As early as 1990, telecom industry observers speculated about the shift away from traditional circuit-switched telephony to “Voice Over IP” (VoIP). By the late 1990s, Internet industry observers began using the term “Everything Over IP” (VoIP) to describe the ongoing and seemingly inevitable shift towards Internet distribution of not just voice, but all forms of, audio, text and multi-media content. Today, term has become a victim of its own success: “Of course, ‘everything’ is delivered over IP. How else would you do it?”
While this capitalist success story is among the greatest technological triumphs of our time, a similar rhetorical pattern is, unfortunately, playing out in very different arena of Regulatory Creep. The crusade for “net neutrality” is metastasizing before our very eyes into a broader holy war for regulating “Everything” (EoIP) in the name of “protecting neutrality.” The next target is clear: search engines Google—as an op-ed in today’s New York Times makes crystal clear. Adam Thierer and I warned about this escalation of efforts to get government more involved in regulating Internet back in October in a PFF paper entitled Net Neutrality, Slippery Slopes & High-Tech Mutually Assured Destruction:
If Internet regulation follows the same course as other industries, the FCC and/or lawmakers will eventually indulge calls by all sides to bring more providers and technologies “into the regulatory fold.” Clearly, this process has already begun. Even before rules are on the books, the companies that have made America the leader in the Digital Revolution are turning on each other in a dangerous game of brinksmanship, escalating demands for regulation and playing right into the hands of those who want to bring the entire high-tech sector under the thumb of government—under an Orwellian conception of “Internet Freedom” that makes corporations the real Big Brother, and government, our savior.
Today’s editorial is only small dose of what’s to come. The floodgates will really open and let forth a great gushing rage of demands for sweeping regulation of the entire Internet under the banner of neutrality when the deadlines pass in the FCC’s “net neutrality” NPRM (comments due January 14, 2010; reply comments due March 5). Continue reading →
Gee, if only the technology sector weren’t so gosh-darn static and slow-to-change, maybe we wouldn’t need government to keep tinkering with the market to make sure big, bad incumbents didn’t reign on high, oppressing us with their monopolistic control of our cyber-lives. But since the Big just keep getting bigger and “network effects” make it impossible for new competitors to get in the game, it’s a good thing we have so many Federal agencies looking out for us poor consumers (FCC, FTC, DOJ, NTIA, etc.) with antitrust interventions, common carriage mandates and 1000 other regulatory “tweaks”—not to mention all those oh-so-tech-savvy state legislators and attorneys general, always eager to leap into action! “Fire, ready, aim, boys!”
I mean after all, it’s only a matter of time before Time Warner/AOL uses their combined $100 billion might as “gatekeepers” to digitally enslave us all, right? Oh, wait…
Business Insider reports that, sometime next year, Scribdwill launch a “seamless” interface that allows users to access Scribd docs on their Kindles. That’s a major step forward for the startup, which aims to be the “YouTube for print”—and which Adam and I use to make all our PFF papers available online in an embeddable Flash viewer that’s much quicker to load than the full PDFs. But it also represents a serious potential long-term challenge to Amazon, since Scribd is “quietly developing a strong e-book storefront to match its hoard of user generated content,” as Business Insider notes, and because:
If Scribd can put its books on the Kindle, this number should only grow, especially since it offers publishers a better business deal than Amazon. Amazon reportedly offers a 50/50 sales split. Scribd only keeps 20% and allows publishers to set their own price.
It would be more accurate to say that Scribd will be “Kindling” e-book competition within the base of Kindle users, and of course, competing devices like Barnes & Noble’s Nook offer cross-platform competition, just as satellite television competes with cable. In both cases, the platform operator has a strong incentive to compete for users by offering as much content (books/video programming) as possible at attractive prices.
