DISQUS

I'm Tim Wu and I approve this message

I haven't investigated whether this is true.

But I personally have said many times that the Asian countries, while often possibly good models for deployment, are certainly not good role models for net neutrality; the glaring example is China.

Ha - the main difference between myself and the writers on this site is they have a studied lack of sensitivity to the infringements of freedom possible from large centralized organizations that don't happen to bear the label "government."

Tim,

I think I know why Google hasn't done taken on this project, and if you think about it, I think you'll know too.

There seems to be substantial disagreement on whether visual voicemail needs network cooperation to work. I have heard both versions of the story.

Anyhow, despite its cast, my view is in fact quite optimistic.

I didn't have a chance to say this in that Slate piece -- however, Apple's strategy is similar to iTunes. Apple would like to get its foot in the door, and then change the market from within.

As I always, I respect Tim Lee's comments on these topics.

A few comments. First, I think efforts to open markets have a mixed story of success and failures. Its sometimes hard to know what going to work and what isn't. For example, Carterfone and number portability and Computer II (which had Carterfone elements) were notable successes, to my mind. Some of the others, which TL focuses on, were arguably less successful.

That said, I there's an imoprtant difference between the winner and loser examples. The winner examples are either easily understood, or tend to try and open the market to an entire vertical industry (e.g., carterfone, number portability, etc.). The loser examples tend to be trying to support competition in a place where it might otherwise not exist.

No one should doubt that the line between the two is hard to guess. But my guess is that the cell phone world is a world where entire industries want to do more, but are being bottlenecked by the carriers.

Second, to suggest abandoning open standards efforts because the carriers will resist too heavily is to simply surrender to lobbying permanently.

For example, say you think number portability rules are important. A counter argument might be, but no, the carriers will resist and drag out the process for years, therefore number portability rules are a bad idea.

Sometimes DC people argue that we shouldn't have X rule because it will be complex, involve litigation, etc. etc. But those costs are not infinite; and sometimes the rule in question is worth it, despite the obvious costs to people close to the DC regulatory process.

For example, Cartferfone involved struggle, techical standards-making, etc. But the social benefits were arguably worth the candle -- even if that isn't obvious to someone who is just watching the process-costs.

Come on -- surely a little criticism of wikitravel doesn't turn one into part of some kind of conspiracy?

And, by the way, I DO contribute to wikitravel, and will probably do more in the future. Wikitravel is a great idea -- it just isn't quite there yet.

TW

So its obviously true that decentralized and centralized systems are better for different things, as RB points.

One thing I think is interesting, and don't quite understand, is how often, however, humans tend to underestimate the potential of decentralized solutions

That's what Hayek was getting at in his paper -- there's no question that if you put a perfect, planned economy next to an unplanned economy, the planned economy will win. Hands down.

But we aren't good at knowing when information problems will cripple what would have been the better system.

So maybe we're overcompensating, as RB suggests, in the direction of decentralized systems, but I happen to think we have to fight a perfectionist instinct that drives us too over-centralization

Just ask Napoleon III

Tim,

Two points. First, I did have spectrum auctions on the mind when writing the paper, and in fact I do mention then, but not in depth, and of course there is only so much ground you can cover in one paper.

Second, though i didn't have time to get into it, I consider some of the other "open access" regimes failures for various reasons -- first, crazy pricing ideas, second, lack of a truly separate market. But the network / physical attachment is a proven divide, hence the proposal for cellular carterfone.

Getting network access rules right is very hard -- though if you get it right the results can be spectacular. Ideally the separation happens without regulation (that's what happened with the internet, though not the phone networks). As I said in the paper, ideally consumer and public pressure will move the mobile networks toward a more open posture;

It may however take enforcement of the actual Part 68 rules -- you'll see some of that coming up soon.

Tim Lee, thanks for the writing.

I think my main problem with the criticism so far is this: my paper has been misinterpreted as a call to regulate the industry. And since its the most familiar thing to do everyone is bringing out their favorite "don't regulate" arguments.

The main point of the paper is to get the facts out on what is happening in wireless, and why it is bad for innovation. That as I say in the introduction, doesn't immediately mean regulation. It may mean questions for the industry itself, for example, or greater consumer pressure.

The problem is that people, especially in DC, get too used to a "regulate don't regulate" debate, which is boring after a while frankly. We all know the arguments on both sides.

Libertarians, in my opinion, make a mistake when they assume that companies here are making the right decisions all of the time. If you spend time in industry, you know that they make serious mistakes. Think, say, MCI, if you need a telecom example.

It is only a unthinking libertarian who assumes these industries don't make mistakes, and I see it as part of my job to point these things out.

