Of the many tech policy-related books I’ve read in recent years, I can’t recall ever being quite so torn over one of them as much as I have been about Jaron Lanier‘s You Are Not a Gadget: A Manifesto.  There were moments while I was reading through it when I was thinking, “Yes, quite right!,” and other times when I was muttering to myself, “Oh God, no!”

The book is bound to evoke such strong emotions since Lanier doesn’t mix words about what he believes is the increasingly negative impact of the Internet and digital technologies on our lives, culture, and economy. In this sense, Lanier fits squarely in the pessimist camp on the Internet optimists vs. pessimists spectrum. (I outlined the intellectual battle lines between these two camps my essay, “Are You An Internet Optimist or Pessimist? The Great Debate over Technology’s Impact on Society.”) But Lanier is no techno-troglodyte. Generally speaking, his pessimism isn’t as hysterical in tone or Luddite-ish in its prescriptions as the tracts of some other pessimists.  And as a respected Internet visionary, a gifted computer scientist, an expert on virtual reality, and a master wordsmith, the concerns Lanier articulates here deserve to be taken seriously— even if one ultimately does not share his lugubrious worldview.

On the very first page of the book, Lanier hits on three interrelated concerns that other Net pessimists have articulated in the past:

1. Loss of individuality & concerns about “mob” behavior (Lanier: “these words will mostly be read by nonpersons–automatons or numb mobs composed of people who are no longer acting as individuals.”)
2. Dangers of anonymity (Lanier: “Reactions will repeatedly degenerate into mindless chains of anonymous insults and inarticulate controversies.”)
3. “Sharecropper” concern that a small handful of capitalists are getting rich off the backs of free labor (Lanier: “Ultimately these words will contribute to the fortunes of those few who have been able to position themselves as lords of the computing clouds.”)

Again, others have tread this ground before, and it’s strange that Lanier doesn’t bother mentioning any of them. Neil Postman, Mark Helprin, Andrew Keen, and Lee Siegel have all railed against the online “mob mentality” and argued it can be at least partially traced to anonymous online communications and interactions. And it was Nick Carr, author of The Big Switch, who has been the most eloquent in articulating the “sharecropper” concern, which Lanier now extends with his “lords of the computing clouds” notion. [More on that towards the end.]

Singularity Silliness & a Kantian Categorical Imperative for High-Tech

Lanier is fairly thoughtful when walking us through these concerns, although at times his passions get the best of him as we’ll see later. He does a nice job asking people to think twice before taking too big of a gulp of the “free culture” kool-aid and extreme varieties of cyber-collectivism.  More broadly, his book is an attack on what he calls “cybernetic totalism,” or the belief by some extreme digital age optimists that a “hive mind” or “noosphere” is coming about; it’s a vision of the Net as an organism powered by the wisdom of crowds. Lanier thinks such thinking is all bunk and, worse yet, that it has dangerous ramifications for humanity and individuality. He is guided by the equivalent of the Kantian categorical imperative:

I take a mystical view of human beings. My first priority must be to avoid reducing people to mere devices. The best way to do that is to believe that the gadgets I can provide are inert tools and are only useful because people have the magical ability to communicate meaning through them. (p. 154).

Lanier is refocusing the inquiry (about the Net’s impact on society & culture) around the question of whether it has bettered the lot of the individual human being, not the group. What he laments is that the early cyberspace dream was supposedly guided by “a sweet faith in human nature,” but this “has been superseded by a different faith in the centrality of imaginary entities epitomized by the idea that the Internet as a whole is coming alive and turning into a superhuman creature.” (p. 14)  Referring to these folks as “digital Maoists,” Lanier argues that this movement “starts to look like a religion rather quickly”:

The Singularity and the noosphere, the idea that a collective consciousness emerge from all the users on the web, echo Marxist social determinism and Freud’s calculus of perversions. We rush ahead of skeptical, scientific inquiry at our peril, just like the Marxists and Freudians. (p. 18)

I too have grown tired of such quixotic techno-utopianism and those Internet pollyannas who sound like they long for the Singularity, global cybernetic consciousness, and life in The Matrix. (Kevin Kelly, I’m looking at you!) But I think Lanier casts this critical net far too wide by suggesting that this thinking has become the dominant mindset among modern digerati. While I agree it has caught on in some circles, I think plenty of others have called out this kookiness or refused to embrace it as a enthusiastically as Lanier suggests.

Lanier’s Critique of the Free Culture / Open Source Movement

Lanier is on safer ground in pushing back against the occasional narrow-mindedness of the free culture / open source movement and their frequently hostility to traditional forms of content creation. Like other Net critics before him, he stresses the occasional downsides of “the wisdom of the crowd” (groupthink, mob-like behavior, puerile comments, etc). And Lanier rightly points out that—contrary to what some free culture / open source advocates would have us think—personal expression and proprietary models have driven some amazing recent innovations, from great video games to Pixar movies to the iPhone. When specifically referring to the work of famed video game innovator Will Wright, creator of The Sims and Spore, Lanier notes:

Wright offers the hive a way to play with what he has done, but he doesn’t create using a hive model. He relies on a large staff of full-time paid people to get his creations shipped. The business model that allows this to happen is the only one that has been proven to work so far: a closed model. You actually pay real money for Wright’s stuff. (p. 132)

And, yet, Lanier notes that, “When Spore was introduced, the open culture movement was offended because of the inclusion of digital rights management software,” and “as punishment for this sin, Spore was hammered by mobs of trolls on Amazon reviews and the like, ruining it public image. The critics also defused what should have been a spectacular debut,” he claims.  I think Lanier makes many fair points here. First, it is certainly true that we occasionally see an entitlement mentality at work with some digital natives who seem to think that intellectual property rights and DRM are akin to a form of slavery. The notion that all intellectual creations must be released immediately into the wild without any constraint, protection, or form of payment is surely the height of digital utopianism, and Lanier is quite right to castigate those who adopt such an approach to culture and its creation.

But, again, one must be careful not to go overboard here. In particular, I think Lanier goes too far when he questions whether open source software has really advanced since the early days of its inception. “Open wisdom-of-crowds software movements have become influential, but they haven’t produced the kind of radical creativity I love most in computer science,” he says. (p. 126) He calls Linux merely “a superbly polished copy of an antique” bit of code, and says that he “long(s) to be made obsolete by new generations of digital culture, but instead I am tortured by repetition and boredom.”  Really? How hard are you looking, Jaron?  Because I believe you can find more—and more interesting—forms of culture today than at any point in human civilization. I’m constantly amazed by the creativity and innovation of all sorts that we see on display every day thanks the Internet and digital technologies— including open source-based efforts.

Generally speaking, I’ve tried to stake out a middle ground, Rodney King (“why-can’t we-all-just-get-along?”) position by arguing that free and open source software (FOSS) and remix culture more generally has offered society enormous benefits, but that FOSS (or collective “wiki” models) will not replace all proprietary business models or methods entirely. Each model or mode of production has its place and purpose and they will continue to co-exist going forward, albeit in serious tension at times.  We should appreciate the benefits of both models and be thankful these distinct modes of cultural production are at work in our modern society and economy.

That said, I find myself increasingly agreeing with Lanier’s worry that “The distinction between first-order expression and derivative expression is lost on true believers of the hive.” He elaborates:

First-order expression is when someone presents a whole, a work that integrates its own worldview and aesthetic. It is something entirely new in the world. Second-order expression is made of fragmentary reactions to first-order expression. A movie like Blade Runner is first order expression, as was the novel that inspired it, but a mashup in which a scene from the movie is accompanied by the anonymous masher’s favorite song in not in the same league.(p. 122)

He’s onto something here. I sometimes find myself perplexed by the amount of remix worship going on in cyberspace and worry that the underlying creativity of the original, first-order work is being downplayed or forgotten. And there are plenty of epigones out there who are butchering someone else’s original work of art on a regular basis. Just search YouTube for the phrase “guitar solo” and be prepared to have your ears violated by those who fancy themselves the reincarnation of Jimi Hendrix or Stevie Ray Vaughn.

Of course, some would claim that a redo, remix, or mashup of first-order creations is the highest form of adoration of that original content—even if it is poorly done. Perhaps. But all too often the focus and adoration is on the redo or remix itself, which often doesn’t share the same degree of creative genius as the underlying first-order expression. And then, of course, there are the sticky copyright / fair use battles. Do I need permission to remix first-order expression?  To be clear, I am not against remix; I made that clear here when commenting on Lessig’s book of the same name. But I generally side with those whose adoration and amazement lies with the original creator(s) of the underlying first-order work. Moreover, I also fear that too often there is a blurring between remix culture and“ripoff culture” (i.e., those who aren’t out to create anything new but instead just take something without paying a penny for it).

For those reasons, I sympathize with Lanier’s critique of the free culture movement when it comes the question of derivative works and how little focus is on the underlying first-order expression. And this is exacerbated when the free culture movement adopts an entitlement mentality regarding access to that first-order expression, regardless of the impact of unlimited use on the first-order creator. Lanier fears that eventually this will result in the loss of a great deal of original culture and creativity:

I don’t claim I can build a meter to detect precisely where the boundary between first- and second-order expression lies. I am claiming, however, that the web 2.0 designs spin out gobs of the latter and choke of the former. It is astonishing how much chatter online is driven by fan responses to expression that was originally created within the sphere of old media and than is now being destroyed by the Net. Comments about TV shows, major movies, commercial music releases, and video games must be responsible or almost as much bit traffic as porn. There is certainly nothing wrong with that, but since the web is killing the old media, we face a situation in which culture is effectively eating its own seed stock. (p. 122)

I’m not sure I would go that far, and in some ways Lanier is undercutting his own argument here since he points out that those free culture fanatics in the webosphere are still plenty enamored with old media!  But his broader concern—about us eating our own seed stock—deserves to be taken seriously. It’s great that the online mob still appreciates professional, first-order cultural production, but will they support it monetarily going forward so that it can be sustained? It’s a fair question.

