On the podcast this week, Peter Thiel, co-founder of PayPal, early investor in Facebook, and president of Clarium Capital, discusses the stagnation of technological innovation. Thiel gives reasons why innovation has slowed recently — offering examples of stalled sectors such as space exploration, transportation, energy, and biotechnology — while pointing out that growth in internet-based technologies is a notable exception. He aslo comments on political undercurrents of Silicon Valley, government regulation, privacy and Facebook, and his new fellowship program that will pay potential entrepreneurs to “stop out” of school for two years.
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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 →
I was quoted this morning in Sara Jerome’s story for The Hill on the weekend seizures of domain names the government believes are selling black market, counterfeit, or copyright infringing goods.
The seizures take place in the context of an on-going investigation where prosecutors make purchases from the sites and then determine that the goods violate trademarks or copyrights or both.
Several reports, including from CNET, The Washington Post and Techdirt, wonder how it is the government can seize a domain name without a trial and, indeed, without even giving notice to the registered owners.
The short answer is the federal civil forfeiture law, which has been the subject of increasing criticism unrelated to Internet issues. (See http://law.jrank.org/pages/1231/Forfeiture-Constitutional-challenges.html for a good synopsis of recent challenges, most of which fail.) Continue reading →
Milton Mueller, a professor at Syracuse University’s School of Information Studies, is a familiar figure to anyone who follows Internet governance issues. He has established himself as a leading Net governance guru thanks to his extensive academic record in this field with books like Ruling the Root: Internet Governance and the Taming of Cyberspace (2002) and his work with The Internet Governance Project and the Global Internet Governance Academic Network. Mueller’s latest book, Networks and States: The Global Politics of Internet Governance, continues his exploration of the forces shaping Internet policy across the globe.
The de Tocqueville of Cyberspace
What Mueller is doing – better than anyone else, in my opinion – is becoming the early chronicler of the unfolding Internet governance scene. He meticulously reports on, and then deconstructs, ongoing governance developments along the cyber-frontier. He is, in effect, a sort of de Tocqueville for cyberspace; an outsider looking in and asking questions about what makes this new world tick. Fifty years from now, when historians look back on the opening era of Internet governance squabbles, Milton Mueller’s work will be among the first things they consult.
Mueller’s goal in Networks and States is two-fold and has both an empirical and normative element. First, he aims to extend his exploration of the actors and forces affecting Internet governance debates and then develop a framework and taxonomy to better map and understand these forces and actors. He does a wonderful job on that front, even though many Net governance issues (especially those related to domain name system issues and ICANN) can be incredibly boring. Mueller finds a way to make them far more interesting, especially by helping to familiarize the reader with the personalities and organizations that increasingly dominate these debates and the issues and principles that drive their actions or activism.
Mueller’s second goal in Networks and States is to breathe new life into the old cyber-libertarian philosophy that was more prevalent during the Net’s founding era but has lost favor today. I plan to discuss this second goal in more detail here because Mueller has done something quite important in Networks and States: He has issued a call to arms to those who care about classical liberalism telling us, in effect, to get off our duffs and get serious about the fight for Internet freedom. Continue reading →
Proponents of Net neutrality regulation continue their full-court press to get the Federal Communications Commission (FCC) and its chairman, Julius Genachowski, to unilaterally push through a new industrial policy regime for the Internet. The latest word, according to Politico, is that the agency is pushing back its scheduled December open meeting from Dec. 15 to Dec. 21 to give the agency more time to plot its next move. There’s no word yet what the agency’s regulatory blueprint will look like, so it’s impossible to critique the agency’s plan at this point. I’ve made the case against Net neutrality regulation here before, however, and I’m sure those same concerns and critiques will apply to whatever the agency ends up adopting.
What’s most concerning about the way this process is playing out currently is just how anti-democratic it is. I understand the zeal of the pro-regulatory forces on this issue, but there is simply no good excuse for advocating that 3 unelected officials at an independent regulatory agency rush through a vote to regulate a such a massive and important sector of the American economy.
It used to be the case that a broad and non-partisan coalition of academics and organizations supported the non-delegation principle, which, generally speaking, refers to the notion that only democratically elected officials should be in a position to pass laws and make the really important decisions about the future course of our polity and its economy. Of course, when it comes to the economy, I’d prefer most of those decisions be left to marketplace experimentation. However, to the extent regulation is deemed necessary and that regulation governs such a massively important portion of the American economy, that determination should definitely be made by elected leaders in Congress and not delegated to bureaucrats who would ram through regulations with 3 votes and sketchy plan for reordering that sector. Continue reading →
After freak-outs and backpedaling, Microsoft has revised its stance on the so-called “hacks” of the Kinect. Wired’s Tim Carmody reported on Monday that Microsoft seems to have indicated that it won’t be taking legal action against anyone who has found new and “unsupported” uses for the Kinect. Shannon Loftis and Alex Kipman—two Microsofties involved in the creation of the Kinect—were featured on NPR’s Science Friday and when asked if anyone would “get in trouble” for their Kinect creations, they responded with “No” and “Nope, absolutely not” respectively.
This is a refreshing change of course from Redmond. Embracing your most enthusiastic fans and harnessing their creative power for the betterment of your product certainly makes a heck of a lot more sense than prosecuting those folks under the DMCA.
To be fair, Carmody notes that Microsoft had reason to hold off on taking this stance immediately. Microsoft wanted to verify that the Kinect was being used as-is, as opposed to anything in the XBOX 360 being modified. This is incredibly important, because, as Carmody succinctly notes:
If Kinect’s whole-room camera, robust facial-recognition software, and portal for video and audio chat are seen as insecure, it’s a nightmare.
