Category Archives: Distributed Participation

An Integral Part: the Internet intertwined with everything else

circle.jpg This is what the Internet is best at:
My blog is an integral part of my life, and I’m neither ashamed of it, nor do I think my online friendships are lesser than physical friendships. And they become physical friendships, a lot of times. I travel all over the place, and whenever there’s anybody in the area I try to meet up with them. I owe almost everything going on in my life right now to blogging and the Internet, and that’s fine with me. The Internet does nothing so well as social networking. The other day, I realized I was living with someone I had met on LiveJournal, spreading jam I had gotten from a friend I met on LiveJournal, and having breakfast at a table I had bought on Craigslist — everything I was doing that day had to do with this glittering network of people I had found through the Internet. The blog doesn’t really interfere with my writing because it comes from a completely different side of the brain. I do feel guilty when I get too busy and haven’t posted, but I would never stop doing it. It’s an integral part of the way I market my books and interact with my audience.

— Catherynne M. Valente: Playing in the Garden, Locus, May 2008

Valente writes fiction, yet many companies can attest to the same kind of intertwining of the Internet with everything else they do.

And there was not a word in there about wanting the Internet turned into cable TV.

-jsq

Vigilantes Against BitTorrent? Revision3 Taken Down by SYN Floods

revision3_f5_dos.jpg Revision3 uses BitTorrent to distribute legal Internet television. It turns out using BitTorrent may be enough to subject a company to crippling online attack.
On the internet, computers say hi with a special type of packet, called “SYN”. A conversation between devices typically requires just one short SYN packet exchange, before moving on to larger messages containing real data. And most of the traffic cops on the internet – routers, firewalls and load balancers – are designed to mostly handle those larger messages. So a flood of SYN packets, just like a room full of hyperactive screaming toddlers, can cause all sorts of problems.

…

That’s what happened to us. Another device on the internet flooded one of our servers with an overdose of SYN packets, and it shut down – bringing the rest of Revision3 with it. In webspeak it’s called a Denial of Service attack – aka DoS – and it happens when one machine overwhelms another with too many packets, or messages, too quickly. The receiving machine attempts to deal with all that traffic, but in the end just gives up.

…

A bit of address translation, and we’d discovered our nemesis. But instead of some shadowy underground criminal syndicate, the packets were coming from right in our home state of California. In fact, we traced the vast majority of those packets to a public company called Artistdirect (ARTD.OB). Once we were able to get their internet provider on the line, they verified that yes, indeed, that internet address belonged to a subsidiary of Artist Direct, called MediaDefender.

— Inside the Attack that Crippled Revision3, by Jim Louderback in Polemics, on May 29th, 2008 at 07:49 am

The plot thickens from there. Well worth reading. I bet the legal proceedings will be even more interesting.

-jsq

Porter’s Five Forces and Net Neutrality: What If Distribution Channels are Open?

brief.jpg Here’s a take on why telcos so adamantly oppose net neutrality:
The eager and almost rabid application of Porter’s “Five Forces” (Supplier Power, Customer Power, Threat of New Entrants, Threat of Substitute Products, Industry Rivalry) to technology products and services has bred an entire generation of MBAs in marketing positions dedicated to developing and maintaining closed systems and closed hardware platforms. This is particularly egregious in the case of business models that are effectively based on distribution channels. In conventional analysis there is nothing wrong with making your living on distribution channels. Remember, that in 1979, when Porter developed the Five Forces framework, distribution channels were highly expensive to create and maintain and, owing to these costs, constructing them effectively presented a significant barrier to entry. Your product didn’t even have to be particularly good, because the threat of substitutes was reduced via the difficulty and expense of the competition actually getting those substitutes (however good they might be) to your customers. Suppliers, if they wanted access to your customer base as a proxy to sell their raw materials, had to go through you. New entrants had to build an entirely new distribution channel. Customers were stuck. You owned the market. But you had to guard this distribution channel carefully. And you had to make sure you hadn’t forgotten something simple and critical. That’s not part of a conventional Porter analysis. But why would it be? Conventional distribution channels are quite physical, antique and boring.

— The Five Forces/Circles of Hell, a Private Equity Professional, Going Private, 27 April 2008

The article goes on to detail how Blockbuster used the old Porter model of closed distribution channels and Netflix used an existing open distribution channel: the U.S. Postal Service.

To spell out the telco connection:

Continue reading →

Postal Hikes and Time Warner’s Role Discovered by New York Review of Magazines

ben_scott_140x140.jpg The New York Review of Magazines catches up with Time Warner and the postal rate hikes it lobbied for and got. First, the bottom line:
…the true price of letting corporations shape government policy: free speech.

— Going Postal, Callie Enlow, New York Review of Magazines, 2008

The NYRB gets into some of the underlying political machinations:
Even Time Warner was taken aback. Halstein Stralberg, co-creator of Time’s rate proposal, said, “There was a new chairman at the commission and there was a totally new environment, and they adopted it, to my surprise.”
The NYRM noted the sudden parachuting in of a new chairman just before the decision as unusual:
In the corporate world, The Progressive Populist would most likely be forced out of business. But should the same rules apply when the product is ideas and the conduit is a government-owned monopoly? To the current administration, the answer is yes, said Cullen. The president appoints the five commissioners that compose the Postal Regulatory Commission. Between the 2005 Time Warner complaint, when the PRC rejected the corporation’s proposed rate restructuring, and the 2006 rate hearings, when the PRC adopted the suggestions almost verbatim, two new commissioners joined the PRC. One of them, Dan G. Blair, replaced George Omas as chairman just one month before the end of the rate cases, a move that Bob Cohen described as “pretty unusual.”
However, the NYRM didn’t follow up on the other chairman, the chairman of the Postal Board of Governors from January 2005 to January 2008, James C. Miller III, and his 27-year-old theory:
“…none should be favored and none benefited. Each party pays the cost of service it consumes, not less, and does not bear the cost of others’ consumption.”
Curious how someone with that philosophy should be chairman just at the time the decision was made.

