Blog - Page 11

Intellectual Property subcommittee Chairman Bob Goodlatte, R-VA (pictured), said he is considering legislation to tweak antirust law to address net neutrality concerns, according to the Hill. That’s apparently because Rep. Henry Waxman (D-CA) reports that,

According to DoJ, favoring websites that pay high fees and degrading websites that don’t is perfectly legal under the antitrust laws as long as the phone or cable company isn’t in direct competition with the websites being degraded.

Goodlatte and Waxman seem to be talking about a vast expansion of the antitrust laws, which are presently concerned with anticompetitive behavior. As a definitional matter, if two rivals are not in competition with one another, then neither can behave anticompetitively toward the other. Nor would they have any incentive for doing so. What would be the point? Neither could derive any tangible benefit if the other were harmed.

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On Friday Scott Cleland predicted that online advertising is an investment bubble which will eventually burst as a result of latent consumer privacy concerns. Expect privacy concerns to be the eventual catalyst that ultimately bursts the Internet investment Bubble 2.0. It is rare when there is a profound disconnect and suspension of reality between industry behavior/investment expectations and customer wants, needs and expectations, but that is precisely what is at work in Bubble 2.0. In the Wall Street Journal, Scott Thurm reported that venture firms have invested $4.7 billion since 2007 in 356 online ad firms. The investment climate is “frothy” according to one of Thurm’s sources. And there’s an arms race among the start-ups for math specialists, he reports. Read More ›

Among other things, George Gilder tells Forbes reporter Chris Barth that the text-based Internet with which we are familiar is evolving into a video-based internet, and the change will be transformative. “When voice came around as the dominant form of communication, it required a complete transformation. You couldn’t just upgrade the telegraph, you had to create a telephone system. The Internet, when you look at it, is another telegraph,” he explained. “Now we’re moving to interactive video. And video teleconferencing cannot be accommodated without a new, upgraded Internet, with new patches and tunnels and layers of Internet technology.”

Yesterday the Tennessee Regulatory Authority (the state’s public utility commission) heard testimony about reforming intrastate access charges (i.e, the rates long-distance carriers pay to local telephone companies when calls are handed off between long-distance and local telecom providers). The rates have been set very high, historically, to generate significant subsidies for making local service affordable and ubiquitous. In my own remarks, I pointed out that the hidden subsidies embedded in intrastate access charges are a tax on consumers. Defenders of the status quo like to avoid that word, but a tax is a tax. Although fully justifiable when established in 1984 upon the breakup of Ma Bell, the hidden subsidies are simply inappropriate in today’s dynamic, competitive marketplace. Some might Read More ›

Scott Walter, writing in Philanthropy Daily, has more on the vast left-wing conspiracy behind network neutrality regulation that was recently revealed by John Fund at the Wall Street Journal. Walter, who cites new evidence on the “discreet relationship” between the Pew Charitable Trusts and Free Press, wonders why “news journalists” did not report on the connections between several “nonpartisan” foundations, which also include the Ford Foundation, and Free Press? A segment of the journalism profession is a core constituency of Free Press, as has been reported. Pew presents itself as objective, but could it really have a partisan agenda?

Apple Computer co-founder Steve Wozniak has a poignant, but factually problematic, plea for Internet regulation in The Atlantic.

Please, I beg you, open your senses to the will of the people to keep the Internet as free as possible. Local ISP’s should provide connection to the Internet but then it should be treated as though you own those wires and can choose what to do with them when and how you want to, as long as you don’t destruct them. I don’t want to feel that whichever content supplier had the best government connections or paid the most money determined what I can watch and for how much. This is the monopolistic approach and not representative of a truly free market in the case of today’s Internet.

The free and open Internet Wozniak celebrates actually evolved in the absence of regulation. William E. Kennard, FCC chairman during the Clinton administration, declared that the “best decision government ever made with respect to the Internet was the decision … NOT to impose regulation on it.”
Meanwhile, back when the computer age was getting started and telephone services were ridiculed and reviled by Lily Tomlin (see SNL clip from 1976) and others, there existed a crucial – albeit frequently overlooked – symbiosis between monopoly and regulation. You don’t hear about it from Tomlin or Wozniak, but the Bell System was a legally-sanctioned and closely regulated monopoly.

While grieving that life for a young computer engineer sucked in the old days when phone and cable companies were monopolies, Wozniak alludes to several persistent misconceptions about the telephone and cable industries that ignore pervasive regulatory failure and provide no justification for Internet regulation.

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Over at the Washington Times, Internet regulation is being described as an “unholy scheme.” According to Editor Emeritus Wesley Pruden, this is a first step toward content control. Anyone paying attention can see how this would be a first step toward revival of the so-called Fairness Doctrine, sought by Barack Obama and the Democrats since he first arrived in Washington. The Fairness Doctrine would require broadcasters, definitely including the cable-TV networks, to provide airtime for anyone criticized by someone else on the air. That, too, sounds good to the inattentive and the well-meaning. What could be nicer than never having to hear anyone say discouraging things about you? John Fund at the Wall Street Journal reveals how Internet regulation is Read More ›

The Federal Communications Commission acted to regulate the Internet by a partisan 3-2 vote. Senate Republican Leader Mitch McConnell warned that there will be pushback. Meanwhile, the courts get another chance to jurisdictional limits on the FCC. Legally, the agency is on shaky ground. The U.S. Court of Appeals for the D.C. Circuit recently ruled that there are significant limitations on the agency’s jurisdiction to regulate broadband services. Rumors indicate the commission is planning to assert jurisdiction on the basis of somewhat obscure statutory provisions which predate the Internet as we know it, and that were drafted for unrelated purposes.

If the United States were growing as well as our Israeli ally, we’d be in fat city right now. The news from the little Mediterranean powerhouse just keeps looking up. GDP rose 3.8 percent last quarter, down from 4.5 percent in the previous quarter, but still very brisk. Technology stocks overwhelmingly lead the way. George Gilder’s thesis in The Israel Test is thus validated daily. Imagine a developed country that sells more to China than it buys!