I write in “The Laws of Disruption” of the risk of unintended consequences that regulators run in legislating emerging technologies. Because the pace of change for these technologies is so much faster than it is for law, the likelihood of defining a legal problem and crafting a solution that will address it is very slim. I give several examples in the book of regulatory actions that quickly become not just obsolete but, worse, wind up having the opposite result to what regulators intended.
An unfortunate example of that problem in the news quite a bit lately is the Electronic Communications Privacy Act or ECPA. (My first published legal scholarship, in 1994, was an article about a provision of ECPA that allowed law enforcement officers to use evidence they came across by accident in the course of an otherwise lawful wiretap, see “Electronic Communications and the Plain View Exception: More ‘Bad Physics.’”)
Passed in 1986, ECPA at the time was a model of smart lawmaking in response to changing technologies. It updated the federal wiretap statute, known as Title III, to take into account the rise of cellular technologies and electronic messages–which didn’t exist when the original law was passed in 1968.
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I have a long opinion piece on CNet today, arguing that much of the talk of “reclassifying” or “relabeling” broadband Internet access to bring it under the FCC’s regulatory authority is just that—talk.
On April 6th, the D.C. Circuit Court of Appeals ruled definitively that the squishy doctrine of “ancillary jurisdiction” provides no authority for the FCC to impose its net neutrality rules on broadband Internet providers.
Law professors and paid advocates are doing a good job of convincing journalists who don’t understand the finer points of administrative law that all the FCC needs to undo that decision is the will to change the classification of broadband and…problem solved.
Not quite. Those who argue the FCC can simply waive a regulatory wand and give itself all the jurisdiction it needs under Title II of the Communications Act are engaging in serious wishful thinking, or worse.
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(Adam beat me to the punch (he’s on East Coast time, after all), but I wanted to make a few preliminary remarks about the FCC loss today anyway.)
The D.C. Circuit Court of Appeals issued its opinion today in Comcast’s appeal of sanctions issued in 2008, rejecting the FCC’s authority to issue the sanctions in the first place. (Brent Kendall of The Wall Street Journal has already reported the story, see “Court Strikes at Net Neutrality.”)
The ruling punished the cable company’s efforts to throttle peer-to-peer traffic over its network of some customers using the BitTorrent application, a network management principle the FCC said violated its “policy” on open and transparent Internet or “net neutrality.” Since Comcast agreed to more subtle forms of traffic management and to make such decisions more transparent, the FCC left them with a slap on the wrist. Comcast appealed nonetheless. (Appeals of FCC adjudications go directly to the D.C. Circuit.)
I’ve read through the court’s 36-page opinion, which will serve as an important marker in the “net neutrality” debate. It largely follows the harsh line of questioning taken during the oral arguments for the case back in January, where the panel challenged the FCC to identify a specific statutory provision that gave them authority to impose the neutrality principles—in this case, in an adjudication that Comcast had failed to follow the rules.
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As the Wall Street Journal is already reporting, today eBay sustained an important win in its long-running dispute with Tiffany over counterfeit goods sold through its marketplace. (The full opinion is available here.)
I wrote about this case as my leading example of the legal problems that appear at the border between physical life and digital life, both in “The Laws of Disruption” and a 2008 article for CIO Insight.
To avoid burying the lede, here’s the key point: for an online marketplace to operate, the burden has to be on manufacturers to police their brands, not the market operator. Any other decision, regardless of what the law says or does not say, would effectively mean the end of eBay and sites like it.
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I had a long interview this morning with the Christian Science Monitor. Like many of the interviews I’ve had this year, the subject was Google. At the increasingly congested intersection of technology and the law, Google seems to be involved in most of the accidents.
Just to name a few of the more recent pileups, consider the Google books deal, net neutrality and the National Broadband Plan, Viacom’s lawsuit against YouTube for copyright infringement, Google’s very public battle with the nation of China, today’s ruling from the European Court of Justice regarding trademarks, adwords, and counterfeit goods, the convictions of Google executives in Italy over a user-posted video, and the reaction of privacy advocates to the less-than-immaculate conception of Buzz.
In some ways, it should come as no surprise to Google’s legal counsel that the company is involved in increasingly serious matters of regulation and litigation. After all, Google’s corporate goal is the collection, analysis, and distribution of as much of the world’s information as possible, or, as the company puts it,” to organize the world’s information and make it universally accessible and useful.” That’s a goal it has been wildly successful at in its brief history, whether you measure success by use (91 million searches a day) or market capitalization ($174 billion).
As the world’s economy moves from one based on physical goods to one driven by information flow, the mismatch between industrial law and information behavior has become acute, and Google finds itself a frequent proxy in the conflicts.
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I published an opinion piece today for CNET arguing against recent calls to reclassify broadband Internet as a “telecommunications service” under Title II of the Communications Act.
The push to do so comes as supporters of the FCC’s proposed Net Neutrality rules fear that the agency’s authority to adopt them under its so-called “ancillary jurisdiction” won’t fly in the courts. In January, the U.S. Court of Appeals for the D.C. Circuit heard arguments in Comcast’s appeal of sanctions levied against the cable company for violations of the neutrality principles (not yet adopted under a formal rulemaking). The three-judge panel expressed considerable doubt about the FCC’s jurisdiction in issuing the sanctions during oral arguments. Only the published opinion (forthcoming) will matter, of course, but anxiety is growing.
Solving the Net Neutrality jurisdiction problem with a return to Title II regulation is a staggeringly bad idea, and a counter-productive one at that. My article describes the parallel developments in “telecommunications services” and the largely unregulated “information services” (aka Title I) since the 1996 Communications Act, making the point that life for consumers has been far more exciting—and has generated far more wealth–under the latter than the former.
Under Title I, in short, we’ve had the Internet revolution. Under Title II, we’ve had the decline and fall of basic wireline phone service, boom and bust in the arbitraging competitive local exchange market, massive fraud in the bloated e-Rate program, and the continued corruption of local licensing authorities holding applications hostage for legal and illegal bribes.
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I’m quoted briefly in a story today in E-Commerce Times (see “Apple’s Patent Attack: This Too May be Overhyped” by Erika Morphy) about the patent lawsuit filed this week by Apple against rival mobile device maker HTC.
Apple, of course, produces the iPhone, while HTC makes Google’s Nexus One and other devices that run on Google’s Android operating system.
So right from the start this case looks less like a simple patent dispute and more like a warning shot over Google’s bow. The two companies are increasingly becoming rivals. In August of last year, Google CEO Eric Schmidt resigned from Apple’s board. Apple CEO Steve Jobs wrote at the time, “Unfortunately, as Google enters more of Apple’s core businesses, with Android and now Chrome OS, Eric’s effectiveness as an Apple Board member will be significantly diminished….” Continue reading →
In interviews last week and this week (see KUOW’s “The Conversation”), I argue that the convictions of three Google executives by an Italian court for “illegal handling of personal data” threaten the future of all hosted content. More than that, I said that the convictions had a disturbing subtext: the on-going effort of the Italian government to intimidate the remaining media outlets in that country it doesn’t already control. (See “Larger Threat is Seen in Google Case” by the New York Times’ Rachel Donadio for the details.)
In Italy and other countries (think of the Twitter revolt following dubious elections in Iran), TCP/IP is quickly becoming the last bastion of a truly free press. In that sense, the objectionable nature of the video in question made Google an easy target for a prosecutor who wanted to give the appearance of defending human dignity rather than threatening a free press.
In a post that was picked up on Saturday by TechMeme, I explained my position in detail:
The case involved a video uploaded to Google Videos (before the acquisition of YouTube) that showed the bullying of a person with disabilities.
Internet commentators were up-in-arms about the conviction, which can’t possibly be reconciled with European law or common sense. The convictions won’t survive appeals, and the government knows that as well as anyone. They neither want to or intend to win this case. If they did, it would mean the end of the Internet in Italy, if nothing else. Still, the case is worth worrying about, for reasons I’ll make clear in a moment.
But let’s consider the merits of the prosecution. Prosecutors bring criminal actions because they want to change behavior—behavior of the defendant and, more important given the limited resources of the government, others like him. What behavior did the government want to change here? Continue reading →
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