NRO Op/Ed: Government v. Google: Why Free Marketeers Should Rally Against Search Neutrality

by on July 22, 2010 · 4 comments

“Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.” Thus did Ronald Reagan capture the essence of big government. The two biggest challenges facing defenders of free markets in technology policy lie in Reagan’s second point:

  • Telling the “Good News Story” about how “it” (human ingenuity—what the great economist Julian Simon called our “Ultimate Resource”) keeps “moving” (by inventing new hardware, software, services, etc.)
  • Holding the line against efforts to extend the regulatory regimes of the past over new technologies, and chipping away at those regimes as best we can

So one might think that believers in limited government would celebrate a company like Google as a great American success story: A university research program launched by two smart kids (one of whom fled Communist oppression) that grew from a garage start-up into a global tech titan whose wide-ranging innovations are revolutionizing more and more of the economy. Surely free marketeers would rally to the defense of such a company when, say, the New York Times—that if-it-moves-regulate-it bastion—calls for bringing “into the regulatory fold,” right?

Unfortunately, all too many free marketeers seem willing to hang Google out to dry, or at least stay silent because they resent the pro-regulatory policy positions taken by the company or the political leanings of its employees and leadership. The company has hardly been a champion of digital capitalism in Washington, allying itself with a number tax/regulate/subsidize groups, pushing for net neutrality regulation, and using antitrust as a sword against its rivals (some of whom seem willing to return the favor). But the principles at stake are too important for free marketeers to gloat, as Adam Thierer argued in an op/ed for National Review Online earlier this week: Government vs. Google: Why Free Marketeers Should Rally Against “Search Neutrality.” Continue reading →

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Genomics industry facing risk of government regulation

by on July 22, 2010 · 5 comments

It’s been a tough week for the personal genomics testing marketplace.  First there were two long days of FDA meetings, and then today an Energy and Commerce Committee held hearings where the GAO announced the results of a “sting” operation into direct to consumer (DTC) genomics companies.   Below is the (brutal) GAO video.  As Daniel MacArthur has pointed out, today there exist both legitimate and not-so-legitimate testing firms, but the GAO has lumped them all in together, which will make it easier for pro-regulatory forces to get their hooks into the industry.  I urge you to read MacArthur’s entire analysis here, since he follows the industry closely and is saddened by the fact that:

The momentum seems to be well and truly in favour of the bureaucrats now. The prospect of increased regulation (specifically from the FDA) seemed to be enthusiastically received by the Committee today; there was explicit mention of increased money for the FDA to support such a move. The shape of this regulation is as yet unclear, but I’m now extremely pessimistic about the industry’s prospects of escaping excessive, innovation-crushing regulation in the US.

This is very bad news for those of us who wish to see personal medicine flourish.

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After the Deluge, More Deluge

by on July 22, 2010 · 0 comments

If I ever had any hope of “keeping up” with developments in the regulation of information technology—or even the nine specific areas I explored in The Laws of Disruption—that hope was lost long ago.  The last few months I haven’t even been able to keep up just sorting the piles of printouts of stories I’ve “clipped” from just a few key sources, including The New York Times, The Wall Street Journal, CNET News.com and The Washington Post.

 

I’ve just gone through a big pile of clippings that cover April-July.  A few highlights:  In May, YouTube surpassed 2 billion daily hits.  Today, Facebook announced it has more than 500,000,000 members.   Researchers last week demonstrated technology that draws device power from radio waves.

Continue reading →

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“Best Practices” Online Safety Panel at Tomorrow’s IGF-USA Event

by on July 20, 2010 · 1 comment

Internet governance is often thought of as ICANN and domain names, but the Internet Governance Forum, a body of the UN, takes a broad approach. Tomorrow I’ll be speaking on a panel about online safety at IGF-USA,  a national body that reports to the full IGF.  We’ll discuss the recent NTIA OSTWG “Youth Safety on a Living Internet” report, among other online safety issues such as sexting, cyberbullying, and proposed state legislation.

