"Demystifying Net Neutrality" was the topic of a February 4th Webinar hosted by The Diffusion Group and VideoNuze, which is now available on the VideoNuze website. As a presenter, I endeavored to shed light on the controversial topic, along with Chris Riley of Free Press and two moderators, Will Richmond and Colin Dixon. While we may not have achieved full demystification of the concept, some interesting points of agreement and disagreement surfaced during the hour-long program.

The moderators set up the core questions: "Is net neutrality a solution in search of a problem? Or is net neutrality required to ensure a fair and open Internet?" As the reader may imagine, I argued, as I have in the past, that net neutrality remains a solution in search of a problem, and Riley argued, as Free Press has, that it is required to ensure a fair and open Internet. In my presentation, I focused on the lack of evidence of a market problem or consumer harms to be redressed by this regulatory remedy; the FCC's lack of "ancillary" jurisdiction to impose the proposed net neutrality mandates; and the possibility that the rules would be found to infringe on the First Amendment rights of broadband Internet service provider. Similarly, Riley, in his presentation, argued that broadband ISPs have the incentive and ability to engage in harmful discrimination in the carriage of Internet traffic; that we should not permit ISPs unbounded discretion to decide what traffic gets priority treatment; that the government need not wait for harm to occur but may be proactive in protecting consumers and competition; and that net neutrality would protect the free speech rights of consumers, as Free Press has maintained.

I was pleased, however, to find at least one, perhaps inadvertent, area of agreement. Riley gave as a policy goal of net neutrality the avoidance of "unbounded agency/provider discretion." Although we disagree on the need to curb provider discretion, I am in complete agreement with Riley's policy goal of avoiding unbounded agency discretion. In fact, that is why I have been so distressed by the FCC's claims that it has ancillary -- and utterly discretionary -- jurisdiction to regulate, or not regulate, the provision of Internet services without any regard to statutory limits. In comments that I filed in the FCC's net neutrality rulemaking, I demonstrated that Congress did not delegate to the FCC unbounded discretion to decide whether and how to regulate the Internet or the provision of Internet services. Such unbounded discretion is unacceptable as both a matter of administrative law and good government.

Harvard Berkman Center professor Jonathan Zittrain has published another pessimistic, Steve-Jobs-is-Taking-Us-Straight-To-Cyber-Hell editorial building on the gloomy thesis he set forth in his 2008 book, The Future of the Internet and How to Stop It. His latest piece appears in the Financial Times and it's entitled, "A Fight over Freedom at Apple's Core. Concerning the recent Apple iPad announcement, Zittrain warns: "Mr Jobs ushered in the personal computer era and now he is trying to usher it out."

I'm not going to go into yet another lengthy dissertation about what it so misguided about his thesis that cyberspace is becoming more "regulable" and that digital "generativity" is dying because of the rise of devices like the iPhone & iPad, or sites like Facebook. Instead, I will just point you to the many things I've written before explaining just how far off the mark Prof. Zittrain is on this point. [See the complete list down below + video of our debate.]

But let me just say this... Ignoring that fact that he is an iPhone user himself -- which makes no sense considering that he thinks of Apple as the font of all cyber-evil -- he can't muster any substantive empirical evidence proving that the Net and digital devices are being more "closed, sterile, and tethered," as he repeatedly claims in his book and editorials. And that's not surprising because the reality is that the digital world is more open and generative than ever, and even if there are some "closed" devices and systems out there, they are actually quite innovative and not perfectly closed as Zittrain suggests. The spectrum of "open vs. closed" systems and devices is incredible diverse and nothing is perfectly "open" or "closed." We can have the best of both worlds: many open systems with some partial "walled gardens" here and there (or hybrid systems combining both). Regardless, we are witnessing greater digital "generativity" and innovation with each passing year. Until Zittrain can prove the opposite, his thesis must be considered a failure.

Finally, I want to associate myself with this excellent critique of the Zittrain thesis by Prof. Ed Felten, who points out that Zittrain's argument doesn't even work for the iPad, which I would agree is a fairly "closed appliance" in the Zittrainian scheme of the things:

Today's Online Safety Technical Working Group (OSTWG) meeting included some heated debate about whether online intermediaries should be doing more to assist law enforcement to help track down child predators and those producing and distributing child pornography. (It's not clear whether or when NTIA will actually put the archived video or a transcript online at this point).

