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Thursday, November 12, 2009

Odlyzko on Net Neutrality, Price Discrimination, PrivacyFail, Search & Cloud Neutrality

by Berin Szoka & Adam Thierer

The latest call for "search neutrality" and "cloud neutrality" comes from Andrew Odlyzko of the University of Minnesota's School of Mathematics & Digital Technology Center--and probably among the top ten most influential academics in Internet policy. In his latest Review of Network Economics article "Network Neutrality, Search Neutrality, and the Never-ending Conflict between Efficiency and Fairness in Markets," Odlyzko shows (discussed by Ars) just how slippery the slippery slope of Net neutrality regulation will be--exactly as we predict in our recent paper "Net Neutrality, Slippery Slopes & High-Tech Mutually Assured Destruction." Odlyzko concludes:

for pervasive infrastructure services that are crucial for the functioning of society, rules about allowable degrees of discrimination have traditionally applied, and are likely to be demanded for the Internet in the future. Those rules have often been set by governments, and are likely to be set by them in the future as well. For telecommunications, given current trends in demand and in rate and sources of innovation, it appears to be better for society not to tilt towards the operators, and instead to stimulate innovation on the network by others by enforcing net neutrality. But this would likely open the way for other players, such as Google, that emerge from that open and competitive arena as big winners, to become choke points. So it would be wise to prepare to monitor what happens, and be ready to intervene by imposing neutrality rules on them when necessary.

Odlyzko identifies search and cloud computing as the next most likely targets of "neutralization" and explains how calls for regulating these virtual "networks" would flow logically from the current arguments for neutrality mandates at the infrastructure layer:
The net neutrality debate is often pictured as a contest between the two most prominent corporate champions of the opposing sides, AT&T and Google. But the underlying issue predates both companies by centuries. It was never resolved completely, since it arises from a conflict between society's drives for economic efficiency and for fairness. There is no reason to expect that this conflict will lessen, and instead there are arguments that suggest it will intensify. Should something like net neutrality prevail, the conflict would likely move to a different level. That level might become search neutrality. (And allegations about discriminatory behavior of a web search provider have surfaced recently in China, Tschang (2009).) Or, to take another currently popular concept, if "cloud computing" does become as significant as its enthusiasts claims, it could lead to dominance of a single service provider. The effective monopoly of that dominant player could then become perceived as far more insidious than any of the "walled gardens" or "intelligent network" that telcos would like to build.

There is, of course, an entirely different approach to the issue that does not involve the sort of across-the-board cyber-meddling that Odlyzko suggests: Freedom for all players at all layers of the Net to invest and innovate in the "networks" or "platforms" that offer content, connectivity and services.

Continue reading Odlyzko on Net Neutrality, Price Discrimination, PrivacyFail, Search & Cloud Neutrality . . .

posted by Berin Szoka @ 5:46 PM | Add category, Broadband, Neutrality, Philosophy / Cyber-Libertarianism

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Thursday, July 30, 2009

Maine's COPPA 2.0 Law Actually an Indirect Age Verification Mandate

The new Maine law I blogged about on Sunday is much worse than I thought based on my initial reading. If allowed to stand, it would constitute a sweeping age verification mandate introduced through the back door of "child protection."

The law, which goes into effect in September, would extend the approach of the Children's Online Privacy Protection Act (COPPA) of 1998 by requiring "verifiable parental consent" before the collection of kids "personal information" about kids, not just those under 13, but also adolescents age 13-17. Unlike other state-level proposals in New Jersey, Illinois, Georgia and North Carolina, Maine's "COPPA 2.0" law would also cover health information, but would only govern the collection and use of data for marketing purposes (while the FTC has interpreted COPPA to cover to essentially any capability for communicating personal information among users).

But the Maine law would go much further than these proposals or COPPA itself by banning transfer or use of such data in anything other than de-identified, aggregate form. Still I took some comfort in the fact that the Maine law, unlike COPPA or these other proposals, lacked the second of COPPA's two prongs: (i) collection from kids and (ii) collection on sites that are directed at kids. It's because of the second prong that COPPA applies not only when a site operator knows that it's collecting information from kids (or merely allowing them to share information with other users), but also when the operator's site is (like, say, Club Penguin) targeted to kids in terms of its subject matter, branding, interface, etc. Because I initially concluded that the Maine law would apply only to knowing collection, I supposed that it would be less likely to require age verification of all users, as other COPPA 2.0 proposals would--something that would be unlikely to survive a First Amendment challenge based on the harm to online anonymity.

But I was quite wrong. During the PFF Capitol Hill briefing Adam and I held on Monday, Jim Halpert, one of our panelists, noted that the bill imposed "strict liability."

Continue reading Maine's COPPA 2.0 Law Actually an Indirect Age Verification Mandate . . .

posted by Berin Szoka @ 9:45 AM | Add category, Advertising & Marketing, Free Speech, Online Safety & Parental Controls

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