Many Increasing Returns
“Many Increasing Returns” is the title of the article I'm working on now. And I'll talk about it tomorrow at Columbia.
News: DOC approved ICANN's contract with VeriSign for .com today.
CDT and PFF urged courts not to let FCC have regulatory authority over speech in the internet age.
And here is a holiday carol.
Ofcom report
Ofcom just released a report today about global telecommunications developments. Key findings here.
Unsurprisingly, people are watching less television, spending less time reading newspapers, spending less time listening to radio offline. Young people do even less of these things. And Ofcom notes that there is a lot of online advertising.
Ofcom is absorbed with “convergence” — that word for the future that current incumbents would like to see, when services are available online but neatly divided into labeled “IPTV,” “movies” etc. categories. The data seems to indicate that convergence is already here, without the need for labels — and the categories aren't always so clear.
And, this just in:
Our 2006 UK Communications Market research on young people in the UK has highlighted the growing role of the internet as an integral part of the social fabric for many young adults today, with the majority using it as a tool for interacting with peers and meeting new people via online communities, often referred to as ‘social networking’.
Aha.
But on a serious note, this:
Next-generation networks (NGNs) will be able to carry the full range of current communications services via data packets, and the nature and timing of NGN deployment will depend partially on the policy decisions regulators make about whether to intervene (and in what manner) in relation to these infrastructure upgrades.
What? The internet already can carry any packet. With enough bandwidth installed, any kind of communication can be watched and interacted with enjoyably. So what's missing that requires an acronym? Why not say we're deploying bandwidth — why invoke a whole slew of centralized standard-setting exercises?
Much to ponder, at any rate.
Miscellany
It's been a long day of gathering information about S. Korean and Japanese highspeed internet access policy.
Culture makes a big difference, as does leadership. If we here in the U.S. decided it was a priority to provide universal highspeed internet access, and we had someone leading us who understood the economic growth/diversity/access connection, we might make progress. But our culture doesn't favor technology and education and getting ahead in life to the same extent that Japanese and Korean cultures do.
Factoids: Japan alone has more fiber subscribers than the total number of highspeed subscribers in 22 of the 30 OECD countries. Most of these Japanese fiber subscribers are signing up with NTT East/West (they control 64% of the fiber lines), which is serving to reconstitute that company's old monopoly on connectivity — in the DSL arena, there is fierce competition.
And, boy, are social networking services popular in Japan.
In 1995 South Korea decided that highspeed internet access was important to that country’s economic growth. They decided to ensure ubiquitous broadband access of 20Mbps by the end of 2006, and backed up the decision with a direct investment of $1.5 billion plus targeted loans and mixed public/private investment encouragement. Universal highspeed internet access has been a central condition of Korean policy for the last seven years, and the government has carried out a plan of investing $30 billion in this access, through direct government investment and indirect, privately-funded initiatives.
In a recent speech, media mogul Rupert Murdoch decried the state of broadband infrastructure in Australia, and urged the government to get involved in investing in a fast network that would cover “every town in Australia.” He said:
They do it in Japan, they do it in South Korea. We should be able to do it here . .. We are being left behind and we will pay for it.. . When you have broadband - real broadband, not the type they're talking about here - where you get, say, 20Mbps of data into your home, it changes everything. . . Broadband certainly is going to become ubiquitous around the world, and if you don't have it, you're left behind.
Diverse new ideas whose development is made swifter by the advent of the internet and its special characteristics are likely to emerge at a greater pace once highspeed access is widely available in this country. As Rupert Murdoch has got to understand, participating in this ecology is becoming more important to the economic and cultural success of Americans and the overall economic growth of this country.
We should tie universal service programs to the principle that funding highspeed access to the internet for all should be a top social priority, to be funded out of general tax revenues.
