I’ve written two articles on the Protect IP Act of 2011, introduced last week by Sen. Leahy (D-Vt.).
For CNET, I look at some of the key differences, better and worse, between Protect IP and its predecessor last year, known as COICA.
On Forbes this morning, I have a long meditation on what Protect IP says about the current state of the Internet content wars. Copyright, patent, and trademark are under siege from digital technology, and for now at least are clearly losing the arms race.
The new bill isn’t exactly the nuclear option in the fight between the media industries and everyone else, but it does signal increased desperation. Continue reading →
What I hoped would be a short blog post to accompany the video from Geoff Manne and my appearances this week on PBS’s “Ideas in Action with Jim Glassman” turned out to be a very long article which I’ve published over at Forbes.com.
I apologize to Geoff for taking an innocent comment he made on the broadcast completely out of context, and to everyone else who chooses to read 2,000 words I’ve written in response.
So all I’ll say here is that Geoff Manne and I taped the program in January, as part of the launch of TechFreedom and of “The Next Digital Decade.” Enjoy!
Loyal readers know of my generally bullish, optimistic outlook regarding the Internet’s impact on society, economy, and even politics. On that last front, columnist Peggy Noonan has a nice piece in today’s Wall Street Journal entitled, “The Internet Helps Us Get Serious.” Serious about politics and political rhetoric, she means. Speaking about how politicians are addressing the current fiscal crisis in the U.S., Noonan argues:
One way to change minds about the current crisis is through information. We all know this, and we all know about the marvelous changes in technology that allow for the spreading of messages that are not necessarily popular with gatekeepers and establishments. But there’s something new happening in the realm of political communication that must be noted. Speeches are back. They have been rescued and restored as a political force by the Internet.
She then makes the point that I always stress when debating Net pessimists: You have to measure progress against the yardstick of the past and ask yourself if we really better off in a world of information scarcity. Noonan does that beautifully when she notes: Continue reading →
Today I filed roughly 30 pages worth of comments with the Federal Trade Commission (FTC) in its proceeding on “Protecting Consumer Privacy in an Era of Rapid Change: a Proposed Framework for Businesses and Policy Makers.” [Other comments filed in the proceeding can be found here.] Down below, I’ve attached the Table of Contents from my filing so you can see the major themes I’ve addressed, and I’ve also attached the entire document in a Scribd reader. In coming days and weeks, I’ll be expanding upon some of these themes in follow-up essays.
In my filing, I argue that while it remains impossible to predict with precision the impact a new privacy regulatory regime will have the Internet economy and digital consumers, regulation
will have consequences; of that much we can be certain. As the FTC and other policy makers move forward with proposals to expand regulation in this regard, it is vital that the surreal “something-for-nothing” quality of current privacy debate cease. Those who criticize data collection or online advertising and call for expanded regulation should be required to provide a strict cost-benefit analysis of the restrictions they would impose upon America’s vibrant digital marketplace.
In particular, it should be clear that the debate over Do Not Track and online advertising regulation is fundamentally tied up with the future of online content, culture, and services. Thus, regulatory advocates must explain how the content and services supported currently by advertising and marketing will be sustained if current online data collection and ad targeting techniques are restricted. Continue reading →
I’m not one of those libertarians who incessantly rants about the supposed evils of National Public Radio (NPR) and the Public Broadcast Service (PBS). In fact, I find quite a bit to like in the programming I consume on both services, NPR in particular. A few years back I realized that I was listening to about 45 minutes to an hour of programming on my local NPR affiliate (WAMU) each morning and afternoon, and so I decided to donate $10 per month. Doesn’t sound like much, but at $120 bucks per year, that’s more than I spend on any other single news media product with the exception of The Wall Street Journal. So, when there’s value in a media product, I’ll pay for it, and I find great value in NPR’s “long-form” broadcast journalism, despite its occasional political slant on some issues.
In many ways, the Corporation for Public Broadcasting, which supports NPR and PBS, has the perfect business model for the age of information abundance. Philanthropic models — which rely on support for foundational benefactors, corporate underwriters, individual donors, and even government subsidy — can help diversify the funding base at a time when traditional media business models — advertising support, subscriptions, and direct sales — are being strained. This is why many private media operations are struggling today; they’re experiencing the ravages of gut-wrenching marketplace / technological changes and searching for new business models to sustain their operations. By contrast, CPB, NPR, and PBS are better positioned to weather this storm since they do not rely on those same commercial models.
