regulate – Technology Liberation Front https://techliberation.com Keeping politicians' hands off the Net & everything else related to technology Thu, 03 Apr 2025 23:20:10 +0000 en-US hourly 1 6772528 Running List of My Research on AI, ML & Robotics Policy https://techliberation.com/2022/07/29/running-list-of-my-research-on-ai-ml-robotics-policy/ https://techliberation.com/2022/07/29/running-list-of-my-research-on-ai-ml-robotics-policy/#respond Fri, 29 Jul 2022 12:51:54 +0000 https://techliberation.com/?p=77020

[last updated 4/3/2025 – Check my Medium page for latest posts]

This a running list of all the essays and reports I’ve already rolled out on the governance of artificial intelligence (AI), machine learning (ML), and robotics. Why have I decided to spend so much time on this issue? Because this will become the most important technological revolution of our lifetimes. Every segment of the economy will be touched in some fashion by AI, ML, robotics, and the power of computational science. It should be equally clear that public policy will be radically transformed along the way.

Eventually, all policy will involve AI policy and computational considerations. As AI “eats the world,” it eats the world of public policy along with it. The stakes here are profound for individuals, economies, and nations. As a result, AI policy will be the most important technology policy fight of the next decade, and perhaps next quarter century. Those who are passionate about the freedom to innovate need to prepare to meet the challenge as proposals to regulate AI proliferate.

There are many socio-technical concerns surrounding algorithmic systems that deserve serious consideration and appropriate governance steps to ensure that these systems are beneficial to society. However, there is an equally compelling public interest in ensuring that AI innovations are developed and made widely available to help improve human well-being across many dimensions. And that’s the case that I’ll be dedicating my life to making in coming years.

Here’s the list of what I’ve done so far. I will continue to update this as new material is released:

2025

2024

2023

2022

2021 (and earlier)

]]> https://techliberation.com/2022/07/29/running-list-of-my-research-on-ai-ml-robotics-policy/feed/ 0 77020 Europe’s New AI Industrial Policy https://techliberation.com/2020/02/20/europes-new-ai-industrial-policy/ https://techliberation.com/2020/02/20/europes-new-ai-industrial-policy/#comments Thu, 20 Feb 2020 19:37:48 +0000 https://techliberation.com/?p=76667

The race for artificial intelligence (AI) supremacy is on with governments across the globe looking to take the lead in the next great technological revolution. As they did before during the internet era, the US and Europe are once again squaring off with competing policy frameworks.

In early January, the Trump Administration announced a new light-touch regulatory framework and then followed up with a proposed doubling of federal R&D spending on AI and quantum computing. This week, the European Union Commission issued a major policy framework for AI technologies and billed it as “a European approach to excellence and trust.”

It seems the EU basically wants to have its cake and eat it too by marrying up an ambitious industrial policy with a precautionary regulatory regime. We’ve seen this show before. Europe is doubling down on the same policy regime it used for the internet and digital commerce. It did not work out well for the continent then, and there are reasons to think it will backfire on them again for AI technologies.

An Ambitious Industrial Policy Vision

The new EU framework includes a lot of catchphrases and proposals that are an industrial policy lover’s dream. In an attempt to create “an ecosystem of excellence” and ensure the “human-centric development if AI,” it identifies a variety of existing or new industrial planning efforts, including: Digital Innovation Hubs, Enterprise Resource Planning, the Digital Europe Programme, the Key Digital Technology Joint Undertaking, and broad-based public private partnerships. This is all part of an official “Coordinated Plan” prepared together with the Member States “to foster the development and use of AI in Europe.”

To accomplish that, the Commission says it will “facilitate the creation of excellence and testing centres” that will “concentrate in sectors where Europe has the potential to become a global champion.” The Commission also wants to give special consideration to growing small and mid-size enterprises (SMEs) is establishing these plans.

Again, it’s an ambitious industrial policy vision, and one that will be accompanied by a wide variety of (yet-to-be-determined) regulatory enactments to shape the development and use of AI. But if that approach really works, why aren’t European digital companies global leaders today? Instead, firms based mostly in the US have risen to become household names across the globe. Regulation had an influence on that result because American firms enjoyed a policy regime that was rooted in “permissionless innovation,” which generally allows experimentation by default and addresses concerns by using more flexible, ex post remedies. By contrast, Europe’s internet policy approach was rooted in the precautionary principle, or the notion that innovation is essentially guilty until proven innocent. New technologies are to be subjected to prior constraints—or what the new European Commission white paper calls “prior conformity assessments”—before being allow into the wild.

Precautionary Regulation Dominates

Despite losing that last round of the innovation wars, the new EU white paper makes it clear that Europe will keep using a precautionary approach. What does that mean for AI regulation? The problem here begins with defining what is a “high-risk” AI application requiring prior restraints. The white paper defines it in a somewhat circular fashion, saying that, “an AI application should be considered high-risk where…(it) is employed in a sector where, given the characteristics of the activities typically undertaken, significant risks can be expected to occur” and is “used in such a manner that significant risks are likely to arise.” Instead of providing legal certainty, this definition clarifies almost nothing and will require future regulatory inquires to determine the full scope and nature of AI controls.

There’s also a lot of talk in the proposal about preemptively addressing “risks for fundamental rights,” which is understandable. AI innovations can raise various safety, security, and privacy concerns that deserve to be taken seriously. But what about the risk of not having access to important AI innovations at all? What about the risk of losing out on life-enriching—and in many cases life-saving—innovations because, instead of “building trust,” the regulatory regime builds the exact opposite: fear of innovating.

Entrepreneurs and investors respond to incentives. Before building or investing in a new technology, they want to know how long it will take to get that good or service launched—assuming they can get approval at all. Every innovator and investor factors such political risk into their business plans. When the potential costs of product launch overwhelm the likely benefits, they will abandon innovative efforts or look to engage in them elsewhere.

The EU says “the race for global leadership is ongoing,” and claims that, “Europe offers significant potential, knowledge and expertise” through its efforts to make the continent an AI innovation hub. Indeed, some of the best AI researchers are in Europe, and there are plenty of brilliant people brimming with entrepreneurial enthusiasm about creating world-class AI applications. But all that knowledge and enthusiasm do not matter much if the regulatory deck is stacked against innovation from the start.

And Even More Expansive Regulation Down the Road

Beyond the precautionary approach in that document, the EU’s accompanying white paper on safety and liability implications of AI leaves open the possibility of an expansion in preemptive regulatory requirements. “Additional obligations may be needed for manufacturers to ensure that they provide features to prevent the upload of software having an impact on safety during the lifetime of the AI products,” the document notes. Moreover, if an ongoing AI software update “modifies substantially the product in which it is downloaded, the entire product might be considered as a new product and compliance with the relevant safety product legislation must be reassessed at the time the modification is performed.”

That sort of regulatory regime may sound quite sensible at first blush. In practice, however, it means that every conceivable tweak to an algorithm requires costly and complex regulatory approval. If traditional computer software had required regulatory approval before any new modifications could be made, most consumers would still be stuck with an aol.com email address and Windows 95 as an operating system.

What the European Commission proves with its new AI policy framework is that it is easy to talk a big game about planning for an innovative future, but it is an entirely different thing to actually bring one about. The European approach will have clear competitive effects, or more specifically, anti-competitive effects. As is already the case with the EU’s regulatory approach to the data economy and GDPR in particular, regulatory compliance costs continue to skyrocket and small and mid-size enterprises struggle to cope. This means that only firms operating the largest digital platforms are able to shoulder these burdens, leaving consumers without as many competitive, low-cost choices as they might otherwise enjoy. Not even generous government support for SMEs will be able to counter-balance the costly entry barriers associated with over-regulation.

Solidifying Market Power of Existing Giants?

This is why it is so ironic how worried the EU is about the market power of Google, Facebook and other US-based tech giants: the regulatory burden now helps those firms maintain their market dominance. Over-regulation by the EU undermined both home-grown and international investment and competition that might challenge those existing players. With each addition layer of AI regulation that now gets piled on top of the Europe’s existing regulatory burden, the prospects for creative destruction decrease, as do the chances for life-enriching innovations to ever make it to consumers.

While the European Commission will, no doubt, insist that they are implementing this new AI regime with the very best of intentions in mind, there is no escaping the fact that regulation involves complex trade-offs and unforeseeable consequences. The consequences in this case are likely a bit easier to predict, however: By smothering new AI applications in layers of red tape, we can expect fewer innovations and less competition.

Despite all the talk of boosting SMEs, perhaps the EU will eventually become more like China and unabashedly support larger home-grown firms to make sure they are part of the global AI race. China has already made waves on this front with its 2017 “New Generation Artificial Intelligence Development Plan,” an audacious industrial policy plan which seeks “to build China’s first-mover advantage in the development of AI [and] to accelerate the construction of an innovative nation and global power in science and technology.” The document is as much a manifesto about geopolitical power as it is about technological governance. And it does not try to hide China’s authoritarian impulse to meticulously plan every facet of daily life under the auspices of promoting global technological leadership. China’s AI manifesto even concludes with a section on “public opinion guidance” that creepily insists the country will, “Fully use all kinds of traditional media and new media to quickly propagate new progress and new achievements in AI, to let the healthy development of AI become a consensus in all of society, and muster the vigor of all of society to participate in and support the development of AI.”

The new European AI industrial policy framework does not go as far as China’s, not only because the continent is obviously more open and democratic by nature, but also because the EU is a collection of many countries and cultures that will never be able to speak as coherently and forcefully with one voice on all technological governance matters. In fact, the EU’s new governance framework explicitly leaves room for more tailored AI regulation by individual member states.

Conclusion

This leaves Europe stuck between the polar opposites of China and the US when it comes to AI governance. China’s meticulously detailed, highly centralized, state-driven approach stands in stark contrast to the more bottom-up, adaptive American approach which insists that regulators, “must avoid a precautionary approach that holds AI systems to such an impossibly high standard that society cannot enjoy their benefits.”

