Futurama
Saul Hansell writes today about Comcast’s “Fancast” service, which is aimed at making it easier to find high-priced content that is being distributed through tightly-controlled windows (e.g., in the theaters, heading to video, being broadcast on cable).
In the future, Fancast wants to tie platforms together:
If you see video on the Web that’s not on cable at all — from a movie on Netflix to a silly clip on YouTube — you might be able to capture it online and send it to your television. For that matter, you might be able to take content from a television broadcast and send it to a personal computer or mobile phone.
It’s smart to make it easier for people to find things they want (or might like, based on their patterns of interaction). But I had the feeling reading this piece that this prediction (particularly in Comcast’s hands) is something like the GM set of predictions for the world of 1960 that people absorbed at the 1939 World’s Fair - intensely exciting, somewhat naive, highly-organized, and driven by particular corporate plans.
“Residential, commercial, and industrial areas all have been separated for greater efficiency, and greater convenience…displacing outmoded business sections, and undesirable slum areas, whenever possible.”
Why Comcast, why emphasize “platforms” of distribution windows? It’s true that cheap and great is better than free and lousy, and it’s true that convenience in finding online material is needed. But GM’s vision of the 1960s depended on more public infrastructure being built - Comcast’s vision, by contrast, may depend on its own private control as a network operator continuing.
Midwest venture capital?
Today in a parking lot in Ann Arbor someone talked to me about his startup. He said it had been mentioned by TechCrunch, by Michael Arrington himself. He was clearly very excited about the mention. But he also said that he was worried about finding funding in the Midwest. “We’re so behind here!” he said. He looked a little frantic.
There’s a Google office in Ann Arbor, and thanks to Ed Vielmetti there’s a vibrant tech meetup. So if you are a VC consider Ann Arbor. There are people here who are ready to pitch to you. (For all I know, there are zillions of VCs in Ann Arbor. But my new parking lot friend didn’t seem to think so.)
“Well, the FCC issued a regulation”
And so even though the DC Circuit said the FCC didn’t have the jurisdiction to adopt that regulation, and Congress hasn’t acted to change that conclusion, Microsoft still apparently thinks its Media Center should acknowledge broadcast flags - preventing users from copying over-the-air digital broadcasts.
[DC Circuit to FCC: Back Off, from the summer of 2005, describes the broadcast flag case, and I wrote frequently about this subject in 2003 and 2004.]
Now, MSN is free to decide to acknowledge flags. The odd thing is that it has done so. The concern back in 2003-04 of content companies was that no self-respecting consumer electronics provider would want to install flag-adherence (why would consumers view this as a positive?) and so the content people thought that a standard regulatory mandate was needed. Now, a few years later, MSN has apparently decided it’s a value-add to voluntarily adhere to flags.
This could be because MSN thinks the entire MSN ecosystem is valuable enough that consumers won’t care about particular limitations on copying. Or it could be because MSN plans to attack Google by aligning itself with the content industry.
But this isn’t happening because of the FCC, and MSN’s reliance on the (illegal) FCC regulation signals that MSN continues to have concern about user reaction to bossy copy-limitations.
Information/communications services
Congress and the Federal Communications Commission have divided all communications using wires or radio waves into two categories: telecommunications services or information services.
Telecommunications services are defined as “basic” transmission services in which there is no “protocol conversion” or re-stating of the communication in a different technical form. Telecommunications services are subject to “common carriage” regulation, in which no discrimination is allowed and everyone must be served on a similar basis. In 1956, AT&T was told in a consent decree with the Department of Justice that it could provide only “common carriage” services.
Information services, on the other hand, do involve these protocol conversions, and are supposed to be “unregulated” - left alone by regulators save for the imposition of particular “social policies” that are deemed to be worth the regulatory candle.
The idea is that everything fits within one or another of these categories – regulated or unregulated – but not both. The theory is that monopoly-provided basic telecommunications services should be subject to common carriage obligations, and one of the ideas behind the AT&T breakup in the 1970s and 1980s was that regulated common carriage providers (the local telephone companies) should not be allowed to cross-subsidize unregulated information services businesses. Similarly, the FCC and Congress take the position that businesses providing unregulated information services should not be subject to common carriage obligations. At bottom, the FCC takes the view that the regulator’s job is to decide how a particular form of communication should be categorized. From that categorization everything else flows.
Network operators providing access to the Internet through coaxial cables, fiber-optic lines, and wireless transmissions have persuaded the FCC and the Supreme Court that everything they do falls into the “information services” category. There is very little common carriage “telecommunications services” provision going on any more.
At this point, the division between “telecommunications services” and “information services” seems like an immutable principle. It seems inconceivable that we could abandon our commitment to this American understanding: telecommunications services on one side, information services on the other, and a hermetic seal between the two.
Yet this fundamental slicing of the world is (or should be) difficult to maintain. Application of the words “information service” to highspeed internet access (which certainly feels just like basic transport to everyone other than communications lobbyists) is extraordinarily difficult. Even though the Supreme Court managed to defer to the Commission’s interpretation on this point, its opinion was easily parodied by Justice Scalia in dissent. The complete absence of basic common carriage telecommunications services has unmoored the notion of “information services” – rather than “information services” being something made possible by basic transmission, “information services” are now everything.