Nonetheless, NPR and PBS and the supporters of increased “pubic media” continue to claim that they are in peril and that increased support — especially public subsidy — is essential to their survival. For example, consider an editorial in today’s
Washington Post making “The Argument for Funding Public Media,” which was penned by Laura R. Walker, the president and chief executive of New York Public Radio, and Jaclyn Sallee, the president and chief executive of Officer Kohanic Broadcast Corp. in Anchorage. They argue: Continue reading →
Today the Mercatus Center has released a short new paper I have authored on “Unappreciated Benefits of Advertising and Commercial Speech.” I begin the piece by noting that:
Federal policy makers, state legislators, and state attorneys general have recently shown interest in regulating commercial advertising and marketing. Several new regulatory initiatives are being proposed, or are already underway, that could severely curtail or restrict advertising or marketing on a variety of platforms. The consequences of these stepped-up regulatory efforts will be profound and will hurt consumer welfare both directly and indirectly.
I go on to note that “advertising can be an easy target for politicians or regulatory activist groups who make a variety of (typically unsubstantiated) claims about its negative impact on society,” but then continue on to explain how “the role of commercial speech in a free-market economy is often misunderstood or taken for granted.” I outline how, despite regulators’ concerns, consumers actually derive three important types of benefits from advertising and marketing: (1) Informational / Educational Benefits; (2) Market Choice / Pro-Competitive Benefits; and (3) Media Promotion / Cross-Subsidization. After discussing each benefit, I conclude that:
For these reasons, a stepped-up regulatory crusade against advertising and marketing will hurt consumer welfare since it will raise prices, restrict choice, and diminish marketplace competition and innovation—both in ad-supported content and service markets, and throughout the economy at large. Simply stated, there is no free lunch.
Read the entire 1,800-word essay here. I have also embedded the document down below in a Scribd reader.
Continue reading →
I’m going to close out my series of essays about Tim Wu’s new book, The Master Switch: The Rise and Fall of Information Empires, by discussing his proposed solutions. In the first five essays in the series, [1, 2, 3, 4, 5] I’ve critiqued Wu’s look at information history as well as his use of terms like “market failure,” “laissez-faire” and “open” vs. “closed.” I argued there’s a great deal of over-simplification, even outright distortion, in his use of those terms throughout the book.
Anyway, let’s run through the basics of the book once more before getting to Wu’s proposed solutions. By my reading of
The Master Switch, Wu’s argument essentially goes something like this:
- Information industries go through cycles. After a period of “openness” and competition, they tend to drift toward “closed,” corporate-controlled, anti-consumer models and outcomes.
- The resulting “monopolists” then block much innovation, competition, and free speech.
- Consequently, “the purely economic laissez-faire approach… is no longer feasible.”
- Moreover, information industries are more important than all others (“information industries… can never be properly understood as ‘normal’ industries”) and even traditional forms of regulation, including antitrust, “are clearly inadequate for the regulation of information industries.” (p. 303).
- Thus, special rules should apply to information-related sectors of our economy.
Again, I’ve challenged some of these assertions in my previous essays, specifically, Wu’s incomplete history of cycles and the fact that he greatly underplays the role of governments in “locking-in” sub-optimal market structures or, worse yet, creating those structures through misguided public policies or regulatory capture. Wu discusses some of those factors in his book, but he tends to regard them as secondary to the inquiry, whereas I believe they are crucial to understanding how most “closed” or anti-competitive scenarios develop or endure. Instead, Wu simplistically suggests that “the purely economic laissez-faire approach… is no longer feasible,” even though no such state of affairs has ever existed within communications or media industries. They have been subjected to varying levels of indirect influence or direct control almost since their inception.
Regardless, what does Tim Wu want done about the problems he has (mis-)diagnosed? Continue reading →
I sincerely hope it was a Washington Post editor, and not New America Foundation president Steve Coll, who picked the title for his editorial today, “Why Fox News Should Help Fund NPR.” After all, Coll certainly must be smart enough to know that there is no law or regulation on the books today that gives the Federal Communications Commission (FCC) or any other agency the ability to force private media providers to fund their public media competitors. Moreover, it takes a lot of chutzpah to try to spin NPR’s recent Juan Williams fiasco into an excuse for private media providers like Fox News to fund NPR, but, shockingly, that’s exactly what Coll does. “The Williams imbroglio is teachable, but its lessons actually point in the opposite direction: America’s public media system, including NPR, requires more funding, not less.” Hmm… that’s not exactly the lesson most of the rest of the world took away from this episode!
Coll first argues it makes sense for private media funds to be transferred to NPR becuase “In this time of niche publications and cable networks that thrive on ideological anger, we should be seeking to strengthen NPR’s role as a convener of the public square, a demagogue-free zone where all political and social groups — including conservatives and others opposed to federal funding of public media — should be welcome on equal terms.” This is indicative of the all-too-common “progressive” impulse to force media upon us that we don’t want or even find offensive. To be clear, I am
not one of those people who finds NPR to be a hopelessly biased bastion of Leftist thinking. While I think it’s clear to everyone that many of NPR’s stories and reporters do lean that direction, I also think there’s some outstanding reporting to be found there. But if Steve Coll and his colleagues at the New America Foundation want to see NPR get more funding, they should do the same thing I do: Open up their wallets and make the voluntary choice to fund it. To force everyone else to do so is despicable.
Continue reading →
After posting the first three installments of my ongoing look at Tim Wu’s important new book, The Master Switch: The Rise and Fall of Information Empires, [see parts 1, 2, & 3], I’ve heard back from some readers as well as Prof. Wu himself that I may be going a bit hard on him, or that I am under-appreciating some of his valid critiques. In particular, Wu and others have claimed I’ve ignored or downplayed his admission that the problem of regulatory capture is a prime culprit of “the cycle” he addresses in his book. So, let me address that point here today.
I have acknowledged that Prof. Wu’s book includes some occasional references to the problem of regulatory capture or bureaucratic bungling throughout the history of communications and media policy. In a comment to my previous post, Wu itemizes a couple of those instances, most of which I’d already cited before. But here’s probably the best passage from the book on this point:
Again and again in the histories I have recounted, the state has shown itself an inferior arbiter of what is good for the information industries. The federal government’s role in radio and television from the 1920s through the 1960s, for instance, was nothing short of a disgrace…. Government’s tendency to protect large market players amounts to an illegitimate complicity … [particularly its] sense of obligation to protect big industries irrespective of their having become uncompetitive. (p. 308)
I agree. And, as I also noted in my previous essay, I very much appreciated this footnote in chapter 3 of Wu’s book: “The technical term for such a system is ‘corporatism’: in its extreme manifestation it is called ‘fascism.” Wu is absolutely right. I applaud him for labeling this system what it really is.
But here’s what’s so damn peculiar about Wu and his book when it comes to the problem of regulatory capture and bureaucratic mismanagement: as soon as he raises it, he immediately walks away from it. There’s seemingly never any serious lesson drawn from it. Continue reading →
I’ve grown increasingly tired of the fight over not just retransmission consent, but almost all TV regulation in general. Seriously, why is our government still spending time fretting over a market that is more competitive, diverse and fragmented than most other economic sectors? It’s almost impossible to keep track of all the innovation happening on this front, although I’ve tried here before. Every metric — every single one — is not just improving but exploding. Just what’s happening on the kids’ TV front is amazing enough, but the same story is playing out across other programming genres and across multiple distribution platforms.
More proof of just how much more diverse and fragmented content and audiences are today comes in this excellent new guest editorial over at GigaOm, “The Golden Age of Choice and Cannibalization in TV,” by Mike Hudack, CEO of Blip.tv. Hudack notes that, compared to the Scarcity Era, when we had fewer choices and were all forced to watch pretty much the same thing, today’s media cornucopia is overflowing, and audiences are splintering as a result. “Media naturally trends towards fragmentation,” he notes. “As capacity increases so does choice. As choice increases audiences fragment. When given a choice people generally prefer media that speaks to them as individuals over media that speaks to the ‘masses.’”
Indeed, he cites Nielsen numbers I’ve used here before illustrating how the top shows of the 50’s (like Texaco Star Theater) netted an astonishing 60-80% of U.S. television households while more recent hits, like American Idol is lucky if it can manage over 15% audience share. He concludes, therefore, that: Continue reading →
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