The US approach also leans heavily on “soft law,” or informal governance mechanisms that are not as burdensome as precautionary regulatory controls. Soft law can include a wide variety of tools and methods for addressing policy concerns, including multistakeholder initiatives, best practices and standards, agency workshops and guidance documents, educational efforts, and much more. These are the governance tools the dominated for the internet and digital platforms for that past twenty years in the US, and they will likely continue to be the primary governance mechanisms for artificial intelligence, robotics, the internet of things, and other emerging tech sectors.

The EU probably thinks it has found the Goldilocks formula and gotten AI policy just right by falling between China and the US on the governance spectrum. It is more likely, however, that European policymakers will be unable to resist the urge to over-plan and micro-manage AI markets until they are once again left wondering how they got stuck trying to regulate market leaders that are headquartered oceans away from them. With the US once again adopting a more flexible approach, we could see a replay of the Web Wars, with innovators and investors putting their efforts behind AI launches in the US instead of Europe. Meanwhile, China will likely attract far more global venture capital for AI and robotics launches than they did for digital platforms. This could really put the squeeze on Europe.

Only time will tell. But, to paraphrase Yoda, when it comes to global artificial intelligence governance, one thing is clear: Begun the AI war has.

]]> https://techliberation.com/2020/02/20/europes-new-ai-industrial-policy/feed/ 1 76667 FCC’s Ajit Pai on Importance of Permissionless Innovation Vision https://techliberation.com/2018/08/07/fccs-ajit-pai-on-importance-of-permissionless-innovation-vision/ https://techliberation.com/2018/08/07/fccs-ajit-pai-on-importance-of-permissionless-innovation-vision/#comments Tue, 07 Aug 2018 17:34:21 +0000 https://techliberation.com/?p=76338

FCC Chairman Ajit Pai recently delivered an excellent speech at the Resurgent Conference, Austin, TX. In it, he stressed the importance of adopting a permissionless innovation policy vision to ensure a bright future for technology, economic growth, and consumer welfare. The whole thing is worth your time, but the last two paragraphs make two essential points worth highlighting.

Pai correctly notes that we should reject the sort of knee-jerk hysteria or technopanic mentality that sometimes accompanies new technologies. Instead, we should have some patience and humility in the face of uncertainty and be open to new ideas and technologies creations.

“Here’s the bottom line,” Pai concludes:

Whenever a technological innovation creates uncertainty, some will always have the knee-jerk reaction to presume it’s bad. They’ll demand that we do whatever’s necessary to maintain the status quo. Strangle it with a study. Call for a commission. Bemoan those supposedly left behind. Stipulate absolute certainty. Regulate new services with the paradigms of old. But we should resist that temptation. “Guilty until proven innocent” is not a recipe for innovation, and it doesn’t make consumers better off. History tells us that it is not preemptive regulation, but permissionless innovation made possible by competitive free markets that best guarantees consumer welfare. A future enabled by the next generation of technology can be bright, if only we choose to let the light in.

Read the whole thing here. Good stuff. I also appreciate him citing my work on the topic, which you can find in my last book and other publications.

]]> https://techliberation.com/2018/08/07/fccs-ajit-pai-on-importance-of-permissionless-innovation-vision/feed/ 3 76338 Wendell Wallach on the Challenge of Engineering Better Technology Ethics https://techliberation.com/2016/04/20/wendell-wallach-on-the-challenge-of-engineering-better-technology-ethics/ https://techliberation.com/2016/04/20/wendell-wallach-on-the-challenge-of-engineering-better-technology-ethics/#respond Wed, 20 Apr 2016 19:08:57 +0000 https://techliberation.com/?p=76026

DM cover
On May 3rd, I’m excited to be participating in a discussion with Yale University bioethicist Wendell Wallach at the Microsoft Innovation & Policy Center in Washington, DC. (RSVP here.) Wallach and I will be discussing issues we write about in our new books, both of which focus on possible governance models for emerging technologies and the question of how much preemptive control society should exercise over new innovations.

Wallach’s latest book is entitled, A Dangerous Master: How to Keep Technology from Slipping beyond Our Control. And, as I’ve noted here recently, the greatly expanded second edition of my latest book, Permissionless Innovation: The Continuing Case for Comprehensive Technological Freedom, has just been released.

Of all the books of technological criticism or skepticism that I’ve read in recent years—and I have read stacks of them!— A Dangerous Master is by far the most thoughtful and interesting. I have grown accustomed to major works of technological criticism being caustic, angry affairs. Most of them are just dripping with dystopian dread and a sense of utter exasperation and outright disgust at the pace of modern technological change.

Although he is certainly concerned about a wide variety of modern technologies—drones, robotics, nanotech, and more—Wallach isn’t a purveyor of the politics of panic. There are some moments in the book when he resorts to some hyperbolic rhetoric, such as when he frets about an impending “techstorm” and the potential, as the book’s title suggests, for technology to become a “dangerous master” of humanity. For the most part, however, his approach is deeper and more dispassionate than what is found in the leading tracts of other modern techno-critics.

Many Questions, Few Clear Answers

Wallach does a particularly good job framing the major questions about emerging technologies and their effect on society. “Navigating the future of technological possibilities is a hazardous venture,” he observes. “It begins with learning to ask the right questions—questions that reveal the pitfalls of inaction, and more importantly, the passageways available for plotting a course to a safe harbor.” (p. 7) Wallach then embarks on a 260+ page inquiry that bombards the reader with an astonishing litany of questions about the wisdom of various forms of technological innovation—both large and small. While I wasn’t about to start an exact count, I would say that the number of questions Wallach poses in the book runs well into the hundreds. In fact, many paragraphs of the book are nothing but an endless string of questions.

Thus, if there is a primary weakness with A Dangerous Master, it’s that Wallach spends so much time formulating such a long list of smart and nuanced questions that some readers may come away disappointed when they do not find equally satisfying answers. On the other hand, the lack of clear answers is also completely understandable because, as Wallach notes, there really are no simple answers to most of these questions.

Just Slow Down!

Moving on to substance, let me make clear where Wallach and I generally see eye-to-eye and where we part ways.

Generally speaking, we agree about the need to come up with better “soft governance” systems for emerging technologies, which might include multistakeholder process, developer codes of conduct, sectoral self-regulation, sensible liability rules, and so on. (More on those strategies in a moment.)

But while we both believe it is wise to consider how we might “bake-in” better ethics and norms into the process of technological development, Wallach seems much more inclined than me to expect that we will be able to pre-ordain (or potentially require?) all this happens before much of this experimentation and innovation actually moves forward. Wallach opens by asking:

Determining when to bow to the judgment of experts and whether to intervene in the deployment of a new technology is certainly not easy. How can government leaders or informed citizens effectively discern which fields of research are truly promising and which pose serious risks? Do we have the intelligence and means to mitigate the serious risks that can be anticipated? How should we prepare for unanticipated risks? (p. 6)

Again, many good questions here! But this really gets to the primary difference between Wallach’s preferred approach and my own: I tend to believe that many of these things can only be worked out through ongoing trial and error, the constant reformulation of the various norms that govern the process of innovation, and the development of sensible ex post solutions to some of the most difficult problems posed by turbulent technological change.

By contrast, Wallach’s generally attitude toward technological evolution is probably best summarized by the phrases: “Slow down!” and, “Let’s have a conversation about it first!” As he puts it in his own words: “Slowing down the accelerating adoption of technology should be done as a responsible means to ensure basic human safety and to support broadly shared values.” (p. 13)

But I tend to believe that it’s not always possible to preemptively determine which innovations to slow down, or even how to determine what those “shared values” are that will help us make this determination. More importantly, I worry that there are very serious potential risks and unintended consequences associated with slowing down many forms of technological innovation, which could improve human welfare in important ways. There can be no prosperity, after all, without a certain degree of risk-taking and disruption.

Getting Out Ahead of the Pacing Problem

WW
It’s not that Wallach is completely hostile to new forms of technological innovation or blind to the many ways those innovations might improve our lives. To the contrary, he does a nice job throughout the book highlighting the many benefits associated with various new technologies, or he is at least willing to acknowledge that there can be many downsides associated with efforts aimed at limiting research and experimentation with new technological capabilities.

Yet, what concerns Wallach most is the much-discussed issue from the field of the philosophy of technology, the so-called “pacing problem.” Wallach concisely defines the pacing problem as “the gap between the introduction of a new technology and the establishment of laws, regulations, and oversight mechanisms for shaping its safe development.” (p. 251) “There has always been a pacing problem,” he notes, but he is concerned that technological innovation—especially highly disruptive and potentially uncontrollable forms of innovation—is now accelerating at an absolutely unprecedented pace.

(Just as an aside for all the philosophy nerds out there…  Such a rigid belief in the “pacing problem” represents a techno-deterministic viewpoint that is, ironically, sometimes shared by technological skeptics like Wallach as well as technological optimists like Larry Downes and even many in the middle of this debate, like Vivek Wadhwa. See, for example, The Laws of Disruption by Downes and “Laws and Ethics Can’t Keep Pace with Technology” by Wadhwa. Although these scholars approach technology ethics and politics quite differently, they all seem to believe that the pace of modern technological change is so relentless as to almost be an unstoppable force of nature. I guess the moral of the story is that, to some extent, we’re all technological determinists now!)

Despite his repeated assertions that modern technologies are accelerating at such a potentially uncontrollable pace, Wallach nonetheless hopes we can achieve some semblance of control over emerging technologies before they reach a critical “inflection point.” In the study of history and science, an inflection point generally represents a moment when a situation and trend suddenly changes in a significant way and things begin moving rapidly in a new direction. These inflections points can sometimes develop quite abruptly, ushering in major changes by creating new social, economic, or political paradigms. As it relates to technology in particular, inflection points can refer to the moment with a particular technology achieves critical mass in terms of adoption or, more generally, to the time when that technology begins to profoundly transform the way individuals and institutions act.

