Yesterday marked the beginning of the third annual US-China Internet Industry Forum (held this year in SF). The purpose of the gathering is to increase mutual understanding of key business and policy issues in China and the US. It is an invite-only event, so I was excited to be there with top government and technology leaders such as Wikipedia’s Jimmy Wales, Sina.com’s Charles Cao, Harvard law prof John Palfrey (author of Born Digital – loved that book), Microsoft’s Chief Research and Strategy Officer Craig Mundie, Google’s Chief Economist Hal Varian, Baidu’s COO Ye Peng, The FBI’s Jeffrey Troy, China’s Deputy Director of the Internet, Liu Zhengrong, and a bunch of others (eBay, Yahoo, Intel, Facebook, etc). The main topics of discussion were intellectual property, online child protection, and cybercrime.
What struck me most about the discussions was the degree of concern the Chinese attendees showed for intellectual property. Now that China is moving towards a knowledge-based economy, they are realizing that it is in their best interests to do a better job of protecting IP. Most Americans probably don’t realize it, but there is a vibrant start-up community in China and it won’t be long before we start to see more innovation coming from that country.
The event was co-hosted by Microsoft and the Internet Society of China and co-sponsored by Google, eBay, Intel, About.com, Verisign, Akamai, Yahoo, People.com, Xinhuanet.com, China.com.cn, CCTV.com, SOHU.com, Netease.com and Baidu.com.
The disabled have much to give thanks for this year—but contrary to common assumptions, it’s not for paternalistic government accessibility mandates, regulations or subsidies (see, for example, the FCC’s November 6 Broadband Accessibility workshop), but for the good ol’ fashioned private sector ingenuity that has made America great. Five broad categories of examples suggest how constantly-improving computing power and innovation can make life easier for many, if not all, disabled users—and how market forces empower the disabled along with everyone else.
Video transcription. Last week, Google announced “the preliminary roll-out of automatic captioning in YouTube, an innovation that takes advantage of our speech recognition technology to turn the spoken word into text captions.” Google uses the same speech recognition technology it refined with its free Goog-411 and Google Voice services to automatically transcribe video dialog (which can also be automatically translated using Google’s translation engine). Why? Not because of any government mandate, but because of some combination of three factors: (i) it’s an easy way for Google to invest in its “reputational capital,” (ii) the underlying technologies of transcribing videos make videos easier to use for all users, not just the hearing-impaired, and (iii) those technologies also make it possible to contextually target advertising to the verbal content of videos.
It’s worth noting that Hulu currently offers closed captioning for some of its television programming but notes that “closed-captioning data that’s used for broadcast TV isn’t easily translated for online use.” The online television clearinghouse promises to offer more closed-captioning soon. Perhaps they ought to license Google’s algorithmic transcription?
Voice recognition for direct consumer use—most notably, Dragon NaturallySpeaking 10, the latest version of the leading voice recognition software, which was released in summer 2008 but only recently seems to have really hit critical mass. Continue reading →
Arik Hesseldahl has an interesting piece in Business Weekabout 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 →
My colleague (and boss) Adam Thierer had a great post last week about how “fart apps” are a great example of the generative nature of the mobile phone application marketplace. But Fart apps are just one type of “soundboard” application. A typical soundboard app has a bunch of buttons, and each time you press a button a sound is played. Most soundboards play catchphrases from popular movies and TV shows. According to AndroidZoom.com, there are 319 applications in the Android Market with “soundboard” in the title or description. Most (280) of them are free.
Almost all the free soundboards I tried include advertising from Google. The three main developers of soundboard apps for Android are Androidz , aspidoff, and Raz Corp. Androidz has ads from DoubleClick and aspidoff and Raz Corp (who’s apps seem exactly the same) both have ads from AdMob (which Google recently acquired). I’m all in favor of ad-supported content, but I suspect that the sound clips used in these soundboards are not licensed. Continue reading →
Be prepared next week for a cacophony of hand-wringing and prognosticating about retail sales figures reported on “Black Friday.” Retailers traditionally count on holiday shoppers to put them “in the black” for the year with a surge of purchases on the Friday after Thanksgiving.
But if you really want to understand this year’s retail sales picture, wait til the Monday after Thanksgiving. “Black Monday” is day a lot of people return to work, fire up the computer, and begin their online holiday shopping.
Recent reports suggest that the recession has boosted rather than harmed electronic commerce, for one simple reason: the Internet makes it a lot easier to find the best price for many common purchases. Numerous recent posts tell this story:
The most popular online sites on STORES Magazine’s list include those of established merchants, such as Walmart, Best Buy, JC. Penney, and Target. They also include the pure online plays, such as Amazon.com, eBay, and Overstock.com. Craigslist — the site where I hunt for used and free stuff — made Stores’ “Top 50” list for the first time this year. That’s surely a sign that the recession has been a boon to online shopping!