Lanier’s Short-Sighted Critique of Modern Culture

At other points in the book, Lanier’s critique of the free culture movement and the modern Web 2.0 world goes off the rails because it devolves into a subjective attack on almost all modern culture. I find that many Net pessimists engage in this sort of philomaths-vs-the plebians, elites-vs-common folk critique. In defending the continued importance of professional content creators, proprietary business models, or intellectual property rights, many Net critics unfortunately often feel the need to denigrate all digital era culture or digital natives themselves. Helprin, Keen, and Siegel were guilty of this in the extreme in their books; Lanier somewhat less so here.  But he still does so occasionally throughout the book.

For example, Lanier dismisses most modern culture as “retro” and “a petty mashup of preweb culture.” “It’s as if culture froze just before it became digitally open, and all we can do now is mine the past like salvagers picking over a garbage dump.” (p. 131) I find this argument largely uncompelling and quite myopic. I believe many Net pessimists (and many other cultural critics, for that matter) are guilty of a form of hyper-nostolgia about those mythical “good ‘ol days” when all was supposedly much better. It’s a common refrain we’ve heard from many social and cultural critics before, of course. But the problem with such cultural critiques is that they are highly subjective in nature. And, like many other critics before him, it seems likely that Lanier’s “adventure window” has slammed shut. Our willingness to try new things and experiment with new forms of culture—our “adventure window”—fades rapidly after certain key points in life, as we gradually get set in our ways. Many cultural critics and average folk alike always seem to think the best days are behind us and the current good-for-nothing generation and their new-fangled gadgets and culture are garbage.

But Lanier’s specific assertion that modern culture has “frozen” and is little more than “a petty mashup of preweb culture” demands closer inspection.  I will be guilty of a bit of subjectivity here myself, but looking back over the list I put together here of my choices for “Best Albums Every Year Since Your Birth,” I am struck by how much incredibly innovative music has been made over the past decade. Among my favorites: Muse, The White Stripes, The Flaming Lips, The Secret Machines, Vampire Weekend, The Killers, Modest Mouse, White Lies, Arcade Fire, Them Crooked Vultures, Silversun Pickups, Stufjan Stevens, Wolfmother, The Airborne Toxic Event, Phoenix, Manchester Orchestra… these bands are making some absolutely amazing music.

Now, if by “retro” Lanier means that some of these modern bands draw upon past musical influences well, then, that is pretty much the history of all music in a nutshell!  Consider my favorite rock band of all time: Led Zeppelin.  Zep was creative beyond belief with a thunderous sound that many others have tried, but failed, to reproduce ever since. If you know anything about Zep, however, you realize how profoundly they were influenced by blues artists. Not only are the influences unmistakable, but their first album is practically a tribute to the genre. But then Zep began experimenting with new sounds based on alternative influences and elevated their art to a whole different level. By their third album, they were drawing upon Celtic influences. By their fifth, east Asian influences can be detected. By their last, they were even toying with a bit of disco. So, are we to conclude from this that Zep was “retro” and “a petty mashup of [previous] culture”? The answer is YES! But only in the sense that all musicians are influenced to some degree by those that came before them.  And the same is true of some modern bands like The White Stripes, Wolfmother and Them Crooked Vultures, all of which are clearly influenced by Zeppelin. (Of course, John Paul Jones of Led Zeppelin is also a member of Them Crooked Vultures, so it only makes sense in that case!) Regardless, these are great bands making great original rock music, even if they also draw upon earlier sounds and influences.

In sum, Mr. Lanier and other cultural critics who lament supposed declines in the quality of modern music (or other culture) typically fail to acknowledge the highly subjective nature of their critiques. Moreover, even if we had a metric by which to judge, it is simply much to early to judge how this generation’s music stacks up against previous eras. Regardless, I wish Net critics like Mr. Lanier would stop tying their critiques of the free culture movement to such subjective theories about the supposedly death of quality content or modern culture. It seriously undercuts their case. There are ways to properly express concerns about the potential downsides of the free culture mindset without suggesting the entire digital generation is a lost cause or that all modern culture is moribund.

“Lords of the Cloud” & False Consciousness

I also find Lanier’s “lords of the cloud” critique of social networking and advertising unpersuasive.  Lanier seems to believe that Google, Facebook, MySpace, Twitter, and other Web 2.0 sites are all just part of the hive mind indoctrination scheme. Or, at a minimum, they are turning our brains into Jello: “Something like missionary reductionism has happened to the Internet with the rise of web 2.0,” he claims.  “The strangeness is being leached away by the mush-making process,” and “using computers to reduce individual expression is a primitive, retrograde activity.” (p. 48)  I don’t know what the hell that even means, but Lanier’s general crankiness here goes back to his nostalgic view of the supposed passing of Web 1.0’s halcyon days.  As Glenn Harlan Reynolds noted in his review of Lanier’s book:

Mr. Lanier is nostalgic for that era and its homemade Web pages, the personalized outposts that have largely been replaced by the more standardized formats of Facebook and MySpace. The aesthetics of these newer options might be less than refined, but tens of millions of people are able to express themselves in ways that were unimaginable even a decade ago. And let’s face it: Those personal Web pages of the 1990s are hardly worth reviving. It’ll be fine with me if I never see another blinking banner towed across the screen by a clip-art biplane.

Amen. Most of us who endured the Web 1.0 world wouldn’t want to go back to the floppy disk era for one second, regardless of Lanier’s romantic view of it.  And are Web 2.0 sites really “de-emphasizing individual humans” as Lanier suggests?  I think that would come as a surprise to a lot of other web critics who think such sites over-emphasize humans by allowing us to have the equivalent of the “Daily Me”, or hyper-tailored content and endless interactions with chums. Of course, the reality is somewhere in between: modern social networking sites and Web 2.0 offer opportunities for us to engage in, or view moments of, both beautiful self-expression and embarrassingly excessive narcissistic immaturity.

But even if Lanier could be convinced that Web 2.0 offered more opportunities for exactly the sort of individual excellence he desires, he wouldn’t care because his view of the modern Netizenry is that we are all just mindless sheep who are being ruthlessly exploited by our commercial masters. “The whole artifice, the whole idea of fake friendship, is just bait laid by the lords of the clouds to lure hypothetical advertisers–we might call them messianic advertisers–who could someday show up.” (p. 54) He then goes into some nonsense about social networking sites manipulating people and “violating privacy and dignity.”  What’s ironic about this argument is that Mr. Lanier goes around calling people “digital Maoists” and yet here he is trotting out some classic Marxist tripe about consumer manipulation! As Clive Thompson’s correctly noted in his review of the book:

Lanier’s critique of online life has a strong whiff of the “false consciousness” dicta that gained currency in the aftermath of the New Left. Lanier assumes people are essentially imprisoned by the software around them and are so witless that they aren’t aware of how impoverished their lot has become—Facebook as the high-tech iteration of Plato’s cave. Now, it’s certainly true that software can influence our behavior… But it’s also true that users aren’t so easily controlled. Indeed, the history of technology is full of people using software in ways the designers never intended or even imagined.

Quite right. Indeed, someone as sapient as Lanier should have a little more faith in humanity and their ability to use new tools and adapt to new realities to better the lot of mankind. Sadly, he’s bought into the sad ‘we’re-all-just-sheep-being-led-to-the-slaughter’ view of things.

Conclusion

Despite the reservations I’ve raised here, Jaron Lanier’s You Are Not a Gadget is an important book worthy of your attention. It will certainly find a slot high up on my next end-of-year “Most Important Info-Tech Policy Books” list since we’ll be talking about Lanier’s book for many years to come.

____________

Additional Thoughts on Jaron Lanier’s You Are Not a Gadget:

• review by Michael Agger in Slate
• review by Glenn Harlan Reynolds that appeared in The Wall Street Journal
• a review by Ellen Ullman that appeared in The Washington Post
• a review by Clive Thompson
• New York Times article by John Tierney, “The Madness of Crowds and an Internet Delusion“
• Lanier interview on NPR’s “On Point” with Tom Ashbrook, “Where the Web Went Wrong“
• WNYC radio debate between Nina Paley and Jaron Lanier
• some typically snarky commentary from Mike Masnick of TechDirt
• + Jaron’s personal website and his bio
• + some videos featuring Jaron discussing or debating the themes from You Are Not a Gadget…

A PBS News Hour Debate

Jaron Lanier: Staying Human in a Tech-Driven World from Richard Huskey on Vimeo.

By Berin Szoka & Adam Thierer

We learned from The Wall Street Journal yesterday that “Federal Communications Commission Chairman Julius Genachowski gets a little peeved when people suggests that he wants to regulate the Internet.” He told a group of Journal reporters and editors today that: “I don’t see any circumstances where we’d take steps to regulate the Internet itself,” and “I’ve been clear repeatedly that we’re not going to regulate the Internet.”

