Last week the California Public Utilities Commission supported a statement of policy in favor of “standalone DSL.” Standalone, or “naked” DSL is when DSL service is provided without local phone service. The PUC said it voted to support a policy of “consumer choice.” But when the a la carte preferences of regulators and some consumers conflict with the bundled prerogatives of technology providers and other consumers, which policy should win out?
Policymakers should resist the urge of forcing communication providers to unbundle their products. And while the California PUC’s policy statement has only the force of persuasion, not law, the premise underlying the statement is still wrong. Bundling is clearly a good thing for the vast majority of consumers. It’s not gouging. It’s not unreasonable tying. Instead, it’s just another example of the way that communication products will be packaged in a world where telephone networks compete against cable and wireless networks.
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The recent decision by the Internet Corporation for Assigned Names and Numbers (ICANN) to delay deciding whether to approve the .xxx top-level domain signals what could be yet another debate about “indecency” over communication networks. This time, it’s about the structure and content of the Internet, not the broadcast airwaves. And because it’s the Internet that will be impacted by debate concerning “indecent” content, international sovereignty and cultural integrity is at stake. The fear is that supposedly independent technical standards bodies will be hijacked by governments wanting to restrict the free flow of content.
But the U.S. is not alone in its apprehension over what it considers to be illegitimate content. Brazil and France were worried about a .xxx TLD. Indeed, Internet communications spill over national borders, connecting and uniting people everywhere. Other countries fear that cultural fragmentation and the violation of national sovereignty will result from increased interconnection.
The World Society of the Information Summit (WSIS – pronounced Wiss Iss) will hold a meeting this November. And on the verge of it governance policy issues are heating up, and as I say in my recent C:\Spin policy article, ICANN and other Internet governance bodies should have accountability, but not necessarily political accountability to the U.S. or UN. These organizations have a role in deciding on the technical specifications that will encourage the free exchange of information, not limit it.
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At the Congressional Internet Caucus Advisory Committee panel discussion on Tuesday, most people seemed to agree on one point about the Grokster decision – we don’t need new copyright legislation (at least not yet).
This general consensus concurs with my recent article on Grokster. It’s just too early to tell how the courts will apply the court’s active inducement test. And I’ve heard it said somewhere that it takes three years to feel the effects of a Supreme Court decision (not including grants of habeas corpus petitions of course).
Yet some groups want action now. According to EFF’s Fred von Lohmann, “the Supreme Court left too many unanswered questions, von Lohmann said, adding, “I don’t believe that uncertainty is balance. We need clear, bright-line rules so that technology companies can know in advance what they are and are not allowed to build.”
According to the CNET article in which he was quoted, von Lohmann suggested two possible ways to legislate:
First, Congress should implement a “collective licensing” system for peer-to-peer file sharing, wherein users would pay a “reasonable fee,” which would in turn be passed on to the copyright holders. Second, lawmakers should scrap the idea of statutory damages–that is, money awarded to copyright owners because of provisions in the law–but leave open the option of awarding actual damages and injunctions through the court action.
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We’re in the midst of a transition from analog to digital transmissions of broadcast TV – sort of (as I said in a C:\Spin article). Today the Senate Commerce Committee held a hearing on legislation concerning digital television (DTV), focusing on how and when to transition away from analog. It is hoped that the hearings will induce Congress to give this lagging transition a defined mission with a “hard” deadline.
Congress must create a “hard” deadline for a complete digital transition. The sooner the date becomes a certainty, the better it will be for: a) consumers, who will be able to make more informed purchases; b) manufacturers, who can label analog sets in a way that will inform consumers of the transition date; c) broadcasters, who can publicize the transition in a way that can help attract increased viewership.
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A hearty, bellowing but gentlemanly “shout out” to the Liberty Belles, a new blog that seeks to inject a lady’s touch to the discussion of libertarian issues. One of the resident bloggers, Anastasia, is a CEI intern this summer. Her blogging conveys her witty, interesting, and energetic persona – and will surely be matched by the four other belles. So check them out! From their blog:
We stand for free minds, free markets, free…Well, let’s say we don’t mind you holding the door for us, we just don’t want the government doing it. For too long, the word on the street has been that the movement for freedom and limited government lacks its Lady Liberty. Women’s voices are largely absent from the conversation, despite the calls and catcalls of our fellow men.
My colleague Wayne Crews has a new paper out on cybersecurity. He outlines why we need to let the insurance market develop for software risks, and that government mandates would hurt this development. He says:
Contractually driven approaches that treat liability as an evolving relationship should prevail over regulatory approaches that mandate liability, or at the opposite extreme, indemnify companies from liability when technologies fail.
From the executive summary:
We face unprecedented information security vulnerabilities in our hyper-networked, global economy. Leaving the path clear for private, technical, market, and contractual solutions, and avoiding governmental mandates that impede contractual liability and insurance markets, should take priority. Embracing legislation or mandates can mean locking in collective “solutions” that may be hard to correct, undermining information security rather than enhancing it.
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“Orphan works” are artistic works still under copyright but whose owner cannot be identified. Because the owner can’t be found, these copyrighted works are not able to be used and society loses out on their creative utilization. The Copyright Office has a proceeding underway on how to solve the orphan works problem. In comments I and Rudy Rouhana, a law student at Catholic University, filed earlier this week, we propose a way that the market can be the Daddy Warbucks for orphan works.
Competing copyright registries, similar to that for Internet domain names, could help provide incentives for the registration of works, especially digital works. What is needed is a registry system that conforms to the wide range of uses and values in copyright, ubiquity of copyrighted works, and easy registration process. A compulsory registration requirement would go against the no formalities requirement of the Berne Convention for the Protection of Literary and Artistic Works. However, this treaty does not preclude private registries. Private registries that are not compulsory but have legal recognition might provide the proper incentives for creators to register their works, thus diminishing the future instances of orphan works.
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Recent news accounts on Steve Ballmer’s visit with Europe’s top antitrust official, Neelie Kroes, again brings to light the concept of software bundling. With Microsoft’s Longhorn operating system still 18 months away, we’ll have a little reprieve at least from more antitrust actions directed against MS (maybe). But what the operating system bundles (and what it doesn’t) will surely be the subject of legal attacks.
It can be easy to bundle digital products, but when is it illegal? This is a difficult question to answer, made more difficult when viewed against the global regulatory scale. In my recent article published in the Intellectual Property & Technology Law Journal, I argue that while it is easy to think of bundling as anticompetitive tying, economic justifications show that this fear is overblown. Consumers generally prefer bundled products because they offer convenience and more value for the money. That’s why EU regulators need to adopt a “rule of reason” approach toward antitrust tying cases. This is the approach that the U.S. has essentially adopted, and represents a more forgiving standard than the hard and fast per se rule.
Why bundle digital products? What are the consumer and regulatory misunderstandings toward technology bundling? What is tying, legally speaking? What’s the international impact? Answers to these and other titillating questions here.
My latest C:\Spin article, The Public Interest Tax on Communications, corresponded with last week’s National Association of Broadcasters show in Vegas. In this article I go after a weighty subject that is somewhat abstract but directly relevant to today’s communications industry – the “public interest” legal standard. Regulations predicated upon the public interest are essentially proxies for the public’s own taste and preferences. If there was a need for this requirement early in the days of broadcasting, today’s new technologies make it unnecessary and a costly way to regulate.
The public interest standard is overly subjective for a legal standard, which results in too much political pork and special interest hijacking. Consumers would be better off if we removed this language from our communications law. My article:
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Last week was the annual National Association of Broadcasters show in Las Vegas. I was fortunate enough to attend, and having finally accustomed to Eastern Standard Time, here are my thoughts:
* Every regulator needs to attend these trade shows, which represent market forces working to meet whatever needs or perceived needs exist. I was truly overwhelmed by the smart people in the electronic media industry.
* Most broadcast industry reps are free speech proponents and against broadcast indecency regulation. The National Association of Broadcasters Education Foundation (NABEF) announced the creation of National Freedom of Speech Week from October 17-23, 2005.
* Digital TV transition is still a mess. The congressional breakfast featured Sen. Conrad Burns, Rep. Joe Barton, and Rep. Fred Upton among others. Barton and Upton advocated for a hard cutoff date, something needed or else the broadcasters will never return the analog spectrum.
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The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.