[Thanks to David Isenberg for many many useful pointers, including but not limited to the Murdoch speech]
Searching for a principle
At the moment, federal telecommunications policy seems to have no coherent set of goals. We have complex and separate regulatory structures covering telephony (wired and wireless), broadcasting, cable television and satellites. Although there is no express delegation by Congress to the FCC to regulate the internet, the FCC sometimes imposes heavy-handed rules (E911 and CALEA for VoIP) and sometimes claims that its chief goal is to be deregulatory. The various policy aims identified by FCC-watchers are sometimes in conflict. Congress spasmodically takes up indecent speech, gambling, spam, spyware, and privacy, among other online topics – without, it seems, an underlying theory that would help prioritize or rationalize regulation.
Even without a clear goal, these regulatory actions affect outcomes and create controversies about which economic and social benefits should be preferred or can be attained. We are stumbling forward, tinkering blindly with the greatest value-creation system we have ever seen.
It is clearly time – it is beyond time – for an organizing principle for communications regulation to emerge. Traditional regulatory silos no longer make sense in this era of digital abundance. Given the advent of smart devices that can avoid interference, spectrum regulation should be substantially loosened over time, and more spectrum opened up for ad hoc uses. Given the abundance of communications available, supporting broadcast content regulation based on a scarcity rationale seems less and less defensible. Media concentration concerns based on, again, scarcity of megaphones in any given locality seem to defy reality, and strict quota-driven approaches to “diversity” (including must-carry rules for cable systems) are poor proxies for actual encouragement of diversity. News is coming from all directions and from a multitude of voices. Telephone regulation is being undermined by the swift advent of online voice services. Aware that explicit authority over the internet is not granted to it in the Telecommunications Act the FCC has moved to assert “ancillary jurisdiction” over everything from devices to online applications. The unbundling regulations applied to telephony providers in the 1996 Act have been gutted through litigation. Traditional forms of communications modalities – postal mail, the press, entertainment distribution systems, telephony – are gradually melting away because of the emergence of online substitutes.
Given this categorical blurring and increased importance of online communications, whatever organizing principle we seize on for communications regulation should be explicitly calibrated for the internet.
And given that communications law should be focused on contributing maximum value to society, the key organizing principle for communications law must be to support the emergence of diverse new ideas online – because that is where economic growth for society as a whole will come from.
This form of diversity support is not the same as the kind of quota-driven artificial “diversity” that has been used to force broadcast content regulation. Rather, this kind of online diversity stems from allowing the end-to-end, content-neutral, layer-independent functions of the internet to flourish, and allowing human attention to pick and choose from among the bad ideas presented online, enabling good ideas to persist and replicate.
Think Jane Jacobs diversity.
This principle for future communications regulation – encourage diversity – has immediate practical implications. The traditional central problem for telecommunications law theorists is the role of the “last mile” or “local loop” connection between an incumbent’s central office and the home of a consumer (or a local business). With the arrival of high-speed connectivity, this last mile connection is now providing access to a system of human communications that is more capable than any past system of generating the diverse new ideas that will support continued economic growth in this county. Yet the desires of network providers to control and prioritize access may frustrate this digital engine of diversity. At the same time, we have not made access to this system of human communications sufficiently universal.
Universal highspeed access to the internet — Korea did it by forcing competition through unbundling (including unbundling cable networks!), putting up grant money, funding research, educating huge numbers of users, and making some strategic investments. That should be our goal here.
Structural will
Most of the time when I talk about the need to treat internet access like a utility, I get amused smiles.
That's the thing we have to change — the idea that it's unthinkable (amusing, even) that we could take this increasingly singular but private relationship of people to broadband internet access and make it a public relationship.
But end-users really don't care whether their provider is a cable company or a telephone company — they think they're getting the internet. They're probably not even aware that a private company is providing internet access to them. And there are even a few people out there in the U.S., despite our best efforts, who don't understand that these private companies have every incentive to prioritize and manipulate their way into showing us “channels” instead of the internet.
This re-framing isn't easy. We haven't nationalized an industry in a while. It's not clear that our government would even be particularly good at making fast internet access into a true public priority and resource.
But as all other categories of former media fall away, as telephony, the press, the movie industry, the postal service, and broadcast all become part of an enormous digital pond, it makes less and less sense to treat access to this crucial informational resource like candy-bar sales — particularly when the market for access isn't itself competitive.
As I say, all I get is smiles when I say this. It happened again today, that amused smile. I hope by a couple of years from now the idea will be getting a different, and more respectful, reception.