We’re thankful to hear Chairman Julius Genachowski to make that promise. We’ll certainly hold him to it. But you will pardon us if we remain skeptical (and, in advance, if you hear a constant stream of “I told you so” from us in the months and years to come). If the Chairman is “peeved” at the suggestion that the FCC might be angling to extend its reach to include the Internet and new media platforms and content, perhaps he should start taking a closer look at what his own agency is doing—and think about the precedents he’s setting for future Chairmen who might not share his professed commitment not to regulate the ‘net. Allow us to cite just a few examples:

Net Neutrality Notice of Proposed Rulemaking

We’re certainly aware of the argument that the FCC’s proposed net neutrality regime is not tantamount to Internet regulation—but we just don’t buy it. Not for one minute.

First, Chairman Genachowski seems to believe that “the Internet” is entirely distinct from the physical infrastructure that brings “cyberspace” to our homes, offices and mobile devices. The WSJ notes, “when pressed, [Genachowski] admitted he was referring to regulating Internet content rather than regulating Internet lines.” OK, so let’s just make sure we have this straight: The FCC is going to enshrine in law the principle that “gatekeepers” that control the “bottleneck” of broadband service can only be checked by having the government enforce “neutrality” principles in the same basic model of “common carrier” regulation that once applied to canals, railroads, the telegraph and telephone. But when it comes to accusations of “gatekeeper” power at the content/services/applications “layers” of the Internet, the FCC is just going to step back and let markets sort things out? Sorry, we’re just not buying it.

Chairman Genachowski may sincerely believe that a clear, bright line can be drawn between the “infrastructure layer” (which he’s certainly going to regulate) and what he likes to think of as “the Internet” (which he promises not to regulate). But as we warned last October, the day after the FCC launched this NPRM:

The promise made yesterday by the FCC—to only apply neutrality principles to the infrastructure layer of the Net—is hollow and will ultimately prove unenforceable. The reality is that regulation always spreads. The march of regulation can sometimes be glacial, but it is, sadly, almost inevitable: Regulatory regimes grow but almost never contract… The basic premise of neutrality regulation is already being proposed for other layers of the Internet….  whatever the FCC might say today, any large online intermediary with a popular platform potentially faces the threat of “network neutrality” mandates—because every platform is essentially a “network,” too. We’re not just talking about “search neutrality” (Google as well as Microsoft) but also about “device neutrality” (mobile handsets), “app neutrality” (Apple’s iTunes store, Facebook’s developers and Google’s Android mobile OS) and so on for social networking, email, instant messaging, online advertising, etc.

We explained how the intellectual foundations for this regulatory creep have already been laid by groups like Free Press and Public Knowledge and law professors like Columbia’s Tim Wu (father of “Net Neutrality”), Harvard’s Jonathan Zittrain (father of “API/device Neutrality”), and Seton Hall’s Frank Pasquale (father of “Search Neutrality”). Joining this intellectual vanguard of Internet regulation is George Washington law school professor Dawn Nunziato, whose new book, Virtual Freedom: Net Neutrality and Free Speech in the Internet Age, is a veritable manifesto for expansive neutrality regulation (especially of Google)—and how the First Amendment (“Congress shall make no law…”) should be twisted not just to allow such regulation of speech platforms, but to require it! Even Wu, whose work blazed a trail for these others, is pretty clear about the breadth of his original vision for “neutrality” regulation, as his popular Net Neutrality FAQ makes clear:

The promotion of network neutrality is no different than the challenge of promoting fair evolutionary competition in any privately owned environment, whether a telephone network, operating system, or even a retail store. Government regulation in such contexts invariably tries to help ensure that the short-term interests of the owner do not prevent the best products or applications becoming available to end-users.

Zittrain, Pasquale, and Nunziato don’t pull any punches either: They don’t shy away from flirting with nebulous neutrality definitions and wide-ranging government powers to regulate. So we don’t have to imagine what the “slippery slope” might look like: There are plenty of very smart and highly influential legal academics out there hard at work sketching out precisely where the path Chairman Genachowski has started us down will ultimately lead.

It’s no less clear why we’ll wind up marching down that path, no matter what the current FCC leadership intends.

1. The current net neutrality rulemaking sets a profoundly dangerous legal precedent of essentially unlimited claims of “ancillary jurisdiction”: As our friends at the Electronic Frontier Foundation (who have a soft spot for net neutrality in theory) put it, “If ‘ancillary jurisdiction’ is enough for net neutrality regulations (something we might like) today, it could just as easily be invoked tomorrow for any other Internet regulation that the FCC dreams up (including things we won’t like).” Our PFF colleague Barbara Esbin carefully dissected this issue for the Commission in her recent filing in this proceeding.
2. As explained above, the general regulatory principle of controlling “gatekeepers” doesn’t end with infrastructure.
3. As EFF notes, “Experience shows that the FCC is particularly vulnerable to regulatory capture.”
4. Now that FCC has opened the door to micro-managing online business practices in the name of “neutrality,” the companies that have made America the leader in the Digital Revolution are already turning on each other in a dangerous game of brinksmanship, escalating demands for regulation and playing right into the hands of those who want to bring the entire high-tech sector under the thumb of government—under an Orwellian conception of “Internet Freedom” that makes corporations the real “Big Brother,” and government, our savior.

This strategy of political escalation will thus quickly steamroll over whatever promises made today to narrowly cabin the principle of neutrality regulation—and end in “Mutually Assured Destruction.” That’s why we referred to the day the FCC started down this path back in September as “The Day Internet Freedom Died.”

If that title sounds melodramatic, take a step back and consider that, back in 1996, Congress decided to enshrine in law the principle that the Internet is different from traditional media: Apart from an ill-considered effort to censor online indecency and obscenity (which was quickly struck down by the Supreme Court as unconstitutional) and the enforcement of intellectual property and criminal laws, Congress decided to take a purely laissez-faire approach to the Internet.  As Barbara reminded the Commission in her net neutrality filing, “Section 230(b)(2) flatly declares that it is the policy of the United States ― to preserve the vibrant competitive free market that presently exits for the Internet and other interactive computer services, unfettered by Federal or State regulation.”

So Chairman Genachowski’s decision to revert to the common carrier model of the railroad era marks a fundamental break with the approach Congress decided we would take to the Internet. The DC Circuit will likely soon rule that the FCC has vastly overstepped its authority in trying to set Internet policy without any clear grant of authority from Congress to do so.

Wireless Innovation & Investment Notice of Inquiry

In fact, the same kind of thinking is already being extended by this FCC in a number of other arenas using a flurry of innocuous-seeming “Notices of Inquiry.” While these notices purport only to ask questions, they either:

1. Foreshadow where the Commission intends to go in proposing new regulations based on its nearly limitless conception of its own regulatory authority;
2. Are intended to pressure Congress to give the agency more statutory authority; or
3. Are intended to intimidate industry into “playing ball” so the FCC won’t actually have to stick its neck out by trying to write rules to regulate Internet activities that are clearly beyond its existing authority and might well be unconstitutional even if Congress ever did expand that authority.

Exhibit A is the language in the Commission’s August 2009 Wireless Innovation and Investment Notice of Inquiry, (paragraph 60, pg. 21) that suggests the FCC is angling to become the Federal Cloud Commission:

As other approaches, such as cloud computing, evolve, will established standards or de facto standards become more important to the applications development process? For example, can a dominant cloud computing position raise the same competitive issues that are now being discussed in the context of network neutrality? Will it be necessary to modify the existing balance between regulatory and market forces to promote further innovation in the development and deployment of new applications and services?

Good morning, Google!  Hello, Facebook! Is anyone out there in the cloud listening to the rumbling thunder of federal regulation? What began as academic theory in a law school ivory tower is coming soon to a regulatory agency near you! But wait… there’s more!

National Broadband Plan Public Notice #21 (Cloud Computing)

Last November, as part of the Commission’s ongoing effort to develop a National Broadband Plan, the FCC released a request for information “on data portability and its relationship to broadband.”  (NBP Public Notice #21) “The Commission seeks tailored comment on broadband and portability of data and their relation to cloud computing, transparency, identity, and privacy,” the notice says.  Here was the second item on the list of things the Commission said it was investigating (p. 2):

When considering the portability of data, we also consider the processes through which data are moved. In this context, we seek comment on how to identify and understand cloud computing as a model for technology provisioning…. What types of cloud computing exist (e.g., public, hybrid, and internal) and what are the legal and regulatory implications of their use? … To what extent are consumers protected by industry self-regulation (e.g., the Cloud Computing Manifesto), and to what extent might additional protections be needed? … What specific privacy concerns are there with user data and cloud computing? What precautions should government agencies take to prevent disclosure of personal information when providing data? Is the use of cloud computing a net positive to the environment? Are there specific studies that quantify the environmental impact of cloud computing?

We suppose some might claim there’s nothing wrong with the FCC looking into these issues, and that the agency’s interest in cloud computing is entirely benign. (Never mind the fact that the Federal Trade Commission already enforces the privacy policies of cloud computing providers and is looking hard at online privacy.)  Seeing all these open-ended questions about something so obviously beyond the scope of the FCC’s authority just makes the potential for—and perhaps even inevitability of—regulatory creep hard to miss.  Eventually, when a regulatory agency asks enough questions, especially the sort of questions highlighted above… well, to paraphrase Master Yoda:

Open-ended inquiries about new regulations are the path to the Dark side. Inquiries lead to agency oversight. Agency oversight leads to regulation. Regulation leads to suffering for innovators and consumers alike.