Most interesting was the third panel of the day (agenda), which devolved into a shouting match as Dr. Frank Kardasz (resume) of the Arizona Internet Crimes Against Children (ICAC) Task Force basically accused Internet intermediaries of being willing accomplices in crimes of sexual abuse against children--and suggested that they could be charged as co-defendants in child porn prosecutions. A few industry folks in the room expressed their outrage at such slander. A retired law enforcement officer perhaps put it best when he said that he had never dealt with an ISP that didn't sincerely want to help law enforcement stop this monstrous crime.

Apart from those pyrotechnics, and a superb morning presentation by the Pew Internet Project's Amanda Lenhart about "Social Media & Young Adults," the most interesting part of the day concerned data retention mandates. Even as a debate rages in Washington about how much collection and use of online data should be permitted, Dr. Kardasz suggested online service providers should be required to hold user data for 5 years. A number of attendees noted the staggering costs of such a mandate given the sheer volume of information shared every day by use, especially for startups for whom building monitoring and compliance infrastructure can be a significant barrier to entry. Of course, practical objections are always answered with practical counter-solutions--in this case, several attendees asked why we couldn't just provide tax incentives or stimulus money to defray such costs. One attendee joked that we'd have to devote the entire state of Montana just to house all the necessary server farms.

But the strongest objection came from John Morris of the Center for Democracy & Technology, who rightly noted that no amount of government subsidies for data retention could prevent leakage of sensitive private data. For this reason and because of the basic civil liberties at stake whenever the government has access to large pools of data about its citizens, Morris argued that we need to strike a balance between how we protect children & the values of free society. Dave McClure of the US Internet Industry Association (USIIA) seconded this point powerfully: If such vast data is retained, it will be abused.

Then the riposte from advocates of data retention mandates: Aren't online intermediaries already retaining huge amounts of consumer information? If they can do that, why can't they retain the data we need to track down child predators and child porn distributors?

I testified this morning in the House Energy and Commerce Committee's Subcommittee on Communications, Technology, and the Internet at a hearing titled, "An Examination of the Proposed Combination of Comcast and NBC Universal." Among those testifying were Comcast Chairman and CEO Brian L. Roberts, and NBC Universal President and CEO Jeff Zucker. Down below I have attached my brief remarks (we only had 5 minutes), but see the Scribd doc at the very bottom to also see the embedded charts. I also wrote a paper about the proposed deal back in December entitled, "A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC" as well as this editorial for Forbes.

____________

Mr. Chairman and members of the Committee, thank you for inviting me here today. My name is Adam Thierer and I am the President of The Progress & Freedom Foundation (PFF).

Although we are still early in this process, there has already been a great deal of hand-wringing and even some dire predictions about the pending merger of Comcast and NBC Universal. I hope to put this proposed marriage in some historical context and explain why the deal certainly won't have the detrimental impact some critics fear, and also explain why it might even be one potential model for how to sustain traditional media going forward.

Beware Media Merger Hysteria

First, let's remember that we've been here before. Paranoid predictions of a media apocalypse have accompanied the announcements of many previous media mergers, from AOL-Time Warner to News Corp.-DirecTV to XM-Sirius.[i] In these cases and almost all others, however, the "sky is falling" claims proved to be greatly overstated.[ii] The only "harm" that one could reasonably claim came from those mergers was not to consumers or content providers, but to the merging firms themselves and their shareholders. That's because many mergers simply fail to create the sort of synergies and benefits originally hoped for and consequently die of natural causes over time.

Other firms, however, have found ways to make deals work and deliver important new services that previously were unimaginable or simply too expensive to offer alone.[iii] Regardless, the point here is that we'll never know what works unless we permit marketplace experimentation with new and innovative business models.

This is true liberty, when free-born men,
Having to advise the public, may speak free,
Which he who can and will, deserves high praise;
Who neither can nor will, may hold his peace;
What can be juster in a State than this?

For over two thousand years the principles underlying our First Amendment protections for free speech and free thought have been the hallmark of just and free societies. Indeed, the advance of civilization is one marked by progress on a path away from state control of speech and thought toward private autonomy in the area of ideas and their communication. It comes as no surprise that the most repressive regimes and movements included among their tenets the suppression of seditious or heretical thought, from the Inquisition of the late Middle-Ages to the most anti-democratic governments of the 20th Century.