Another related concept that Wallach discusses is the so-called “Collingridge dilemma,” which refers to the notion that it is difficult to put the genie back in the bottle once a given technology has reached a critical mass of public adoption or acceptance. The concept is named after David Collingridge, who wrote about this in his 1980 book, The Social Control of Technology. “The social consequences of a technology cannot be predicated early in the life of the technology,” Collingridge argued. “By the time undesirable consequences are discovered, however, the technology is often so much part of the whole economics and social fabric that its control is extremely difficult.”

On “Having a Discussion” & Coming Up with “a Broad Plan”

These related concepts of inflection points and the Collingridge dilemma constitute the operational baseline of Wallach’s worldview. “In weighing speedy development against long-term risks, speedy development wins,” he worries. “This is particularly true when the risks are uncertain and the perceived benefits great.” (p. 85)

Consequently, throughout his book, Wallach pleads with us to take what I will call Technological Time Outs. He says we need to pause at times so that we can have “a full public discussion” (p. 13) and make sure there is a “broad plan in place to manage our deployment of new technologies” (p. 19) to make sure that innovation happens only at “a humanly manageable pace” (p. 261) “to fortify the safety of people affected by unpredictable disruptions.” (p. 262) Wallach’s call for Technological Time Outs is rooted in his belief that “the accelerating pace [of modern technological innovation] undermines the quality of each of our lives.” (p. 263)

That is Wallach’s weakest assertion in the book and he doesn’t really offer much evidence to prove that the velocity of modern technological is hurting us rather than helping us, as many of us believe. Rather, he treats it as a widely accepted truism that necessitates some sort of collective effort to slow things down if the proverbial genie is about to exit the bottle, or to make sure those genies don’t get out of their bottles without a lot of preemptive planning regarding how they are to be released into the world. In the following passage on pg. 72, Wallach very succinctly summarizes his approach recommended throughout A Dangerous Master:

this book will champion the need for more upstream governance: more control over the way that potentially harmful technologies are developed or introduced into the larger society. Upstream management is certainly better than introducing regulations downstream, after a technology is deeply entrenched or something major has already gone wrong. Yet, even when we can access risks, there remain difficulties in recognizing when or determining how much control should be introduced. When does being precautionary make sense, and when is precaution an over-reaction to the risks? (p. 72)

Those who have read my Permissionless Innovation book will recall that I open by framing innovation policy debates in almost exactly the same way as Wallach suggests in that last line above. I argue in the first lines of my book that:

The central fault line in innovation policy debates today can be thought of as ‘the permission question.’  The permission question asks: Must the creators of new technologies seek the blessing of public officials before they develop and deploy their innovations? How that question is answered depends on the disposition one adopts toward new inventions and risk-taking, more generally.  Two conflicting attitudes are evident. One disposition is known as the ‘precautionary principle.’ Generally speaking, it refers to the belief that new innovations should be curtailed or disallowed until their developers can prove that they will not cause any harm to individuals, groups, specific entities, cultural norms, or various existing laws, norms, or traditions. The other vision can be labeled ‘permissionless innovation.’ It refers to the notion that experimentation with new technologies and business models should generally be permitted by default. Unless a compelling case can be made that a new invention will bring serious harm to society, innovation should be allowed to continue unabated and problems, if any develop, can be addressed later.

So, by contrasting these passages, you can see what I am setting up here is a clash of visions between what appears to be Wallach’s precautionary principle-based approach versus my own permissionless innovation-focused worldview.

How Much Formal Precaution?

But that would be a tad bit too simplistic because just a few paragraphs after Wallach makes the statement just above about “upstream management” being superior to ex post solutions formulated “after a technology is deeply entrenched,” Wallach begins slowly backing away from an overly-rigid approach to precautionary principle-based governance of technological processes and systems.

He admits, for example, that “precautionary measures in the form of regulations and governmental oversight can slow the development of research whose overall society impact will be beneficial,” (p. 26) and that can “be costly” and “slow innovation.” For countries, Wallach admits, this can have real consequences because “Countries with more stringent precautionary policies are at a competitive disadvantage to being the first to introduce a new tool or process.” (p. 74)

So, he’s willing to admit that what we might call a hard precautionary principle usually won’t be sensible or effective in practice, but he is far more open to soft precaution. But this is where real problems begin to develop with Wallach’s approach, and it presents us with a chance to turn the tables on him a bit and begin posing some serious questions about his vision for governing technology.

Much of what follows below are my miscellaneous ramblings about the current state of the intellectual dialogue about tech ethics and technological control efforts. I have discussed these issues at greater length in my new book as well as a series of essays here in past years, most notably: “On the Line between Technology Ethics vs. Technology Policy; “What Does It Mean to “Have a Conversation” about a New Technology?”; and, “Making Sure the “Trolley Problem” Doesn’t Derail Life-Saving Innovation.”

As I’ve argued in those and other essays, my biggest problem with modern technological criticism is that specifics are in scandalously short supply in this field! Indeed, I often find the lack of details in this arena to be utterly exasperating. Most modern technological criticism follows a simple formula:

TECHNOLOGY –>> POTENTIAL PROBLEMS –>> DO SOMETHING!

But almost all the details come in the discussion about the nature of the technology in question and the apparent many problems associated with it. Far, far less thought goes into the “DO SOMETHING!” part of the critics’ work. One reason for that is probably self-evident: There are no easy solutions. Wallach admits as much at many junctures throughout the book. But that doesn’t excuse the need for the critics to give us a more concrete blueprint for identifying and then potentially rectifying the supposed problems.

Of course, the other reason that many critics are short of specifics is because what they really mean when they quip how much we need to “have a conversation” about a new disruptive technology is that we need to have a conversation about stopping that technology.

Where Shall We Draw the Line between Hard and Soft Law?

But this is what I found most peculiar about Wallach’s book: He never really gives us a good standard by which to determine when we should look to hard governance (traditional top-down regulation) versus soft governance (more informal, bottom-up and non-regulatory approaches).

On one hand, he very much wants society to exercise greatly restraint and precaution when it comes to many of the technologies he and others worry about today. Again, he’s particularly concerned about the potential runaway development and use of drones, genetic editing, nanotech, robotics, and artificial intelligence. For at least one class of robotics—autonomous military robots—Wallach does call for immediate policy action in the form of an Executive Order to ban “killer” autonomous systems. (Incidentally, there’s also a major effort underway called the “Campaign to Stop Killer Robots” that aims to make such a ban part of international law through a multinational treaty.)

But Wallach also acknowledges the many trade-offs associated with efforts to preemptively controls on robotics and other technology. Perhaps for that reason, Wallach doesn’t develop a clear test for when the Precautionary Principle should be applied to new forms of innovation.

Clearly there are times when it is appropriate, although I believe it is only in an extremely narrow subset of cases. In the 2 nd Edition of my Permissionless Innovation book, I tried to offer a rough framework for when formal precautionary regulation (i.e., highly-restrictive policy defaults are necessary, such as operational restrictions, licensing requirements, research limitations, or even formal bans) might be necessary. I do not want to interrupt the flow of this review of Wallach’s book too much, so I have decided to just cut-and-paste that portion of Chapter 3 of my book (“When Does Precaution Make Sense?”) down below as an appendix to this essay.

The key takeaway of that passage from my book is that all of us who study innovation policy and the philosophy of technology—Wallach, myself, the whole darn movement—have done a remarkably poor job being specific about precisely when formal policy precaution is warranted. What is the test? All too often, we get lazy and apply what we might call an “I-Know-It-When-I-See-It” standard. Consider the possession of bazookas, tanks, and uranium. Almost all of us would agree that citizens should not be allowed to possess or use such things. Why? Well, it seems obvious, right? They just shouldn’t! But what is the exact standard we use to make that determination.

In coming years, I plan on spending a lot more time articulating a better test by which Precautionary Principle-based policies could be reasonably applied. Those who know me may be taken aback by what I just said. After all, I’ve spend many years explaining why Precautionary Principle-based thinking threatens human prosperity and should be rejected in the vast majority of cases. But that doesn’t excuse the lack of a serious and detailed exploration of the exact standard by which we determine when we should impose some limits on technological innovation.

Generally speaking, while I strongly believe that “permissionless innovation” should remain the policy default for most technologies, there certainly exists some scenarios where the threat of harm associated with a new innovation might be highly probable, tangible, immediate, irreversible, and catastrophic in nature. If so, that could qualify it for at least a light version of the Precautionary Principle. In a future paper or book chapter I’m just now starting to research, I hope to fuller develop those qualifiers and formulate a more robust test around them.

I would have very much liked to see Wallach articulate and defend a test of his own for when formal precaution would make sense. And, by extension, when should we default to soft precaution, or soft law and informal governance mechanisms for emerging technologies.

We turn to that issue next.

Toward Soft Governance & the Engineering of Better Technological Ethics

Even though Wallach doesn’t provide us with a test for determining when precaution makes sense or when we should instead default to soft governance, he does a much better job explaining the various models of soft law or informal governance that might help us deal with the potential negative ramifications of highly disruptive forms of technological change.

What Wallach proposes, in essence, is that we bake a dose of precautionary directly into the innovation process through a wide variety of informal governance/oversight mechanisms. “By embedding shared values in the very design of new tools and techniques, engineers improve the prospect of a positive outcome,” he claims. “The upstream embedding of shared values during the design process can ease the need for major course adjustments when it’s often too late.” (p. 261)

Wallach’s favored instrument of soft governance is what he refers to as “Governance Coordinating Committees” (GCCs). These Committees would coordinate “the separate initiatives by the various government agencies, advocacy groups, and representatives of industry” who would serve as “issue managers for the comprehensive oversight of each field of research.” (p. 250) He elaborates and details the function of GCCs as follows:

These committees, led by accomplished elders who have already achieved wide respect, are meant to work together with all the interested stakeholders to monitor technological development and formulate solutions to perceived problems. Rather than overlap with or function as a regulatory body, the committee would work together with existing institutions. (p. 250-51)

Wallach discussed the GCC idea in much greater detail in a 2013 book chapter he penned with Gary E. Marchant for a collected volume of essays on Innovative Governance Models for Emerging Technologies. (I highly recommend you pick up that book if you can afford it! Many terrific essays in that book on these issues.) In their chapter, Marchant and Wallach specify some of the soft law mechanisms we might use to instill a bit of precaution preemptively. These mechanisms include: “codes of conduct, statements of principles, partnership programs, voluntary programs and standards, certification programs and private industry initiatives.”