Again, we’re not just inventing bogeymen here. It’s quite clear that regulatory advocates want to take neutrality regulation into “the Cloud.” As Jason Lanier, author of the popular book You Are Not a Gadget summarizes one of his key themes:

While there is a lot of talk about networks and emergence from the top American technologists, in truth, most of them are hoping to thrive by controlling the network that everyone else is forced to pass through. Everyone wants to be a “Lord of a Computing Cloud.”

In Lanier’s dystopia of techno-feudalism, the Lords oppressing the poor digital “peasants” certainly aren’t just those running broadband service providers. It’s the Google, Facebooks, and Twitters of the world. It’s similar to the “sharecropper” concern raised by Nick Carr in his book The Big Switch. Complaints like those will only grow in the years to come, and few will buy—or even pause to remember—the distinction Chairman Genachowski seems to stand on now between infrastructure and “the Internet.”

National Broadband Plan Public Notice #29 (Privacy)

The “Recovery Act” passed in January 2009 tasked the FCC with formulating “a detailed strategy for achieving affordability of such service and maximum utilization of broadband infrastructure and service by the public.” The FCC seized this as an opportunity to solicit suggestions as to how regulate the use and collection of data by the private sector on the grounds that concerns about privacy might somehow be slowing broadband adoption.

Chairman Genachowski’s flurry of open-ended inquiries about new regulation are clearly intended to give a bully pulpit to regulatory advocates to demand that the FCC issue the very sort of Internet regulations the Chairman purports to abhor (or that Congress give the agency authority to do so). But most of these notices at least appear to be objective requests for comments written independently of the groups the Commission seems so eager to hear beg for Internet regulation. But in this case, the Commission dispensed with that tedious formality and just outsourced the writing of the inquiry itself to one of the outside groups clamoring the loudest for data regulation in the name of “privacy”: our friends at the Center for Democracy & Technology, with whom PFF has worked closely on many free speech issues in the past.

CDT is on to something when they write that “Consumers will not embrace broadband if they have a sense that everything they do online will be watched by government officials.” We’ll join with them in the fight to protect consumers’ privacy from the Real Big Brother—government!—but once again, as with net neutrality, advocates of regulation see government as the protector of our digital liberties (if only we can forever make sure noble civil-libertarians are in charge of the regulatory apparatus of the state!). So CDT has it exactly backwards when they say: “Consumer privacy concerns encompass not only what companies do with their data, but also the extent to which the government accesses it.” And instead of just suggesting that the FCC’s National Broadband Plan include a recommendation that Congress clean up the antiquated laws intended to limit government surveillance, CDT pushes for sweeping regulations that would affect the ability of most online services and sites to collect and use the data they need to improve their services, innovate, and maybe even try to make some money on advertising to support all the free content and services they give away.

Thus, instead of focusing on the clear harm from government, the FCC’s outsourced inquiry goes after online operators as “privacy proxies” for concerns about government action. At least Congress actually asked for the FCC’s recommendations in this case, unlike all the other inquiries the agency has launched sua sponte. But as Berin noted in his comments on this inquiry, the Recovery Act allowed the FCC to “recommend only those policies that it concludes will, on net, help achieve “affordability” and ‘maximum utilization’ of broadband.” That means the Commission would actually have to consider the many trade-offs inherent in the private sector use of data before recommending regulation: If the Internet ecosystem is impoverished by government intervention, however well-intentioned it may be, users will have that much less reason to adopt and “utilize broadband.” So the FCC would have a lot of cost-benefit analysis to do before it could actually make the kinds of regulatory recommendations CDT wants. And we suspect that, on the whole, that analysis wouldn’t turn out the way CDT thinks it would.

Child Safe Viewing Act Notice of Inquiry

In a somewhat similar vein, Congress last year asked the agency to examine how well parental control technologies work to allow parents to filter objectionable content online. So while the FCC may have had, for once, the authority to ask broad questions, it’s startling just how broad those questions were. The Commission obviously has no authority over video games or virtual worlds, online video distribution networks or video hosting sites, mobile web content, MP3 players or iPods, P2P networks, VCRs or DVD players, PVRs or TiVo, Internet filters, safe search tools, laptops, and so on. And yet, all these things (and much more) were mentioned in the Commission’s Child Safe Viewing Act Notice of Inquiry.

The proceeding raises the prospect of what Adam has called “convergence era content regulation” since it opens the doors to FCC meddling on a number of new fronts in the name of “protecting children.” Although the Commission’s final report to Congress stopped short of calling for an substantive expansion of the agency’s content regulatory regime, it teed up another proceeding, discussed next. (And if Congress hasn’t moved more quickly to grant the FCC new power in this area, it’s probably because they’re busy trying to figure out how to get around a line of First Amendment cases that consistently require government regulation to yield to “less restrictive” alternatives like parental control tools and education.)

Empowering Parents & Protecting Children Notice of Inquiry

This wide-ranging inquiry reads like the ultimate “fishing expedition” by a regulatory agency—fishing for new jurisdictional authority to regulate, that is!  The questions asked are too broad, far-flung and various to catalog here (we’ll have a big filing coming in the matter soon), but the Commission asks about extending to Internet media the model of the 1990 Children’s Television Act, which imposes “public interest” obligations on broadcasters and cable operators to offer “education” content while also strictly limiting how much advertising may be shown during children’s TV. The Commission also alludes, ominously, to the V-chip model for requiring universal ratings for television and hints that it would really like for “current laws [to] be updated to reflect this convergence and to keep pace with changes in technology” (¶ 41).

The Commission mentions only in passing at the very end of the Inquiry that it “has varying degrees of statutory authority with respect to different media. We ask commenters, in proposing any action, to discuss the source and extent of the Commission’s authority to take the action, or whether new legislation would be needed to authorize such action” (¶ 58). Translation: “Uh, yeah… so… we know we don’t have a statutory leg to stand on here, but we think it’d be really cool if we did, so let’s just all, you know, kinda brainstorm about what kind of regulation we could be imposing here and what kind of law we’d need get Congress to pass to make it all legal. Or if you have any creative ideas on how we could get away with just making up the jurisdiction thing on our own, that’d be even better!”

YouTube, you’re first on the list of targets for the kind of online video regulation the FCC is hinting at here—and none too subtly. But why stop there? The FCC’s laundry list of complaints aren’t limited just to video, but could apply to essentially all online media. But this is all in the name of “protecting the children,” and Chairman Genachowski doesn’t want to regulate the Internet, so we really don’t need to worry—right?

Future of Media Notice of Inquiry

Most recently, in late January, the Commission launched the ambitiously-named “Examination of the Future of Media and Information Needs of Communities in a Digital Age.” The FCC asks a number of good questions about how government could get out of the way of media struggling to reinvent themselves in the digital era by scrapping outdated regulations. The inquiry also tips its hat to the vital importance of advertising in supporting media. But it’s otherwise pretty bad news as a harbinger of a “Chill Wind” for the future of a free press in this country, as Ken Ferree, PFF’s former president and current board member noted.

In particular, the Commission comes right out with a “trial balloon” about imposing public interest obligations on online operators—the very thing it hinted at slightly more delicately in the “Empowering Parents” inquiry mentioned above:

Broadcasters have certain public interest obligations, including that they provide programming responsive to the needs and issues of their communities and comply with the Commission’s children’s programming requirements. Cable and satellite operators have their own responsibilities…  Should such obligations be applied to a broader range of media or technology companies, or be limited in scope?

OK, so we’re not going to “regulate” online content operators; we’re just going to impose “public interest” obligations on them to provide certain kinds of content preferred by politicians. Right… and if Google News or YouTube don’t do enough to “serve the public interest,” what then? Will the Federal Search Commission take away Google’s search license or cloud computing license?

Of course, we don’t mean to suggest that even the “Federal Cloud Commission” would ever be so unsubtle as to create a formal licensing system when they can probably achieve the same ends with far less obvious regulation. But how is this all going to work, exactly? Again, this is exactly the kind of hopelessly vague regulatory morass Congress had in mind when it declared that the federal government would avoid “fettering” the “vibrant competitive free market … for the Internet and other interactive computer services” with regulation.

The FCC goes on to revive the kinds of broad net neutrality ideas discussed above in asking:

How would policies related to “open Internet” or “universal broadband” or other FCC policies about communications infrastructure affect the likelihood that the Internet will meet the information needs of communities? Are there search engine practices that might positively or negatively affect web-based efforts to provide news or information?

In other words, “Tell us why and precisely how we should start regulating search engines in order to help ‘save  news.'” Google, here’s looking at you, kid! You want to keep your search license, dontcha? Well, just do what the nice men from Washington want and there won’t be any trouble.

Finally, the Commission opens the door to the noxious proposal for a “public option” for media, which Adam has lambasted. Here’s what the Commission says:

In general, what categories of journalism are most in jeopardy in the digital era? What categories are likely to flourish? While much is still to be determined as media companies test various business models and payment approaches in the coming years, based on what is known now, are there news and information needs that commercial market mechanisms alone are unlikely to serve adequately?