On the one hand, one might say that inter-platform competition is stronger in the case of video delivery platforms, because users generally lease equipment on a month-to-month basis, while e-book users must buy their $250+ device up-front (making it therefore harder to switch from Amazon to Barnes & Noble, if one decides one doesn’t like the offerings or prices for e-books on the Kindle). But on the other hand, if Scribd can compete head-to-head with Amazon in offering e-books on Amazon’s Kindle (and perhaps on the Note, too, someday soon), users don’t need to switch devices at all: They can just switch e-book providers. Furthermore since e-books are bought on an à la carte basis, users don’t have to switch completely, they can just switch for any particular book—meaning that Amazon needs to compete for every additional purchase they can get, which means lower prices and more choices for consumers.
by James Dunstan & Berin Szoka* (PDF) Originally published in Forbes.com on December 17, 2009
As world leaders meet in Copenhagen to consider drastic carbon emission restrictions that could require large-scale de-industrialization, experts gathered last week just outside Washington, D.C. to discuss another environmental problem: Space junk.[1] Unlike with climate change, there’s no difference of scientific opinion about this problem—orbital debris counts increased 13% in 2009 alone, with the catalog of tracked objects swelling to 20,000, and estimates of over 300,000 objects in total; most too small to see and all racing around the Earth at over 17,500 miles per hour. Those are speeding bullets, some the size of school buses, and all capable of knocking out a satellite or manned vehicle.
At stake are much more than the $200 billion a year satellite and launch industries and jobs that depend on them. Satellites connect the remotest locations in the world; guide us down unfamiliar roads; allow Internet users to view their homes from space; discourage war by making it impossible to hide armies on another country’s borders; are utterly indispensable to American troops in the field; and play a critical role in monitoring climate change and other environmental problems. Orbital debris could block all these benefits for centuries, and prevent us from developing clean energy sources like space solar power satellites, exploring our Solar System and some day making humanity a multi-planetary civilization capable of surviving true climatic catastrophes.
The engineering wizards who have fueled the Information Revolution through the use of satellites as communications and information-gathering tools also overlooked the pollution they were causing. They operated under the “Big Sky” theory: Space is so vast, you don’t have to worry about cleaning up after yourself. They were wrong. Just last February, two satellites collided for the first time, creating over 1,500 new pieces of junk. Many experts believe we are nearing the “tipping point” where these collisions will cascade, making many orbits unusable.
But the problem can be solved. Thus far, governments have simply tried to mandate “mitigation” of debris-creation. But just as some warn about “runaway warming,” we know that mitigation alone will not solve the debris problem. The answer lies in “remediation”: removing just five large objects per year could prevent a chain reaction. If governments attempt to clean up this mess themselves, the cost could run into the trillions—rivaling even some proposed climate change solutions.
In case you live under a digital rock (whaddyamean, you don’t check TechMeme hourly?), you have probably heard that EPIC filed a complaint with the Federal Trade Commission Thursday, alleging that Facebook’s revised privacy settings (and their implementation) constitute “unfair and deceptive trade practices” punishable under the FTC’s Section 5 statutory consumer protection authority. Specifically, EPIC demands, in addition to “whatever other relief the Commission finds necessary and appropriate,” that the FTC “compel Facebook to restore its previous privacy settings allowing users to:”
“choose whether to publicly disclose personal information, including name, current city, and friends” and
“fully opt out of revealing information to third-party developers”
In addition, EPIC wants the FTC to “Compel Facebook to make its data collection practices clearer and more comprehensible and to give Facebook users meaningful control over personal information provided by Facebook to advertisers and developers.”
I’ll have more to say about this very complicated issue in the days to come, but I wanted to share, and elaborate on, two press hits I got on this issue today. First, in the PC World story, I noted that “we’re already seeing the marketplace pressures that Facebook faces move us toward a better balance between the benefits of sharing and granular control” and expressed my concern “about the idea that the government would be in the driver’s seat about these issues.” In particular, Facebook has made it easier for users to turn off the setting that includes their friends among their “publicly available information” that can be accessed on their profile by non-friends (unless the user opts to make their profile inaccessible through Facebook search and outside search engines).
