Senior Fellow in Technology & Innovation at the R Street Institute in Washington, DC. Formerly a senior research fellow at the Mercatus Center at George Mason University, President of the Progress & Freedom Foundation, Director of Telecommunications Studies at the Cato Institute, and a Fellow in Economic Policy at the Heritage Foundation.
It’s my great pleasure this week to be participating in a 2-day symposium on “Competition in Online Search” that is being hosted by the Antitrust & Competition Policy Blog. Daniel Sokol, Associate Professor of Law at the University of Florida Levin College of Law, was kind enough to invite me to join the fun. Professor Sokol is the editor of the Antitrust & Competition Policy Blog. Others participating in this symposium include: James Grimmelman (NY Law); Eugene Volokh (UCLA); Marvin Ammori (Stanford Law); Mark Jamison (Univ. of Florida); Eric Clemons (Wharton School); Dan Crane (Michigan Law); and both Marina Lao and Frank Pasquale (Seton Hall); and more.
My entry is now live. In it, I focus on how dynamically competitive and innovative the digital economy has been over the past 15 years and question to need for intervention at this time, especially of the “public utility” variety. I’ve re-posted my entry below, but make sure to head over to the Antitrust & Competition Policy Blog to read all the contributions to this excellent symposium. Continue reading →
My most recent Forbes column is entitled, “We All Hate Advertising, But We Can’t Live Without It.” It’s my attempt to briefly (a) defend the role advertising has traditionally played in sustaining news, entertainment, and online service, and (b) discuss some possible alternatives to advertising that could be tapped if advertising starts failing us a media cross-subsidy.
What got me thinking about this issue again was the controversy over satellite video operator DISH Network offering its customers a new “Auto Hop” capability for its Hopper whole-home HD DVR system. Auto Hop will give viewers the ability to automatically skip over commercials for most recorded prime time programs shown on ABC, CBS, FOX and NBC when viewed the day after airing. It makes the viewing experience feel like the ultimate free lunch. Alas, something still must pay the bills. As innovative as that technology is, we can be certain that it will not make content consumption cost-free. We’ll just pay the price in some other way. The same is true for online services since it’s never been easier to use technology to block ads.
So, what is going to pay the bills for content as ad-skipping becomes increasingly automated and effortless? Stated differently, what are the other possible methods of picking up the tab for content creation? Here’s a rough taxonomy: Continue reading →
Writing over at the conservative Big Government blog (part of the Breitbart.com network of blogs), someone who goes by the pseudonym “Capitol Connection” has posted an editorial about the debate over retransmission consent reform that is full of misinformation and misguided policy prescriptions, at least if you believe is truly limited government. The piece is entitled, “Big Cable Would Prefer if You Paid Their Bills,” and the problems are almost immediately evident from that headline alone. First, what is a supposedly small government-oriented blog doing using a silly label like “Big Cable” to describe a vigorously competitive sector of our capitalist economy? Using terms like “Big Cable” is a silly lefty tactic. Second, no one in the cable industry is proposing anyone “pay their bills” except for the customers who enjoy their services. Isn’t a fee for service part of capitalism?
Anyway, that’s just the problem with the title of the essay. Sadly, the rest of the piece is filled with even more erroneous information and arguments about the retransmission consent regulatory process as well as the bill that aims to reform that process, “The Next Generation Television Marketplace Act” (H.R. 3675 and S. 2008). That bill, which is sponsored by Senator Jim DeMint (R-SC) and Rep. Steve Scalise (R-LA), represents a comprehensive attempt to deregulate America’s heavily regulated video marketplace. In a recent Forbes oped, I argued that the DeMint-Scalise effort would take us “Toward a True Free Market in Television Programming” by eliminating a litany of archaic media regulations that should have never been on the books to begin with. The measure would:
eliminate: “retransmission consent” regulations (rules governing contractual negotiations for content);
end “must carry” mandates (the requirement that video distributors carry broadcast signals even if they don’t want to);
repeal “network non-duplication” and “syndicated exclusivity” regulations (rules that prohibit distributors from striking deals with broadcasters outside their local communities);
end various media ownership regulations; and
end the compulsory licensing requirements of the Copyright Act of 1976, which essentially forced a “duty to deal” upon content owners to the benefit of video distributors.
This represents genuine and much-needed deregulation of a market that has been encumbered with far too much top-down control and micro-management by the FCC over the past several decades. To be clear, none of these rules apply to any other segment of our modern information economy. Every day of the week, deals are cut between content creators and distributors in many other segments of the media industry without these rules encumbering the process. The DeMint-Scalise bill is an attempt to get big government out of the way and let these deals be cut in a truly free market without regulators putting their thumb on the scale in one direction or the other. Continue reading →
Via Twitter, Andrew Grossman brought to my attention this terrifically interesting interview with a Kuwaiti censor that appeared in the Kuwait Times (“Read No Evil – Senior Censor Defends Work, Denies Playing Big Brother“). In the interview, the censor, Dalal Al-Mutairi, head of the Foreign Books Department at the Ministry of Information, speaks in a remarkably candid fashion and casual tone about the job she and other Kuwaiti censors do every day. My favorite line comes when Dalal tells the reporter how working as a censor is so very interesting and enlightening: “I like this work. It gives us experience, information and we always learn something new.” I bet! But what a shame that others in her society will be denied the same pleasure of always learning something new. Of course, like all censors, Dalal probably believes that she is doing a great public service by screening all culture and content to make sure the masses do not consume offensive, objectionable, or harmful content.
But here’s where the reporter missed a golden opportunity to ask Dalal the one question that you must always ask a censor if you get to meet one: If the content you are censoring is so destructive to the human soul or psyche, how then is it that you are such a well-adjusted person? And Dalal certainly seems like a well-adjusted person. Although the reporter doesn’t tell us much about her personal life or circumstances, Dalal volunteers this much about herself and her fellow censors: “Many people consider the censor to be a fanatic and uneducated person, but this isn’t true. We are the most literate people as we have read much, almost every day. We receive a lot of information from different fields. We read books for children, religious books, political, philosophical, scientific ones and many others.” Well of course you do… because you are lucky enough to have access to all that content! But you are also taking steps to make sure the rest of your society doesn’t consume it on the theory that it would harm them or harm public morals in some fashion. But, again, how is it that you have not been utterly corrupted by it all, Ms. Dalal? After all, you get to consume all that impure, sacrilegious, and salacious stuff! Shouldn’t you be some kind of monster by now?
How can this inconsistency be explained? The answer to this riddle can be found in the “Third-Person Effect Hypothesis.” Continue reading →
I wanted to follow up on Eli Dourado’s excellent previous post (“Real Talk on Net Neutrality“) to reiterate the importance of a few points he made and add some additional thoughts about the issues raised in that New York Times article on Net neutrality and forced access regulation that lots of people are talking about today.
What Eli’s post makes clear is that there are those of us who think about Net neutrality and infrastructure regulation in economic terms (a rapidly shrinking group, unfortunately) and those who think it about in quasi-religious terms. The problem with the latter ideology of neutrality uber alles, however, is that at some point it must confront real-world economics. This is Eli’s core point: Something must pay the bills. In this case, something must cover the significant fixed costs associated with broadband investments if you hope to sustain those networks. Unless you are ready to make the plunge and suggest that the government should cover those costs through massive infrastructure expenditures and even potential nationalization or municipalization of broadband networks — and some clearly would be — then you have to get serious about how those costs will be covered by private operators.
Thus, we come back to the importance of business model experimentation and pricing flexibility to this debate. I have been harping on this point for a long time now, going all the way back to this 2005 essay, “The Real Net Neutrality Debate: Pricing Flexibility Versus Pricing Regulation.” And there’s a litany of other things I’ve penned on the same point, many of which I have cited at the end of this essay.
Here are the core points I have tried to get across in those earlier essays: Continue reading →
This seems like a logical follow-up to Berin Szoka’s previous post about technology, social activism, and government power. ReasonTV has produced this important short clip on “Cops Vs. Cameras: The Killing of Kelly Thomas & The Power of New Media.” It documents how the combined power of citizen journalism, social media, and surveillance video can ensure that our police authorities are held accountable for their actions. In this particular case, it can hopefully win some justice for Kelly Thomas, the homeless Fullerton, California man who was brutally beaten to death by police officers on the night of July 5, 2011.
