Articles by Adam Thierer 
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.
Potentially huge FCC development here, and one they actually has some sense to it. According to Kim McAvoy over at TV News Check.com:
FCC broadband czar Blair Levin earlier this month met with leading TV broadcasters in Washington to discuss the nation’s urgent need for more spectrum for wireless broadband access to the Internet and the possibility of broadcasters’ relinquishing most of their spectrum to help meet that demand. According to sources familiar with the Oct. 8 meeting with the board of the Association for Maximum Service Television (MSTV), Levin suggested broadcasters might want to consider returning their spectrum in exchange for a share in the billions of dollars that would come from the auction of the spectrum to the wireless industry.
Broadcasting would retain just enough spectrum so that each station could provide a lifeline standard-definition service to the millions of TV viewers who still rely on over-the-air reception. Broadcasters could no longer offer over-the-air HD and second channels and mobile video would be off the table, but they could continue to provide a single channel of TV to every home in their markets as they do today — in full-blown HD via cable and satellite carriage and SD via the over-the-air lifeline service.
Wow, this is a very big deal, folks, since we are talking about a mother lode of prime spectrum that could be put to any variety of excellent alternative uses. The problem is, broadcasters will—rightly, in my opinion—protest that they have occupied that spectrum for a long, long time and they have something akin to a property right in their allocations. Of course, paying them to relocate might be a very sensible way to get them off that spectrum voluntarily. But the question is whether they should be
forced off of it and whether that is even legal. No doubt, any attempt to force them off would be held up in court for many years because of inevitable legal challenges.
There is another solution: Just give the broadcasters a full, unencumbered property right in their spectrum and let them sell it or use it however they wish. Some will protest that it’s not “fair” and that the broadcasters should never be given a property right in something they did not pay for to begin with. Yet, at some point we have to stop the endless search for what I have referred to as a “spectrum reparations policy” and just get on with life.
I think everyone can now agree that the old command-and-control regulatory regime for “zoning” spectrum has retarded innovation. Imagine if we told Apple back in the 1980s that, because they started in the PC business, they could never leave the PC business and offer other innovations. That would have been nuts! We’d never have the iPhone today. But that’s U.S. spectrum policy for broadcasting in a nutshell. As a broadcaster, it is
illegal for you to repurpose your spectrum for alternative uses. Stated different, spectrum innovation is a crime. How pathetic.
It’s time to change the rules and move forward. I applaud Blair Levin and the FCC for offering at least one solution, but if it doesn’t work, we should try the other: property rights and flexible use rights in spectrum. And here are 4 or 5 other ways to get the job done.
Last night here on the TLF, Bret Swanson raised a number of objections with this FCC-commissioned report about international broadband comparisons, which was conducted by some folks at Harvard University’s Berkman Center. Meanwhile, over at the Digital Society blog, George Ou also offers a hard-nosed look at the Berkman broadband report and concludes “The underlying data cited by Berkman study is simply too flawed to be of any use.” I recommend everyone check out both essays. It will be interesting to hear how the Berkman folks respond. Some of these international broadband comparisons are really fishy. [Here’s a podcast we did on that issue two years ago.]
One quick point… Like Bret, I also found it shocking that–even though the report reads like an ode to forced access regulation–the Berkman folks didn’t spend much time discussing the result of America’s previous open-access regime. “The gaping, jaw-dropping irony of the report,” Bret argues, “was its failure even to mention the chief outcome of America’s previous open-access regime: the telecom/tech crash of 2000-02. We tried this before. And it didn’t work!” Indeed, America’s regulatory experiment with forced access regulation involved a lot of well intentioned laws and regulation, and too many acronyms to count–CLECs, TELRIC, UNE-P, etc– but it did not result in serious, facilities-based competition. Instead it offered us the fiction of competition through network-sharing, or what Peter Huber once referred to as building “networks out of paper.” The results were disastrous for investment during that period since regulatory uncertainly led to a lot of stunted innovation.
In sum, sharing is not competing. You can socialize and commoditize old pipes for awhile and get decent results in the short-term, but you’ll sacrifice long-run investment and innovation if you do. [For more background, see my recent essay on “The Fiction of Forced Access ‘Competition’ Revisited” and this old Cato piece on “UNE-P and the Future of Telecom “Competition” as well as Jeff Eisenach’s PFF white paper, “Broadband Policy: Does the U.S. Have It Right After All?”]
