TCS Daily

Open and Shut

By Glenn Harlan Reynolds - May 20, 2003 12:00 AM

Federal Communications Commission chair Michael Powell isn't worried about media concentration. He thinks that growing competition from satellite broadcasters, the Internet, and other New Media will serve as a check on the power of concentrated Old Media.

There's some truth to this statement, of course. Back when I was a communications lawyer (there was a different President Bush then, but the debate was about the same) I drafted quite a few documents making precisely that claim. And I did so with a good conscience, because it was true. But I'm less sanguine now.

The reason is that today's Internet is not what it used to be. Oh, in many ways it's much more. But the trend has changed, and the Internet of the future may not be capable of playing the role that Powell claims to see for it.

It's all a matter of regulatory direction. I'm not sure I'd go as far as Larry Lessig, and say that the Internet is dying, but the decades-long trend toward communications openness has, in some important ways, reversed itself. And if it continues, I don't believe that the Internet will be able to provide the sort of discipline that Michael Powell is counting on.

In the 1970s and 1980s, the networks were opening up. Most people today don't realize how closed they used to be - but in the early 1970s, AT&T (then known as "the Bell System") tried to block the sale of a plastic cup, called the Hush-a-Phone, that went over the mouthpiece of a telephone to screen out background noise. Nobody, according to AT&T, could "attach" anything to its network without its permission. AT&T lost that one (though it was close), and that was the beginning of an opening-up process that saw competition in long-distance services, the ability to buy third-party equipment (like phones and answering machines) instead of having to lease it from AT&T, and, ultimately, the ability to use ordinary phone lines to access computer services, and later the Internet, via modem without any special permission from the phone company. AT&T didn't like that, but it was forced by regulators, not least the FCC, to go along. Similarly, cable TV monopolies came under (some) competitive pressure, VCRs allowed people more control over what they watched on television, and satellite TV services sprang up. The consumer was king.

Now we seem to be heading backward. At the behest of Big Entertainment, state legislatures are considering, and sometimes passing, so-called "Super DMCA" bills that would make it - shades of Hush-a-Phone - illegal to hook up anything to the internet or cable without the provider's permission. Cable companies would thus - shades of Ma Bell - be able to force you to lease VCRs or TiVO-like devices from them, instead of buying your own, and those "approved" devices would no doubt be gimmicked to be sure that you couldn't skip commercials, keep copies for more than a few days, or do anything else without their explicit approval. As the Rocky Mountain News put it:

Did you get permission from your cable company before you bought your kids a new VCR? Did your telephone company say you could use a modem to log on to the Internet? Did your Internet service provider give written approval for your Webcam? Do you think you should have to ask them?

No, I don't. And I don't think that a world in which you have to ask people for permission to do this sort of thing is a world in which alternative media are capable of providing the necessary competitive discipline to justify increased market concentration.

So, Michael, here's the deal: if you think that concentration in Old Media is okay because New Media will provide the discipline, then stand up for freeing the New Media from the shackles that the Old Media are trying to weld on. Because if you're not serious about freeing the New Media, then you're not serious about competition, and what you're describing isn't a bold new world, but a sellout.

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