If done properly, GCCs could provide exactly the sort of wise counsel and smart recommendations that Wallach desires. In my book and many law review articles on various disruptive technologies, I have endorsed many of the ideas and strategies Wallach identifies. I’ve also stressed the importance of many other mechanisms, such as education and empowerment-based strategies that could help the public learn to cope with new innovations or use them appropriately. In addition, I’ve highlighted the many flexible, adaptive ex post remedies that can help when things go wrong. Those mechanisms include common law remedies such as product defects law, various torts, contract law, property law, and even class action lawsuits. Finally, I have written extensively about the very active role played by the Federal Trade Commission (FTC) and other consumer protection agencies, which have broad discretion to police “unfair and deceptive practices” by innovators.

Moreover, we already have a quasi-GCC model developing today with the so-called “multistakeholder governance” model that is often used in both informal and formal ways to handle many emerging technology policy issues.  The Department of Commerce (the National Telecommunications and Information Administration in particular) and the FTC have already developed many industry codes of conduct and best practices for technologies such as biometrics, big data, the Internet of Things, online advertising, and much more. Those agencies and others (such as the FDA and FAA) are continuing to investigate other codes or guidelines for things like advanced medical devices and drones, respectively. Meanwhile, I’ve heard other policymakers and academics float the idea of “digital ombudsmen,” “data ethicists,” and “private IRBs” (institutional review boards) as other potential soft law solutions that technology companies might consider. Perhaps going forward, many tech firms will have Chief Ethical Officers just as many of them today have Chief Privacy Officers or Chief Security Officers.

In other words, there’s already a lot of “soft law” activities going on in this space. And I haven’t even begun an inventory of the many other bodies or groups that already exist in each sector today that has set forth their own industry self-regulatory codes, but they exist in almost every field that Wallach worries about.

So, I’m not sure how much his GCC idea will add to this existing mix, but I would not be opposed to them playing the sort of coordinating “issue manager” role he describes. But I still have many questions about GCC’s, including:

  • How many of them are needed and how we will know which one is the definitive GCC for each sector or technology?
  • If they are overly formal in character and dominated by the most vociferous opponents of any particular technology, a real danger exists that a GCC could end up granting a small cabal a “heckler’s veto” over particular forms of innovation.
  • Alternatively, the possibility of “regulatory capture” could be a problem for some GCCs if incumbent companies come to dominate their membership.
  • Even if everything went fairly smoothly and the GCCs produced balanced reports and recommendations, future developers might wonder if and why they are to be bound by older guidelines.
  • And if those future developers choose not to play by the same set of guidelines, what’s the penalty for non-compliance?
  • And how are such guidelines enforced in a world where what I’ve called “global innovation arbitrage” is an increasing reality?

Challenging Questions for Both Hard and Soft Law

To summarize, whether we are speaking of “hard” or “soft” law approaches to technological governance, I am just not nearly as optimistic as Wallach seems to be that we will be able to find consensus on these three things:

(1) what constitutes “harm” in many of these circumstances;

(2) which “shared values” should prevail when “society” debates the shaping of ethics or guiding norms for emerging technologies but has highly contradictory opinions about those values (consider online privacy as a good example, where many people enjoy hyper-sharing while other demand hyper-privacy); and,

(3) that we can create a legitimate “governing body” (or bodies) that will be responsible for formulating these guidelines in a fair way without completely derailing the benefits of innovation in new fields and also remaining relevant for very long.

Nonetheless, as he and others have suggested, the benefit of adopting a soft law/informal governance approach to these issues is that it at least seeks to address these questions in more flexible and adaptive fashion. As I noted in my book, traditional regulatory systems “tend to be overly rigid, bureaucratic, inflexible, and slow to adapt to new realities. They focus on preemptive remedies that aim to predict the future, and future hypothetical problems that may not ever come about. Worse yet, administrative regulation generally preempts or prohibits the beneficial experiments that yield new and better ways of doing things.” ( Permissionless Innovation, p. 120)

So, despite the questions I have raised here, I welcome the more flexible soft law approach that Wallach sets forth in his book. I think it represents a far more constructive way forward when compared to the opposite “top-down” or “command-and-control” regulatory systems of the past. But I very much want to make sure that even these new and more flexible soft law approaches leave plenty of breathing room for ongoing trial-and-error experimentation with new technologies and systems.

Conclusion

In closing, I want to reiterate that not only did I appreciate the excellent questions raised by Wendell Wallach in A Dangerous Master, but I take them very seriously. When I sat down to revise and expand my Permissionless Innovation book last year, I decided to include this warning from Wallach in my revised preface: “The promoters of new technologies need to speak directly to the disquiet over the trajectory of emerging fields of research. They should not ignore, avoid, or superficially dampen criticism to protect scientific research.” (p. 28–9)

As I noted, in response to Wallach: “I take this charge seriously, as should others who herald the benefits of permissionless innovation as the optimal default for technology policy. We must be willing to take on the hard questions raised by critics and then also offer constructive strategies for dealing with a world of turbulent technological change.”

Serious questions deserve serious answers. Of course, sometimes those posing those questions fail to provide many answers of their own! Perhaps it is because they believe the questions answer themselves. Other times, it’s because they are willing to admit that easy answers to these questions typically prove quite elusive. In Wallach’s case, I believe it’s more the latter.

To wrap up, I’ll just reiterated that both Wallach and I share a common desire to find solutions to the hard questions about technological innovation. But the crucial question that probably separates his worldview and my own is this: Whether we are talking about hard or soft governance, how much faith should we place in preemptive planning vs. ongoing trial and error experimentation to solve technological challenges? Wallach is more inclined to believe we can divine these things with the sagacious foresight of “accomplished elders” and technocratic “issue managers,” who will help us slow things down until we figure out how to properly ease a new technology into society (if at all). But I believe that the only way we will find many of the answers we are searching for is by allowing still more experimentation with the very technologies that he and others seek to control the development of. We humans are outstanding problem-solvers and have the uncanny ability among all mammals to adapt to changing circumstances. We roll with the punches, learn from them, and become more resilient in the process. As I noted in my 2014 essay, “Muddling Through: How We Learn to Cope with Technological Change”:

we modern pragmatic optimists must continuously point to the unappreciated but unambiguous benefits of technological innovation and dynamic change. But we should also continue to remind the skeptics of the amazing adaptability of the human species in the face of adversity. [. . .] Humans have consistently responded to technological change in creative, and sometimes completely unexpected ways. There’s no reason to think we can’t get through modern technological disruptions using similar coping and adaptation strategies.

Will the technologies that Wallach fears bring about a “techstorm” that overwhelms our culture, our economy, and even our very humanity? It’s certainly possible, and we should continue to seriously discuss the issues that he and other skeptics raise about our expanding technological capabilities and the potential for many of them to do great harm. Because some of them truly could.

But it is equally plausible—in fact, some of us would say, highly probable—that instead of overwhelming us, we learn how to bend these new technological capabilities to our will and make them work for our collective benefit. Instead of technology becoming “a dangerous master,” we will instead make it our helpful servant, just as we have so many times before.

APPENDIX: When Does Precaution Make Sense?

[excerpt from chapter 3 of Permissionless Innovation: The Continuing Case for Comprehensive Technological Freedom. Footnotes omitted. See book for all references.]

But aren’t there times when a certain degree of precautionary policymaking makes good sense? Indeed, there are, and it is important to not dismiss every argument in favor of precautionary principle–based policymaking, even though it should not be the default policy rule in debates over technological innovation.

The challenge of determining when precautionary policies make sense comes down to weighing the (often limited) evidence about any given technology and its impact and then deciding whether the potential downsides of unrestricted use are so potentially catastrophic that trial-and-error experimentation simply cannot be allowed to continue. There certainly are some circumstances when such a precautionary rule might make sense. Governments restrict the possession of uranium and bazookas, to name just two obvious examples.

Generally speaking, permissionless innovation should remain the norm in the vast majority of cases, but there will be some scenarios where the threat of tangible, immediate, irreversible, catastrophic harm associated with new innovations could require at least a light version of the precautionary principle to be applied.  In these cases, we might be better suited to think about when an “anti-catastrophe principle” is needed, which narrows the scope of the precautionary principle and focuses it more appropriately on the most unambiguously worst-case scenarios that meet those criteria.

Precaution might make sense when harm is … Precaution generally doesn’t make sense for asserted harms that are …
Highly probable Highly improbable
Tangible (physical) Intangible (psychic)
Immediate Distant / unclear timeline
Irreversible Reversible / changeable
Catastrophic Mundane / trivial

 

But most cases don’t fall into this category. Instead, we generally allow innovators and consumers to freely experiment with technologies, and even engage in risky behaviors, unless a compelling case can be made that precautionary regulation is absolutely necessary.  How is the determination made regarding when precaution makes sense? This is where the role of benefit-cost analysis (BCA) and regulatory impact analysis is essential to getting policy right.  BCA represents an effort to formally identify the tradeoffs associated with regulatory proposals and, to the maximum extent feasible, quantify those benefits and costs.  BCA generally cautions against preemptive, precautionary regulation unless all other options have been exhausted—thus allowing trial-and-error experimentation and “learning by doing” to continue. (The mechanics of BCA are discussed in more detail in section VII.)

This is not the end of the evaluation, however. Policymakers also need to consider the complexities associated with traditional regulatory remedies in a world where technological control is increasingly challenging and quite costly. It is not feasible to throw unlimited resources at every problem, because society’s resources are finite.  We must balance risk probabilities and carefully weigh the likelihood that any given intervention has a chance of creating positive change in a cost-effective fashion.  And it is also essential to take into account the potential unintended consequences and long-term costs of any given solution because, as Harvard law professor Cass Sunstein notes, “it makes no sense to take steps to avert catastrophe if those very steps would create catastrophic risks of their own.”  “The precautionary principle rests upon an illusion that actions have no consequences beyond their intended ends,” observes Frank B. Cross of the University of Texas. But “there is no such thing as a risk-free lunch. Efforts to eliminate any given risk will create some new risks,” he says.