In other words, this is an evolving process and Facebook faces enormous pressure to strike the right balance between openness/sharing and closedness/privacy. While Facebook’s critics assume that it is simply placing its owyou and I saw an article that is as oldyou you as it isn financial interests above the interests of its users, the reality is more complicated: Facebook’s greatest asset lies not in the sheer number of its users and not just in the information they share, but in the total degree of engagement in the site. The more time users spend on the site, the better, because Facebook is rewarded by advertisers for attracting and keeping the attention of users. Continue reading →
The LA Times has come out swinging in a devastating editorial against Rep. Anna G. Eshoo’s (D-CA) Commercial Advertisement Loudness Mitigation (CALM) Act, passed by the House on Tuesday. As Adam Thierer and I have discussed (here, here, and here), and as PFF’s Ken Ferree notes here, this silly paternalist law would require the FCC to issue rules that broadcast and cable TV ads:
(1) … shall not be excessively noisy or strident;
(2) … shall not be presented at modulation levels substantially higher than the program material that such advertisements accompany; and
(3) [their] average maximum loudness… shall not be substantially higher than the average maximum loudness of the program material that such advertisements accompany.
The LA Times‘s pithy response: “Ads too loud? Try ‘mute.‘” Three cheers for trusting users to take advantage of the simple tools available to them to make these decisions for themselves (like the “mute” button on their remote), instead of leaping to legislative solutions:
Eshoo might have the public on her side, but as a representative of Silicon Valley, she should be more wary of having the government dictate technological solutions to problems that individuals can solve themselves. The market is already responding — more than 30% of TV viewers use ad-skipping video recorders. Besides, as dissenting Republicans on the House Energy and Commerce Committee pointed out,“Americans’ televisions still have volume control, and remote controls still have ‘mute’ buttons. Consumers do not need the government to come into their homes and operate their remote controls for them.” With all the challenges facing the country, you’d think lawmakers could find better things to do than invite themselves into their constituents’ living rooms.
Besides the broad philosophical precedent that this elitist law sets (consumers are too stupid and helpless to take care of themselves so government must do it for them), I explained in some detail five other reasons why this law is a terrible idea when I blogged about it in October: Continue reading →
The European Commission today announced the settlement of its antitrust case against Microsoft concerning the inclusion of Internet Explorer in its operating system. In the settlement, Microsoft has agreed to offer a “browser ballot” in its Windows 7 operating system, which Adam Marcus and I commented on in November.
It’s a relief to see that the European Commission is bringing to a close this chapter in the seemingly endless epic of its antitrust persecution of Microsoft. The Commission should have recognized that Internet Explorer’s rapidly falling market share made it unnecessary to meddle in software creation. Still, I suspect that it’s only a matter of time before the Commission hauls another Microsoft or some other innovative American tech titan into court on trumped-up charges.
Worse, such mandates could easily extend to require “ballots” for choosing one’s default search engine, media player, instant messaging client, email provider, and so on. That kind of bureaucratic interference with the delicate art of interface design will only serve to discourage Microsoft and its many competitors from including useful new features in their offerings, thus harming consumers.
At a public forum held today by the Federal Trade Commission on “Sizing Up Food Marketing and Childhood Obesity,” activists called on Congress to pass legislation that would heavily curtail food marketing to children, including:
Rep. Jim Moran’s (D-VA) “Healthy Kids Act” (H.R. 4053) would direct the FTC to conduct a rulemaking and decide what kinds of foods could be marketed to children, and FCC to ban or seriously restrict broad categories of food and beverage ads shown on children’s programming.
Sen. Tom Harkin (D-IA) wants to repeal limitations a heavily Democratic Congress imposed in the late 1970’s on the FTC’s unfairness rulemaking authority over children’s advertising after the agency ran amok.
Rep. Dennis Kucinich (D-OH) intends to introduce legislation to essentially tax so-called “fast food and junk food” marketed to children by eliminating the current tax deduction.
It’s easy to pick on advertising as the cause of all of society’s ills, but there’s no hard evidence that food advertising is to blame for childhood obesity or that restricting food ads on television or the Internet will solve the problem. Howard Beales, now at George Washington University’s business school, wrote the definitive law review article on this topic back in 2004, when he was Director of the FTC’s Bureau of Competition: Advertising to Kids and the FTC: A Regulatory Retrospective that Advises the Present. It is a true masterpiece.
