Thought you all might be interested in this upcoming PFF event on “Can Government Help Save the Press?” It will take place on Thursday, May 20, 2010 from 8:30 a.m. – 12:00 p.m. in the International Gateway Room, Mezzanine Level of the Ronald Reagan Building on 1300 Pennsylvania Ave, N.W. here in DC.   This event will consider the FCC’s “Future of Media” proceeding (comments are due this Friday) and debate what role the government should play (if any) in sustaining struggling media enterprises, “saving journalism,” or promoting more “public media” or “public interest” content. [You can find all our essays about this here.]

The event will feature a keynote address by Ellen P. Goodman of the FCC’s Future of Media team. Ellen is one of the sharpest minds in the media policy universe today, and a real asset to the FCC team. She is a Distinguished Visiting Scholar at the FCC, a Research Fellow at American University’s Center for Social Media, and a Visiting Scholar at the University of Pennsylvania’s Annenberg School of Communications.  She is also a Professor at Rutgers University School of Law at Camden, specializing in information law and policy. She has spoken before a wide range of audiences around the world on media policy issues, has consulted with the U.S. government on communications policy, and served as an advisor to President Obama’s presidential campaign and transition team.

After Ellen Goodman brings us up to speed with where the FCC’s Future of Media process stands, we’ll hear from a diverse panel of experts that I am still busy assembling. But so far it includes Charlie Firestone of the Aspen Institute, who will be on hand to discuss the work he’s been doing with the Knight Commission on this front.  I’ve also invited a rep from the Newspaper Association of America to come and talk about the diversity of new media monetization models that they have been aggregating.  (Check out the appendix of their outstanding FTC filing last Nov.) And Kurt Wimmer of Covington & Burling, who represents broadcasters among others, will talk about the need for regulatory flexibility / forbearance, especially on ownership issues.  Again, more panelists to come. But please sign up now!

I have a blog post up at Cato@Liberty today about Senate Democrats’ national ID plans. The thing is nine printed pages long. It doesn’t get my recommendation that you read the whole thing—unless you really jones for identity-systems talk. Here’s a summary:

The plan is confusing, disorganized, repetitive, and sometimes contradictory. Summarizing it is a little like trying to piece together the egg when all you have is the omelet, but three themes emerge: First, this summary backs away from an earlier claim that there would not be a biometric national identity database. There will be a national biometric database. Second, repeating the word “fraud-proof” does not make this national ID system fraud proof. Third, this national ID system definitely paves the way for uses beyond work authorization. This is the comprehensive national identity system that people across the ideological and political spectrum oppose.

I pity the Hill staffer who had to write the national ID parts of the plan. He or she almost certainly doesn’t know enough to write sensibly about the design of identity systems, and the demands of politics require the plan to talk about impossible things as if they’re possible, and even easy.

And your privacy doesn’t matter one whit.

PFF today released the fifth installment in our ongoing series on “The Wrong Way to Reinvent Media.” This series of papers explores various tax and regulatory proposals that would have government play an expanded role in supporting the press, journalism, or other media content. In the latest essay, Berin Szoka, Ken Ferree, and I discuss proposals for direct subsidies for failing media outlets and out-of-work journalists.

We argue taxpayer support for failing outlets and unemployed journalists implicates significant First Amendment concerns. On the whole, subsidies can make “journalists and media operators more dependent upon the State; compromise press independence and diminish public trust in the free press; and result in government discrimination in the politically inescapable dilemma of determining eligibility for subsidies.” Such an agenda would also entail huge cost to taxpayers—initially about $35 billion per year according to advocates—and would represent “a massive wealth transfer from one class of speakers to another…”

We warn that calls for seemingly beneficent bailouts “to save” the media and journalism may actually be driven by those who have something more nefarious in mind: a “post-corporate” world shorn of media capitalists, and “such radicalism must be rejected if we hope to sustain a truly free press and uphold America’s proud tradition of keeping a high and tight wall of separation between Press and State.”

The ideas within these and other essays in the series will be worked into a major PFF filing in the Federal Communications Commission’s (FCC) proceeding on the “Future of Media” on May 7. The paper may be viewed online here and I’ve attached it down below in a Scribd reader.

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No, I’m not here to tell you more about the “supersized” FTC. Berin has done yeoman’s work to highlight that issue, among other things with the PFF event you can review here. On TechDirt, Mike Masnick wrote this morning about how the feds are itching to regulate the Internet.

This is about the direct government invasions of privacy likely to occur if S. 3217 passes. On the Cato@Liberty blog I write about the detailed financial market research that new regulatory agencies would do—research aimed at you.