Don’t worry, it’s not as if government will exercise control over the media companies it funds if the media-socialist fantasies of the neo-Marxist Robert McChesney and his ironically-named “Free Press” group actually come true. Nope, government’s just here to help!

We’d all do well to remember that subsidies always come with strings attached—namely, regulation. That’s the Golden Rule: “He who has the gold, makes the rules!”

Conclusion

Chairman Genachowski, with all due respect, if you don’t like people suggesting that the FCC may be positioning itself to regulate the Internet and digital media platforms, then you might want to take a careful look at what your agency has been doing. You should think hard both about the precedents that will be set by “neutrality” regulation for online content and services, and also about the quasi-regulatory effect that your agency’s flurry of open-ended inquiries will have on the operators you claim not to want to regulate.

What will future Chairmen do with these precedents? What will emerge from every “Pandora’s Box” you’ve opened with each new sweeping inquiry? The answer, we fear, is an endless parade of new Internet regulations—and the death by a thousand cuts of real Internet freedom.

I’ve written before about my dislike of “the cloud.”

The term implies that there aren’t specific actors doing specific things with data, which will tend to weaken people’s impression that they have rights and obligations when using or providing cloud services. We’re talking privacy problems.

When “cloud” services fail, the results can be widespread and significant. Think of cloud computing as a sibling of security monoculture.

TechDirt’s indefatigable Mike Masnick reminds us of this with a tweet today about hiccups in Google Calendar that may have prevented him getting on a conference call. He’s written once or twice about the cloud in terms of legal/discovery issues, privacy issues, and business/regulatory hurdles.

Remote computing is not going away, but it’s a fad that should fade over time. I think I hit the right notes in an earlier post where I said:

There will always be a place for remote storage and services—indeed, they will remain an important part of the mix—but I think that everyone should ultimately have their own storage and servers. (Hey, we did it with PCs! Why not?) Our thoroughly distributed computing, storage, and processing infrastructure should be backed up to—well, not the cloud—to specific, identifiable, legally liable and responsible service providers.

Hmmm… What am I missing? I cannot lay my finger on a single line in the Communications Act of 1934, the Telecommunications Act of 1996, or any statute in between that gives the Federal Communications Commission (FCC) the authority to regulate cloud computing.  And yet, like any good stickler for jurisdictional authority, my PFF colleague Barbara Esbin keeps bringing to my attention little FCC chirps here and there which suggest that the agency is slowly positioning itself to become the Federal Cloud Commission. For example, back in September, Barbara brought to my attention this passage in the Commission’s recent Wireless Innovation and Investment Notice of Inquiry, (paragraph 60, pg. 21):

As other approaches, such as cloud computing, evolve, will established standards or de facto standards become more important to the applications development process? For example, can a dominant cloud computing position raise the same competitive issues that are now being discussed in the context of network neutrality? Will it be necessary to modify the existing balance between regulatory and market forces to promote further innovation in the development and deployment of new applications and services?

In my earlier essay about this, I noted that these questions should serve as a wake-up call for Google and other cloud-based providers who think that “neutrality” mandates will end at the infrastructure layer of the Net.  As Berin Szoka and I argued in our paper on “high-tech mutually assured destruction,” regulatory regimes grow but almost never contract.  And I’m even less optimistic about the FCC limiting its regulatory aspirations after the latest thing Barbara Esbin brought to my attention.

Today, as part of the Commission’s ongoing effort to develop a National Broadband Plan, the FCC released a request for information “on data portability and its relationship to broadband.”  (NBP Public Notice #21) “The Commission seeks tailored comment on broadband and portability of data and their relation to cloud computing, transparency, identity, and privacy,” the notice says.  Here was the second item on the list of things the Commission said it was investigating:

Cloud computing. When considering the portability of data, we also consider the processes through which data are moved. In this context, we seek comment on how to identify and understand cloud computing as a model for technology provisioning.

1. The National Institute of Standards and Technology defines cloud computing as “a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction.” Does this definition accurately capture the concept of cloud computing?
2. What types of cloud computing exist (e.g., public, hybrid, and internal) and what are the legal and regulatory implications of their use?
3. Can present broadband network configurations handle a large-scale shift in bandwidth usage that a rapid adoption of cloud computing might cause?
4. How does cloud computing affect the reliability, scalability, security, and sustainability of information and data?
5. To what extent can the federal government leverage cloud solutions to improve intra-agency processes, intergovernmental coordination, and civic participation?
6. What impact do developments in cloud computing have with respect to broadband deployment, adoption, and use?
7. How can various parties leverage cloud computing to obtain economic or social efficiencies? Is it possible to quantify the efficiencies gained?
8. To what extent are consumers protected by industry self-regulation (e.g., the Cloud Computing Manifesto), and to what extent might additional protections be needed?
9. What specific privacy concerns are there with user data and cloud computing?
10. What precautions should government agencies take to prevent disclosure of personal information when providing data?
11. Is the use of cloud computing a net positive to the environment? Are there specific studies that quantify the environmental impact of cloud computing?

I suppose some might claim there’s nothing wrong with the FCC looking into these issues, and that the agency’s interest in cloud computing is entirely benign.  But when it read all these questions about cloud computing in recent FCC notices, I can’t help but thinking about the potential for regulatory creep.  Eventually, when a regulatory agency asks enough questions — especially the sort of questions bolded above — it leads to more agency oversight.  And more agency oversight typically leads to some sort of agency regulation.

Or perhaps I’m just being paranoid.

Regardless, at a minimum, would someone at least tell me where the FCC gets the authority to even ask these questions?  Or do we live in such a Bold New World of progressive government that little encumbrances like statutory authority can be thrown to the wind?   Years from now, some might look back and ask the question that Nobel Prize-winning economist Ronald Coase asked 50 years ago about the FCC and spectrum regulation:  “How did the commission come to acquire this power?”  But I’d like to know the answer to that question right now regarding the FCC’s growing interest in cloud computing.

by Berin Szoka & Adam Thierer, Progress Snapshot 5.11 (PDF)

Ten years ago, Nobel Prize-winning economist Milton Friedman lamented the “Business Community’s Suicidal Impulse:” the persistent propensity to persecute one’s competitors through regulation or the threat thereof. Friedman asked: “Is it really in the self-interest of Silicon Valley to set the government on Microsoft?” After yesterday’s FCC vote’s to open a formal “Net Neutrality” rule-making, we must ask whether the high-tech industry—or consumers—will benefit from inviting government regulation of the Internet under the mantra of “neutrality.”

The hatred directed at Microsoft in the 1990s has more recently been focused on the industry that has brought broadband to Americans’ homes (Internet Service Providers) and the company that has done more than any other to make the web useful (Google). Both have been attacked for exercising supposed “gatekeeper” control over the Internet in one fashion or another. They are now turning their guns on each other—the first strikes in what threatens to become an all-out, thermonuclear war in the tech industry over increasingly broad neutrality mandates. Unless we find a way to achieve “Digital Détente,” the consequences of this increasing regulatory brinkmanship will be “mutually assured destruction” (MAD) for industry and consumers.

New Fronts in the Neutrality Wars

The FCC’s proposed rules would apply to all broadband providers, including wireless, but not to Google or many other players operating in other layers of the Net who favor such broadband-specific rules. With this rulemaking looming, AT&T came after Google with letters to the FCC in late September and then another last week accusing the company of violating neutrality principles in their business practices and arguing that any neutrality rules that apply to ISPs should apply equally to Google’s panoply of popular services. In particular, AT&T accused Google of “search engine bias,” suggesting that only government-enforced neutrality mandates could protect consumers from Google’s supposed “monopolist” control.

The promise made yesterday by the FCC—to only apply neutrality principles to the infrastructure layer of the Net—is hollow and will ultimately prove unenforceable. The reality is that regulation always spreads. The march of regulation can sometimes be glacial, but it is, sadly, almost inevitable: Regulatory regimes grow but almost never contract. Indeed, in some ways, the prediction we made just three weeks ago is already coming true: The basic premise of neutrality regulation is already being proposed for other layers of the Internet—and not just by AT&T in retaliation. One need not agree with all of AT&T’s accusations to recognize that, whatever the FCC might say today, any large online intermediary with a popular platform potentially faces the threat of “network neutrality” mandates—because every platform is essentially a “network,” too. We’re not just talking about “search neutrality” (Google as well as Microsoft) but also about “device neutrality” (mobile handsets), “app neutrality” (Apple’s iTunes store, Facebook’s developers and Google’s Android mobile OS) and so on for social networking, email, instant messaging, online advertising, etc.

An open letter sent to FCC Chairman Julius Genachowski this week by 28 founders and CEOs of leading application providers—including Amazon, Google, Facebook, Netflix, Craigslist, Sony and Twitter—speaks generally about the need for the FCC to enforce a “guarantee of neutral, nondiscriminatory access by users.” While many of these signatories may have in mind ISPs as the network “gatekeepers” that need to be reined in by the FCC, the more successful among them are likely to find this letter used against them in the future—perhaps even by co-signatories—to advance a broad conception of what the government must do to ensure “openness” and “access” for platforms at all layers of the Internet.

