I don’t have a great deal to add to coverage of last week’s big patent story, which concerned the filing of a complaint by Microsoft co-founder Paul Allen against major technology companies including Apple, Google, Facebook and Yahoo. Diane Searcey of The Wall Street Journal
, Tom Krazit at CNET News.com, and Mike Masnick on Techdirt pretty much lay out as much as is known so far.
But given the notoriety of the case and the scope of its claims (the Journal, or at least its headline writer, has declared an all-out “patent war”), it seems like a good opportunity to dispel some common myths about the patent system and its discontents.
And then I want to offer one completely unfounded theory about what is really going on that no one yet has suggested. Which is: Paul Allen is out to become the greatest champion that patent reform will ever know.
Continue reading →
The Washington Post editorializes this morning on the “Google-Verizon” proposal for government regulation of the Internet:
For more than a decade, “net neutrality” — a commitment not to discriminate in the transmission of Internet content — has been a rule tacitly understood by Internet users and providers alike.
But in April, a court ruled that the Federal Communications Commission has no regulatory authority over Internet service providers. For many, this put the status quo in jeopardy. Without the threat of enforcement, might service providers start shaping the flow of traffic in ways that threaten the online meritocracy, in which new and established Web sites are equally accessible and sites rise or fall on the basis of their ability to attract viewers?
What a Washington-centric view of the world, to think that net neutrality has been maintained all this time by the fear of an FCC clubbing. Deviations from net neutrality haven’t happened because neutrality is the best, most durable engineering principle for the Internet, and because neutral is the way consumers want their Internet service.
Should it be cast in stone by regulation, locking in the pro-Google-and-Verizon status quo? No. The way the Internet works should continue to evolve, experiments with non-neutrality failing one after another . . . until perhaps one comes along that serves consumers better! The FCC would be nothing but a drag on innovation and a bulwark protecting Google and Verizon’s currently happy competitive circumstances.
I’ll give the
Post one thing: It represents Washington, D.C. eminently well. The Internet should be regulated because it’s not regulated.
“If it moves, tax it. If it keeps moving, regulate it. And if it stops moving, subsidize it.”
The Progress and Freedom Foundation has just published a white paper I wrote for them titled “The Seven Deadly Sins of Title II Reclassification (NOI Remix).” This is an expanded and revised version of an earlier blog post that looks deeply into the FCC’s pending Notice of Inquiry regarding broadband Internet access. You can download a PDF here.
I point out that beyond the danger of subjecting broadband Internet to extensive new regulations under the so-called “Third Way” approach outlined by FCC Chairman Julius Genachowski, a number of other troubling features in the Notice indicate an even broader agenda for the agency with regard to the Internet. Continue reading →
A favorite PR maven pitched me (and probably many of you) Senator Al Franken’s (D-MN) email suggesting that WiFi is threatened by the Google-Verizon “deal.”
“The Google-Verizon ‘framework’ was written so as not to apply to wireless Internet services,” says Franken. “If you use wi-fi or access the Internet on your phone, this is a serious problem.”
Kindamaybenotsomuch. WiFi is wireless, yes, but it’s not what they’re talking about when they say “wireless.”
But what caught my eye is Senator Franken’s somewhat inverted take on power arrangements in the federal government: “This evening, I’ll be speaking at an FCC hearing in Minneapolis. I’ll urge the commissioners to reject the Google-Verizon framework, stop the Comcast/NBC merger, and take action to keep the Internet free and open.”
Folks, Article I, section 1 of the United States Constitution creates the United States Senate, with section 3 describing the Senate’s makeup and some procedures.
The Federal Communications Commission is not a constitutional body. The best view is that Congress has no authority to establish an FCC like we have today. The better view is that Congress should not maintain the sprawling FCC we have today. And the only correct view is that FCC is a creation of Congress, beneath it in every relevant respect.
Senator Franken is supposed to be the boss of the FCC, not a supplicant “urging” the FCC to do x, y, and z.
Does it matter a lot? No. Senator Franken is mostly making a symbolic appeal to gin up constituent support. But he’s also symbolizing the abasement of the legislative branch to an independent agency that has no constitutional pedigree.
Wall Street Journal columnist Holman Jenkins has a terrific, wide-ranging interview with Google CEO Eric Schmidt in today’s paper that is well worth reading. One thing worth highlighting is Schmidt’s comments on the “economic disaster that is the American newspaper.” He argues that, “The only way the problem [of insufficient revenue for news gathering] is going to be solved is by increasing monetization, and the only way I know of to increase monetization is through targeted ads.”
Absolutely correct. It’s a point that Berin Szoka, Ken Ferree and I tried to make in PFF’s mega-filing in the FCC’s “Future of Media” proceeding in early May, and Berin and I stressed it in even more detail in our piece on”Chairman Leibowitz’s Disconnect on Privacy Regulation & the Future of News.” The key takeaway: If Washington goes to war against advertising — and targeted advertising in particular — then there will be no future for private news. As we stated there:
The reason for the indispensability of advertising is simple: Information (including news and other forms of “content”) has “public good” characteristics that make it is very difficult (and occasionally impossible) for information-publishers to recoup their investments. Simply put, they quite literally lack pricing power: Whatever they charge, someone else will charge less for a close substitute, inevitably leading to “free” distribution of the content, even though the content is anything but free to produce. Advertising is the one business model that has traditionally saved the day by rewarding publishers for attracting the attention of an audience.
