Worst. Sentence. Ever.

by on October 28, 2012 · 0 comments

Here it is:

In an era where individuals take to social networks to not only connect with one another, but also share experiences, the “statusphere” as I call it, is transforming a media ecosystem into a very personal EGOsystem.

Let’s start with the awkward phrasings.

An “era” is a time-period, so you’d modify it with “when” not “where.” And why not simply begin the sentence with “When”? Those four letters could have communicated the same thing as the first four words.

Then there’s the tongue-twisting staccato of putting a prepositional phrase that starts with “to” in series with an infinitive. And not just any infinitive: a split infinitive. (I don’t think it’s always wrong to split an infinitive, but there was no need to do so here.)

The parallel between “connect” and “share” should be signaled by saying “to share” rather than letting “share” dangle eight words from the “to” signal.

The failure to set off “as I call it” with commas at both ends makes it unclear whether the author is coining this term in the first instance or distinguishing his version of the term from someone else’s.

And shifting to substance: that term—“statusphere.” Really? No.

The “-sphere” or “-osphere” suffix is a played-out meme generator.

But that is not the only meme plopped in our laps. We also have the unpunny meme, “EGOsystem.”

Oh, I get it. People are too self-oriented on social networks. (The effort is evidently to make an obvious notion seem ready for the cover of Wired circa 1995.)

My point? I haven’t got one, other than: “If you write, learn to write.” And perhaps, “Let your original ideas shine through as clear expression rather than dressing old ideas in gaudy, new words.”

This has been my review of the second sentence in a piece called “The Erosion of Privacy and the Rise of Publicness…and why it’s a good thing” (pre-existing overdone meme, capitalization fail, and indeterminate reference all in original).

Now I’ll go see if I can get through the next sentence.

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Why Doesn’t Everyone Go Prepaid?

by on October 23, 2012 · 2 comments

There’s been a resurgence in interest in non-contract (prepaid) phone plans and MVNOs in tech reporting lately, which makes sense given recent market dynamics.  Prepaid subscriptions number over 100 million, are now 25% of the mobile subscriber market, and Ars Technica recently reported that post-paid subscriptions declined for the first time ever in mid-2012.  Prepaid is definitely attracting people other than the usual lower-income folks, students, and the tech-savvy, who have the patience (or need) to navigate the hurdles prepaid sometimes presents.  The prepaid market has come a long way since Adam wrote about Straight Talk three years ago, and as one of the newest customers of Straight Talk—an MVNO that leases their networks from the Big Four carriers—I’d like to weigh in on these prepaid market challengers.

This post is mostly inspired by a conversation I had with a telecom expert at a recent event.  I asked her if she thought Americans would, like the Europeans have, shift towards prepaid in the next few years.  I was optimistic but she didn’t think Americans would go to a prepaid model anytime soon.  (She did say, however, that some carriers would prefer we switch to a prepaid model.)  So why hasn’t the US market shifted towards prepaid plans like much of the world?  I suspect if we polled economists, carriers, and tech writers, most would agree that prepaid is a better model.  It’s almost always cheaper to use a prepaid plan and you can avoid a two-year contract.  So why hasn’t there been even more adoption of prepaid?  I offer a few possibilities from the demand side (there are likely supply-side issues too, but let’s save that for another day). Continue reading →

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Perry Keller on the relationship between the state and the media

by on October 23, 2012 · 0 comments

Perry Keller, Senior Lecturer at the Dickson Poon School of Law at King’s College London, and author of the recently released paper “Sovereignty and Liberty in the Internet Era,” discusses how the internet affects the relationship between the state and the media. According to Keller, media has played a formative role in the development of the modern state and, as it evolves, the way in which the state governs must change as well. However, that does not mean that there is a one-size-fits-all solution. In fact, as Keller demonstrates using real-world examples in the U.S., U.K., E.U., and China, the ways in which new media is governed can differ radically based upon the local legal and cultural environment.

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Getting Communications & Media Reform Done Right Once and For All

by on October 19, 2012 · 0 comments

Yesterday it was my privilege to speak at a Free State Foundation (FSF) event on “Ideas for Communications Law and Policy Reform in 2013.” It was moderated by my friend and former colleague Randy May, who is president of FSF, and the event featured opening remarks from the always-excellent FCC Commissioner Robert McDowell.

During the panel discussing that followed, I offered my thoughts about the problem America continues to face in cleaning up communications and media law and proposed a few ideas to get reform done right once and for all. I don’t have time to formally write-up my remarks, but I thought I would just post the speech notes that I used yesterday and include links to the relevant supporting materials. (I’ve been using a canned version of this same speech at countless events over the past 15 years. Hopefully lawmakers will take up some of these reforms some time soon so I’m not using this same set of remarks in 2027!)

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Pricing Experimentation & Broadband Usage-Based Pricing

by on October 19, 2012 · 11 comments

We spend a lot of time here defending the simple proposition that flexible free-market pricing is a good thing. You would think that in 2012 we wouldn’t need to do so, but there’s a growing movement afoot today by some academics, regulatory activists, and public policymakers to have government start asserting more authority over broadband pricing. In particular, they want Congress, the FCC, or state officials to investigate and possibly even regulate efforts by wireline and wireless broadband carriers to use usage-based pricing and data caps as a method of calibrating supply and demand. This was the focus of my last weekly Forbes column, “The Specter Of Broadband Price Controls.” In the piece I note that:

Data caps and usage-based pricing are forms of what economists refer to as price discrimination. Although viewed with suspicion by some policymakers and regulatory-minded academics and activists, price discrimination is widely recognized to improve consumer welfare. Price-differentiated and prioritized services are part of almost every industrial sector in our capitalist economy. Notable examples include airline and hotel reservations, prioritized shipping services, amusement park passes, and fuel and energy pricing. Economists agree that price discrimination represents a sensible way to calibrate supply and demand while ensuring the fixed costs of doing business get covered. Consumers benefit from such pricing experimentation by gaining more options while firms gain more certainty about investment and service decisions.

This is confirmed by an excellent new Mercatus Center working paper on “The Impact of Data Caps and Other Forms of Usage-Based Pricing for Broadband Access,” by Daniel A. Lyons, an assistant professor of law at Boston College Law School. Lyons explains why a return to price controls for communications would be monumentally misguided. Continue reading →

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New Paper on Wu’s “Separations Principle” & the War on Vertical Integration in the Tech Economy

by on October 16, 2012 · 0 comments

[UPDATE 4/30/13: This article was subsequently published in Volume 65, Issues 2 of the Federal Communications Law Journal in April 2013. The links below now point to the final FCLJ version.]

The Mercatus Center at George Mason University has just released a new paper by Brent Skorup and me entitled, “Uncreative Destruction: The War on Vertical Integration in the Information Economy.”  Brent, who is the research director for the Information Economy Project at the George Mason University School of Law, and I have been working on this paper since the Spring and we are looking forward to getting it published in a law review shortly. The paper focuses on Tim Wu’s “separations principle” for the digital economy, something I’ve spent some time critiquing here in the past. Here’s the introduction from the 44-page paper that Brent and I just released:

Are information sectors sufficiently different from other sectors of the economy such that more stringent antitrust standards should be applied to them preemptively? Columbia Law School professor Tim Wu responds in the affirmative in his book The Master Switch: The Rise and Fall of Information Empires. Having successfully pushed net-neutrality regulation into the policy spotlight, Wu has turned his attention to what he regards as excessive market concentration and threats to free speech throughout the entire information economy.To support his call for increased antitrust intervention, Wu explains his view of competition in the information economy—a view that deviates substantially from current mainstream antitrust theory.

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Stan Liebowitz on copyright and incentives

by on October 16, 2012 · 0 comments

Stan Liebowitz on copyright and incentivesStan Liebowitz, Ashbel Smith Professor of Economics at the University of Texas at Dallas, discusses his paper, “Is Efficient Copyright a Reasonable Goal?” According to Leibowitz, economists could hypothetically calculate the exact copyright terms necessary to incentivize creators to make new works without allowing them to capture “rents,” or profits above the bare minimum necessary. However, he argues, efficiency might not be the best goal for copyright.

Liebowitz argues from a fairness or justice perspective that society should not favor an economically efficient copyright law, but one that treats creators of copyrighted works the same as workers in other types of industries. In other industries, he argues, workers are allowed to capture and keep rents.

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Event: FCC v. Fox: Broadcast Indecency Law as the New Paradigm for Regulatory Failure

by on October 15, 2012 · 0 comments

This Wednesday the Information Economy Project at George Mason University wil present the latest installment of its Tullock Lecture series, featuring Thomas G. Krattenmaker, former director of research at the FCC. Here is the notice:

Thomas G. Krattenmaker
Former Director of Research, FCC
Former Professor of Law, Georgetown University Law Center
Former Dean and Professor, William and Mary Law School

Wednesday, October 17, 2012

The Information Economy Project at George Mason University
proudly presents The Tullock Lecture on Big Ideas About Information

4:00 – 5:30 pm @ Hazel Hall Room 215
GMU School of Law, 3301 Fairfax Drive, Arlington, Va.
(Orange Line: Virginia Square-GMU Metro)
Reception to Follow in the Levy Atrium, 5:30-6:30 pm

In its June 21, 2012 opinion in FCC v. Fox, the Supreme Court vacated reasoned judgments of the Second Circuit, without one sentence questioning the validity or wisdom of those judgments. Although the Court absolved Fox on a technicality, its opinion appears to reflect a post-modern approach to First Amendment jurisprudence concerning broadcast speech, whereby neither precedent nor principle control outcomes. This indulgent approach to a government censorship bureau appears to acquiesce in an unconfined, unprincipled, and unwarranted seizure of regulatory power by the FCC. The Fox opinion thus compounds and enables a grave regulatory failure; whether any sound broadcast indecency policy or legal regime is feasible is perhaps debatable, but the Federal Communications Commission is wholly incapable of administering such a regime. The lecture will be preceded by a short introduction by Fernando Laguarda.

Register here.

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Leon Panetta: Beware of cyber-derailed trains full of lethal chemicals

by on October 12, 2012 · 1 comment

On the front page of today’s New York Times, Defense Secretary Leon Panetta again sounds the alarm about a "cyber Pearl Harbor.

“An aggressor nation or extremist group could use these kinds of cyber tools to gain control of critical switches,” Mr. Panetta said. “They could derail passenger trains, or even more dangerous, derail passenger trains loaded with lethal chemicals. They could contaminate the water supply in major cities, or shut down the power grid across large parts of the country.”

Defense officials insisted that Mr. Panetta’s words were not hyperbole, and that he was responding to a recent wave of cyberattacks on large American financial institutions. He also cited an attack in August on the state oil company Saudi Aramco, which infected and made useless more than 30,000 computers.

Not hyperbole, hmm? It’s the usual cyber fear two-step. First lay out a doomsday scenario involving hackers remotely derailing trains full of lethal chemicals. Second, cite recent attacks as evidence that the threat is real. Except let’s look at the cited evidence.

Here’s how the New York Times itself described the recent attacks on banks:

The banks suffered denial of service attacks, in which hackers barrage a Web site with traffic until it is overwhelmed and shuts down. Such attacks, while a nuisance, are not technically sophisticated and do not affect a company’s computer network — or, in this case, funds or customer bank accounts. But they are enough to upset customers.

Explosive stuff. And what about that attack on Saudi Aramco? Serious, to be sure, even if no control systems were breached, but as Reuters recently reported,

One or more insiders with high-level access are suspected of assisting the hackers who damaged some 30,000 computers at Saudi Arabia’s national oil company last month, sources familiar with the company’s investigation say. …

The hackers’ apparent access to a mole, willing to take personal risk to help, is an extraordinary development in a country where open dissent is banned.

“It was someone who had inside knowledge and inside privileges within the company,” said a source familiar with the ongoing forensic examination.

What this shows is that one of the greatest threats to networks is not master hackers tunneling their way in, but good old fashioned spies. The cybersecurity legislation that Panetta and the administration are pushing cannot prevent a determined insider with access and permissions from carrying out an attack. It can, however, distort the incentives of businesses and hamper innovation.

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Pandora vs. FM: A case of picking winners and losers

by on October 11, 2012 · 5 comments

A few weeks I wrote an [intentionally provocative post](http://jerrybrito.com/2012/07/25/how-copyright-is-like-solyndra/) comparing copyright to Solyndra. My argument was that just as Congress has a knowledge problem and a public choice problem picking the right technologies to subsidize, so does it have these problems when it comes to picking winners and losers when it comes to setting out the contours of copyright.

I’m grateful for all the [wonderful feedback](https://plus.google.com/u/0/117169003326996777677/posts/TjzX6ZHLTK6) I got on that post, and I agree with those who pointed out that a problem with my analogy was that unlike subsidies to Solyndra, copyright doesn’t pick particular politically connected individuals or companies to privilege. I think it’s much more accurate to say that Congress can use copyright to privilege certain classes of well-organized industries or companies.

A case in point that shows how Congress picks winners and losers is being [debated right now](http://www.theverge.com/2012/9/24/3381396/pandora-internet-radio-royalty-bill): the framework that governs digital music broadcasting royalties for satellite radio and internet radio stations like Pandora. Today you pay a different royalty rate for playing a sound recording (like the lasted LMFAO opus) depending on what kind of radio station you are. Satellite radio stations pay 6 to 8 percent of their gross revenues each year in royalties. Pandora, however, pays around 50 percent, and it will likely be more next year. Meanwhile, traditional AM and FM radio stations pay nothing, zip, zero, zilch.

I won’t get into the public choice problems that may have led to this situation, but the fact is that one legacy industry is not just being subsidized with free access to an essential input (sound recordings), but it is also protected. That protection comes at the expense of a new and innovative industry–internet radio–that is being charged punishing rates for the same essential input.

My colleague Matt Mitchell recently published an excellent paper entitled [The Pathology of Privilege: The Economic Consequences of Government Favoritism](http://mercatus.org/publication/pathology-privilege-economic-consequences-government-favoritism) that catalogs the different ways government has favored particular industries. He also shows how this behavior “misdirects resources, impedes genuine economic progress, breeds corruption, and undermines the legitimacy of both the government and the private sector.” The uneven playing field in the digital music space fits right in with the type of privilege he discussed.

Conservatives and libertarians who are wary of such government extensions of privilege should keep their eye on copyright as the source of many such imbalances.

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