Dumb Networks, Dumb Devices

The intellectual foundations for this regulatory creep have already been laid by groups like Free Press and Public Knowledge and law professors like Columbia’s Tim Wu, Harvard’s Jonathan Zittrain and Seton Hall’s Frank Pasquale. As originally conceived by Tim Wu in 2003, “network neutrality” is not unique to broadband networks: “the basic economic problem found in the network neutrality debate (a form of ‘platform exclusion’ or ‘vertical foreclosure’) can be found in many other markets.” Indeed, Wu’s popular Net Neutrality FAQ declares:

The promotion of network neutrality is no different than the challenge of promoting fair evolutionary competition in any privately owned environment, whether a telephone network, operating system, or even a retail store. Government regulation in such contexts invariably tries to help ensure that the short-term interests of the owner do not prevent the best products or applications becoming available to end-users.

Zittrain picked up where Wu left off in The Future of the Internet and How to Stop It—attacking, as the enemies of innovation, not ISPs but the supposedly “closed” platforms of Apple, TiVo and Microsoft’s Xbox. Zittrain warns that:

If there is a present worldwide threat to neutrality in the movement of bits, it comes not from restrictions on traditional Internet access that can be evaded using generative PCs, but from enhancements to traditional and emerging appliancized services that are not open to third-party tinkering.

Zittrain’s general solution is “API [Applications Programming Interface] neutrality:” If you create a platform (whether hardware or software) and begin allowing third-party contributions (“generativity”), you will lose all control over devices or applications that can run on that platform.

Those who offer open APIs on the Net in an attempt to harness the generative cycle ought to remain application-neutral after their efforts have succeeded, so all those who built on top of their interface can continue to do so on equal terms…. [N]etwork neutrality ought to be applied to the new platforms of Web services that, in turn, depend on Internet connectivity to function.

Clearly, if Zittrain and his allies have their way, the sort of neutrality mandates envisioned by the FCC or some Congressmen for ISPs will eventually cover companies such as Apple, Google, Facebook, Myspace, Twitter and Amazon—all singled out by Zittrain in a New York Times op-ed in July:

If the market settles into a handful of gated cloud communities whose proprietors control the availability of new code, the time may come to ensure that their platforms do not discriminate. Such a demand could take many forms, from an outright regulatory requirement to a more subtle set of incentives — tax breaks or liability relief — that nudge companies to maintain the kind of openness that earlier allowed them a level playing field on which they could lure users from competing, mighty incumbents.

Frank Pasquale agrees on the need to restrain all “the dominant players at all layers of online life,” but focuses on his demand for a Federal Search Commission to control supposedly “biased” search results. While the FCC wrings its hands over “managed services” offered by ISPs, search engines are increasingly offering their own value-added services by “blending” algorithmically-derived results with special features like maps, videos, books or music depending on what the search term suggests the user is interested in. “Artificially” ensuring that these features appear on the first page of search results is clearly non-neutral, and necessarily involves search engines making ”managed” decisions as to whose features to include. Yet such features also clearly benefit users—dramatically improving the usefulness of search engines and helping to sustain struggling business models like music retailing.

But one need not resort to the works of “ivory tower” academics to see the slippery slope we’re already tumbling down with the infinitely elastic principle of “neutrality.” The prospect of the FCC gradually transforming into a “Federal Information Commission” becomes more apparent when one reads the Wireless Innovation and Investment Notice of Inquiry recently released by the FCC:

As other approaches, such as cloud computing, evolve, will established standards or de facto standards become more important to the applications development process? For example, can a dominant cloud computing position raise the same competitive issues that are now being discussed in the context of network neutrality? Will it be necessary to modify the existing balance between regulatory and market forces to promote further innovation in the development and deployment of new applications and services?

One can imagine how some might use such language to accuse Google of being in “a dominant cloud computing position” such that “the context of network neutrality” will be applied to cloud service (like Google Voice) to “modify the existing balance between regulatory and market forces” through regulation. Indeed, that’s precisely what AT&T has suggested in recent letters (September 25 ^th and October 14 ^th) to the FCC.

AT&T’s partner Apple has already been the subject of such attacks for its decision to block the Google Voice app earlier this summer. The incident marked the beginning of open warfare between Google and AT&T/Apple. The FCC quickly jumped into the mix, first questioning how Apple manages its iTunes apps store for the iPhone, then questioning how Google runs its free Voice application. What legal authority the FCC has over either service is far from clear, but Apple seems to have gotten the message: It recently approved the Spotify music streaming app for the iPhone, which could be a serious competitive threat to the iTunes music store. This small incident highlights how easily regulators can impose their will through informal mechanisms like open-ended investigations even without clear authority to issue rules or bring enforcement actions. Yet none dare call it what it is: regulatory blackmail.

The Inevitability of Regulatory Capture

No doubt, other industry players will cheer on such regulatory harassment of the titans of tech—and maybe even demand more of it. Regulatory creep is driven by more than the self-interests of every bureaucracy to expand its own mission, budget and staff. As the Electronic Frontier Foundation has noted, “Experience shows that the FCC is particularly vulnerable to regulatory capture.” While lobbyists play an important role in defending business from government, all too many businesses naively look at government as a beast that can be tamed, trained, and turned to one’s own advantage, and often try to use the expanding regulatory apparatus to their own advantage or simply throw their competitors under the bus to save themselves. The result is a Hobbesian regulatory “war of all against all” within industry.

As Professor Alfred E. Kahn explained in his 2-volume opus, The Economics of Regulation, all regulation—however high-minded—is inevitably captured by special interests because:

When a commission is responsible for the performance of an industry, it is under never completely escapable pressure to protect the health of the companies it regulates, to assure a desirable performance by relying on those monopolistic chosen instruments and its own controls rather than on the unplanned and unplannable forces of competition. […] Responsible for the continued provision and improvement of service, [the regulatory commission] comes increasingly and understandably to identify the interest of the public with that of the existing companies on whom it must rely to deliver goods.

If Internet regulation follows the same course as other industries, the FCC and/or lawmakers will eventually indulge calls by all sides to bring more providers and technologies “into the regulatory fold.” Clearly, this process has already begun. Even before rules are on the books, the companies that have made America the leader in the Digital Revolution are turning on each other in a dangerous game of brinksmanship, escalating demands for regulation and playing right into the hands of those who want to bring the entire high-tech sector under the thumb of government—under an Orwellian conception of “Internet Freedom” that makes corporations the real Big Brother, and government, our savior.

Toward a Less MAD World: Digital Détente

Sincere defenders of real Internet Freedom—that is, freedom from government techno-meddling—recognize that there will always be disputes over how companies deal with each other online across all layers of the Internet. The question is not whether we need a technical coordinating mechanism for handling such disputes. Someone should mediate conflicts over alleged deviations from abstract neutrality principles. But should that arbitrator be an inherently political body like FCC? Or should we instead look to truly independent, apolitical arbitrators like the Internet Engineering Task Force or collaborative efforts like the Network Neutrality Squad? Such alternative dispute resolution mechanisms and fora need not have the power of law to be effective: The weight of their expert opinion, based on careful investigation of the facts, would likely resolve most disputes, because companies have strong reputational incentives to comply with reasoned rulings by truly neutral experts. And the white hot spotlight of public attention has a way of disciplining marketplace behavior as well.

Government would still have a role to play, of course, in enforcing antitrust laws where anticompetitive harm to consumers can be proven, and in enforcing the promises companies make to consumers. Ultimately, however, certain business models and technologies require non-neutral treatment, and the best remedy for concerns about non-neutrality is competition itself: In the high-tech sector more than any other, disruptive innovation makes it difficult for even the most successful companies to stay on top forever. Competitive entry—or even the threat of new entry—provides a powerful check on the power of so-called “gatekeepers,” but even more important is the prospect that today’s leaders will be tomorrow’s laggards: There’s little reason to think Google (search and advertising), Apple (smart phones and music) and Facebook (social networking) won’t someday find themselves playing catch-up, just as IBM (computers), Microsoft (desktop software and search), Friendster and MySpace (social networking), and Yahoo! and AOL (web portals) have had to do.

“Digital Détente” would require that all parties concede something and work constructively toward a more “peaceful” ( i.e., less regulatory) resolution. And yet, no Internet company wants to disarm unilaterally, foreswearing politics as a continuation of competition by other means. Only through multilateral disarmament could they break out of the current cycle of regulatory one-upmanship: If the companies in the Internet ecosystem could form a united front against increased government regulation and in favor of removing existing regulatory obstacles to competition, they could all return to their core competencies of creativity and innovation.

The alternative is a regulatory “nuclear winter”: high-tech titans turning their political fire on each other, catching innocent third parties in the cross-fire and bringing a dark cloud of government regulation over the entire Internet. Such increased regulation would stifle investment and innovation throughout the Internet ecosystem. Thus, it is consumers who will ultimately suffer most from the tech industry’s suicidal impulse, as their choices and digital lives are impoverished. For their sake, we hope all industry players will step back from the brink to avoid such high-tech mutually assured destruction.

This Microsoft-funded study projects that, by 2013, cloud computing will have added $800 billion in net new business revenues for the 52 countries surveyed (over 2009 levels). The growing economic importance of the cloud is likely to increase pressure for government involvement. As President Reagan said: “Government’s view of the economy could be summed up in a few short phrases: If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”

In episode #44 of “Tech Policy Weekly,” Berin Szoka and Adam Thierer engage in a debate with Internet security expert Chris Soghoian, who is a student fellow at the Berkman Center for Internet & Society at Harvard University. He is also a Ph.D. candidate at Indiana University’s School of Informatics.

