This is the first in a series of articles that will focus directly on technology instead of technology policy. With an average age of 57, most members of Congress were at least 30 when the IBM PC was introduced in 1981. So it is not suprising that lawmakers have difficulty with cutting-edge technology. The goal of this series is to provide a solid technical foundation for the policy debates that new technologies often trigger. No prior knowledge of the technologies involved is assumed, but no insult to the reader's intelligence is intended.

This article focuses on cookies--not the cookies you eat, but the cookies associated with browsing the World Wide Web. There has been public concern over the privacy implications of cookies since they were first developed. But to understand them , you must know a bit of history.

I have long been intrigued with the effort to regulate online gaming activities because it represents the most sophisticated effort by our government yet to eradicate a specific class of online speech or commerce. (My TLF colleague Tom Bell has done seminal work in this field). In her weekly "The Regulators" column, The Washington Post's outstanding regulatory columnist Cindy Skrzycki writes about the enforcement challenges at work here:

It's not easy making rules for a U.S. law intended to deter illegal Internet gambling by choking off the flow of funds to offshore sites. That's because no one seems to agree on what the law covers. Officials at the Treasury Department and the Federal Reserve found that out after sifting through more than 200 comments from banks, gamblers, church groups and members of Congress on recommendations for the Unlawful Internet Gambling Enforcement Act of 2006. The basic sentiment was that their Oct. 4 proposal, which depends on financial institution enforcement, won't work.

The outcome will affect 23 million online gamblers, some 2,500 Internet sites and the growth of an industry with an estimated $15 billion in annual global revenue. The law bars financial institutions from processing payments involving Internet gambling -- with the notable exceptions of Indian gaming, state gaming and horse racing. "If the federal agencies themselves cannot agree on the law, what hope is there that banks can resolve these confounding legal issues?" the American Bankers Association said in commenting on a conflict between the Treasury and Justice departments on the legality of betting on horses. The Washington trade group said the suggested rules are more likely to catch its members in a compliance trap than stop profits from illegal gambling from escaping offshore.

In a few of my previous essays, I've been wondering about the future of virtual reality worlds and specifically how property rights might get defined within those worlds. Alan Sipress of the Washington Post penned an excellent story yesterday on this subject which I thought I'd bring to your attention. In his lengthy front-page story, "Where Real Money Meets Virtual Reality, The Jury Is Still Out," Sipress notes that:

"As virtual worlds proliferate across the Web, software designers and lawyers are straining to define property rights in this emerging digital realm. The debate over these rights extends far beyond the early computer games that pioneered virtual reality into the new frontiers of commerce. ... U.S. courts have heard several cases involving virtual-world property rights but have yet to set a clear precedent clarifying whether people own the electronic goods they make, buy or accumulate in Second Life and other online landscapes. ...

The debate is assuming greater urgency as commerce gains pace in virtual reality. In Second Life, where nearly 2 million people have signed up to create their own characters and socialize with other digital beings, the virtual economy is booming, with total transactions in November reaching the equivalent of $20 million. Second Life's creator, Linden Lab, allows members to exchange the electronic currency they accumulate online with real U.S. dollars. Last month, people converted about $3 million at the Lindex currency market."

From Businesspundit, an interesting essay on whether regulation works.

Commentary by Steve Ryan.

So, what's up with the phrase "Internet Governance" anyway. We don't want to say, "Internet Government," do we? Will the rose by another name smell so sweet?

I find this description of the pack of hounds now worrying at "Internet Governance" problems alarming.

A positive take, anyone?

Alec Van Gelder offers a more optimistic take on an independent ICANN.

The US Department of Commerce has recently taken additional steps to establish an independent ICANN. Some have heralded this as a step away from undue U.S. influence over ICANN, and a step towards real independence.

But I must admit I'm skeptical that ICANN independence will result in realizing benefits from genuine market forces, as opposed to a power vacuum that Europeans and other officials will step into aggressively. But I haven't followed the specefic terms of their latest agreement. Comments?

Here's some more specefics about my concern: it seems to me that for an independent ICANN to realize market forces, it needs competition, or, barring that in the short run, some other kind of accounatability to the user community, particularly in the private sector. The voting and committees established early on don't seem to have gotten us there. A good many decisions were made by the board in closed sessions. But my information might simply be out of date... did they change something fundemental? If they didn't, I'm afraid that an independent ICANN will turn out to be a sort of international Post Office.

Another way of asking the same thing: if ICANN manages the domain system in a stupid way, what are the consequences for them? Bad press? Do they lose a customer? Does a product fail? Does someone get fired? Sued? Do they take a hit in their stock price? Revenues? Can ICANN go out of business? Eventually enough annoyed people get together and figure out an alternative to the domain name system? Search engines have somewhat diminished the importance of domain names, but how much pressure does this place on ICANN?

I find this eBay versus Google battle over payment services quite interesting. In case you missed it, eBay stuck it to Google this week by notifying the world that it would not allow Google's new "Google Checkout" payment service to be used to clear transactions on eBay. A lot of people are up in arms about this claiming that eBay has excessive market power and that antitrust actions need to be considered (or at least threatened).

But I think there's a different way of looking at this scuffle.

Let's have fun with numbers, shall we?

Last weekend in Geneva, after nearly 5 years of work, the World Trade Organization negotiations of the so-called Doha Round appeared to grind to a halt, leaving open the possibility that for the first time since the WTO's founding, a trade round could end without a new global agreement. Accepting the credit (in my mind, the blame) for this disaster is India's commerce and industry minister, Kamal Nath.