Oftentimes, after working through all these considerations about whether to regulate new technologies or technological processes, the best solution will be to do nothing because, as noted throughout this book, we should never underestimate the amazing ingenuity and resiliency of humans to find creative solutions to the problems posed by technological change.  (Section V discusses the importance of individual and social adaptation and resiliency in greater detail.) Other times we might find that, while some solutions are needed to address the potential risks associated with new technologies, nonregulatory alternatives are also available and should be given a chance before top-down precautionary regulations are imposed. (Section VII considers those alternative solutions in more detail.)

Finally, it is again essential to reiterate that we are talking here about the dangers of precautionary thinking as a public policy prerogative—that is, precautionary regulations that are mandated and enforced by government officials. By contrast, precautionary steps may be far more wise when undertaken in a more decentralized manner by individuals, families, businesses, groups, and other organizations. In other words, as I have noted elsewhere in much longer articles on the topic, “there is a different choice architecture at work when risk is managed in a localized manner as opposed to a society-wide fashion,” and risk-mitigation strategies that might make a great deal of sense for individuals, households, or organizations, might not be nearly as effective if imposed on the entire population as a legal or regulatory directive.

Finally, at times, more morally significant issues may exist that demand an even more exhaustive exploration of the impact of technological change on humanity. Perhaps the most notable examples arise in the field of advance medical treatments and biotechnology. Genetic experimentation and human cloning, for example, raise profound questions about altering human nature or abilities as well as the relationship between generations.

The case for policy prudence in these matters is easier to make because we are quite literally talking about the future of what it means to be human.  Controversies have raged for decades over the question of when life begins and how it should end. But these debates will be greatly magnified and extended in coming years to include equally thorny philosophical questions.  Should parents be allowed to use advanced genetic technologies to select the specific attributes they desire in their children? Or should parents at least be able to take advantage of genetic screening and genome modification technologies that ensure their children won’t suffer from specific diseases or ailments once born?

Outside the realm of technologically enhanced procreation, profound questions are already being raised about the sort of technological enhancements adults might make to their own bodies. How much of the human body can be replaced with robotic or bionic technologies before we cease to be human and become cyborgs?  As another example, “biohacking”—efforts by average citizens working together to enhance various human capabilities, typically by experimenting on their own bodies —could become more prevalent in coming years.  Collaborative forums, such as Biohack.Me, already exist where individuals can share information and collaborate on various projects of this sort.  Advocates of such amateur biohacking sometimes refer to themselves as “grinders,” which Ben Popper of the Verge defines as “homebrew biohackers [who are] obsessed with the idea of human enhancement [and] who are looking for new ways to put machines into their bodies.”

These technologies and capabilities will raise thorny ethical and legal issues as they advance. Ethically, they will raise questions of what it means to be human and the limits of what people should be allowed to do to their own bodies. In the field of law, they will challenge existing health and safety regulations imposed by the FDA and other government bodies.

Again, most innovation policy debates—including most of the technologies discussed throughout this book—do not involve such morally weighty questions. In the abstract, of course, philosophers might argue that every debate about technological innovation has an impact on the future of humanity and “what it means to be human.” But few have much of a direct influence on that question, and even fewer involve the sort of potentially immediate, irreversible, or catastrophic outcomes that should concern policymakers.

In most cases, therefore, we should let trial-and-error experimentation continue because “experimentation is part and parcel of innovation” and the key to social learning and economic prosperity.  If we froze all forms of technological innovation in place while we sorted through every possible outcome, no progress would ever occur. “Experimentation matters,” notes Harvard Business School professor Stefan H. Thomke, “because it fuels the discovery and creation of knowledge and thereby leads to the development and improvement of products, processes, systems, and organizations.”

Of course, ongoing experimentation with new technologies always entails certain risks and potential downsides, but the central argument of this book is that (a) the upsides of technological innovation almost always outweigh those downsides and that (b) humans have proven remarkably resilient in the face of uncertain, ever-changing futures.

In sum, when it comes to managing or coping with the risks associated with technological change, flexibility and patience is essential. One size most certainly does not fit all. And one-size-fits-all approaches to regulating technological risk are particularly misguided when the benefits associated with technological change are so profound. Indeed, “[t]echnology is widely considered the main source of economic progress”; therefore, nothing could be more important for raising long-term living standards than creating a policy environment conducive to ongoing technological change and the freedom to innovate.

]]> https://techliberation.com/2016/04/20/wendell-wallach-on-the-challenge-of-engineering-better-technology-ethics/feed/ 0 76026 FCC Commish Robert McDowell on Regulatory Failure & “Regulate My Rival” Politics https://techliberation.com/2012/06/28/fcc-commish-robert-mcdowell-on-regulatory-failure-regulate-my-rival-politics/ https://techliberation.com/2012/06/28/fcc-commish-robert-mcdowell-on-regulatory-failure-regulate-my-rival-politics/#comments Thu, 28 Jun 2012 15:45:35 +0000 http://techliberation.com/?p=41521

This may be the best speech by a regulator that you will read in your entire life. Federal Communications Commission (FCC) Commissioner Robert McDowell delivered an address in Rome today entitled, “The Siren Call of “Please Regulate My Rival”: A Recipe for Regulatory Failure.” I highly recommend it (and not just because I’m cited in it!) It is infused with important insights about the ugly downsides of excessive regulation of technology markets.

McDowell is an astute student of regulatory history and he documents how, despite the best of intentions, economic regulation has often been turned into a tool that industry exploits for their own narrow interests. Sadly, examples of such “regulatory capture” are rampant, as I have documented here before. McDowell notes that many telecom and media companies “suffer from the ‘please regulate my rival’ malady of an industry that has been regulated too much and for too long.  History is replete with such scenarios,” he says, “and the desire for more regulation for competitors always ends badly for the incumbent regulated industry in the form of unintended and harmful consequences.” That is exactly right.

I strongly encourage you to read the entire speech, but if you only have time to read one thing, make it the powerful and poetic closing paragraphs, which I have reprinted below:

“Regulating my rival” is a seductive notion for many, but it only lures its victims to rocky shores before revealing itself as a perilous Siren call.  Telecom companies should not look to regulate their “rivals,” Internet content and applications companies, down to their level – especially not through an intergovernmental body.

Instead, network operators should seek deregulation by their home governments to allow them full flexibility to produce and price freely in competitive markets.  In fact, as history shows us, attempting to regulate rivals will only produce unintended consequences that will harm the companies advocating regulation.  More importantly, consumers end up losing the most.  In short, the opposite of what is desired will occur, something called “regulatory failure.”  No government, let alone an intergovernmental body, can make economic and engineering decisions in lightning fast Internet time.  Nor can any government mandate innovation.  But new rules can undermine investment, innovation and job creation all too easily.

Despite these realities, resisting the temptation to regulate is difficult for many.  Furthermore, deregulation can seem counterintuitive to some.  We always hear talk of “market failure,” but we rarely see analyses of “regulatory failure.”  Perhaps that is why, in the words of Professor Adam Thierer, “regulation always spreads.” As world economies contract and government debt mounts, repeating the same government actions of regulating more and spending more of the public’s money will only produce the same results: shrinking economies and growing debt.  It is time to reverse these trends, but doing so will require tremendous political courage.

We can start by avoiding any expansion of regulation to the Internet.  Its phenomenal success can be traced directly to its voluntary and self-governing structure, the result of a multi-stakeholder process free from top-down governmental influences.  In fact, policy makers should head in the opposite direction of the proposals outlined earlier. We should learn from the voluntary, bottom-up, self governance approach in the image of the non-hierarchical Internet itself, and look to apply this successful model elsewhere.  Revolutionizing public policy through a fundamental modernization of legacy laws to clear away unnecessary regulatory obstructions will uncork the flow of investment capital, spark innovation, drive economic growth and propel job creation.  Couldn’t today’s world economy benefit from such positive and constructive change?

On the other hand, dragging rivals down to the lowest common denominator of overly regulated international telecom companies will enshrine mediocrity at best, and, at worst, snuff out incentives to take risks and reap the resulting rewards, therefore killing opportunities to revitalize moribund economies and improve the human condition.

Thank you, Commissioner McDowell, for speaking the truth and reminding the world that the actual history of telecom and media regulation has been a miserable, cronyist, anti-consumer fiasco.  This is exactly why we need to comprehensively deregulate these markets right now while also making sure that creeping cronyism and “regulate my rival” politics do not spread to new tech sectors.

]]> https://techliberation.com/2012/06/28/fcc-commish-robert-mcdowell-on-regulatory-failure-regulate-my-rival-politics/feed/ 3 41521 Netflix Falls Prey to Marginal Cost Fallacy & Pleads for a Broadband Free Ride https://techliberation.com/2011/07/08/netflix-falls-prey-to-marginal-cost-fallacy-pleads-for-a-broadband-free-ride/ https://techliberation.com/2011/07/08/netflix-falls-prey-to-marginal-cost-fallacy-pleads-for-a-broadband-free-ride/#comments Fri, 08 Jul 2011 21:33:21 +0000 http://techliberation.com/?p=37727

Of all the shockingly naive and shamelessly self-serving editorials I’ve read by businesspeople in recent years, today’s Wall Street Journal oped by Netflix general counsel David Hyman really takes the cake. It’s an implicit plea to policymakers for broadband price controls. Hyman doesn’t like the idea of broadband operators potentially pricing bandwidth according to usage /demand and he wants action taken to stop it. Of course, why wouldn’t he say that? It’s in Netflix’s best interest to ensure that somebody else besides them picks up the tab for increased broadband consumption!

But Hyman tries to pull a fast one on the reader and suggest that scarcity is an economic illusion and that any effort by broadband operators to migrate to usage-based pricing schemes is simply a nefarious, anti-consumer plot that must be foiled. “Consumers and regulators need to take heed of what is happening and avoid winding up like the proverbial frog in a pot of boiling water,” Hyman warns. “It’s time to jump before it’s too late.”