Example:

Section 1071(b) requires any deposit-taking financial institution to geo-code customer addresses and maintain records of deposits for at least three years. Think of the government having its own Google map of where you and your neighbors do your banking. The Bureau [of Consumer Financial Protection] may “use the data for any other purpose as permitted by law,” such as handing it off to other bureaus, like the Federal Bureau of Investigation.

“Washington, D.C. has determined that Washington, D.C. should manage the financial services industry. Your personal and private financial affairs will be managed there too.”

What would I say about my own writing but read the whole thing?

The Federal Trade Commission is reportedly on the verge of suing to block Google’s proposed acquisition of mobile advertising firm AdMob. The deal’s antitrust implications were discussed in a panel earlier this month on Capitol Hill featuring Berin Szoka. (For other interesting perspectives on the topic, see Geoff Manne and Tom Lenard).

In an opinion essay on Forbes.com this week, I argue that the FTC should approve Google’s acquisition of AdMob without conditions:

FTC Should Green-light Google AdMob Deal

by Ryan Radia

Google competes in many markets, but its most pressing threat comes not from a rival but from antitrust authorities. The Federal Trade Commission is reportedly on the verge of filing a lawsuit against Google to block its proposed $750 million acquisition of mobile advertising company AdMob. Yet antitrust fears about Google are misplaced. Government intervention would harm the very consumer interests the FTC is supposed to protect.

As the government prepares for a potential court battle against Google, the budding mobile advertising market is evolving before our very eyes. Just two weeks ago Apple launched iAd, a mobile advertising platform aimed at the world’s 50 million iPhone users. And Microsoft is in talks to acquire Millenial Media, another major player in mobile advertising, according to Business Insider.

Meanwhile, smart phone use is increasing rapidly–and opportunities for entry in the mobile advertising market are increasing with it. Can Google, armed with AdMob’s advertising platform, succeed in gaining the top spot in mobile advertising? Perhaps — but only if Google-AdMob manages to outcompete and out-innovate rivals that have deep pockets and brilliant engineers of their own.

What tomorrow’s mobile ad market will look like if Google and AdMob join forces is anybody’s guess. Trying to predict how a proposed merger or acquisition will impact consumers is difficult, if not impossible.

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What makes a joke funny is that there is often a kernel of underlying truth. And  when Senator Rockefeller quipped that COPPA’s age should be extended beyond 12 to age 18, or even 25, nervous laughter followed. Because unfortunately there’s existing movement afoot from some advocates to expand COPPA’s reach and scope to adolescents.

I attended this morning’s Congressional hearing on the Children’s Online Privacy Protection Act (COPPA), where I heard TLF’s own Berin Szoka deliver masterful testimony. Based on what we heard at the hearing, we’ll have to be on the lookout for efforts to create a new privacy regime for adolescents (13-17).

Senate Commerce (Consumer Protection Subcommittee) heard testimony from Facebook, Microsoft, PFF, Kathryn Montgomery, EPIC, and the FTC.  Members at the hearing were: Rockefeller, Pryor, Wicker, and Klobuchar. The hearing was convened to learn about how new technologies impact children privacy in the context of the FTC’s current review of COPPA. Through the prepared testimony, it was clear that there were two camps for the role of Congress:

1. Congress doesn’t need to amend or propose new legislation. The FTC has sufficient authority to make changes to COPPA, as only minor changes are needed Continue reading →

I write in “The Laws of Disruption” of the risk of unintended consequences that regulators run in legislating emerging technologies.  Because the pace of change for these technologies is so much faster than it is for law, the likelihood of defining a legal problem and crafting a solution that will address it is very slim.  I give several examples in the book of regulatory actions that quickly become not just obsolete but, worse, wind up having the opposite result to what regulators intended.

An unfortunate example of that problem in the news quite a bit lately is the Electronic Communications Privacy Act or ECPA.   (My first published legal scholarship, in 1994, was an article about a provision of ECPA that allowed law enforcement officers to use evidence they came across by accident in the course of an otherwise lawful wiretap, see “Electronic Communications and the Plain View Exception:  More ‘Bad Physics.’”)

Passed in 1986, ECPA at the time was a model of smart lawmaking in response to changing technologies.  It updated the federal wiretap statute, known as Title III, to take into account the rise of cellular technologies and electronic messages–which didn’t exist when the original law was passed in 1968.