UPDATE:  Here’s a summary and video excerpt of my presentation.

Here’s the panel:

Moderator: Danny Weitzner, Associate Administrator, Office of Policy Analysis and Development U.S. Department of Commerce

Panelists:

  • Michael W. McKeehan, Executive Director, Internet and Technology Policy, Verizon
  • Braden Cox, Policy Counsel, NetChoice Coalition
  • Anne Collier, via remote participation [Invited]
  • Jennifer Hanley, Family Online Safety Institute (FOSI)
  • Stacie Rumenap, Stop Child Predators

Respondents:

  • Morgan C. Little, Elon University Graduate, Political Science, American University
  • Jane Coffin, NTIA: comments on some of the global activities
  • Bessie Pang, Executive Director, POLCYB

Check it out and come for the other panels on cybersecurity, cloud computing and global governance for governments. Registration is free.

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When it comes to Internet taxes, where you sit determines where you stand

by on July 19, 2010 · 1 comment

In light of the Delahunt “Main Street Fairness Act” (HR 5660) introduced earlier this month, over at the NetChoice blog Steve DelBianco describes why it is important to consider that “where you sit determines where you stand”  when it comes to Internet taxes:

Big-box stores like Walmart and Target support a federal mandate that forces everyone to collect sales tax, even for states where they have zero presence.  So why would these giant chains  — who already have to collect taxes on their web sales — stand for this?

Because from where Walmart sits, any simplification – even a little – helps reduce their costs.  And because these big boys want to impose new tax collection costs on their small online competitors.

He’s also reacting to a post at BNET last week, where Chris Dannen described how big retailers are supporting the so-called “streamlined sales tax”:

“Brick-and-mortar retailers — many of whom have operations online — are some of the most vocal proponents of the new online tax laws. The members of the pro-tax lobby, which includes Best Buy, WalMart ,Target and others, already collect sales tax online, regardless of the buyer’s state, and see Web-only retailers as having an unfair advantage, from How to Tax E-Commerce without Killing Entrepreneurship (and eBay)”

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New York Times Symposium on Future of Indecency Regulation

by on July 19, 2010 · 0 comments

As part of its excellent “Room for Debate” series, the New York Times has an interesting new online symposium up now asking, “Will Networks Go Wild, With No Decency Rules?”  It was in response to last week’s Second Circuit decision, which again slapped down an effort by the Federal Communications Commission to defend the agency’s indecency enforcement regime.  I was honored to be asked to contribute a short essay on the subject. Here are the other contributors and their essays.  Take the time to check them out:

I was particularly interested in former FCC’s Chairman Michael Powell’s admission that “The [FCC’s] fleeting expletive policy was a mistake,” and that “the real problem is the now-flawed constitutional foundation on which the law is built.” Powell goes on to argue that, “We cannot have one First Amendment for broadcasting and another one for every other medium. This vestige of a bygone era provides fertile ground for mischief — culture wars, political agenda and moral mandates. It’s high time for the high court to bring our laws into the 21st century.”

I wholeheartedly agree, and I wrote a lengthy law review article on just that topic back in 2007 entitled,“Why Regulate Broadcasting: Toward a Consistent First Amendment Standard for the Information Age.” If you find it too boring, just watch this video I made summarizing the key points, which I called “America’s First Amendment Twilight Zone.”

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Coupla Cybersecurity Notes

by on July 19, 2010 · 7 comments

Check out national security reporter Shaun Waterman’s report on lapses in security using techniques that only recently became known as “social engineering.”

Ms. Sage’s connections invited her to speak at a private-sector security conference in Miami, and to review an important technical paper by a NASA researcher. Several invited her to dinner. And there were many invitations to apply for jobs.

“If I can ever be of assistance with job opportunities here at Lockheed Martin, don’t hesitate to contact me, as I’m at your service,” one executive at the company told her.