Too true. Microsoft’s sensitivity on the topic is easy to understand when this massive security concern is taken into consideration. However, it seemed evident from the get-go that all of these “hacks” had nothing to do with hijacking the XBOX’s software for the Kinect, but rather simply plugging the hardware it into another device entirely—namely a PC running Windows or Linux.
So, kudos to Microsoft on sorting out their feelings when it comes to the Kinect. Too bad they had to do so in public.
So now you can pay Netflix $7.99 a month and stream all the video you want? Damn cool if you ask me!
What does the Netflix decision mean for consumers—two words: More choice! This is what functional markets deliver. There was a time when if you missed an episode of your favorite show, that was it. You might have gotten lucky and caught it on its single rerun, but that was hit or miss. These days, I can watch The Office at 8 p.m. on Thursday nights. Or I can record on my DVR and watch it later that night. Or I can watch it the next day on my PC by visiting nbc.com. Or I can watch it on-demand from my cable box. Or I can wait a few months and watch it on DVD. Or, soon, via Netflix stream.
I can’t help but wonder if this makes moot all the handwringing about the FCC’s desire to place conditions on the online services a merged Comcast-NBC Universal can offer. Come on, Netflix has blown up the whole cable TV model. Continue reading →
On the podcast this week, Tyler Cowen, professor of economics at George Mason University, general director of the Mercatus Center, and founder of the popular economics blog Marginal Revolution, answers questions from Surprisingly Free listeners and Marginal Revolution readers. Cowen discusses why people will be appalled that we ever questioned intrusive searches by TSA, what should have been done to minimize unemployment and other harm from the financial crisis, how the “famous American formula” for good government is broken, what might force us to sit around opening cans of dog food with our teeth, and which global sites should be connected by Stargate portals to create the most value. He also asks, “Why read books?”, speculates about the value of his blog, addresses price discrimination of chicken McNuggets, talks about a modern day Athens in Asia with good food, suggests that internet comments are a relatively harmless form of stupidity, and opines about the best thing that government does.
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[This guest post is by Joshua Wright (George Mason University) and Geoffrey Manne (International Center for Law & Economics), who blog regularly at Truth on the Market]
We’ve been reading with interest a bit of a blog squabble between Tim Wu and Adam Thierer (see here and here) set off by Professor Wu’s WSJ column: “In the Grip of the New Monopolists.” Wu’s column makes some remarkable claims, and, like Adam, we find it extremely troubling.
Wu starts off with some serious teeth-gnashing concern over “The Internet Economy”:
The Internet has long been held up as a model for what the free market is supposed to look like—competition in its purest form. So why does it look increasingly like a Monopoly board? Most of the major sectors today are controlled by one dominant company or an oligopoly. Google “owns” search; Facebook, social networking; eBay rules auctions; Apple dominates online content delivery; Amazon, retail; and so on.
There are digital Kashmirs, disputed territories that remain anyone’s game, like digital publishing. But the dominions of major firms have enjoyed surprisingly secure borders over the last five years, their core markets secure. Microsoft’s Bing, launched last year by a giant with $40 billion in cash on hand, has captured a mere 3.25% of query volume (Google retains 83%). Still, no one expects Google Buzz to seriously encroach on Facebook’s market, or, for that matter, Skype to take over from Twitter. Though the border incursions do keep dominant firms on their toes, they have largely foundered as business ventures.
What struck us about Wu’s column was that there was not even a thin veil over the “big is bad” theme of the essay. Holding aside complicated market definition questions about the markets in which Google, Twitter, Facebook, Apple, Amazon and others upon whom Wu focuses operate—that is, the question of whether these firms are actually “monopolists” or even “near monopolists”—a question that Adam deals with masterfully in his response (in essence: There is a serious defect in an analysis of online markets in which Amazon and eBay are asserted to be non-competitors, monopolizing distinct sectors of commerce)—the most striking feature of Wu’s essay was the presumption that market concentration of this type leads to harm.
Continue reading →
As he noted, Adam Thierer’s lead article in the most recent Cato Policy Report is called “The Sad State of Cyber-Politics.” It goes through so many ways tech and telecom companies are playing the Washington game to win or keep competitive advantage.
It’s a nice set-up to a Washington Post opinion piece from this weekend in which TownFlier CEO Morris Panner talks about the growing riches accruing to Washington influencers:
We are creating so much regulation – over tax policy, health care, financial activity – that smart people have figured out that they can get rich faster and more easily by manipulating rules on behalf of existing corporations than by creating net new activity and wealth. Gamesmanship pays better than entrepreneurship.
Thierer sees some hope for the tech sector, for a few reasons:
Smaller tech companies have thus far largely resisted the urge [to engage with Washington]. Hopefully that’s for principled reasons, not just due to a shortage of lobbying resources. Second, the esoteric nature of many Internet and digital technology policy discussions frustrates many lawmakers and often forces them to lose interest in these topics. Third, the breakneck pace of technological change makes it difficult for regulators to bottle up innovation and entrepreneurialism.
Panner’s broader piece calls for “a national campaign to create transparency in our legislation and a national moratorium on the creation of commissions, regulators and czars. It is time for Congress to do the hard job of saying what lawmakers mean in clear and easy-to-understand language.” He continues, “We should reject bills that are thousands of pages or that delegate vast authority to unelected regulators.”
That would be a start.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.