Rubbish! The only thing policymakers need to do is avoid myopic, misguided advice like Hyman’s, which isn’t based on one iota of economic theory or evidence.

Hyman’s economic illiteracy is evident from the get-go. He tries to spook people with the headline, “Why Bandwidth Pricing Is Anti-Competitive.” No it isn’t. Usage-based pricing is used in countless economic sectors every day and it is overwhelming viewed by economists as a sensible way to calibrate supply and demand while ensuring costs are covered. But Hyman says the laws of economics don’t apply to broadband!  No seriously, he says:

Cable and telecom companies argue that bandwidth is a scarce resource and that imposing caps and overage fees will relieve pressure on high-speed networks. Families pay more when they use more electricity, these companies point out, so why shouldn’t households pay more if they use more bandwidth?  The analogy is a false one. Wireline bandwidth is an almost unlimited resource due to advances in Internet architecture. Adding more capacity is easy. The marginal cost of providing an extra gigabyte of data—enough to deliver one episode of “30 Rock” from Netflix—is less than one cent, and falling. […] Consumer access to unlimited bandwidth is good for society. It fosters innovation, drives commerce, and advances political and social discourse. Given that bandwidth is cheap and plentiful and will only grow more so with time, there is no good reason for bandwidth caps and fees to take root.

Oh my goodness. Really? Hyman appears to be suffering from a rather serious case of marginal cost fallacy: the belief that prices should, as a rule, equal marginal costs. The problem with such thinking is that it leaves zero room for investment, innovation, and other real-world dynamics that get conveniently forgotten as “fixed costs.”  Of course, if you begin with the truly outrageous claim that “bandwidth is an almost unlimited resource,” and “bandwidth is cheap and plentiful and will only grow more so with time,” then it’s only logical that you’d fall prey to this fallacy!

Meanwhile, back in the real world, economists and financial analysts will explain to you that high fixed-cost goods like broadband networks don’t just grow on trees or fall like manna from heaven. Yes, of course it is true that “consumer access to unlimited bandwidth is good for society.”  But the same is true of countless other goods that we’d all like to have access to at zero cost. But that doesn’t invalidate the fundamental laws of economics. Someone financed and built those networks and someone has to keep building and improving them. You’d never get anything built if you adopted the view that scarcity was a myth and that prices must equal marginal cost.

On that point, I was tickled to see in the online comments to Hyman’s piece that one gentleman asked, “what happens when you allow unlimited access at.. marginal cost?” and for another to say in response, “Answer: You turn into Greece.”   Quite right. There is no free lunch. Something has to pay the bills, including the broadband bills. You can’t just free-ride on the future forever by pretending that bandwidth is an abundant good and holding prices at or below marginal cost.

Once you understand these facts you can point out what’s really wrong with Mr. Hyman’s reasoning: He basically wants average costs for all consumers to go up so that his costs (or the costs of any high-bandwidth use or user) will never go up. Shameful!  Indeed, let’s just call Mr. Hyman’s editorial what it is: a blatant attempt to get government to impose price controls on broadband providers to favor his company. End of story.  He could have spared us all the sloppy economic sophistry and just told us that. It would have made it a bit easier to take him seriously.

P.S. Incidentally, Mr. Hyman’s one and only suggestion for how to deal with network demand/congestion is this: “If Internet service providers really wanted to manage traffic efficiently, they would limit speeds at peak times.” Interesting. I wonder how the Net neutrality crowd feels about Netflix’s new-found love of broadband throttling!

 

]]> https://techliberation.com/2011/07/08/netflix-falls-prey-to-marginal-cost-fallacy-pleads-for-a-broadband-free-ride/feed/ 12 37727 If NCMEC’s Going to Regulate the Internet for Child Porn, It Should At Least Be Subject to FOIA https://techliberation.com/2009/08/09/if-ncmec%e2%80%99s-going-to-regulate-the-internet-for-child-porn-it-should-at-least-be-subject-to-foia/ https://techliberation.com/2009/08/09/if-ncmec%e2%80%99s-going-to-regulate-the-internet-for-child-porn-it-should-at-least-be-subject-to-foia/#comments Sun, 09 Aug 2009 20:51:10 +0000 http://techliberation.com/?p=20147

Last year, my PFF colleague Adam Thierer asked whether State AGs + NCMEC = The Net’s New Regulators? Adam noted that NCMEC, the National Center for Missing and Exploited Children, a private non-profit organization, was playing a law enforcement role in regulating child pornography—but without any clear mechanisms for ensuring its accountability and effectiveness. Adam’s point wasn’t just that transparency is a good thing, but that when it comes to a cause as important as protecting children from exploitation, it’s vital to ensuring that we’re that we’re actually doing a good job at it!

Yesterday, Emmanuel Lazaridis commented on that post:

Given the increasing regulatory and investigative powers of the NCMEC, it is no longer clear whether or not the [Freedom of Information Act] applies to NCMEC records. We are about to find out. I am right now bringing a case against the NCMEC in federal court for access to records under the FOIA and, failing that, for discovery under 28 U.S.C. § 1782(a).

Mr. Lazaridis’s complaint in the D.C. District Court claims that Lazaridis (a Greek national) has been unfairly deemed a fugitive from U.S. justice for having taken his daughter to Greece over the objections of the girl’s American mother, Lazaridis’s ex-wife. NCMEC got involved by placing the girl on their MissingKids.com registry of abducted children. Lazaridis wants the court to recognize his custody, deem him not to be a fugitive, and to order NCMEC to turn over all their records on the girl.

This is, of course, just one side of the story (and such cases are usually so complicated as to be indecipherable to outsiders). But even if Lazaridis’s case were wholly without merit, his basic argument would be a sound one: Why shouldn’t NCMEC, in exercising any of its essentially governmental functions, be subject to the same accountability requirements through FOIA as the FBI would be?

When the issue is the Lazaridis family’s trans-Atlantic custody battle, it may seem easy to ignore this question. But when NCMEC is essentially making policy regarding filtering Internet content, blacklisting websites, turning over user logs to law enforcement, or “cleaning up” Craigslist, the question of NCMEC’s accountability under FOIA cannot be avoided as a critical decision about the future of Internet governance.

On heels of Adam’s piece last year, controversialist Chris Soghoian suggested one answer: Given its status as a sacred cow, we cannot expect any politician pay heed to calls to overhaul NCMEC or subject it to oversight. However, what we can do, is call for the nationalization of the National Center for Missing and Exploited Children.

Think of it this way: We have a drug czar, a war czar, a copyright czar, and will likely have a cybersecurity czar and car czar under the next administration. Why not throw a child porn czar into the mix? Nationalize NCMEC, make all of its workers federal employees, with good health care and job security, and perhaps even expand its budget–after all, it does good work, right? NCMEC’s job is simply too important to be entrusted to a nonprofit group–such a task can only be performed by a fully trained and funded law enforcement agency (one, which conveniently enough, is subject to the Freedom of Information Act, congressional oversight, and constitutional requirements for due process.)

Despite my differences with Chris, he’s often right and may be here, too. He’s certainly right that Congress is unlikely to address the problem of NCMEC’s accountability given the sensitivity of the issue of child protection.

But, fortunately, we live in a republic, not a pure democracy: Our third branch of government, the courts, exists to enforce the rule of law; being somewhat insulated from political pressure, the courts provide a final check on the authority even of the almighty NCMEC. So while Chris’s nationalization proposal might well be the ideal solution, it hasn’t happened yet—nine months later to the day, and it’s probably not high on the Obama administration’s list of czarist reforms.

But simply by ordering NCMEC to comply with FOIA, the Lazaridis court could, with the stroke of a pen, bring accountability to NCMEC’s law enforcement functions. The legal question is simple: Does NCMEC qualify as an “agency,” which FOIA defines as an “authority of the Government of the United States?”

If so, NCMEC must not only respond to requests for certain of its “records,” but it must also follow a rule-making process akin to that required of federal agencies when they make policy decisions, offering the public appropriate notice and the opportunity to comment on proposed regulations—instead of, say, threatening Internet companies behind closed doors (sometimes the same companies that later make generous donations to NCMEC) or cutting deals with state attorneys general.

It turns out that this is not a new issue. Federal courts have had to decide whether a number of quasi-governmental entities qualify as “agencies” over the years, especially given the trend towards privatization over the last three decades. Some organizations, like the Smithsonian Institution, have decided to comply with FOIA even though courts have held that they’re not required to do so. NCMEC could have allayed all these concerns years ago by doing the same thing, but absent a change in management at the organization, it seems only a court order will force the organization to open its “black box” of decision-making to public inquiry.

In a number of other circumstances, courts have required nominally private organizations to comply with the federal FOIA or its state equivalents. A thorough (if dated) treatment of this issue can be found in the 1999 law review article, Privatization and the Freedom of Information Act: An Analysis of Public Access to Private Entities Under Federal Law by Craig Feiser, Florida’s deputy solicitor general and an adjunct at FSU Law. Feiser explains:

When Congress amended FOIA in 1974, it added section 552(f)(1) and broadened the definition of “agency” to include entities not explicitly mentioned under the APA, but which “perform governmental functions and control information of interest to the public.”

In deciding whether a private organization qualifies as an agency subject to FOIA, courts have considered two factors.

One factor asks whether the entity has substantial independent authority in performing a function of the government, making it the functional equivalent of the government. The other factor asks whether the government substantially controls the entity’s day-to-day operations or organizational framework. In using either factor, the court is essentially asking to what degree the entity is performing a government function. In one case, the government is pulling nearly all of the strings; in the other case, the entity is making decisions independently for the government.

Financially, NCMEC is largely a creature of government: 70% of NCMEC’s $42 million budget in 2007 came from the government. But as Feiser notes, funding does not always mean control. Government control over NCMEC’s internal decisions is unclear. Indeed, the very lack of government control over an organization essentially regulating the Internet and imposing criminal sanctions that could follow convicted “sex offenders” for life would by itself be an enormous problem.