Then there’s former DHS policy official Stewart Baker’s unusually harsh attack on the “privacy lobby” and Wired reporter Ryan Singel at Volokh.com. The comments are good-quality and interesting.

Knowing how canny Baker is, I would guess that his unusually shrill tone is a ploy to start a fight that helps him sells more copies of his book. But maybe he’s just losing his cool.

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Title II for broadband is desperate and ill-conceived

by on July 16, 2010 · 2 comments

Julius Genachowski is in a hurry.

He is arguing that the commission must act quickly to “restore the longstanding deregulatory—as opposed to ‘no-regulatory’ or ‘over-regulatory’—compact” that governed broadband Internet access services prior to a recent court decision.  Such an approach is urgently needed to “restore the status quo,” he claims.

If the Federal Communications Commission cannot regulate the Internet, it may die.   The telephone and television industries are declining, whereas communications industries which the FCC monitors to some extent but does not regulate, e.g., the Internet backbone, broadband Internet access and wireless, are thriving.  The Internet, which the FCC cannot regulate, is subsuming legacy communications services which the commission can regulate.  That spells doom for legacy regulation.  Career regulators are worried.

Genachowski’s plan would reclassify broadband as a “telecommunications” service subject to blunt, onerous, industrial-era regulation under Title II of the Communications Act of 1934 – which governs common carriers – and then forbear from enforcing most of Title II’s heavy-handed provisions.

Broadband services haven’t been subject to Title II regulation for several years, so reclassification would not restore the status quo.   It would harken back to a bygone era.

Broadband services provided by cable operators have thrived in the absence of common carrier regulation since before 1999, when William E. Kennard (designated FCC chairman by President Bill Clinton) declared:

If we’ve learned anything about the Internet in government over the last 15 years, it’s that it thrived quite nicely without the intervention of government.

If fact, the best decision government ever made with respect to the Internet was the decision that the FCC made 15 years ago NOT to impose regulation on it. This was not a dodge; it was a decision NOT to act. It was intentional restraint born of humility. Humility that we can’t predict where this market is going.

Though under significant pressure to do so, Kennard refused to regulate broadband services provided by cable operators like the broadband services provided by telecommunications carriers.  In 2005 and 2007, respectively, the commission finally admitted that neither telecommunications carriers nor wireless providers provided broadband services that met the statutory definition of a “telecommunications” service under Title II, either.

Continue reading →

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We Need “New York Times Neutrality”—NOT!

by on July 15, 2010 · 0 comments

I’ve long been a fan of Danny Sullivan, who edits Search Engine Land, and probably knows more about search engines than anyone outside the companies that actually run them. But my respect for his wit, eloquence and perspective  has reached new heights with his latest piece:  The New York Times Algorithm & Why It Needs Government Regulation, a lampoon of the NYT’s foolish call for search neutrality in an editorial yesterday, turning the Times’ arguments right back at them, and pointing out the hypocrisy by which the established press often tries to deny First Amendment protection to newcomers to the speech business. Danny’s post is truly a masterpiece of satire, worthy of Jonathan Swift. But one section deserves special attention:

I’ve been covering the search space closely for nearly 15 years, from before Google itself even existed, so I have seen these types of claims far longer and examined them in far more depth than what went into that New York Times editorial.

My guess is that the editorial staff (the staff that writes the newspaper’s editorials, which are opinion pieces, which is confusing when the newspaper also has an editorial staff that writes “editorial” stories elsewhere that are supposed to be unbiased) spent about an hour or so discussing recent Google news, then someone was probably assigned to write the editorial and invested all of about three hours on it.

That’s not much time or care for a major and well-respected newspaper (in many quarters) to decide the government should evaluate “fairness” when it comes to making editorial judgments in search results, be they from Google or any other search engine.

I’m afraid Danny’s right. What a shameful day for the “Grey Lady.” Anyway, here are a few of the pieces Adam and I have written about the dangers inherent in the seductive idea of search neutrality: Continue reading →

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