By contrast, for over two hundred years, our Constitution has provided the most rigorous bulwark the world has ever known protecting the free dissemination of ideas. It certainly is not always a comfortable fit; the safeguards sometimes protect speech or speech-conduct that is repulsive to many. But there can be little doubt after more than two centuries of our Constitutional experiment that liberty and justice are served by more, not less, freedom of speech.

For that reason, the FCC's recently announced inquiry into "the future of media and information needs of communities in a digital age" should make the stomachs of civil libertarians everywhere queasy. Of course the Public Notice of the inquiry is dressed up in all of the usual public interest language. The Commission purports to be interested in protecting good journalism, promoting a diversity of information sources, and expanding the opportunities for a vibrant debate of public issues. We have no reason to doubt the sincerity of those representations, or of the FCC's claim that it will consider First Amendment concerns first and foremost as the inquiry proceeds.

A revealing dispute has erupted between Ben Sheffner of Copyrights & Campaigns and the not-so-competent Editors of the website Copycense, which humbly describes itself as "the online journal of code and content."

To shorten a longer story, Professor Edward Felten recently disclosed a summary of the results of a forthcoming "Sahi-Felten study" of files available to users of a "trackerless" BitTorrent-based file-sharing program. According to Professor Felten's summary, statistical analysis showed that 99% of the files available were infringing. Ben Sheffner then authored a blog post that described this summary as "[v]aluable information to keep in mind while debating net neutrality rules and IPS's right to manage their networks and fight piracy."

But Mr. Sheffner's observation outraged the allegedly pious data-prudes at Copycense. In an unsigned "Editorial" entitled Science vs. Advocacy, the crack team at Copycense thus sanctimoniously denounced Mr. Sheffner for daring to suggest that such imperfect "summary" data should ever affect important debates about network neutrality: Calling his post "reflexive" and "impetuous" they denounced his conclusion: "drawing such correlations at this point--with respect to the summary, the resulting paper, (which has not yet been vetted, reviewed, or published), or Felten's perceived or actual personal or professional biases--is premature and careless."

I will not summarize the droning Copycense account of a few of the many, many things that can inarguably go wrong during statistical analyses of sociological phenomena. Indeed, that would be pointless because Copycense itself actually concluded its sanctimonious sermon by agreeing with the substance of the conclusions that it had just denounced as "premature and careless":

"We can say with a strong level of confidence, however, that the way the current statutes are written, it would have been shocking if anything significantly less than 100% of the files on BitTorrent were technical infringements of copyright law."

How thoughtful of Copycense to admit that it knows better than to take seriously its own prudish fretting about theoretical defects that could arise from yet-to-be-reported nuances of the Sahi-Felten study. Even though Copycense currently lacks all the data that it claims to need in order to fully and completely assess all of the implications of this forthcoming study, Copycense still admits that even persons as erudite as its own Editors can, nonetheless, already "say with a strong level of confidence [that]... it would have been shocking if anything significantly less than 100% of the files on BitTorrent were technical infringements of copyright law."

The PBS documentary series Frontline aired a new program last night called "Digital Nation: Life on the Virtual Frontier." [You can watch it online at that link.] Produced by Rachel Dretzin and Douglas Rushkoff, the 90-minute special touched on several themes we have debated here through the years including:

1. concerns about information overload and multitasking;


2. the role of computers and digital technology in education & learning; and,


3. the nature and impact of virtual reality and virtual worlds on real-world life and culture.

As a student of information history, I'm particularly interested in these subjects because I've written frequently about the lively debates between techno-optimists and techno-pessimists throughout history. (See my latest essay: "Are You An Internet Optimist or Pessimist? The Great Debate over Technology's Impact on Society.") I thought Dretzin and Rushkoff did a nice job covering a lot of ground in a very short amount of time and providing balance from folks on both sides of the optimist/pessimist spectrum. Below I'll just summarize a few notes I took while watching "Digital Nation" and offer a few thoughts on these controversial topics. Mostly, I'll just discuss the first two, interrelated issues. (My thoughts on the third issue -- virtual worlds and virtual reality, can be found in these videos from my recent speech in Second Life).