Chris is an up-and-coming star in the field of cyberlaw and technology policy as he has quickly made a name for himself in debates over privacy policy, data security, and government surveillance.  He straddles the line between academic and activist, and the role he often plays in many tech policy debates is somewhat akin to what Ralph Nader has done in many other fields through the years. Except, in this case, instead of “Unsafe at Any Speed” it’s more like “Unsafe at Any Setting,” since Chris is often raising a stink about what he regards as unjust or unreasonable privacy or security settings that various online websites or service providers use.

On the show, Chris talks about two of his recent crusades to get certain online providers to change their default settings to improve user security or privacy: (1) His effort this week to get major email providers—and Google in particular—to change their default security settings on their email offerings; and (2) his earlier crusade to create permanent opt-out cookies to stop behavioral advertising by advertising networks.

There are several ways to listen to today’s TLF Podcast. You can press play on the player below to listen right now, or download the MP3 file. You can also subscribe to the podcast by clicking on the button for your preferred service. (And do us a favor, Digg this podcast!)

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Finally, here’s some relevant links that were mentioned during today’s show:

• Chris Soghoian’s webpage + his Harvard Berkman Center page
• Chris’s blog (“Slight Paranoia”)
• Chris’s “TACO” (Targeted Advertising Cookie Opt-Out) plug-in for Firefox (and description of it on his home page)
• Chris’s “Caught in the Cloud” paper (+ a video of him presenting it at Harvard)
• The letter from 38 cybersecurity researchers that Chris sent to Google
• Berin Szoka’s response to Chris’s “Caught in the Cloud” paper
• Berin’s discussion of the issue of preserving user choice through permanent opt-out cookies

I just finished reading through The Economist’s new 14-page special report on cloud computing, “Let It Rise” in which Ludwig Siegele provides an outstanding overview of cloud computing and why it is so important:

The rise of the cloud is more than just another platform shift that gets geeks excited. It will undoubtedly transform the information technology (IT) industry, but it will also profoundly change the way people work and companies operate. It will allow digital technology to penetrate every nook and cranny of the economy and of society, creating some tricky political problems along the way.

Even if you are very familiar with cloud computing, I recommend you take a look at the article. Anyway, while I was reading it, I was unsurprised to come across some comments from Nicholas Carr, whose new book The Big Switch: Rewiring the World, from Edison to Google, is essentially an early history of cloud computing and an investigation into its effects on our economy, culture, and society. And that also reminded me that, even though I have mentioned Carr’s book here several times since it was released earlier this year, I have failed to give it a dedicated review. And it certain deserves one because “The Big Switch” is easily one of the most important technology policy books of 2008.

One of the reasons Carr’s book will be high up on my end of the year list of best tech books has nothing to do with substance. It’s his style. Carr is one of most gifted writers in the tech policy field today. His eloquence and brilliant story-telling skills remind me of George Gilder in his prime. Carr nicely places modern developments in a historical context and relates the changes we are witnessing today to previous technological innovations and eras.

At the same time, however, Carr has also become one of the America’s leading Internet skeptics and vocal critics of techno-utopianism, as I noted in an essay a few months ago about Internet optimists and pessimists. He is, by far, the most reasonable and respected of those Net skeptics, using a measured tone when attacking those who have adopted a more pollyanna-ish, rose-colored view of the world. [For similar reasons, Carr’s “Rough Type” blog is must-reading for anyone who monitors technology policy.]

Electric Parallels

But on to the substance of the book. Carr’s thesis is that we are in the midst of “another epochal [technological] transformation” that parallels what happened with the “democratization of electricity” a century ago:

What happened to the generation of power a century ago is now happening to the processing of information. Private computer systems, built and operated by individual companies, are being supplanted by services provided by a common grid — the Internet — by centralized data-processing plants. Computing is turning into a utility, and once again the economic equations that determine the way we work and live are being rewritten. (p. 12)

“That shift,” Carr continues, “promises not only to change the nature of corporate IT departments but to shake up the entire computer industry.” (p. 13) Indeed, the “revolutionary potential of the information utility” promises to have profound implications:

In the years ahead, more and more of the information processing tasks that we rely on, at home and at work, will be handled by big data centers located out on the Internet. The nature and economics of computing will change as dramatically as the nature and economics of mechanical power changed in the early years of the last century. The consequences for society — for the way we live, work, learn, communicate, entertain ourselves, and even think — promise to be equally profound. (p. 21)

Unsurprisingly, Google is the central player in Carr’s drama because it is “a giant information utility” (p. 13) that has capitalized on the movement of so much knowledge and technology into the cloud and off of our desktops. Carr argues that “once utility services mature, the idea of getting rid of your PC will become much more attractive” (p. 80) and “We may find, twenty or so years from now, that the personal computer has become a museum piece, a reminder of a curious time when all of us where forced to be amateur computer technicians.” (p. 81)

Carr’s Critique of “Techno-Utopianism”

Part One of The Big Switch is primarily concerned with this progression of computing and IT from specialized service to mainstream utility, and I believe that most readers will find it as engrossing and enlightened as I did. But the tone and focus of Carr’s book change dramatically as Part Two opens. Whereas Carr keeps Part One fairly value- or viewpoint-neutral, Part Two is a more spirited critique of the economic and cultural consequences of “The Big Switch.”

In Part Two, he launches into his attack of the “techno-utopianism” that sometimes accompanies discussions about the implications of the Information Age and life in the cloud. “[O]ptimism is a natural response to the arrival of a powerful and mysterious new technology,” but, Carr warns, “it can blind us to more troubling portents.” And “there is reason to believe that our cybernetic meadow may be something less than a new Eden.” (p. 125)

It is here that Carr’s critique becomes familiar to those of us who follow the modern Internet policy debates. As I noted in my “Internet Optimists and Pessimists” essay, Carr is joining the ranks of other Net skeptics like Andrew Keen, Lee Siegel, and others. In my recent review of Lee Siegel’s Against the Machine: Being Human in the Age of the Electronic Mob, I traced this strand of social criticism back to the late Neil Postman, author of the 1992 anti-technology manifesto, Technopoly: The Surrender of Culture to Technology.

Carr’s concerns about the consequences of cloud computing and the rise of “techno-utopianism” parallel those found in those other “pessimistic” tracts, although Carr is far more level-headed in articulating those fears. As I noted in the Siegel review, those concerns can generally be grouped as follows:

1. The Net is destroying (or at least greatly diminishing) the role of experts, authority, “truth”, and traditional societal norms and institutions. This is having (or eventually will result in) dangerous ramifications for our culture, economy, and democracy.
2. The personalization and customization that the Information Age and the Internet have spawned could have troubling ramifications for our society and culture.

Dangers of Disintermediation and the Problem with “Free”

Regarding the first of these concerns, Carr argues that “while it’s true that the reduction in production and distribution costs is bringing us many more options, it would be a mistake to leap to the conclusion that nothing will be sacrificed in the process. More choices don’t necessarily mean better choices,” he says. (p. 151) He continues:

Many cultural goods remain expensive to create or require the painstaking work of talented professionals, and it’s worth considering how the changing economics of media will affect them. Will these goods be able to find a large enough paying audience to underwrite their existence, or will they end up being crowded out of the marketplace by the proliferation of free, or easily accessible products? Even though the Internet can in theory accommodate a nearly infinite variety of information goods, that doesn’t mean that the market will be able to support all of them. Some of the most cherished creative works may not survive the transition to the Web’s teeming bazaar. (p. 151)

More specifically, Carr is worried about what “The Great Unbundling” — i.e., the radically disruptive disintermediation associated with the Internet Age — will mean for the future of “hard news,” investigative journalism, and prized forms of culture. The cross-subsidies that have supported the creation of such content are at risk, Carr fears, as the Net’s relentless drive for increased efficiency rolls like a digital wrecking ball through the old media and cultural landscape. “[T]he largest threat posed by social production won’t be to big corporations but to individual professionals — to the journalists, editors, photographers, researchers, analysts, librarians, and other information workers who can be replaced,” Carr says, by “crowdsourcing.” (p. 142)

In this way, Carr’s concerns are quite similar to those raised by Andrew Keen and others about how the Internet is potentially “killing our culture” (or at least the best of it as they would define it). But Carr extends this social critique in an important way by claiming that the problem with the emerging model of social production and “free” business models that dominate the online marketplace today is that they are built on a “sharecropper model.” The Net’s dominant giants, he argues, are reaping their riches on the back of free labor. These new sites and services “are essentially agglomerations of the creative, unpaid contributions of their members. In a twist on the old agricultural practice of sharecropping, the site owners provide the digital real estate and tools, let the members do all the work, and then harvest the economic riches.” (p. 137-8)

I have some sympathy for these arguments, especially as they have been articulated by Carr here in The Big Switch. Compared to the way other critics like Keen and Siegel have used over-the-top apocalyptic, neo-Luddite rhetoric when discussing their related concerns, Carr generally avoids such hysteria and does a better job of laying out his concerns about the Net and cloud computing in a more reasonable fashion. And there is little doubt that the Internet and social production models are placing enormous strain on many traditional professions and professionals.