Dan Jaffe of the Association of National Advertisers, brings his extraordinary expertise on this issue to bear in his comments (full comments in Word doc) to today’s workshop, which update and expand on the themes Howard discussed in his 2004 article. As Dan describes in rich detail, industry is already responding to demands by parents and other consumers with healthier foods and self-regulation.
So, rather than restricting the free speech of advertisers, and thus diluting First Amendment rights in general, the FTC should use its existing authority to punish truly unfair and deceptive claims. Governments and schools should focus on educating kids and parents about eating healthier and exercising more.
Three months ago, when the DC Circuit struck down the FCC’s “Cable Cap”—which prevented any one cable company from serving more than 30% of US households out of fear that he larger cable companies would use their “gatekeeper” power to restrict programming—the New York Times bemoaned the decision:
The problem with the cap is not that it is too onerous, but that it is not demanding enough.
Even with the cap — and satellite television — there is a disturbing lack of price competition. The cable companies have resisted letting customers choose, a la carte, the channels they actually watch….
[The FCC] needs to ensure that customers have an array of choices among cable providers, and that there is real competition on price and program offerings.
Perhaps the Times‘ editors should have consulted with the Lead Technology Writer of their excellent BITS blog. Nick Bilton might have told him the truth: “Cable Freedom Is a Click Away.” That’s the title of his excellent survey of devices and services (Hulu, Boxee, iTunes, Joost, YouTube, etc.) that allow users to get cable television programming without a cable subscription.
Nick explains that consumers can “cut the video cord” and still find much, if not all, their favorite cable programming—as well as the vast offerings of online video—without a hefty monthly subscription. (Adam recently described how Clicker.com is essentially TV guide for the increasing cornucopia of Internet video.) This makes the 1992 Cable Act’s requirement that the FCC impose a cable cap nothing more than the vestige of a bygone era of platform scarcity, predating not just the Internet, but also competing subscription services offered by satellite and telcos over fiber. That’s precisely what we argued in PFF’s amicus brief to the DC Circuit a year ago, and largely why the court ultimately struck down the cap.
Bilton notes that “this isn’t as easy as just plugging a computer into a monitor, sitting back and watching a movie. There’s definitely a slight learning curve.” But, as he describes, cutting the cord isn’t rocket science. If getting used to using a wireless mouse is the thing that most keeps consumers “enslaved” to the cable “gatekeepers” the FCC frets so much about, what’s the big deal? Does government really need to set aside the property and free speech rights of cable operators to run their own networks just because some people may not be as quick to dump cable as Bilton? Is the lag time between early adopters and mainstream really such a problem that we would risk maintaining outdated systems of architectural censorship (Chris Yoo’s brilliant term) that give government control over speech in countless subtle and indirect ways? Continue reading →
The New York Times has a great summary of yesterday’s Exploring Privacy workshop at the FTC, where Adam and I made the case that restrictive, preemptive privacy regulations affecting online advertising is likely to harm, not help, consumers. Check out Adam’s excellent summary here. Adotasnotes:
… the highlight was the third panel, when Jeff Chester, executive director for the Center for Digital Democracy and an outspoken online privacy advocate, and Berin Szoka, director of the Center for Internet Freedom at the Progress and Freedom Foundation, got into a 10-minute tete-a-tete on the importance of targeting in advertising as well as journalism.
[Jeff] Chester railed against targeting in general and called for a “citizen friendly” system while Szoka the importance of targeted advertising in funding high-cost content. Szoka argued that for users to access certain content at no cost, there is a trade-off in giving up certain types of data.
Jeff and I will be “taking our show on the road” Wednesday morning with a four-way debate moderated by Rob Atkinson of ITIF, also including Howard Beales and Ari Schwartz, as well as the FTC’s Peder McGee. Given the energy level in our discussion at the FTC, this more focused panel promises to be a great discussion of how to maximize the many competing values of consumers—or, more precisely (from my perspective, anyway), how to educate and empower users to make those decisions for themselves.
So don’t miss it if you can attend (1101 K Street, Suite 610, Washington, DC), and be sure to watch the live-streaming if you can’t!
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.