Just FYI... This Thursday, February 4th at 9:30 am, the House Commerce Committee Subcommittee on Communications, Technology, and the Internet will hold a hearing titled, "An Examination of the Proposed Combination of Comcast and NBC Universal." It will be held in 2123 Rayburn House Office Building and the Committee members were kind enough to ask me to come up and say a few words. Here's the witness list:

• Brian L. Roberts, Chairman and CEO, Comcast Corporation


• Jeff Zucker, President and CEO, NBC Universal


• Colleen Abdoulah, President and CEO, WOW! Internet, Cable, and Phone


• Mark Cooper, Ph.D., Director of Research, Consumer Federation of America


• Michael J. Fiorile, President and COO, The Dispatch Printing Company, Chair of the NBC Affiliates Board


• Adam D. Thierer, President, Progress and Freedom Foundation

For those interested, the hearing will be webcast at www.energycommerce.house.gov. There's also another hearing Thursday on the same issue over in the Senate Judiciary Committee's Subcommittee on Antitrust, Competition Policy and Consumer Rights. It's titled, "The Comcast/NBC Universal Merger: What Does the Future Hold for Competition and Consumers?" and it will take place in the Dirksen Senate Office Building, Room 226 at 2:30 p.m. It too will be webcast live.

Incidentally, I wrote a paper back about the proposed deal back in December entitled, "A Brief History of Media Merger Hysteria: From AOL-Time Warner to Comcast-NBC" as well as this editorial for Forbes.

During a recent blog post on William Patry's self-parodying, dishonest, and hate-filled book Moral Panics and the Copyright Wars, ("Copyright Wars"), I argued that disputes between creative industries and technologists who create new means to access creative works tend to be notoriously complex because creators of new content and creators of new content-access technologies are producers of complementary goods.

Producers of complementary goods do not want to destroy each other, but they would love to commoditize each other. In other words, a producer of a complementary good should want to drive the price of any complements produced by others as close as possible to marginal cost in order to maximize the share of mutually-created value that it could potentially capture.

For a concrete example of what I was talking about, review Clash of the Titans, an interesting, opinionated, and perceptive account of the recent clash between Amazon.com and Macmillan over ebook pricing. It represents a thoughtful analysis of the complexities lurking behind these debates. Moreover, the issues outlined are relevant to debates about online pricing of all types of expressive works--music, video, news, periodicals, etc.

Thanks to Marginal Revolution for highlighting this post.

PS: Speaking of Patry's vile book Copyright Wars, I just belatedly perceived another of its many glaring ironies. Around a year ago, the unhinged Patry was putting the finishing touches upon its false and hate-filled claims, (e.g., "I cannot think of a single significant innovation in either the creation or distribution of works of authorship that owes its origins to the copyright industries."), in order to depict an ugly alternate reality in which copyrights had so failed to support the production of innovative works that they should be wholly repealed: "In other areas where a government monopoly, created to serve the public interest, is blatantly abused over a long period of time, it is taken away" (p.199).

Meanwhile, back on Earth, funding provided by copyright industries was empowering Director James Cameron to put the finishing touches on the years of work and the millions of dollars in R&D required to create the beautiful alternate reality depicted in his wildly popular film Avatar. A finer testament to the vacuity of Patry's rabid, unreasoned hate is scarcely conceivable....

The Annenberg School at the University of Southern California has released a paper by Geoffrey Cowan and David Westphal suggesting yet again that the government should more heavily micromanage, and fund, the news media. I am reluctant to belabor the particulars of the proposal (which must necessarily include increased regulation, direct and indirect funding for journalists and news organizations, and a variety of bureaucratic mechanisms to administer the government's oversight of media), but little of it is new and all of it is scary.

The paper is premised on the notion that the government has for many years and in many ways subsidized and/or regulated the news media, and it concludes that enhancing those efforts will forestall the decline of news and information media. The paper fails, however, to: 1) grapple with the question of whether those earlier efforts helped or hindered the media; 2) address the fundamental question of whether there is some systematic reason that news and information services cannot survive on their own merits; and 3) provide a satisfactory answer to the question of whether government entanglement with the media is consistent with a free society.

On a technical level the paper provides a short and somewhat selective history of postal subsidies and tax incentives that have one way or another benefited various forms of publication over the past two centuries. It also covers in cursory fashion federal regulations that have had an impact on purveyors of news and information. Again, the question it never asks or answers, however, is whether the government's meddling on the periphery of the news business was helpful or harmful -- it merely assumes the former. Superficially, this does not seem an unreasonable assumption. But as much as a crutch can help one stand, it can also slow one down in a race. I, at least, am not at all convinced that the government's "assistance" to the media has been a positive force over time. Indeed, some of the media's current problems may well result, at least in part, from past government policies that were intended to benefit the media or to otherwise improve the quality of news and information services provided to the American people.