I have problems with his “sharecropper” argument, however. This logic ignores the non-monetary benefits that many of us feel we extract from today’s online business models and social production processes. Most of us feel we get a lot back as part of this new value exchange. Carr is certainly correct that Google, Facebook, MySpace, and a lot of other Net middlemen are getting big and rich based on all the user-generated content flowing over their sites and systems. On the other hand, most cyber-citizens extract enormous benefits from the existence of those (mostly free and constantly improving) platforms and services. It’s a very different sort of value exchange and business model than most of us have been accustomed to in the past, but we are adjusting to it. We humans are resilient, adaptable creatures and we can usually learn to cope with such changes and find a way to use them to our advantage. It’s not all about companies getting rich; we are getting richer too, but in a different way. We have an abundance of information, culture, and communications opportunities at our disposal today that were simply unthinkable even a generation ago.

Carr and other Net skeptics certainly raise some very legitimate questions about the limitations of the “free culture” mindset, however. There are times when the net optimists really do sound like the pollyannish “utopians” that Carr claims they are. When I am reading the work of Benkler and other optimists, it sometimes comes across as techno-Rousseauian gibberish (or what Carr labels “the Internet’s liberation mythology.”) The Internet isn’t remaking man or changing human nature in any fundamental way, which is what some optimists seem to imply. Moreover, when it comes to economics, all this talk about the Long Tail being “the future of business” (Chris Anderson) and of “Wikinomics… changing everything through mass collaboration,” (Don Tapscott & Anthony Williams) goes much too far in my opinion. It’s irrational (techno-) exuberance.

On the other hand, Carr and the other pessimists occasionally go to the opposite extreme in critiquing new models of social production, open source, and other collaborative creative endeavors. Their obsession with Wikipedia is particularly curious. If one views Wikipedia and Wiki- models as supplements or compliments to traditional media and communications models and activities, then where is the harm? Most of us understand they are not perfect, but we can appreciate the benefits they bring society despite their limitations.

When it comes to the true impact of the Internet on our economy and culture, the truth is somewhere in between the two extremes staked out by optimists and pessimists. My own position in this regard might best be labeled “pragmatic optimism”: One can appreciate how much better off the Internet has made society while also recognizing that it has created new challenges that we need to think through.

Downsides of Hyper-Personalization

The other important theme developed by Carr in the second half of The Big Switch, which also runs throughout the work of other techno-pessimist tracts, is that the increased personalization and customization facilitated by the Internet is breeding dangerous anti-social attitudes and tendencies. Building on an argument first put forth by Cass Sunstein in his 2001 book Republic.com , Carr worries about the impact of the “Daily Me.” The “Daily Me” was the term Nicholas Negroponte coined in his prescient 1995 book Being Digital, to describe the new digital world he hoped would develop, filled with hyper-personalized, instantaneously-delivered content. And that’s largely the Web 2.0 world we live in today.

But Carr, Sunstein, and many other Net skeptics, refer to Negroponte’s “Daily Me” in contemptuous terms, arguing that the hyper-customization of websites and online technologies is causing extreme social “fragmentation,” “polarization,” “balkanization,” and “single-mindedness.” Carr warns:

Every time we subscribe to a blog, add a friend to our social network, categorize an email message as spam, or even choose a site from a list of search results, we are making a decision that defines, in some small way, whom we associate with and what information we pay attention to. (p. 160)

Thus, he fears, we could be “click[ing] our way to a fractured society” (p. 160) because of the “ideological amplification” (p. 164) bred by the Daily Me. There’s even the risk of increased fanaticism, radicalization, and extremism, he warns.

I have addressed this argument at length in my 2005 book, Media Myths (p. 39) but, to summarize, the fundamental problem with this logic is that it ignores the fact that, thanks to the rise of the Net, most of us are experiencing far more diverse voices and viewpoints than we ever did in the past. Sure, it is true that we also can now find our little niche groups and bunk-up with them online for extended periods, but I find it absurd to claim that we humans are less exposed to diverse viewpoints today than in the past.

Regardless, even if Carr and the other Net skeptics are correct and the Net is breeding such isolation and balkanization, what are we suppose to do about it? Should we roll back the clock to the good ol’ days? Carr doesn’t give us a straight answer. But, again, there are good reasons to question whether society was really better off in the pre-Internet days. The Analog / Scarcity Era had it’s own share of problems, beginning with the fact that it was extremely difficult for niche interests in our society to be served when media was catering to a mass audience through newspapers and broadcast stations. Certainly, the old model of media delivery had its advantages, but the drawbacks were enormous, and not just as it pertained to entertainment. Consider news: If we all weren’t home sitting in front of our TV sets at exactly 6:30 each night, then we missed our chance to hear the same three old white guys in bad suits tells us what the important news of the day was. Look, I liked Cronkite, Brinkley & Co., but I will take today’s 24/7 news cycle of instantaneous news over that old system any day of the week.

Again, there are trade-offs at work here. Things are not all roses like Net optimists would claim. The downside of an endless news cycle is that people can just find a niche news channel or program that feeds them news more closely in line with their own ideological tendencies. Moreover, there very well may be — to use Glenn Reynolds’s phrase — “An Army of Davids” out there in the blogosphere today taking on traditional media and expressing themselves however they wish, but that doesn’t automatically mean they all have something interesting to say! Even when they do, there is still a useful role played by mass media providers or “professional” media in steering news and culture. Indeed, they provide an essential editing function in terms of helping us decide what types of news or culture may be more important. I personally rely on the Wall Street Journal to help guide my investigation of what financial market news is worth exploring each week. I wouldn’t want to just set up my Google Alerts to feed me “financial news” and then trust that everything that came into my RSS reader was worth reading. In this sense, the WSJ is what I call a “trusted information intermediary” (or “old school filter” if you will) that many of us could not live without.

But that traditional intermediary editing and filtering function, which used to be total in its applicability to news and culture, is now shrinking rapdily. “Mass media” just isn’t quite as MASS-ive as it once was, and the rise of personalized “Daily Me” media and culture certainly has had something to do with that since it has allow us to filter news and culture ourselves.  But why can’t we have the best of both worlds — some old school filtering by trusted information intermediaries along with plenty of personalized filtering? In many ways, I think we have that balance today — and it is a wonderful thing. Pessimists like Carr seem to only focus on the downsides of customized media, and that’s unfortunate. Nonetheless, they are right to ask the tough questions about how long those old school filters (traditional media intermediaries) will survive if all of us flock to an extreme “Daily Me” mindset. My contention, however, is that we won’t. Most of us appreciate the balanced approach and are willing to support some — but not all — of those old intermediaries and filters.

I have far less sympathy for Carr’s argument that increased specialization and customization are breeding “fanaticism” and “radicalization.” Last time I checked, mobs weren’t rioting in the streets or rushing out to join the Nazi or Communist parties! Those knuckleheads still exist, of course, but they have always existed. And let’s not forget, it was during the age of scarcity and mass media that those movements gained traction and took control in some countries. In the Internet Age, by contrast, such extremist loonies usually get exposed and widely ridiculed. As the old saying goes, the answer to bad speech is more speech. The Internet has given it to us and helped us counter such societal extremism, even if it has simultaneously given such extremists a new soapbox to stand on and spew their hatred and stupidity. Let them spew it and we will respond! And we will marginalize them in the process. There’s just no chance some sort of mini-Hitler is going to use the Net to revive fascism and build a mass audience today.

Finally, I believe Carr makes a similar mistake when he argues that computers and the Internet are really more “technologies of control” than “technologies of emancipation.” (p. 191)  “While the Net offers people a new medium for discovering information and voicing opinions, it also provides bureaucrats with a powerful new tool for monitoring speech, identifying dissidents, and disseminating propaganda.” (p. 200)  In this sense, Carr is adopting the same pessimistic tone set forth by Jack Goldsmith and Tim Wu in their book Who Controls the Internet? While I agree that computers and the Net give the big bad statist bureaucrats new tools of control, I persist in my belief that these digital tools offer the masses more methods of evading and minimizing the power of government over their lives and liberties.  Again, I think it is important to put things in some historical context. In the past, governments could completely control the media and disseminate incessant propaganda. It is far more difficult for them to get away with that today, and citizens have many tools and outlets at their disposal to respond.  Digital technologies really are technologies of emancipation, but we can’t expect them to break the backs of the statist thugs overnight.

Conclusion

Carr’s pessimism on the two issues discussed above is succinctly captured on pg. 167 of his book when he argues that:

it’s clear that two of the hopes most dear to the Internet optimists — that the Web will create a more bountiful culture and that it will promote greater harmony and understanding — should be treated with skepticism. Cultural impoverishment and social fragmentation seem equally likely outcomes.

That almost perfectly delineates the battle lines in the great debate taking place today between Internet optimists and pessimists. The Big Switch probably makes the best case for the pessimists that has been penned thus far, and for that reason alone it deserves your attention. However, I continue to remain cautiously optimistic that the Net is moving our economy, culture, and society in a better direction — at least compared to a past, which had its own share of drawbacks and problems.

P.S. If you are interested in the ongoing debate about cloud computing — and specifically the question of how much competition we can expect going forward — you’ll definitely want to check out this very interesting discussion taking place between Hugh Macleod, Tim O’Reilly, and Nick Carr.

• “The Cloud’s Best-Kept Secret” — Hugh Macleod
• “Web 2.0 and Cloud Computing” — Tim O’Reilly
• “What Tim O’Reilly gets wrong about the cloud” — Nick Carr
• “Further musings on the network effect and the cloud” — Nick Carr

Also, here’s a video of Nick Carr’s recent appearance on “The Colbert Report”: