising and that this could have profound impact on the outcome of this debate.

As Berin Szoka and I noted in a recent paper, “The Hidden Benefactor: How Advertising Informs, Educates & Benefits Consumers,” the FTC, the FCC, the FDA, and Congress are all considering, or already imposing, a host of new rules that will seriously affect advertising markets.  This article in AdAge today confirms this:

The advertising industry is heading for a “tsunami” of regulation and is at a “tipping point” of greatly increased scrutiny, warned a panel on social media and privacy at the American Advertising Federation conference here [in Orlando].

The reason this is so important for the ongoing debate about the future of media and journalism is because, as Berin and I argued in our paper: Continue reading →