I’ve ranted on here before about technological etiquette, or that lack thereof by many people. (See my tedious screed from 3 years ago: “A Few Snooty Words about Technological Etiquette.” Man, I was really angry when I wrote that piece!) As much as I love technology and defend its unrestricted use, I think it’s important to encourage social norms about proper technology use to make it less likely people will call government in to act as a nanny.
That’s why I found this new “Intel Holiday Mobile Etiquette” poll so intriguing. According to the poll, which was conducted by Harris Interactive and sponsored by Intel:
most online U.S. adults (80 percent) feel there are unspoken rules about mobile technology usage, and approximately 7 in 10 (69 percent) agreed that violations of these unspoken mobile etiquette guidelines, such as checking e-mails, sending text messages and making phone calls while in the company of others, are unacceptable.
Hmmm… While I’m glad that such a large majority still have a sense of propriety about such things,
this sounds like a case of people saying one thing when they likely do quite another. Then again, my perspective might be biased by life in a big city where people have PDAs practically glued to their hands full-time. I’ve even grown accustomed to people staring at their digital devices more than me during conversations and meetings. Of course, that could just be because I am so damn boring. [My colleague Jim Harper will, no doubt, suggest the latter.] Regardless, I just remain shocked by how people feel they simply must take every call, answer every email, or do whatever else on their devices in the presence of crowds or others. In my rant from 3 years ago, I offered “Two Simple Rules of Techno-Etiquette” that I will reiterate here as the first steps down the path to techno-etiquette recovery:
(1) If you absolutely MUST take that cell phone call or answer that e-mail right away, try saying this: “Excuse me, do you mind if I do this real quick?”
(2) Do not EVER, under any circumstances, answer a cell phone call while you are in a restaurant, movie theater or other public establishment where relative quiet is expected. If you have to take the call, go outside.
Seriously, would that be so hard?
Another great column by the Wall Street Journal’s Gordon Crovitz, who is quickly becoming my favorite tech policy columnist. In today’s column, “Bloggers Mugged by Regulators,” he comments on the FTC’s new disclosure rules for bloggers, which I discussed here over the weekend. Crovitz focuses on the enforcement challenges associated with the new rules and also argues that self-regulation should be given a chance to work:
There should be more disclosure, but the Web is different from earlier media in ways that make government regulation less relevant and practical. The Web has its own self-regulatory mechanisms. Failing to disclose interests sullies one’s reputation online, and reputation harm travels faster and lasts longer than it did before the Web.
There’s also greater need for caveat emptor online, because there is no practical way that any government agency can monitor the world’s bloggers and posters. There will always be people who post comments about products and services that are self-serving in one way or another, at least by someone’s definition. […]
Instead of trying to extend analog-era regulations onto the Web, the FTC should encourage readers to be vigilant about assessing for themselves the independence of sources online. At least we now know the biggest fraudulent claim so far on the Web: It’s been committed by regulators claiming there can be a government stamp of approval on everything anyone posts anywhere on the Web.
Amen brother.
Three cheers for Randall Rothenberg, President and Chief Executive Officer of the Interactive Advertising Bureau (IAB) for having the guts to send this splendid open letter to Federal Trade Commission (FTC) Chairman Jon Leibowitz about the agency’s new disclosure rules for bloggers. Rothenberg’s entertaining and brutally honest letter is a rarity for a trade association chief. Most of the time trade associations fall all over themselves to whisper sweet-nothings in the ears of regulators, even when those regulators are out to crush the industries in question. But Rothernberg doesn’t pull any punches in his letter to Chairman Leibowitz. After walking through some of the stunning ambiguities of the rules, such as how much “weight consumers give to [a] review” by a blogger who might have a commercial sponsor, Rothenberg asks:
With all due respect, Mr. Chairman: Huh? Does the FTC really intend to probe America’s opinion-mongering apparatus this closely? Do you have a team of Freuds and Jungs able to examine “the weight” consumers give such opinion – and the way they weigh that weight?
Naturally, this expedition from Oceania – that’s the place Big Brother ruled – should be worrisome to all Americans, and to all viewers, readers, listeners, users, and providers of any communications medium. But for the 400 members of the Interactive Advertising Bureau, most of which are small and medium-sized enterprises struggling to build their businesses in the face of the worst decline in marketing spending since the 1930’s, the implication that online social media represent a separate class of communications channels with less Constitutional protection than corporate-owned newspapers, radio stations, or cable television networks is of particularly grave concern.
They – and we — are not arguing that bloggers and social media be treated differently than incumbent media. After all, most newspapers, magazines, radio stations and television networks, in recognition that Americans are embracing new forms of social communications, have established their own blogs, boards, Facebook pages, Twitter feeds, and the like. Rather, we’re saying the new conversational media should be accorded the same rights and freedoms as other communications channels.
Yep, exactly right and it echoes the questions I’ve raised here before. And his letter just gets better from there regarding the enforcement nightmare presented by these ambiguous rules:
Continue reading →
Wal-Mart is often cast as a villain by some labor unions, local politicians and small retailers, but for the average consumer Wal-Mart has been a savior: A relentless price-cutting machine that instantly changes the dynamics of every market it touches. Indeed, when Wal-Mart decides to jump into a sector by offering a new good or service in its stores, something akin to “the Southwest effect” on steroids kicks in: That market segment is often transformed overnight in that the good or service Wal-Mart starts delivering is essentially instantly commoditized. For the seller of that good or service, this is both a blessing and a curse: They gain the massive market reach that goes along with being in Wal-Mart’s 8,000 retail stores. On the other hand, they instantly surrender any semblance of pricing power they once had. And this typically also puts downward pressure on prices not just for the particular good carried in the Wal-Mart stores, but for that entire market segment more generally. [This exact scenario is currently playing out in the book marketplace as Wal-Mart has gone to war with Amazon in cost-cutting bonanza.]
The reason I bring all this up is because, as most of you probably already heard, Wal-Mart jumped into the prepaid cell phone business this week with the launch of Straight Talk:
a new solution in no-contract cellular, exclusively at more than 3,200 Walmart stores nationwide starting October 18, 2009. Straight Talk will bring to the market a new low price for no-contract wireless service with two prepaid plans now available to customers nationwide at $30 and $45 a month. Straight Talk will only be available in Walmart stores and online at www.Walmart.com and www.StraightTalk.com. The average U.S. adult spends $78 on his or her cell phone bill to receive 1000 minutes a month. By switching to the $30 Straight Talk plan, for example, the average 1,000 minutes-per-month consumer could save more than $500 per year and still be on a reliable nationwide network.
I don’t want to overplay the significance of this development, but I really do believe that Wal-Mart’s presence in this field is significant, at least for entry-level mobile phones. While it would be easy for those of us who use more advanced smartphones to shrug off the Wal-Mart announcement, it would be a mistake for reasons made clear by David Worthington over at Technologizer: Continue reading →
Hey people. You owe me. All of you. You owe me free broadband. I am entitled to it, after all. That seems to be where our current FCC is heading, anyway. And hey, Finland’s just done it, and the supposed Silicon Valley capitalists at TechCrunch are giddy with delight about it. We’re apparently all just Scandinavian socialists at heart now.
Thus, I too have decided to throw in the towel on the idea of everyone carrying their own weight and picking up their own tab. So, get your wallets open and ready for me because I have lots and lots of things that I believe I have an inalienable right to receive free of charge from the government (i.e, “the people”; i.e., “YOU”). Please let me know which of the things on my high-tech wish list that you’ll be purchasing for me and I’ll check you off my registry so I don’t have to send the cops to your house to collect:
- free broadband (fiber, Wi-Max, and whatever else is around the corner);
- a couple of free new computers (and a really fast ones, thank you very much);
- 3 new HDTVs for my home (including one of those sweet new DLP projectors that usually cost about $10,000 bucks. And I’ll need you to pay for someone to help me install it. Or could you just come over and do that for me perhaps?);
- 3 free new DVRs for each new TV set that you are buying me (and could I get a nice universal remote to control everything, please);
- a free subscription in my area to either DirecTV, Cox Cable, or Verizon FIOS TV (with all the premium channels and sports packages… and don’t forget the Playboy Channel!);
- a free lifetime subscription to Netflix (or I guess I would settle for a free Blu-Ray player and some free movies);
- free new wi-fi router and signal extenders for my home (N-standard please, none of that B or G garbage… too slow for me);
- free mobile phone service for life + an iPhone + unlimited downloads in their app store (oh, could you have that iPhone autographed by Steve Jobs if you get a chance?);
- free Playstation or XBox + lots of games (and if I could get one of those driving wheels to play my new Gran Turismo game that would be dandy); and finally,
- free lifetime tech support when all this crap breaks down.