Although the telecommunications/information service dichotomy is a basic building block of communications law, the details of the categorizations that are currently carried out using these words make little sense. The reason the “information services” category is incoherent (particularly when it floats alone, unaccompanied by any notion of underlying common carriage) is that we have forgotten where it came from.
The origins of “information services” are found in the pre-Internet era, when we were concerned that telephone companies would use their bottleneck control over communications services to control access to early computing services such as data processing carried out on enormous mainframes. We assumed the presence of common carriage communications, and we were worried about giving those carriers the power to choke off these new computing services. The idea of “information services” was designed to protect the computing industry from the depredations of the carriers.
Since the 1950s, the computing industry has morphed into the human-computer-interaction that we know as Internet applications. Meanwhile, the notion of “information services” has been pressed into duty by the carriers themselves to define what it is they do so that they can protect themselves from regulation. But this idea was never designed to protect the carriers, nor even to serve as a definition of a particular form of transport. It was designed to protect computing.
The consequences of the deracination of “information services” are profound. Now that all network operators can style themselves as providing “information services,” there is no legal constraint on their ability to discriminate against particular uses of their networks. Yet this discretion to discriminate is exactly what the original thinking behind the “information services” category sought to avoid. Also, loss of the idea of common carriage that is behind the “communications services” category (now itself a kind of lost positive) has been destructive to communications provision and even, perhaps, to economic growth in the U.S.
Commencement 2008
thanks to altopower
Skype, M2Z, and termination fees
All being discussed at the FCC June 12 meeting, according to this report.
Here’s what may happen: the Skype petition will be denied, more spectrum may be suggested for auction (on the condition that some of it be made available for free wireless use - relates to the M2Z plan that was rejected by the Commission), and a quiet deal between the FCC and wireless carriers on early termination fees may be struck.
Meanwhile, I’ve been spending time working on whether Clayton Act amendments would solve net neutrality issues. At this point, I’m not confident this approach makes sense. The current proposed bill, H.R. 5994, would allow for discrimination (as long as the discrimination was equal) by network operators, and is subject to substantial exceptions (including permitting measures by network operators that are designed to “prevent a violation of a Federal or State law” or to “manage the functioning of its network”).
More importantly, case-by-case antitrust-like remedies don’t fit the network problems that the neutrality movement has identified. By the time we’ve managed to fight through the facts of a particular issue, the real battle - the battle for attention and user expectations - will have been lost. More on this next week.
The biggest surveillance story in years
To very little uproar - that’s the problem - the UK is considering floating a bill that would centralize all data collected by ISPs.
Can you imagine this? The UK has had data retention laws since October 2007 that require phone companies to hang onto phone and text records, and this next step would make all of that data plus email, internet usage, and VoIP data available in a single place - accessible by a mid-level policeman who wanted to know more about his traffic-stop suspect. Data mining for any purpose (national security, fighting terrorism, or a divorce case) would be possible, without judicial oversight.
The UK is a very watched place.
I understand that coverage of this issue by mainstream press in the UK (and in particular the BBC) has been light. Perhaps the civil society objections are too muted - perhaps it seems inevitable that all data will be perfectly searchable by law enforcement authorities. There’s a good story in ComputerWeekly here, which may be an exception. And this seems to be a summary of the bill, but I can’t find its actual text.
This is the biggest surveillance story in years. If there isn’t uproar, the bill will be introduced as planned; if it’s introduced, it will likely pass. Let’s hope someone is watching and objecting.
The old AT&T
From End of the Line: The Rise and Fall of AT&T, by Leslie Cauley, a description of AT&T culture c. 1997:
Literally a century in the making, the [AT&T] culture was so omnipresent that it even had its own nickname: the Machine. . . . Almost impenetrable to outsiders, the Machine was a self-perpetuating mechanism that was loath to change. Like Hal, the megalomaniac computer in 2001: A Space Odyssey, nothing escaped the Machine’s ever-present eyes and ears. . .
Process was a big part of the Machine’s artistry. . . . [M]eetings could ramble on for weeks, or even months. It wasn’t uncommon for AT&T execs to have meetings to talk about meetings.. . .
The Machine steadfastly resisted change, and embraced those who did the same. It wasn’t uncommon for executive decisions to be ignored or openly flouted…
Structural separation
I’ve been spending a lot of time with the 1956 At&T consent decree that was so disliked by Ma Bell. The incumbent disliked it because it commanded that AT&T act only as a common carrier - no other functions allowed. (It doesn’t say anything about precluding AT&T from using electronics in its network when it was acting like that carrier, by the way. It does command, however, that the company not go into other lines of business.)
Today a Gartner report (summary here) written with incumbent-customers in mind, bemoans a global move towards 1956-like limitations on telcos:
[O]wnership separation [is a] global trend[ that] will particularly impact developed countries where the telecom market is mature and regulators are trying to inject more direct market competition as a stimulus for innovation and greater investment in next-generation broadband.
The report defines “ownership separation” as “a carrier division with some of the network or the entire network is placed in a separate legal entity and owned by a company other than the parent company.” In other words, structural separation.
Now, Gartner isn’t happy about this, and says that this may interfere with “cost efficiencies currently enjoyed by vertically integrated carriers.” (In response, a comment reads: “What?! Who paid Gartner to make this report?”)
Over the last fifty years, we’ve succeeded in this country in completely subverting the principles that brought us the 1956 decree. A source of pain to AT&T (because it kept AT&T out of the computing business), and embarrassment to the Department of Justice (because it didn’t involve actual divestiture of any AT&T businesses), the decree had the merit of reminding AT&T that it was only a common carrier. All the Computer Inquiries that followed afterwards were also based on the assumption that there would be a common carrier in the picture. Now our carriers are all “uncommon” - all perfectly free to discriminate and vertically integrate.
But at least Gartner says structural separation is a trend. Here’s hoping that under the next Administration in this country that trend will reach our shores.
The Computer Fraud and Abuse Act
Last Friday’s news that Lori Drew (neighbor who posed on MySpace as potential teenage boyfriend) was being indicted under the Computer Fraud and Abuse Act represents yet another cyberlaw constitutional moment. Once again, we’re pressing laws intended to address X problem into service mending Y dispute. This time, however, the law is more sweeping than we might like to admit. In fact, courts have already read the CFAA to stretch awfully far - including to violations of agreements *not* found in the Terms of Service on a particular web site. The relevant question: Is this appropriate?
Background: As the news reports make clear, the CFAA was originally designed to address hacking of federal computers or financial industry systems. It was broadened in 1984 to add civil remedies (so anyone can use it, not just prosecutors), broadened again in 1996 to cover any protected computer (which essentially means any computer in interstate commerce - so any computer attached to the internet), and then broadened yet again in 2001 to include any computer outside the US that communicates with the US. So this is a statute that has migrated from protecting government computers to protecting all possible computers.
It’s a violation of the CFAA to (1) intentionally access a protected computer without authorization and (2) cause damage that adds up to at least $5,000. (Take a look at 18 U.S.C. Sec. 1030(a)(5)(A)(iii).) It’s very easy to come up with $5K in damages - you can use fees paid to consultants, or the cost of responding to the offense. Given the attention to the Myspace suicide, the company won’t have a problem showing damages. (I know this seems odd, but the damages don’t have to be directly related to fixing the actual break-in.)
What’s the break-in? The statute was written with classic hacking behavior in mind - guessing passwords, monkeying with files, etc. But here the “hack” is (apparently) to intentionally violate the Terms of Service posted by MySpace, which prohibit users from lying to MySpace or using their accounts to harrass other users. Here, the neighbor arguably breached these terms by saying she was a teenage boy and harrassing her teenage neighbor.
This may seem nuts to you. It does to many of us. A civil litigant can paint his/her opponent as a quasi-*criminal* by showing that he/she has violated some form contract on a site. Even odder things have happened under the CFAA.
For example, in EF Cultural Travel BV v. Explorica, Inc. (2001, 1st Circuit), an incumbent travel site upset that a former employee had scraped the site for pricing information sued under the CFAA, claiming that the former employee’s breach of a broad confidentiality agreement with the incumbent made his access to the site for scraping purposes an act that “exceeded authorized access.”
The argument in this case, as in lots of former-employee cases under the CFAA, is that employees “exceed authorization” to employer databases when they access them for purposes of serving new ventures. In Explorica, the argument seems to reach even further - that access to *public sites* with knowledge of how they work (in this case, where the pricing information is available) may amount to “unauthorized access.”
There’s an AOL Terms of Service case, AOL v. LCGM, Inc. (EDVA 1998), that says that use of an email address extractor program in AOL chat rooms violated the AOL terms and therefore was “unauthorized” under the CFAA.
What a litigation tool! The CFAA is extraordinarily powerful. You can bring a “theft of trade secrets case” under the CFAA without proving that you ever actually had a trade secret (which has to have value because it’s secret). Because everything is now stored on a computer, the CFAA gives a federal forum and a federal claim for an infinite array of disputes. It’s like a civil RICO for our era - expansive and powerful, and now quite popular.
Hard questions. The implications of the CFAA for the free flow of information across a globally-interconnected network are profound. Who gets to decide what “terms” are enforced by using the CFAA? Can a plaintiff just decide who gets to access “his” computer, and for what purposes? Is there any limitation to the coverage of the CFAA - some boundary of “reasonable expectations” of the site “owner”? Here, shouldn’t Myspace have anticipated that people would fudge in setting up their accounts?
Should the CFAA be used to shut down speech, as this indictment suggests?
Unless the CFAA is amended, it will continue to be used in this way. Its definitions are extraordinarily broad. Everything is a “protected computer,” losses of $5K are incredibly easy to prove, and it’s simple to slap up an anti-competitive, anti-speech set of online terms. We need some better legislative explanation of what “unauthorized access” or “exceeding authorization” mean.
This is a “bad facts” case - a suicide, a stunned populace, and a yearning for revenge are shaping interpretation of a broad federal statute. The problem is that some courts have already reached the conclusion that the CFAA can be used for almost any perceived online infraction.