Seems like everywhere I turn someone is gushing about their new Droid phone, including my TLF colleagues Berin Szoka, Braden Cox, and Ryan Radia, who all had great fun rubbing their new toys in my nose over the past couple of days. And why not, it’s a very cool little device. It makes my HTC Touch seems positively archaic in some ways, and it’s only a year old. Apparently, 100,000 people already picked up a Droid in just its first weekend on the market.
But here’s the first thing that pops in my mind every time I see someone showing off their new Droid: How can a device like this even exist when America’s leading cyberlaw experts have been telling us that the whole digital world is increasingly going to hell because of “closed” devices, proprietary code, and managed networks? I’m speaking, of course, about the lamentations of Harvard professors Lawrence Lessig, Jonathan Zittrain, and their many disciples. As faithful readers will recall, I have relentlessly hammered this crew for their unwarranted cyber-Chicken Little-ism and hyper techno-pessimism. (See my many battles with Zittrain [1, 2, 3, 4, 5, 6 + video] and my 2-part debate with Lessig earlier this year).
“Left to itself,” Lessig warned in Code, “cyberspace will become a perfect tool of control.” He went on to forecast a dystopian future in which nefarious corporate schemers would quash our digital liberties unless benevolent public philosopher kings stepped in to save our poor souls. Code was the Old Testament of cyber-collectivism. The New Testament arrived last year with Zittrain’s The Future of the Internet and How to Stop It. In it, we hear the grim prediction that “sterile and tethered” digital technologies and networks will triumph over the more “open and generative” devices and systems of the past. The iPhone and TiVo are cast as villains in Zittrain’s drama since they apparently represent the latest manifestations of Lessig’s “perfect control” paranoia.
If you read nothing else this year about dynamic competition theory and antitrust, check out this recently-released paper by J. Gregory Sidak and David J. Teece, available from SSRN. Sidak and Teece explain why the current economic framework that formally underpins antitrust insufficiently accounts for “Schumpeterian,” “innovative,” or “dynamic” competition. They provide a good discussion of the insights from behavioral economics, evolutionary economics, Austrian economics, and corporate strategy that would be useful in remaking the economic foundations of antitrust. Then they explain implications for specific topics, such as market definition, defining potential competitors, mergers, and intellectual property.
Most intriguing is their claim that the antitrust agencies have been drifting toward dynamic competition analysis without always acknowledging that’s what they’re doing:
If a lesson can be generalized, it is that one should approach with considerable skepticism the august pronouncements of the suppleness of existing antitrust doctrine to accommodate consideration of dynamic efficiency. It is time for the antitrust enforcement agencies and the courts to address forthrightly the challenge of developing more dynamically efficient merger guidelines. Achievement of that goal would lay the foundation for an analogous refinement of substantive rules of liability, defenses, and remedies across antitrust law generally. (pp. 43-44)
Sidak and Teece note that the Federal Trade Commission and Antitrust Division’s recent solicitation of comments on their merger guidelines could provide an opportunity to articulate some new economic foundations for antitrust. After reading the list of things the FTC and DOJ do not intend to change, it looks to me like the agencies will cling pretty fiercely to many traditional static concepts used in antitrust analysis. But two questions they raise provide glimmers of hope:
8. Should the Guidelines be revised to explain more fully … how market shares and market concentration are measured and interpreted in dynamic markets, including markets experiencing significant technological change?
15. Should the Guidelines be updated to address more explicitly the non-price effects of mergers, especially the effects of mergers on innovation?
Still, this seems narrow to me. “Normal” markets will remain subject to static analysis, while those special markets experiencing significant technological change might be analyzed differently. That seems to define dynamic competition awfully narrowly.
I debated PK’s Art Brodsky last week about net neutrality on the international news channel, RussiaToday. Here are a few of my key points of disagreement with Art:
The glittering generality of “Neutrality,” once enshrined in law for one layer of the Internet will be extended, sooner or later, to other layers. As Adam and I have warned, “the same rationale would apply equally to any circumstance in which access to a communications platform is supposedly limited to a few ‘gatekeepers.'” We’re already seeing this with fights over application neutrality and deviceneutrality, and calls for search neutrality are growing.
Art insists that antitrust suits work too slowly. But he doesn’t address the basic question of what standard should govern network management. Should it be “neutrality uberalles” or, if we’re going to regulate in fashion, why shouldn’t we ask what’s good for consumers—the standard proposed by PFF’s 2005 Digital Age Communications Act (DACA)? Neutrality isn’t always best!
Common carriage regulation didn’t work well for railroads (contrary to popular myth) and it worked even less well for communications media, retarding the development of new services like faxes, Internet services and cell phones. Regulating broadband providers the same way will work even more poorly because they aren’t just “big dumb pipes” providing a plain vanilla service and incapable of innovation that can benefit consumers.
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. 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.