Thus an attack on advertising is an attack on media / news itself. And yet Washington is currently engaged in an all-out assault on advertising, marketing, and data collection efforts / business models.
Incidentally, Google recently submitted comments with the Federal Trade Commission in reaction to its Staff Discussion Draft about the future of journalism and laid out their views on many of these issues. More importantly, as summarized on pg. 30 (of the pdf) of this Newspaper Association of America filing to the FTC, Google has proposed an interesting monetization model that utilizes Google Search, Google Checkout and DoubleClick ad server, “to build a premium content system for newspapers.” Worth checking out. Kudos to Google for taking these steps and to Schmidt for again stressing the importance of targeted advertising for the future of media.
The release of a joint policy framework from Google and Verizon this week touched off even more activity in the never-ending saga of Net Neutrality than the rumors about the possibility such an agreement was in the works did the week before.
Op-ed pages, business and technology news programs, and public radio’s precious moments were overrun with anxious talking heads denouncing or praising the latest developments, or even a few of us trying just to explain what was and was not actually being said and done.
That’s not how August is supposed to be in policyland, when Washington reverts to the swamp from which it came. (John Adams left early one summer during his Presidency and refused to return long after the heat had broken.) I had hoped at long last to get around to finalizing last year’s tax return or maybe fixing my perennially-broken irrigation system, but oh well. Continue reading →
At ten A.M. Pacific this morning, CNET News.com asked if I could write an article unraveling the legal implications of a rumored deal between Google and Verizon on net neutrality. I didn’t see how I could analyze a deal whose terms (and indeed, whose existence) are unknown, but I thought it was a good opportunity to make note of several positive developments in the net neutrality war this summer.
Just as I was finishing the piece a few hours later, another shocker came when the FCC announced it was concluding talks it had been holding since June with the major net neutrality stakeholders. It’s possible the leaked story about Google and Verizon, and the feverish response to it, whipped up by the straggling remnants of a coalition aimed at getting an extreme version of net neutrality into U.S. law by any means necessary, soured the agency on what appeared to be productive negotiations. Or maybe they’ve just gone as far as they can for now. Continue reading →
As Steve Titch discusses below, Google and Verizon, two of the leading antagonists in the long-running drama over FCC net neutrality regulation, may be about to call a truce. According to numerous media reports, the two firms have or soon will agree to a compromise framework for regulation, which would provide for a limited degree of regulation by the FCC.
The exact provisions of the compromise are unclear. Reportedly, however, the plan would ban Internet access providers such as Verizon from blocking content outright, while allowing them to offer prioritized service for a fee. The provisions would not apply to wireless Internet access, which would be kept mostly free of regulation.
While Google and Verizon have long been adversaries on this issue, it’s been no secret that the two have been working together to craft out common ground. The two in fact, filed joint comments in the FCC’s rulemaking on the issue earlier this year, and the CEOs of the two firms even jointly authored a Wall Street Journal op-ed on broadband policy.
The incentives for both are clear. With federal courts earlier this year rebuffing the FCC’s attempts to impose regulation, it was no doubt clear to Google that nothing could happen without a compromise. Moreover, the “big is bad” tenor of the debate no doubt gave Google – one of the largest firms in our galaxy – reason to rethink. For Verizon, a deal would provide some policy certainty, much-needed given the vast investments in broadband it is making. And since the firm has always disavowed any desire to block wireline content, the new rules would come at little apparent cost.
Continue reading →
Today I appeared on CNBC’s “Power Lunch” to debate Net neutrality issues and the specific role of pricing in this debate. Specifically, the producers wanted to know whether websites should be allowed to pay a higher fee to allow consumers faster access to their sites or should it be equal for every website. The show was partially a response to the rumors that the may be some sort of deal pending between Verizon and Google about prioritized services. On the program, I was up against Craig Aaron of Free Press. During the discussion I made several points, many of which first appeared in my 2005 essay on “The Real Net Neutrality Debate: Pricing Flexibility Versus Pricing Regulation.” Here are the key points I tried to get across:
- In a free-market economy, companies should be able to freely set prices for goods and services without fear of government price controls.
- This isn’t about consumers paying more for basic Internet access or having their connections “slowed down”? This is about whether the government will allow some broadband services to be differentiated or specialized for unique needs, such as online gaming, live event telecasts, secure telepresence conferences, telemedicine, etc.
- Differentiated and prioritized services and pricing are part of almost every industrial sector in a capitalistic economy. (ex: airlines, package shipping, hotels, amusement parks, grades of gasoline, etc.) Why should it be any different for broadband?
- It’s always important to remember that there is no such thing as a free lunch. Something has to pay for Internet access. It doesn’t just fall like manna from heaven. Differentiated services may help in this regard by allowing carriers to price more intensive or specialized users and uses to ensure that carriers don’t have to hit everyone – including average household users – with the same bill for service. Why should the government make that illegal through Net neutrality regulation?
- Heavy-handing tech mandates – especially Internet price controls – could have a profoundly deleterious impact on investment, innovation, and competition. After all, there can be no innovation or investment without a company first turning a profit. We don’t want to return to the era of rotary-dial regulated monopoly, in which our choices were few and our services were standardized and rudimentary. We should let our current experiment with facilities-based, head-to-head competition continue.
http://plus.cnbc.com/rssvideosearch/action/player/id/1559985749/code/cnbcplayershare
The Technology Liberation Front is the tech policy blog dedicated to keeping politicians' hands off the 'net and everything else related to technology.