But given what NCMEC actually does, it obviously qualifies as an “agency” subject to FOIA under the “functional equivalence factor,” which as Feiser explains,

basically represents the opposite situation from the control factor. Here, the entity is functioning independently, but making decisions for the government, as opposed to having its decisions made by the government. In effect, it is the functional equivalent of the federal government, and, therefore, it should be an “agency” under the FOIA.

I’ll be watching the Lazaridis case closely, hoping that the court sees NCMEC for what it is: a private organization tasked with implementing not just any government function, but the enforcement of laws against the most vulnerable victims in society. Absent such a recognition, NCMEC will continue to grow into an unaccountable regulator for the Internet.

Today, the only public oversight of NCMEC required by law is the requirement that NCMEC (like any non-profit with federal tax-exempt 501(c)(3) non-profit status) file a Form 990 each year disclosing basic information about its finances. That report does not list NCMEC’s donors, because donors have a First Amendment right to remain anonymous, but a more transparent organization would, like my own think tank, at least identify its major donors. The 2006 and 2007 Form 990s do reveal a few interesting things, though, about what NCMEC does with its budget (70% of which comes from the taxpayer):

  • NCMEC’s CEO, Ernie Allen, was paid $359,191 plus $411,636 in benefits in 2006 (PDF p. 46) and $409,821 plus $426,540 in benefits in 2007 (PDF p. 19), for a total of $1.6 million in two years (roughly $800,000/year);
  • Not counting Allen, NCMEC spent $778,564 on its top five highest-paid employees in 2006 ($155,713/employee), and $875,657 in 2007 ($175,131/employee) (PDF p. 10 in both);
  • 31% of NCMEC’s 2006 revenues and 35% of its 2007 revenues went to salaries (PDF pp. 1 & 2 in both); and
  • NCMEC had 104 employees paid over $50,000 in 2006 (PDF p. 10) and 116 in 2007 (PDF p. 10).

I’d be reluctant to suggest that anyone at NCMEC was more interested in money than in protecting children, but if given the choice, we’d all prefer to do well while doing good. So if Allen were smart, he’d realize that a court order subjecting NCMEC to FOIA might be the best of all possible worlds: Requiring real accountability would neutralize calls for nationalizing NCMEC, allowing the organization to continue operating as a non-profit that can pay quite a bit better than the Federal civil service. Even the Senior Executive Service, for agency heads, maxes out at a measly $177,000/year.

Of course, if NCMEC’s records and decisions to regulate the Internet were subject to FOIA, the organization might not be able to… “convince” the Internet companies it essentially regulates to write large checks to NCMEC. But even this tax-hating libertarian would be hard-pressed to argue against funding the enforcement of laws against child pornography, abduction and exploitation with taxpayer dollars.

As the grandson of an FBI agent, whose framed credentials hang in a place of pride in my office (stamped “RETIRED” after his 25 years of loyal service), I can’t help but wonder how many more agents the FBI could employ to combat child porn with an extra $1.6 million/year in funding (the salary of Allen and NCMEC’s top-five highest paid employees). It seems that FBI agents today make roughly $48,000-87,000/year. Let’s call it an average of $67,500 and throw in 20% for overhead. That works out to $81,000/year—or:

  • 20 new agents for what NCMEC is paying its top six employees; or
  • 368 new agents for the $29.82 million NCMEC received in government support in 2007.

I’m sure the solution is far more complicated than simply hiring more FBI agents, and that NCMEC does much good work in the service of a noble cause. But until NCMEC is either nationalized as a direct arm of law enforcement or made significantly more accountable as a private organization, we won’t really have any way of knowing whether the money being spent on NCMEC is being spent in the most effective manner possible to deal with the problems of child pornography, abduction and exploitation. We also won’t know whether draconian alternatives to direct enforcement ( e.g., hiring more FBI agents) like network-level filtering mandates are truly necessary, despite their unintended consequences for the free speech and privacy rights of law-abiding Internet users.

]]> https://techliberation.com/2009/08/09/if-ncmec%e2%80%99s-going-to-regulate-the-internet-for-child-porn-it-should-at-least-be-subject-to-foia/feed/ 11 20147 Tennessee Enacts Flawed Cyberharassment Law https://techliberation.com/2009/07/07/tennessee-enacts-flawed-cyberharassment-law/ Wed, 08 Jul 2009 01:35:13 +0000 http://techliberation.com/?p=19190

The painful issue of cyberbullying has recently taken center stage in the ongoing debate about online child safety. Last week I wrote about Lori Drew’s acquittal on charges related to Megan Meier’s tragic suicide, suggesting that the judge in the case was right to overturn her conviction on a very expansive reading of the federal anti-hacking statute. While I think that decision was necessary on legal grounds, it’s sure to add “fuel to the fire” of calls for “action” in Congress.  Thus, I emphasized that observers of the case need to separate their understandable outrage from the from the questions of (1) whether that statute was properly applied and (2) how the law should treat such cases in the future.

On the second question, Adam and I recently released a major entitled, “Cyberbullying Legislation: Why Education is Preferable to Regulation.”  We distinguish among:

  1. Cyberbullying: kid-on-kid abuse online
  2. Cyberharassment generally: people of all ages using the Internet to harass each other
  3. Adult-on-kid cyberharassment: For example, Lori Drew’s alleged (but still unclear) role in the Megan Meier case

In a nutshell, we argue that education is the better approach to cyberbullying (Problem #1)—an approach taken by a bill introduced in the Senate by Sen. Robert Menendez (D-NJ) and in the House by Rep. Debbie Wasserman Schultz (D-FL) .  We go on to argue that, while it would be difficult to create criminal sanctions for cyberharassment generally (Problem #2) without infringing free speech and due process rights, it might be possible to craft laws narrowly tailored to cyberharassment of kids by adults (Problem #3).

By contrast, Rep. Linda Sánchez has proposed the “Megan Meier Cyberbullying Prevention Act, which by its title purports to deal with that problem (#3) but would actually create a sweeping Federal felony for all cyberharassment (#2). We noted the potential Commerce Clause problems with states trying to regulate Internet speech, and emphasized education as a superior approach at both the federal and state level that avoids constitutional problems, but suggested that, if Congress does ultimately conclude a criminal law is needed for Problem #3, it would well to do look to how the states craft cyberharassment laws before creating any federal penalty.

Just about the time we finished our paper, Tennessee enacted a new law (PDF) that makes it a misdemeanor (up to 1 year in prison and a $2,500 fine) for making threats made online (cyberstalking) as well as certain instances of cyberharassment, defined as communications:

  1. Made with “the malicious intent to frighten, intimidate or cause emotional distress”;
  2. Made in a “manner the defendant knows, or reasonably should know, would frighten, intimidate or cause emotional distress to a similarly situated person of reasonable sensibilities; and
  3. That actually result in making that person “frightened, intimidated or emotionally distressed.”

Prong #1 is essentially the same as the Sánchez bill (with the addition of the word “malicious”), while Prongs #2 and 3 somewhat increase the evidentiary burden faced by any prosecution under the law. So the bill suffers from many of the same problems that the Sánchez bill suffers from, which we discuss in our paper—most importantly, the bill would chill protected online speech because it is unclear when it would apply, and some online speakers would fear prosecution under the bill.

But what’s really disappointing here is that the original Tennessee bill at least recognized the critical importance of drawing distinctions by age.  It would have applied to specifically to harassing communications “with another person who is, or purports to be, less than 18 years of age” or to communications that cause “another person to be frightened, intimidated, or emotionally distressed, provided that the person’s response is one of a person of average sensibilities considering the age of the person.” While neither approach is quite what we recommend in our paper—if we’re going to criminalize anything, it should be adult-on-kid harassment—the original legislation was certainly better to what finally passed, which would likely fail to pass constitutional muster.

In a related context, Adam and I recently released another major paper detailing the serious consequences for online free speech of well-intentioned efforts to expand COPPA’s privacy protections for kids under 13 to cover all adolescents. There as here, while children under a certain age might be uniquely vulnerable and therefore require special protection (such as special penalties for cyberharassment by adults), we can’t treat everyone like small children without severely compromising freedom of expression online and the future vitality of the Internet itself. Again, this is why education is generally a better approach than criminalization.

]]> 19190 Use Competition to Bridge the Gap in Human Spaceflight https://techliberation.com/2008/10/31/use-competition-to-bridge-the-gap-in-human-spaceflight/ https://techliberation.com/2008/10/31/use-competition-to-bridge-the-gap-in-human-spaceflight/#comments Fri, 31 Oct 2008 16:04:28 +0000 http://techliberation.com/?p=13688

As TLF readers may know, I took over in July as Chairman of the Board of the Space Frontier Foundation.  As I explained in my recent interview on The Space Show, SFF has been the leading citizens’ advocacy group for space commercialization since 1988.  Dedicated to promoting Princeton physicist Gerard O’Neill‘s vision of space settlement, as described in his 1976 masterpiece The High Frontier, the Foundation has always argued that “space is a place, not a program.”

We sent out the following press release on October 28, calling for a major transformation of the U.S. government’s space program by which the U.S. government would buy commercial transportation to the International Space Station.  We’ll have more to say about this in the coming weeks.

Space Frontier Foundation Finds Funding Source for COTS-D

The Space Frontier Foundation today called upon Presidential candidates Barack Obama and John McCain to invest the $2 billion in new funds they have promised to NASA for reducing the “Gap” in U.S. human spaceflight (after the Space Shuttle is retired in 2010) to spur innovation and competition in America.

Foundation Chairman Berin Szoka said “It’s time that our national leaders give American entrepreneurs a shot at closing this gap. Let’s take the two billion dollars in the candidates’ plans and fund up to five winners of COTS-D.”

The NASA Authorization Act of 2008, recently signed into law by the President, directs NASA to “issue a notice of intent [by mid-April 2009] … to enter into a funded, competitively awarded Space Act Agreement with two or more commercial entities’ for transporting humans to the ISS”-the “Capability D” of NASA’s Commercial Orbital Transportation Services program (or COTS-D for short). But that directive is not yet funded.

