Balkinization: Beyond Innovation: The Many Goals of Internet Law and Policy

Beyond Innovation: The Many Goals of Internet Law and Policy

Frank Pasquale

Innovation has been the central focus of internet law and policy. While they sharply divide on the best way to promote innovation, commentators across the political spectrum routinely elevate its importance. Academics and public interest groups have celebrated search engines, social networks, and start-ups as model corporations in a new service economy. For example, Lawrence Lessig has proposed eliminating the Federal Communications Commission and replacing it with a streamlined entity with a single mission: to promote innovation and reduce the type of monopoly power that stifle innovation.

President Obama should get Congress to shut down the FCC and similar vestigial regulators, which put stability and special interests above the public good. In their place, Congress should create something we could call the Innovation Environment Protection Agency (iEPA), charged with a simple founding mission: "minimal intervention to maximize innovation." The iEPA's core purpose would be to protect innovation from its two historical enemies—-excessive government favors, and excessive private monopoly power.

But is innovation really the be-all and end-all of internet policy? My colleague Gaia Bernstein has argued that innovation is only one concern of a technology policy; diffusion of what has been invented is key as well. A democratic culture may be just as important a goal of media policy as innovation. Health care is another regulated industry with multiple (and occasionally conflicting) goals: quality, cost-control, and access are concerns of every policymaker in that field. When I think of internet policy, I think that access is just as important as increasing innovation, if not more so. Moreover, innovation is just one dimension of quality, which should include all of the political and cultural concerns raised by dominant online entities--be they carriers, search engines, or social networks.

Lessig and other advocates of network neutrality worry that the owners of the "pipes" that carry communications may impede innovation by favoring their own applications. YouTube may never have developed if Verizon could have throttled it in favor of its own video sharing site; online innovation in general would be discouraged if carriers consistently charged innovators more for access to customers as they became more successful. The drama of "good innovators" vs. "bad carriers" has pervaded the net neutrality debate, but it has been vigorously contested by laissez-faire voices who contend that the key competition YouTube might face in the future is a video sharing service given a leg up by carriers. On this view, there is nothing special about the physical layer of internet communications that makes it uniquely dangerous for innovation.

Technological change and new business realities are now radically challenging both extant interventionist positions and laissez-faire approaches. Rather than developing their own alternatives to dominant search engines and social networks, carriers are partnering with them. For example, Google and Comcast have already announced an alliance to create new communication technologies. As internet traffic increases, carriers are going to face the same dilemmas of information overload now managed by search engines. Their vertical integration with content providers is developing, as will alliances with social networks. While network neutrality advocates focus on the convergence of voice, data, and content on common "pipes" (or wireless connections), the joint ventures of leading internet companies will raise a new host of concerns about privacy, culture, and power online. Calls for network neutrality will morph into demands for transparency and fairness from dominant online entities generally, be they search engines, social networks, or carriers.

Deregulationists will oppose these proposals with assurances that the market will punish any untoward behavior by intermediaries. They claim that undue discrimination or invasive surveillance will lose an entity customers--and to the extent monopoly power prevents that, antitrust law is remedy enough. Were new concerns about intermediaries wholly economic in nature, such assurances would have some merit. However, the cultural, political, and privacy concerns raised by the new business alliances of search engines, social networks, and carriers cannot be translated into traditional economic analysis or antitrust doctrine. They raise questions about the type of society we want to live in—-a holistic inquiry that cannot be reduced to the methodological individualism of economics or the summum bonum of "innovation."

I share Lessig's exasperation with the FCC, but any policy for replacing it needs to acknowledge that concentrations of power online can do more than stifle innovation. They can increase inequality, skew culture, and influence politics. The protection of privacy and political expression online can't just be side-constraints on dominant online entities; rather, they should be at the core of the regulatory missions of the FCC and FTC.

Posted 10:52 AM by Frank Pasquale [link]