TW

Thanks for the shout-out -- but the presentation is on Wednesday, not tomorrow!

tw

This is a good and interesting discussion. I am left thinking that the entire debate revolves around two facts:

1. How serious are the interference problems at various frequencies; and
2. How limiting for market entrants are the any set of rules that might deal with those intereference problems.

The answer to those two questions for various frequencies, if they exist, determines the ideal mix of unlicensed and propertized spectrum.

As for which side to err on. While obviously interference problems exist, my concern is that they can be fetishized. For example, during the low-power FM radio debate, trumped up claims of interference that was really impossible to detect manage to kill the FCC's proposals. The problem with claims of interference is that there's always SOME -- and if that's a trump card it kills alot of interesting spectrum proposals.

Its similar to the criticisms of ethernet. Obviously ethernet is a protocol that's going to lose alot of packets. But that doesn't mean it isn't great anyhow. If you were a real stickler for perfect networking, you'd say no to ethernet, and that's the same instinct i have with unlicensed spectrum. Lossly but maybe good.

Finally, as for "command and control." If we agree that the experiment with unlicensed garage band spectrum was a success (perhaps for the reasons suggested) it cannot be true that all commons schemes are doomed to failure as "command and control" regimes.

Finally finally. As much as I like talking about network neutrality, it can't be that EVERY issue we discuss here somehow need to be related to the "Tony Soprano model of networking?"

TW

The point made by Tim Lee is decent. It is certainly true that the FCC would have to state some kind of standard to make possible permissionless entry into the spectrum market (as it does for the garage band used by 802.11b). In addition, private actors could, if they wanted, similarly allow permissionless use of spectrum. The question is why they would want to.

In general I cannot understand the strength of Jerry's and others' objection to the substance of rules that would create permissionless market entry into the spectrum market. In my view, reflected in that paper, permissionless market entry is one of the holy grails of an effective market system.

But that's an ongoing debate,

Tim Wu

Just came across this interesting discussion of my paper.

A few points. First, the point of the paper, as many have correctly noted, is to begin moving the discussion of the desirability of IP away from the model of monopoly profit versus incentives to create and towards and understanding of its effects on industry structure.

I wanted to emphasize that the choice of rules and exceptions in IP will centralize and/or decentralize decision-making. For example, as I say in the paper, from a Hayekian viewpoint the derivative work right probably gives the copyright owner power to decide the future of a given work.

In response to Richard Bennett and a few others, the use of Hayek is of course in good faith. I believe the that centralization of decision-making in industries like the software and, say, music industries is aided by the accumulation of large stores of intellectual property.

However, on re-reading my paper, I also think that it would have been useful to do more to emphasize some of the ways that IP rights can decentralize decision-making. For example, patents on drugs make it easier to decide to research a drug even if the NIH thinks its a bad idea. That point deserves more exposure.

Finally, to Noel Le, there are plenty of current efforts to both weaken or strengthen IP protection. For example, a treaty under consideration by the WIPO proposes to create a new 50-year IP right in broadcast signals, for what reasons I have not completely understood.

Anyhow thanks to those who read the paper,

Tim Wu

PS I had understood from the preponderance of articles I read and computer scientists I talked to that Japan's Fifth Generation project hadn't been a great success. However, I suppose dissent from that position is to be expected.

Adam, with respect, I worry you've been in Washington too long if you think the big question right now is whether government will regulate TV cell phones.

The bigger question is how good the technology actually is, and whether anyone will be willing to pay for cell phone TV. On both scores I'd be pessimistic. The larger point is that there is too much ex ante fuss, both regulatory and anti-regulatory, over technologies that don't even exist in any important form. Like video over DSL, for example, video-telephone, and for that matter digital television. I suspect that the regulatory talk itself can slow down these technologies

Why Adam Is Wrong

Adam is right about many things but not this. A carrier will rationally block or at least slow Vonage if the carrier offers a competing product. If the carrier can be sure nothing will be done or it can do so unnoticed, its interest in blocking increases.

It is true that public and government pressure can stop a company from blocking Vonage, and indeed that would be preferable to regulation. But what creates public pressure is not arguing that regulation is out of the question, but rather the threat of regulation itself. Indeed the regulatory threat approach is exactly the one Michael Powell takes.

Adam's argument can be (unfairly) compared to an argument that we don't need murder laws because the public is against murder and most people are decent. It is the bad actors that the law cares about, and what people might do in the absence of a regulatory threat. The closest comparison is to antitrust. Today, companies may not engage in anti-competitive behavior, like price-fixing, all that often. But we must ask whether that is because they don't think it advantageous, or whether they threat of enforcement discourages such behavior.

The actions of carriers, if true, are a textbook example of vertical foreclosure. To rule out possible enforcement against such anti-competitive behavior is folly.

Tim Wu