There is live video from the horrific beating here, but I caution you it is not for the faint of heart. Watching the last moments of man’s life slip away from repeated blows to the head while he begs for his life and calls out for his father is, well, stomach-turning. But imagine if this video and the other citizen videos that were taking that night had not existed. As the ReasonTV clip notes, the Fullerton police department basically ignored requests for more information about the case until Kelly’s father (who was former police officer himself) took cell photos of his son’s beaten face in the hospital and released them to the public. Then the citizen videos of the beating were posted on YouTube and went viral. And then, finally, mainstream media started paying attention. And now the surveillance video from a nearby street camera has been released after citizens and activists demanded it. Continue reading →
While preparing my latest Forbes column, “Does the Internet Need a Global Regulator?” I collected some excellent resources. I figured I would just post all the links here since others might find them useful as we work our way up to the big U.N. International Telecommunication Union (ITU) World Conference on International Telecommunications (WCIT) in Dubai this December. Please let me know of other things that I should add to this resource database. I’ve divided the database into “General Resources” and “Opinion Pieces”: Continue reading →
This morning I spoke at a U.S. Chamber of Commerce event on “Responsible Data Uses: Benefits to Consumers, Businesses and the Economy.” In preparing for the event, I dusted off some old working notes for speeches I had delivered at other events about privacy policy and “big data” and expanded them a bit to account for recent policy developments. For what it’s worth, I figured I would post those notes here. (I apologize about the informality but I never write out my speeches, I just work from bullet points.)
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Benefits of “Big Data”
“big data” has numerous micro- and macroeconomic benefits
Micro benefits:
data aggregation of all varieties has powerful social and economic benefits that are sometimes invisible to consumers and citizens but are nonetheless enjoyed by them
big data can positively impact the 3 key micro variables – quality, quantity & price – and benefit consumers / citizens in the process
Macro benefits:
Data is the lifeblood of the information economy and it has an increasing bearing on the global competitiveness of companies and countries
In the old days, when we talked about comparative and competitive advantage, the focus was on natural resources, labor, and capital.
Today, we increasingly talk about another variable: information
Data is increasing one of the most important resources that can benefit economic growth, innovation, and the competitive advantage of firms and nations.
Privacy Concerns
of course, “big data” also raises big privacy concerns for many groups and individuals
this has led to calls for regulatory action and virtually all levels of government – federal, state, local, and international – are considering expanded controls on data collection and aggregation
The folks at the Concurring Opinions blog were kind enough to invite me to participate in a 2-day symposium they are holding about Brett Frischmann’s new book, Infrastructure: The Social Value of Shared Resources. In my review, I noted that it’s an important book that offers a comprehensive and highly accessible survey of the key issues and concepts, and outlines much of the relevant literature in the field of infrastructure policy. Frischmann’s book deserves a spot on your shelf whether you are just beginning your investigation of these issues or if you have covered them your entire life. Importantly, readers of this blog will also be interested in the separate chapters Frischmann devotes to communications policy and Net neutrality regulation, as well as his chapter on intellectual property issues.
However, my review focused on a different matter: the book’s almost complete absence of “public choice” insights and Frischmann’s general disregard for thorny “supply-side” questions. Frischmann is so focused on making the “demand-side” case for better appreciating how open infrastructures “generate spillovers that benefit society as a whole” and facilitate various “downstream productive activities,” that he short-changes the supply-side considerations regarding how infrastructure gets funded and managed. I argue that: Continue reading →
The fine folks at George Mason University School of Law’s Henry G. Manne Program in Law & Economics Studies have put together another stellar agenda and lineup of speakers for their Second Annual Conference on Competition, Search & Social Media. The event will be held at GMU’s School of Law on Wednesday, May 16th from 8:00 A.M. to 5:00 P.M. Panel topics are listed as follows:
PANEL 1: Antitrust and Platform Competition in Search and Social Media (This panel will discuss issues involving market definition, network effects, and dynamic considerations when analyzing search and social media platform competition.)
PANEL 2: Search, Duties to Deal, and Essential Facilities (This panel will explore the extent to which search engines should be viewed as utilities, and whether they may have a legal duty to assist their rivals under the essential facilities doctrine as it survives after Trinko and Linkline.)
PANEL 3: The Interface Between Privacy and Competitive Analysis in Search and Social Media (This panel will explore the extent to which privacy should be germane to antitrust analysis of online search and social networks, including whether privacy can be viewed as a dimension of quality and the extent to which privacy regulation may affect competition.)
PANEL 4: Are There Workable Remedies for “Search Engine Bias”? (This panel will discuss economic, legal (including First Amendment), and practical issues surrounding potential remedies to allegedly “biased” search engine results.)
Seriously, you’d be hard-pressed to find a better set of speakers on these topics. Check them all out here, where you can also RSVP if you’re interested.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology. Learn more about TLF →
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.