Szoka continued, “Let’s have an American competition in space – to create good jobs, fuel innovation, and close the gap more quickly. With private funds matching government’s investment, we can dramatically leverage the $2 billion to produce breakthroughs in a new American industry – commercial orbital human spaceflight.”

By investing in several different approaches, the government will win no matter who wins this new race, and also benefit from the resulting price competition.

Many American companies, including Boeing, PlanetSpace, SpaceDev, SpaceX, and t/Space have each previously submitted credible COTS-D proposals to NASA. Each of these firms has reached the semi-finals of one of the previous NASA COTS competitions. Increasing funding for COTS by $2 billion would allow NASA to fund all five of these promising companies’ proposals with COTS agreements, and in so doing, build redundancy into the human spaceflight capability available to NASA and other customers.

“It’s popular in Washington to use ‘The Gap’ to cynically justify continued funding of an expensive jobs program,” concluded the Foundation’s co-founder, Bob Werb. “We’re using ‘The Gap’ to advocate a policy that will bridge a gap that matters much more: the chasm between a dying government Human spaceflight monopoly and an emerging, free and competitive marketplace that can open the space frontier to everyone.”

]]> https://techliberation.com/2008/10/31/use-competition-to-bridge-the-gap-in-human-spaceflight/feed/ 4 13688 Goodbye to Most Business Method & Software Patents? https://techliberation.com/2008/10/30/goodbye-to-most-business-method-software-patents/ https://techliberation.com/2008/10/30/goodbye-to-most-business-method-software-patents/#comments Fri, 31 Oct 2008 03:25:15 +0000 http://techliberation.com/?p=13692

The Federal Circuit significantly limited the patentability of software and business methods today.  Mike Masnick at TechDirt summarizes the holding of the case as follows:

the court has said that there’s a two-pronged test to determine whether a software of business method process patent is valid: (1) it is tied to a particular machine or apparatus, or (2) it transforms a particular article into a different state or thing. In other words, pure software or business method patents that are neither tied to a specific machine nor change something into a different state are not patentable.

I’m sure several of my TLF colleagues will have a great deal to say about this.   Tim Lee has already written about this on Ars Technica:

The Bilski decision, then, is a clear signal that the pendulum has begun to swing back toward tighter limits on software and business patents. However, it remains to be seen how far the court will go in this direction. Bilski was a relatively easy case. The applicant made little effort to hide the fact that he was seeking to patent a mental process, something the Supreme Court has clearly said is not allowed. Therefore, the Federal Circuit’s rejection of this patent doesn’t tell us how it will rule when confronted with software or business method patents that are tied more directly to a physical machine or a transformation of matter. And indeed, the Federal Circuit reiterated that some software and business method patents are valid, so we are unlikely to return to the near-prohibition on such patents that prevailed until the early 1980s.

Thoughts?

]]> https://techliberation.com/2008/10/30/goodbye-to-most-business-method-software-patents/feed/ 11 13692 A Wide Diversity of Consumer Attitudes about Online Privacy https://techliberation.com/2008/10/30/a-wide-diversity-of-consumer-attitudes-about-online-privacy/ https://techliberation.com/2008/10/30/a-wide-diversity-of-consumer-attitudes-about-online-privacy/#comments Fri, 31 Oct 2008 00:03:30 +0000 http://techliberation.com/?p=13683

Debates about online privacy often seem to assume relatively homogeneous privacy preferences among Internet users.  But the reality is that users vary widely, with many people demonstrating that they just don’t care who sees what they do, post or say online.   Attitudes vary from application to application, of course, but that’s precisely the point:  While many reflexively talk about the “importance of privacy” as if a monolith of users held a single opinion, no clear consensus exists for all users, all applications and all situations.  

If a picture is worth a thousand words, this picture makes the point brilliantly—showing:

locations where [Flickr] users are more likely to post their photos as “public,” which is the default setting, in green. Places where Flickr users are more likely to put privacy controls on their photos show up in red.

Of course, geography is just one dimension across which users may vary in their attitudes about privacy, but the map makes the basic point about variation very well.  Seeing what users actually do in real life says a lot more about their preferences than merely polling them about what they think they care about in the abstract—as my colleagues Solveig Singleton and Jim Harper argued brilliantly in their 2001 paper With A Grain of Salt: What Consumer Privacy Surveys Don’t Tell Us (SSRN).

]]> https://techliberation.com/2008/10/30/a-wide-diversity-of-consumer-attitudes-about-online-privacy/feed/ 11 13683 Google Policy Fellow Program https://techliberation.com/2008/10/25/google-policy-fellow-program/ https://techliberation.com/2008/10/25/google-policy-fellow-program/#comments Sat, 25 Oct 2008 18:32:55 +0000 http://techliberation.com/?p=13455

Google has just announced that it is now accepting applications from undergraduate, graduate and professional students for its summer 2009 Google Policy Fellowship.  Three think tanks employing TLFers are among the host organizations participating in the program: The Progress & Freedom Foundation, the Cato Institute and the Competitive Enterprise Institute. 

Applications are due by December 12, 2008.  The program will run for ten weeks during the summer of 2009 (June-August). Apply today!

]]> https://techliberation.com/2008/10/25/google-policy-fellow-program/feed/ 12 13455 PFF Launches Center for Internet Freedom https://techliberation.com/2008/10/24/pff-launches-center-for-internet-freedom/ https://techliberation.com/2008/10/24/pff-launches-center-for-internet-freedom/#comments Fri, 24 Oct 2008 15:46:02 +0000 http://techliberation.com/?p=13445

The Progress & Freedom Foundation has just launched the new Center for Internet Freedom.  CIF offers an alternative to the proliferation of advocacy groups calling for government intervention online by offering timely analyses and critiques of proposals that diminish the vital role of free markets, free speech and property rights.  We aim to drive the Internet policy debate in new directions by emphasizing a layered approach of technological innovation, user education, user self-help, industry self-regulation, and the enforcement of existing laws consistent with the First Amendment.  Such an approach is a less restrictive—and generally more effective—alternative to increased regulation.  

Here are some of the issues I’ll be working on as CIF’s Director in conjunction with my esteemed colleagues Adam Thierer, Adam Marcus, and adjunct fellows: 

  • Defending online advertising as the lifeblood of online content & services, especially in the “Long Tail”;
  • Emphasizing market solutions to problems of privacy protection, especially regarding the use of cookies and packet inspection data;
  • Protecting online speech and expression both in the U.S. and abroad;
  • Defending Section 230 immunity for Internet intermediaries;
  • Opposing online taxation and legal barriers to e-commerce and digital payments, especially at the state and local levels; and
  • Ensuring that Internet governance remains transparent and accountable without hampering the evolution of the Internet.
]]> https://techliberation.com/2008/10/24/pff-launches-center-for-internet-freedom/feed/ 12 13445 A Major Victory for Space Commercialization https://techliberation.com/2008/10/22/a-major-victory-for-space-commercialization/ https://techliberation.com/2008/10/22/a-major-victory-for-space-commercialization/#comments Wed, 22 Oct 2008 20:57:07 +0000 http://techliberation.com/?p=13409

Congress has very wisely cancelled the National Reconnaissance Office’s proposed Broad Area Space-Based Imagery Collection (BASIC) satellite system. The proposal to build two new imaging satellites at a cost to taxpayers of $1.7 billion would have represented a major break from what is possibly the U.S. government’s most successful effort to promote space commercialization to date: buying the imagery it needs from commercial providers, who can also sell imagery to other buyers.

Five years ago, the idea that Internet users could pull up a satellite image of just about any location on the planet at a whim would have seemed ludicrous. Yet that’s precisely what websites like Google Maps and Microsoft’s Live Search offer today—for free! Desktop applications like Microsoft’s Virtual Earth and Google Earth offer even more advanced geospatial tools—again, for free. But of course this library of incredibly rich imagery didn’t just “fall out of the sky,” as they say. It was collected by a handful of expensive commercial remote sensing satellites whose construction was made possible by the National Geospatial-Intelligence Agency‘s (Wikipedia) extraordinarily successful “Nextview” program implemented under the Commercial Remote Sensing Policy of 2003.  Rather than having the Federal government build its own satellites—and pay for the entire cost of the satatellites—the NGA very wisely chose to buy imagery from commercial providers in two ~$500 million, 4-year contracts with U.S. satellite imagery companies:  DigitalGlobe in 2003 and OrbImage (now GeoEye) in 2004.  

These long-term purchase agreements essentially made the U.S. Government the “anchor tenant” in a new class of remote sensing satellites, providing the initial funding for both companies to build and operate their satellites. But because the companies sell roughly half of imagery to foreign governments and commercial buyers like Google and Microsoft, these deals have saved U.S taxpayers money for the purchase of imagery for a wide variety of needs, ranging from agricultural monitoring to military intelligence. At the same time, the Nextview contracts have given birth to a vibrant geospatial industry whose immediate benefits should be obvious to anyone who’s ever pulled up a satellite map online and whose macroeconomic impact is potentially enormous. 

So why mess with success?  If the U.S. Government thinks it needs more satellite imagery, why not simply award another long-term purchase agreement to a commercial provider? Besides reducing the burden on the taxpayers, continuing the NextView approach would support the construction of a new generation of commercial satellites like GeoEye-1, which was launched just last month, and DigitalGlobe’s WorldView-1, launched last year.  Rather than rolling back NextView in favor of building its own systems, the U.S. Government should be looking for other space services it can buy on a commercial basis as a way of building industries rather than programs, ranging from sending crew & cargo to the International Space Station to communications and navigation services for NASA’s planned Return to the Moon.

Rather than giving up on the NextView approach in the area where it has already produced spectacular results, the U.S. government should be looking for other areas in which to apply the NextView model by buying space services from commercial providers.

Full disclosure: I was proud to handle FCC matters for GeoEye while practicing law at Latham & Watkins LLP. I currently have no greater personal interest in their success than should any American who wants to see the private sector succeed where the government has failed in opening up the space frontier to all mankind.

]]> https://techliberation.com/2008/10/22/a-major-victory-for-space-commercialization/feed/ 12 13409