In closing, I thank you for your generosity. I mean, look, I know I don’t actually deserve any of this stuff, and that there’s no good reason that you should have to pay for my free-riding ways, and there’s obviously nothing in our Constitution to support all this, but hey… screw all that! This is my God-given birthright. I am
entitled, baby! Now get busy thinking of how you are all going to start paying for me, you selfish bastards.
The smell of high-tech regulation is increasingly in the air these days and many lawmakers and some activist groups now have the mobile marketplace in their regulatory cross-hairs. Critics make a variety of claims about the wireless market supposedly lacking competition, choice, innovation, or reasonable pricing. Consequently, they want to wrap America’s wireless sector in a sea of red tape. Two important new studies thoroughly debunk these assertions and set the record straight regarding the state of wireless competition and innovation in the U.S. today. These reports are must-reading for Washington policymakers and FCC officials who are currently contemplating regulatory action.
First, Gerald Faulhaber and Dave Farber have a new report out entitled “Innovation in the Wireless Ecosystem: A Customer-Centric Framework.” Here’s what Faulhaber and Farber find:
the three segments of the wireless marketplace (applications, devices, and core network) have exhibited very substantial innovation and investment since its inception. Perhaps more interesting, innovation in each segment is highly dependent upon innovation in the other segments. For example, new applications depend upon both advances in device hardware capabilities and advances in spectral efficiency of the core network to provide the network capacity to serve those applications. Further, we find that the three segments of the industry are also highly competitive. There are many players in each segment, each of which aggressively seeks out customers through new technology and new business methods. The results of this competition are manifest: (i) firms are driven to innovate and invest in order to win in the competitive marketplace; (ii) new business models have emerged that give customers more choice; and (iii) firms have opened new areas such as wireless broadband and laptop wireless in order to expand their strategic options.
They continue on to address the policy issues in play here and discuss the “consumer-centric” approach they recommend that the FCC adopt: Continue reading →
Over at his new blog, our old TLF colleague Tim Lee has an interesting post up about “The Problem with Top-Down ‘App Stores’” in which he argues that “when app store approval becomes mandatory, it becomes a major impediment to the success of high-tech platforms.” But I have to wonder if the facts support that assertion. Here’s how I commented on his site:
Tim… What I don’t hear you articulating here is your vision of what a “bottom-up” app store would look like and why it would really produce vastly superior results. Nor do I hear you saying anything about the legitimate concerns that the handset makers might have about the security or stability factors associated with certain applications. I’m not saying those problems are extensive, but at the margins they could be real depending on the nature of the program and how it interacts with the handset and/or network.
Second, there needs to be some sense of proportionality here, at least about the iPhone (I can’t speak for the Palm experience). In just a little over a year, there’s been 2 billion downloads of over 85,000 apps from over 125,000 developers. So, when you talk about Apple’s approval process being “plagued by.. problems” and “rejections for trivial or non-sensical reasons” and “long delays in the review process have become a staple of the tech blogosphere” I think you are giving the impression that this is somehow the norm when it is very much the exception to the rule. Perhaps you would be willing to itemize the examples for us. Once you do, I’d appreciate you doing the math on what that looks like as a percentage of the total 85,000 apps that are already out there on the market today. I am willing to bet the result is something like 0.000001%.
Again, a sense of proportionality is really key here. While I am not an Apple fan and agree they have a bit too much of a control streak for my tastes, it’s hard to argue with results. In this case, a closed, top-down system has produced some fairly spectacular results.
I’m sure Tim will have more to say so head over to his blog for more discussion.
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.