A few Qs on the Master Switch

The Master Switch is a great read — thanks, Tim, for unearthing and synthesizing such an astounding amount of history.

I thought I’d share some of the questions that came up as I read it —

  • Patents: At different places Tim underscores how crucial a role they play in the development of an industry.  At times the story is one where patents helped competition, as when they allow the little guy to avoid being crushed by the prevailing behemoth.  Bell can hold off the Western Union thanks to patents.  But at other times they’re clearly subject to abuse, such as with the movie trust.  What, in short, would you recommend changing about current patent policy, if anything?  Is misuse doctrine enough to carve away the bad uses while leaving the salutary ones?  Why not be supportive of at least some business method patents, in circumstances where they could help the little guy too?
  • Peering: Given the worries expressed in the book about consolidation, I’m so curious to know what Tim and others think about the current state of play in Internet peering.  To what extent should peering agreements be, as they largely are today, confidential?  How much should gov’t intervene in peering disputes, such as the famed recent blowout between Level3 and Comcast over Netflix traffic — which apparently accounts for a stunning 40% — 40%! — of U.S. bandwidth usage?
  • Do we have a neutral net today?: The dark matter of the Internet makes no appearance in the book: Akamai.  At one point Tim brings up the spectre of a broadband provider offering a fast lane to faraway content providers for an extra fee — and suggests how awful that would be.  But then what of Akamai, which offers exactly that kind of fast lane?  It is saving the Net by offering a quality-of-service set of efficiencies to speed video on its way through clever co-location — indeed, that’s how Netflix got to people before the Level3 imbroglio — or is it exactly the model that makes it harder for new entrants, at least new bandwidth-intensive entrants, to compete?
  • The net neutrality tripwire: The book points out the power of corporate norms — if today’s barons are looking to build empires, they’re certainly not advertising it the way their predecessors did.  The few examples of actual net neutrality violations are pretty thin, and as the book points out, quickly disavowed as the actions of rogue employees, or accidents, when uncovered.  Should systematic net neutrality violations take place, wouldn’t that result in a rather quick sea change in favor of net neutrality?
  • Search neutrality: Frank Pasquale hasn’t put it to Tim in this symposium, so I will!  At the end of the day Google comes out pretty well in your estimation, though it’s on probation as any private behemoth would be in your eyes.  But you do accord it the privilege of, among everyone, currently holding the closest thing to the Master Switch.  So: should there be some kind of mandated search neutrality?  Or do you think, despite what you describe as Google’s monopoly position, that market forces will discipline any movement to unduly shade organic search results?  Would you apply separation principles to the various Google ventures?  (You seem to dismiss everything but search as a sideshow, but I’m not so sure — I take Google seriously that it aims to organize all the world’s information, and personal data, which can be gathered through many of those ancillary projects from Orkut to Reader — is information.)
  • One wire or many: In the book’s history Tim seems to rue consolidation of the phone network to one wire.  More generally, he looks with awe but ultimately disfavor on the anti-Adam Smith segment of corporatist philosophy that says that competition is messy and wasteful.  But what, then, would be the best regime for broadband?  What’s the ideal?  Is it gov’t-provided fiber, full stop, like interstate highways?  Private fiber, even a single wire, but with open access requirements?  No open access but net neutrality?  Or lots of wires?
  • Advertising: The book devotes some interesting space to the role of advertising in radio, and how advertising pushed American radio one way while the BBC went another.  Should the gov’t have any dog in the fight as browser makers come, in the name of privacy, to develop what could be powerful ad blocking software, leading some to say that the foundations of the current free Web are threatened?  Or are do-not-track systems a form of consumer empowerment to be cheered?
  • Apple + AT&T = ?: Since the book went to press we’ve seen Apple announce Verizon as an alternative iPhone carrier.  How much does this impact the sense of Apple and AT&T as, in essence, an attempted merger?
  • Other consolidation: Another kind of consolidation, taking place quite naturally, is the sheltering of formerly self-hosted Web sites under bunkerized umbrellas.  If I’m going to run a Web server today as a small- or medium-sized venture I’m less likely than ever to try to host it in my basement, and instead will look to Amazon hosting or somesuch — in part because of the prevalence of denial of service attacks and other unpredictabilities.  It’s hard to blame Amazon for taking the business that comes its way — or for exercising its choices about how to implement its terms of service.  Or does the logic of the book say that there should be hosting neutrality, too, a form of common carriage?

So, questions rather than claims from me.  Thanks again for a pathbreaking book — and a thought-provoking symposium.  …JZ

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4 Responses

  1. Teddy Microphone says:

    I came to the same conflict regarding patents. The pharmaceutical industry is a great example of the patents in action. On the one hand the money patents grant companies provides incentives for innovations in the field of medicine to continue, but on the other hand they’ve also created evil empires, such as the pharmaceutical industry. Patents aren’t per se bad, but the laws guiding them definitely need to be changed much like the America bail system: http://lawblog.legalmatch.com/2011/02/07/americas-bail-system-needs-to-be-reformed/

  2. Paul Ohm says:

    Great list, JZ. I think I’d tease the Advertising/Privacy story into (at least) two different points:

    1. The one you raise: should the government advance policies that hurt the “free web” (which of course isn’t free) in the name of privacy?

    2. Should our enthusiasm for Google’s role in the recent history of innovation be tempered by how the business model depends on users putting their privacy at risk in new, opaque, and underappreciated ways?

  3. Frank Pasquale says:

    This is a great set of questions. Let me just build on JZ’s point on search neutrality and Ohm on Google-opacity:

    I am very cautious about the term “search neutrality.” I did try to draw parallels between broadband non-discrimination and search non-discrimination in this article:
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1134159

    But virtually every time the term “search neutrality” comes up at cyberlaw conferences, people tend to want to end the argument by saying “there is no one best way to order search results—editorial discretion is built into the process of ranking sites.” To search neutrality’s critics, a neutral search engine would have to perform the (impossible) task of ranking every site according to some Platonic ideal of merit.

    On my account of neutrality, a neutral search engine must merely *avoid* certain suspect behaviors, including:

    1) Stealth marketing (secretly taking cash or other consideration in exchange for elevating the profile of sites in organic search results)

    2) De-indexing without notice and explanation (removing legal, non-spam sites from the index after they have been included in the search engine’s corpus, and failing to give some explanation to the removed site as to why it was removed)

    I think my concept of neutrality is much closer to the way the term is normally used in political philosophy (where, say, a “neutral state” is one that does not favor any particular conception of the good, rather than one that accords exactly the right amount of respect to each conception of the good). Neutrality is a very broad term, and the obvious differences between the technical operation of physical infrastructure and search engines should not stop us from applying certain broad principles to each entity.

    I also believe that Google is only one of many intermediaries that use opaque search technology. Some entity should be able to audit the systems used by any dominant intermediary to find out if stealth marketing and de-indexing without notice is happening. I make that case in these articles:

    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1762236
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1762766

    Looking ahead, I don’t actually think this disclosure remedy will do much to change consumer behavior. But it will at least allow future historians, academics, and policymakers to understand how our information environment was shaped.

    In the long term, we’ll probably need to have some publicly funded alternative to dominant internet intermediaries, just as we have a Postal Service to serve those who can’t afford FedEx, or Medicare to serve those who are too old or disabled to get reasonably priced private insurance, or arts subsidies to help forms of expression that the market will never underwrite. That’s my point in this piece:
    http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1762241

    Disclosure helps us understand how urgent the need is for an alternative.

  4. Tim WU says:

    Okay I’ll answer these questions soon.