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The Washington Post carried an article earlier this week by Cecilia Kang that noted the Federal Trade Commission could gain enforcement power over online businesses as a result of the financial services legislation under discussion in Congress. Ms. Kang contrasted the possibility of an empowered FTC issuing fast-track regulations against the recent experience of the Federal Communications Commission, which has become bogged down in its search for legal authority to issue net neutrality regulations. 

The comparison is insightful, but not for the reasons you might expect. Part of the debate over the FTC revolves around language in the House financial services bill that would repeal the “Magnuson-Moss” provisions that govern FTC promulgation of consumer protection regulations. (The name comes from the fact that these restrictions on FTC rulemaking were included in the Magnuson-Moss Warranty Act, which got the FTC into the business of regulating car warranties.)

If the FTC wants to regulate some type of general business practice under the FTC Act, it has to establish a factual record substantiating that there is actually a systemic problem that regulation can solve, hold a public hearing, allow cross-examination on factual matters, and conduct an economic analysis of the regulation’s effects.  In short, the commission has to do the homework necessary to demonstrate that its proposed regulation will actually solve a widespread problem that actually exists.

When Tim Muris directed the FTC’s Bureau of Consumer Protection in the early 1980s, he authored an article in Regulation magazine pointing out that when the FTC does careful analysis before issuing a rule, the rule is more likely to benefit consumers, more likely to be upheld in court, and more likely to be issued expeditiously. He contrasted the evidence-based eyeglass rule, which took three years to issue, with the anecdote-based funeral rule, which took ten. Muris noted wryly, “Some critics of my position charge that it is revolutionary to ask a body of lawyers and economists not to impose its own view of proper regulation on the world without first systematically evaluating the problem.” Muris went on to serve as chairman of the FTC between 2001-04, and last month he defended the Magnuson-Moss restrictions in testimony before Congress.  

What does this have to do with the FCC?  The FCC lost its case against Comcast on appeal, precisely because the FCC tried to take shortcuts. The FCC tried to promote net neutrality by enforcing a set of “principles” that originated in a former chairman’s speech and were never promulgated in a notice-and-comment rulemaking. The FCC commissioners endorsed these principles without investigating whether there was a systemic problem (ie, more than a few anecdotes of misbehavior). Indeed, Chairman Martin’s Notice of Inquiry on “Broadband Industry Practices” that was launched around the same time the FCC took its enforcement action against Comcast turned up no evidence of a systemic problem. If the FCC now tries to impose net neutrality by reclassifying broadband as a “Title II” common carrier, it will have to do the difficult but necessary work of demonstrating, with real factual evidence, that broadband is more like a common carrier than like the lightly-regulated “information service” the commission previously decided it was.

We don’t need Congress to free the FTC from Magnuson-Moss. Instead, Congress should impose the same requirements on the FCC. Sometimes, taking the time to do your homework leads to better decisions, sooner.

I’m testifying this morning before the Senate Commerce Committee’s Consumer Protection Subcommittee on Examining Children’s Privacy: New Technologies and the Children’s Online Privacy Protection Act at 10 am in 253 Russell. I offered an overview of my testimony in a PFF TechCast interview yesterday.

MP3 file: PFF TechCast #4 – Senate COPPA testimony of Berin Szoka

My pre-scripted oral testimony (PDF) follows below, but you can download my somewhat longer written testimony here, which offers an overview of our past work on this subject at PFF, particularly the paper Adam Thierer and I published last summer COPPA 2.0: The New Battle over Privacy, Age Verification, Online Safety & Free Speech.

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Mr. Chairman and Committee members, thank you for inviting me here today.  My name is Berin Szoka.[1] I’m a Senior Fellow at The Progress & Freedom Foundation.  I commend this Committee for studying COPPA, and the FTC for its upcoming COPPA Review and Roundtable.[2]

Background on COPPA

For an “Internet Jr.” of sites “directed at” children under 13, COPPA requires sites either to age-verify all users or limit functionality to prevent children from making personal information “publicly available”—including the sharing of user-generated content.  COPPA imposes the same requirement on general audience sites when they have actual knowledge a user is under 13.  Because of this forced separation and the costs of age verification, COPPA may well have unintentionally limited choice and competition by driving increased consolidation in the marketplace for child-oriented sites and services online.  On the other hand, COPPA has been reasonably successful in fulfilling Congress’s original goal of “enhancing parental involvement” to protect children’s online privacy and safety.

Whatever this trade-off, I’m here today to caution against expanding COPPA beyond its original, limited purpose. COPPA’s unique value lies in its flexibility, subtlety, and intentional narrowness. Continue reading →