Law for engineers
Someone recommended a lovely essay to me by James Boyd White: Constituting a Culture of Argument: The Possibilities of American Law (a chapter from a book, When Words Lose Their Meaning). I'd link to it, but it's not available online. Try your local library.
Boyd White left English literature for law study, and found the interrelations of the two disciplines interesting and pleasant. His concern and respect for the law as expressed in this essay is deeply felt, and I wish that engineers who are contemptuous of lawyers would give this chapter a try.
From what I can tell, engineers think that law is something that lawyers manipulate to get something done so that they'll be paid. So lawyers are tricksters and the law is a tool. And lawyers, seen this way, are likely to be terrible dinner companions.
James Boyd White tries to explain that law is a collective conversation — a highly formal one, sure, but a narrative nonetheless:
The law is best regarded not so much as a st of rules and doctrines or as a bureaucratic system or as an instrument for social control but as a culture, for the most part a culture of argument. It is a way of making a world with a life and a value of its own. The conversation that it creates is at once its method and its point, and its object is to give to the world it creates the kind of intelligibility that results from the simultaneous recognition of contrasting positions.
. . .[The law] establishes roles and relations and voices, positions from which and audiences to which one may speak, and it gives us as speakers the materials and methods of a discourse.
So law is a conversation that allows us to find meaning, or talk about meaning, in the world. It's very self-consciously rhetorical, actually — we lawyers always talk about how we should talk, who has the right to talk in a given context, what forms of argument are acceptable, how to constitute community and government and authority. Yes, truth may be contingent, and that's very annoying to the engineers — but that is how we make something out of nothing, a government out of people, without killing one another.
The Declaration of Independence is seen by James Boyd White as an inspirational text, something written to recreate in the hearts of all who read it the same feeling of a grand motive based on a sense of common identity. It's a lawyerly text too — it's an argument as well as a declaration.
So lawyers try to articulate basic commitments all the time, and judges often write highly rhetorical and symbolic opinions. We're all working on a conversation, and many points of view need (and deserve) to be aired as part of this conversation. It's supposed to be an open system, the law — more like music or English literature than it is unlike these humane pursuits.
It's fine to be cynical, and to dislike the niceties of lawyers, and it's also too often true that you get the law you pay for. But I do wish that the engineers weren't quite so dismissive of the lawyers. They're not all bad.
Economic growth and infrastructure investment
There's a large report out from the United Nations Conference on Trade and Development this month on the relationship between development and information technologies. In skimming it this evening, I noticed an emphasis on the importance of government policy in enforcing competition or promoting broadband uptake. The idea is that broadband policy is closely linked to economic growth:
Corporate analysts estimate that broadband could contribute hundreds of billions of dollars a year to the GDP of developed countries in the next few years, and liken it to water and electricity as “the next great utility” (Whisler and Saksena, 2003).
(from p.45). The work of growth theorists reveals that choices made by government to stimulate the production of new ideas can have an significant effect on economic growth. Compared to a country with restraints on idea-generation diversity, a country supporting free trade in ideas should tend to have a greater amount of resources devoted to idea-generation and thus a higher rate of economic growth. At the level of the country’s economy as a whole, increasing returns should be the result. The state of a country's telecommunications infrastructure has strong effects on economic growth — and the fact that our public infrastructure is under the control of such a concentrated duopoly of access providers (none of whom is interested in providing open, unprioritized internet access) should be a cause for great governmental concern.
Better growth policy could have implications for the standard of living of all Americans that are so enormous that they are hard to understand. For example, if the rate of economic growth over the next 45 years or so were to increase by 0.5% per year, it could fix all of the budget difficulties associated with the aging of the boomer generation, with a lot left over.
I'm at the tail end of that generation, so I'm anxious to get this fixed. We won't be stimulating the production of new ideas by having telcos/cablecos in charge of innovation.
Two wikis and a question
OneWebDay 2007 is ten months away. We've set up a wiki page for planning purposes on the OneWebDay.org site. I've got some people creating a great composite zippy video from the 2006 materials, and that will be released online before the end of the year. The video will explain what OneWebDay is all about and will prompt lots of participation. But the wiki help on planning would be great.
