Technology Policy: A Look Ahead

by on May 12, 2014 · 0 comments

This article was written by Adam Thierer, Jerry Brito, and Eli Dourado.

For the three of us, like most others in the field today, covering “technology policy” in Washington has traditionally been synonymous with covering communications and information technology issues, even though “tech policy” has actually always included policy relevant to a much wider array of goods, services, professions, and industries.

That’s changing, however. Day by day, the world of “technology policy” is evolving and expanding to incorporate much, much more. The same forces that have powered the information age revolution are now transforming countless other fields and laying waste to older sectors, technologies, and business models in the process. As Marc Andreessen noted in a widely-read 2011 essay, “Why Software Is Eating The World”:

More and more major businesses and industries are being run on software and delivered as online services—from movies to agriculture to national defense. Many of the winners are Silicon Valley-style entrepreneurial technology companies that are invading and overturning established industry structures. Over the next 10 years, I expect many more industries to be disrupted by software, with new world-beating Silicon Valley companies doing the disruption in more cases than not.

Why is this happening now? Six decades into the computer revolution, four decades since the invention of the microprocessor, and two decades into the rise of the modern Internet, all of the technology required to transform industries through software finally works and can be widely delivered at global scale.

More specifically, many of the underlying drivers of the digital revolution—massive increases in processing power, exploding storage capacity, steady miniaturization of computing, ubiquitous communications and networking capabilities, the digitization of all data, and increasing decentralization and disintermediation—are beginning to have a profound impact beyond the confines of cyberspace.

The pace of this disruptive change is only going to accelerate and come to touch more and more industries. As it does, the public policy battles will also evolve and expand, and so, too, will our understanding of what “tech policy” includes.

That’s why the Mercatus Center Technology Policy Program continues to expand its issue coverage to include more scholarship on a wide array of emerging technologies and sectors. What we’re finding is that everything old is new again. The very same policy debates over privacy, safety, security, and IP that have dominated information policy are expanding to new frontiers. For example, when we started our program five years ago, we never thought we would be filing public interest comments on privacy issues with the Federal Aviation Administration, but that’s where we found ourselves last year as we advocated for permissionless innovation in the emerging domestic drone space. We now expect that we will soon find ourselves making a similar case at the Food and Drug Administration, the Department of Transportation, and many other regulatory bodies in the near future.

In many ways, we’re still just talking about information policy, it’s just that increasing number of devices and sensors are being connected to the Internet. In other ways, however, it is in fact about more than simply an expanded conception of information policy. It’s about bringing the benefits of a permissionless innovation paradigm, which has worked so well in the Internet space, to sectors now controlled by prescriptive and precautionary regulation. As software continues to eat the world, innovation is increasingly butting up against outmoded and protectionist barriers to entry. Most will agree that the Internet has been the success it is because to launch a new product or service, you don’t have to ask anyone’s permission; we only need contract and tort law, and smart guard rails like safe harbors, to protect our rights. Yet if you want to offer a software-driven car service, you have to get permission from government first. If you want to offer genome sequencing and interpretation, you have to get permission first.

Maybe it’s time for a change. As Wall Street Journal columnist L. Gordon Crovitz argues, “The regulation the digital economy needs most now is for permissionless innovation to become the default law of the land, not the exception.” As a result, we’ll see this debate between “permissionless innovation” and the “precautionary principle” play out for a wide variety of new innovations such as the so-called “Internet of Things” and “wearable technologies,” but also with smart car technology, commercial drones, robotics, 3D printing, and many other new devices and services that are just now emerging. A recent New York Times survey, “A Vision of the Future From Those Likely to Invent It,” highlights additional innovation opportunities where this tension will exist.

The evolution of our work is also driven by the accelerating trend of decentralization and disintermediation, which could potentially make precautionary regulation too costly to undertake. When governments want to control information, they invariably head for the choke points, like payment processors or ISP-run DNS servers. This fact has created a demand for technologies that bypass such intermediaries. As mediated systems are increasingly replaced by decentralized peer-to-peer alternatives, there will be fewer points for control for governments to leverage. The result may be that any enforcement may have to target end users directly, which would not only increases the direct costs of enforcement, but also the political ones.

So in the coming months, you can expect to see Mercatus produce research on the economics of intellectual property, broadband investment, and spectrum policy, but also research on autonomous vehicles, wearable technologies, cryptocurrencies, and barriers to medical innovation. The future is looking brighter than ever, and we are excited to make permissionless innovation the default in that future.

Further Reading:

Previous post:

Next post: