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.
I’ve ranted in past blog posts about the inconvenience of Ticketmaster’s paperless tickets and have even called them the highway to ticket hell (a nod to AC/DC’s paperless tickets use). I’m in a ranting mood again today, particularly when I was thinking about how they’d frustrate a Christmas gift to my parents for a play or show (my parents love attending concerts & theater).
Ticketmaster may call it innovation, but I call it frustration. You can resell your townhouse, Toyota, or textbooks online. But there’s one product, that thanks to new technology, can’t be bought and resold–“paperless tickets“.
That almost anything can be bought and resold is a benefit to consumers, particularly in tough economic times. But with paperless tickets, instead of getting a paper ticket (or an email that you print up at home) you have to present 1) the credit card used to purchase the tickets, and 2) a government-issued photo identification for admittance. Paperless tickets have been used throughout the recent Miley Cyrus tour this year. She performed at the Verizon Center last month in Washington, DC and a local news story reported on the hardship it created for many fans:
A photo ID is also required, meaning Talia Levin couldn’t just take her mom’s credit card to the concert. Her mom had to swipe her through. “If you are older, then you can go by yourself, so it’s hard to have to go with your parents,” stated Talia Levin. “I refuse to buy into any artist who does this ever again,” said Talia’s mom, Melanie Levin. “I won’t do it.”
So what if I wanted to go online to buy concert tickets for my parents as a Christmas Gift? Would I have to go down to the arena to get them in–down in Atlanta?? Continue reading →
ACT represents the interests of software companies, but today we’ve released a new paper trumpeting the virtues of hardware.
We highlight how software developers and computer chip makers increasingly depend on one another for better products. This symbiotic hardware/software relationship is crucial for the sort of exponential innovation we’ve grown accustomed to in the IT industry. And it is something ACT recently highlighted in a letter to the FTC signed by 37 software developers.
The old days of understanding computer processors and its effect on software was easy. Chips increased in clock speed (first in MHz, then in GHz) and this made software run faster. This worked well for years, but then it became apparent that high clock speed processors often ran idle because other system components couldn’t keep up. These processors also ran very hot, consuming lots of power and creating heat problems.
Today’s chips take a different approach. Chips now have processors with multiple cores (or CPUs) to separately but simultaneously handle independent tasks. In a survey of ACT members that we conducted for the paper, 58% of the respondents identified multicore technology as the processor advancement that has most improved their software products. One member said “multicore makes programming harder, but when my apps leverage it, they can do more.”
But how do programmers know what to do so they can better leverage processor designs such as multicore? Every major chip manufacturer worth a grain of sand has established support programs and created tools for the developer community. Sun has its Sun Developer Network, Intel has a Software Partner Program (and just announced a new software development kit (SDK) for its mobile Atom processor), and AMD has the CodeAnalyst Performance Analyzer to analyze software performance and help developers optimize applications.
In some ways it seems like chip manufacturers are sucking up to software developers. Continue reading →
The Comcast-NBC deal has the traditional media world all atwitter—well, better call it aflutter. “Atwitter” is losing its old media connotations.
So the New York Times rounded up a foursome of advocates to air their views, among them Adam Thierer and yours truly.
Huzzahs and rotten fruit in the comments, please.
(And you can see from comparing our posts which of us believes in economy in the use of words.)
Bidding has begun on Comcast’s acquisition of a majority stake in NBC Universal. No, not the bidding between GE and Comcast over the terms of the sale. That was the comparatively easy part. The real bidding is over at the FCC, as various interests work to get concessions and pledges from Comcast as a condition of FCC approval of the deal. The jostling may put post-Thanksgiving Black Friday sales to shame. Everything from more kid’s shows to broadband open access mandates are potentially on the table.
And that’s if the sale is approved by the FCC at all. Groups such as Free Press called for its rejection as soon as it was announced. Commissioner Michael Copps underscored the alpine nature of the approval process, stating bluntly that the deal “faces a very steep climb with me.”
Amidst the din, however, one question has been drowned out: Why is the FCC involved in this at all? Continue reading →
My PFF colleague Barbara Esbin has a great piece about why “FCC Could Mess Up Internet With ‘Net Neutrality’ Rules No One Needs” in a USNews point/counterpoint debate with Andrew Schwartzman of the Media Attack Access Project, who claims such rules “Would Keep the Web Free for Speech and Trade.” Here are her two best gems:
The FCC claims that broadband Internet markets are insufficiently competitive today to protect consumer interests. Yet a 2007 Federal Trade Commission report found no market failure and warned regulators to proceed with caution. The FCC acknowledges that broadband service providers face growing traffic volume demands that must be managed but claims that they have the potential—the opportunity, means, and motive—to act in an anticompetitive fashion when transporting Internet traffic across their networks. FCC detectives point to economic theory suggesting providers have incentives to act in an anticompetitive manner against competing providers of content, applications, or services. What is missing from this crime scene investigation is the body—the actual evidence that providers are behaving anticompetitively or are likely to.
And:
Lacking evidence that regulation is now necessary to combat either market failure or other consumer harms, the FCC is left to postulate a dystopian world without network neutrality rules. It claims that unless it acts now, we risk losing what we value most about the Internet. In other words, it creates what economists would call a “counterfactual.”
But we don’t need economic theory to tell us what a world without network neutrality rules would look like because we already live in that world. And in the real world, the fact is that the Internet ecosystem we have is functioning quite well to satisfy customer needs without the ministrations of the FCC. In fact, one might go so far as to say it functions as well as it does because of that.
Of course, regulatory advocates would insist that broadband providers aren’t really behaving themselves today, citing a handful of vastly exaggerated examples. But they would probably fall back on the argument that broadband service providers are just waiting to start behaving even more anti-competitively until the threat of net neutrality regulation has been removed.
It’s certainly true that government disciplines markets as much by the threat of regulation as the actual exercise thereof, but that’s especially true of antitrust laws: Even if we never see an antitrust suit brought against an ISP for anticompetitive behavior towards applications and content providers, antitrust laws would still play—indeed, have already played—a vital role in discouraging companies from engaging in the kind of behavior Andy Schwartzman worries about. That’s why PFF proposed relying on case-by-case antitrust enforcement rather than preemptive regulation with its 2005 DACA project.
Given the dangers of inviting further proscriptive government regulation of the Internet: “All we are saying, is give love antitrust a chance…”
Arik Hesseldahl has an interesting piece in Business Week about Apple’s control of the iPhone App approval process in which he asks: “Is a smartphone gatekeeper needed?” Plenty of people don’t think so and have raised a stink about Apple trying to play that role for the iPhone. It certainly could be true, as some critics suggest, that Apple is being too heavy-handed on occasion when rejecting apps, but it’s always easy for those of us on the outside of the process to think that. Hesseldahl notes that:
it’s tempting to consider the implications of a less hands-on approach, as is the case with Macs, Microsoft (MSFT) Windows PCs, or other smartphones, including those running the Google (GOOG)-backed Android operating system. The software market for personal computing has existed in this way for nearly three decades, and while there have certainly been some problems along the way, I’d argue that overall we’re better off without Microsoft or Apple or some other organization approving software applications before they’re released to the market. PC users have learned to be careful about what they put on their computers through unhappy trial and error.
But he also notes that there is another side to the story: Continue reading →
I was just digging through some old files and came across a quote that I found entertaining. Back in 2003, when he was still president and chief operating officer of Viacom, Mel Karmazin said with reference to Microsoft, AOL-Time Warner, and Comcast: “I can’t imagine being a competitor with any of these guys.” At the time, some media worrywarts made great hay of Mel’s quip and claimed, as Gene Kimmelman of Consumers Union argued at the time, that it proved how “Media moguls themselves admit their desire to avoid real competition within their industry.”
Utter rubbish. In fact, just six years after Karmazin spoke those words, Microsoft finds itself in a heated war with Google on all fronts, AOL-Time Warner has crumbled (even Time Warner Cable and Time Warner Entertainment got divorced!), and Comcast is now squaring off against telco and online video competitors that were unfathomable at the time (not to mention traditional satellite TV competitors.) In the meanwhile, Karmazin abandoned Viacom and today, as CEO of Sirius XM, is struggling to find a way to make the satellite radio universe survive the ongoing digital music bloodbath thanks to unforeseen competition from online music services and a little thing called the iPod!
It’s proof positive that media markets and digital technologies always evolve faster than most people — even smart industry titans like Karmazin — anticipate.
Great story in Wired about how Apple disrupted Microsoft’s mobile OS lead, again illustrating how quickly today’s leaders can, and probably will, become tomorrow’s laggards in the topsy-turvy tech biz.
And on the benefits of Apple’s heretical “closedness”:
The iPhone operates on a closed system, which can only run on Apple hardware, meaning third- party developers can produce apps and games that work exclusively with the iPhone Therefore, despite Apple’s questionable and controversial approval policy for iPhone apps developers can code one app that works with 40 million iPhone and iPod Touch devices which is less time consuming than developing several versions of one app for a variety of Windows Mobile smartphones. In turn, that spells out to a larger number of apps in the App Store, which enables Apple’s hardware to cater to a larger and broader audience.
by Berin Szoka & Adam Thierer
The latest call for “search neutrality” and “cloud neutrality” comes from Andrew Odlyzko of the University of Minnesota’s School of Mathematics & Digital Technology Center—and probably among the top ten most influential academics in Internet policy. In his latest Review of Network Economics article “Network Neutrality, Search Neutrality, and the Never-ending Conflict between Efficiency and Fairness in Markets,” Odlyzko shows (discussed by Ars) just how slippery the slippery slope of Net neutrality regulation will be—exactly as we predict in our recent paper “Net Neutrality, Slippery Slopes & High-Tech Mutually Assured Destruction.” Odlyzko concludes:
for pervasive infrastructure services that are crucial for the functioning of society, rules about allowable degrees of discrimination have traditionally applied, and are likely to be demanded for the Internet in the future. Those rules have often been set by governments, and are likely to be set by them in the future as well. For telecommunications, given current trends in demand and in rate and sources of innovation, it appears to be better for society not to tilt towards the operators, and instead to stimulate innovation on the network by others by enforcing net neutrality. But this would likely open the way for other players, such as Google, that emerge from that open and competitive arena as big winners, to become choke points. So it would be wise to prepare to monitor what happens, and be ready to intervene by imposing neutrality rules on them when necessary.
Odlyzko identifies search and cloud computing as the next most likely targets of “neutralization” and explains how calls for regulating these virtual “networks” would flow logically from the current arguments for neutrality mandates at the infrastructure layer:
The net neutrality debate is often pictured as a contest between the two most prominent corporate champions of the opposing sides, AT&T and Google. But the underlying issue predates both companies by centuries. It was never resolved completely, since it arises from a conflict between society’s drives for economic efficiency and for fairness. There is no reason to expect that this conflict will lessen, and instead there are arguments that suggest it will intensify. Should something like net neutrality prevail, the conflict would likely move to a different level. That level might become search neutrality. (And allegations about discriminatory behavior of a web search provider have surfaced recently in China, Tschang (2009).) Or, to take another currently popular concept, if “cloud computing” does become as significant as its enthusiasts claims, it could lead to dominance of a single service provider. The effective monopoly of that dominant player could then become perceived as far more insidious than any of the “walled gardens” or “intelligent network” that telcos would like to build.
There is, of course, an entirely different approach to the issue that does not involve the sort of across-the-board cyber-meddling that Odlyzko suggests: Freedom for all players at all layers of the Net to invest and innovate in the “networks” or “platforms” that offer content, connectivity and services. Continue reading →
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.