Another wiki page, this one about ICANN meeting improvement is here on the ICANNwiki. If you have any interest in ICANN, please edit and comment. There will be a public session at the next ICANN meeting about all this (in São Paulo on Wednesday, 6 December, at 15:00 São Paulo time, which is UTC -3, audio feed, webcasting and transcription of the workshop will be available), and the more public feedback there is beforehand the better. Plus there's a questionnaire here. Wiki, questionnaire, email comments — whatever — please get involved if you're interested.
And the question: I'm part of a conference on personal ultrabroadband on Dec. 1 (announcement here). Before the conference, I would like to talk to someone who knows all about public policy in South Korea on broadband. I've been poking around online but an actual conversation would be wonderful.
Thanks for the help.
South Korea and Ireland
Great article here about the future of the internet — in South Korea. Everyone's a netizen. Everyone has cheap broadband. Nine out of ten 20-something Koreans are part of Cyworld. Online activists helped elect the President, and the President gives his first interview to OhMyNews.
South Korea made the decision ten years ago to invest in high-speed (competitive) internet access and subsidize cheap PCs — as a result, they have just about the highest broadband penetration in the world. Not only has the dream come true, but economic growth comes attached.
Meanwhile, someone sent me a Wall Street Journal Europe article about VCs carving up an Irish telephone company to treat transport like a utility. The big guys can watch the model and then think about selling their own networks to raise some cash.
Ireland is a model proving ground to attempt a split, says Robert Topfer, head of corporate finance at Babcock & Brown. Because Ireland has a relatively small population of about four million spread out over the island, it would be too expensive for any competitor to build a network reaching all the homes and offices, leaving Eircom with a monopoly. The company must share the network by leasing access to competitors and others such as Internet providers, but the system for doing that is clumsy and loses money and is a headache for regulators.
“We share, but we share begrudgingly,” Mr. Topfer says. The answer, he says, is to hive off the network and regulate it like a utility. For the regulator, such an outcome would be “nirvana,” he adds.
So the money guys see the advantage in separation.
As I've mentioned in the past, the EU telecommunications regulator keeps talking about separation and suggesting that taking this step would help the competitive picture all over Europe.
There are good ideas all over the place outside the borders of the U.S. — all we need now is bravery, and we'll be able to catch up. I hope.
A good day for users
Today the Supreme Court of California issued its much-looked-for decision [warning, pdf] in Barrett v. Rosenthal. Unlike that kooky dicta-ridden Craigslist case from last week, this one falls right in line with Zeran and lets online service providers (and users!) breathe a sigh of relief.
It's based on some strange facts. Rosenthal, the defendant, forwarded an allegedly defamatory article written by someone else to a newsgroup. The statute, 47 USC 230(c)(1), says that “No provider or user of an interactive computer service shall be treated as the publisher or speaker of any information provided by another information content provider.” But the “user” part hadn't come up before in litigation.
Who's a “user”? The court decides that a user is — a user. Anyone using an interactive computer service. So by forwarding or posting the article, Rosenthal was a user. She shouldn't be treated as the information content provider and held liable for its content, because she didn't write the article.
The strongest and most useful part of the opinion squelches the argument that “distributor” liability was somehow left untouched by Section 230. If this argument had prevailed, “publishers” would be immunized from defamation liability, but “distributors” would be on the hook if they “knew or had reason to know” that there was some potentially defamatory material on their servers.
Nonsense, the court says. This would be terrible for interactive computer services — an impossible burden — because every time they received notice of something potentially defamatory (had “had reason to know” such a thing) they'd have to make a judgment about it and decide whether or not to continue the publication. Far too many bits flying around for that to make sense.
My favorite section of the opinion is the part pointing out that the legislative history of the Dot Kids Implementation and Efficiency Act, 47 USC 941, includes specific language making clear that registrars and registries with responsibility for .kids.us are “interactive computer services” for the purposes of Section 230. The committee report prepared in connection with the Act says that Zeran etc. was correctly decided. Bravo.