The NYRM does say what happened, why it was unusual, and who it affected: Continue reading →

Positive Externalities: What Yoo Ignores

frischmann.jpg It turns out Prof. Chris Yoo has been rebutted by legal scholars before:
Our article directly replies to a series of articles published by Professor Christopher Yoo on this topic. Yoo’s scholarship has been very influential in shaping one side of the debate. Yoo has mounted a sophisticated economic attack on network neutrality, drawing from economic theories pertaining to congestion, club goods, public goods, vertical integration, industrial organization, and other economic subdisciplines. Yet he draws selectively.

For example, his discussion of congestion and club goods is partial in that he ignores the set of congestible club goods that are most comparable to the Internet – public infrastructure. Yoo focuses on the negative externalities generated by users (i.e., congestion) but barely considers the positive externalities generated by users (he simply assumes that they are best internalized by network owners). Yoo appeals to vertical integration theory to support his trumpeting of ‘network diversity’ as the clarion call for the Internet, but he myopically focuses on the teaching of the Chicago School of economics and fails to consider adequately the extensive post-Chicago School literature. And so on.

In our article, we explain the critical flaws in Yoo’s arguments and present a series of important arguments that he and most other opponents of network neutrality regulation ignore.

— Network Neutrality and the Economics of an Information Superhighway: A Reply to Professor Yoo, BRETT M. FRISCHMANN, Loyola University of Chicago – Law School; Fordham University – School of Law, BARBARA VAN SCHEWICK, Stanford Law School, Jurimetrics, Vol. 47, 2007, Stanford Public Law Working Paper No. 1014691, Stanford Law and Economics Olin Working Paper No. 351

Hm, “positive externalities generated by users” as in participation and ad hoc content creation.

The authors also address David P. Reed’s point that competition is not the holy grail of networking:

By focusing only on the market for last-mile broadband networks, Yoo not only neglects the importance of unfettered application-level innovation for realizing economic growth and the role of a nondiscriminatory access regime in fostering the production of a wide range of public and nonmarket goods. His argument also neglects other ways to solve the problem of broadband deployment that would not impede competition and innovation in complementary markets.

-jsq

Myths and Historical Errors: Cherry Re Yoo

cherry.jpg Dr. Barbara Cherry sent me a response to Dr. Chris Yoo’s “novel” opinion of her antitrust theory. Dave Farber posted Barb’s comments on his Interesting People list, although without her postscript with the pointer to her articles and book. Farber appended a response from Chris, which I’ll post separately.
From: “Cherry, Barbara” <cherryb at indiana.edu>
Date: Fri, 9 May 2008 18:28:04 -0400
Subject: Re: Prof. Yoo responds for Prof. Farber

John,

Christopher Yoo’s response unfortunately contains several historical analytical errors that I’ve repeatedly discussed in my writings. It is unlikely that he actually read my TPRC paper to which you provided a link in our blog, as he would have readily discovered some of them.

Perhaps the fundamental problem is that many economists and legal scholars commenting on the network neutrality debate DO NOT understand the history of common carriage. Under the common law, common carriage obligations were TORT obligations imposed on carriers (in their relationship with customers) simply by virtue of their status of engaging in the business. In other words, the obligations are STATUS-BASED and unrelated to the industry’s market structure. Attributing the imposition of common carriage obligations to natural monopoly is a MYTH, unfortunately so often erroneously repeated in the secondary literature that it is believed to be true.

The rest after the jump. Continue reading →

Social Welfare: Reed Asks Yoo

DPRPhotoSmall.jpg David P. Reed asks a question and Christopher S. Yoo responds on Farber’s Interesting People list. I’m posting both in full here, with my thoughts at the end; basically, law isn’t a science, and anecdotes can turn into legal cases; some have already regarding net neutrality.
From: David P. Reed [dpreed@reed.com]
Sent: Saturday, May 10, 2008 11:50 AM
To: David Farber
Cc: ip
Subject: Re: [IP] re-distribution of op-ed on Net Neutrality — a reaction and a reply from one of the authors

I read through the long comment by Chris Yoo below, and as a non-lawyer interested in policy, I ask the following simple question:

Is there a well-regarded (one might ask for scientifically reasoned) argument that antitrust law as currently interpreted and practiced has a substantial impact measured in some currency like $ on social welfare?

Otherwise this entire argument is about nothing more than vaporware proceeding from a faith that competition (however loosely defined) creates social welfare best. AFAIK, this is largely an article of faith, just as the “End of History” was a grand article of faith posited by many of the same people as “truth”.

It is just not fair to imply that the core of “today’s settled antitrust law” carries even the level of weight as Darwin’s Theory of Evolution. There have been no replicable studies of its practice.

Law professors and lawyers who don’t challenge its truthiness squarely are merely behaving as dogmatic mandarins always do – asserting authority of professional status, rather than rigor of reasoning, experiment, or argument.

I say this not as FOX News or Hillary Clinton would call an elitist, but as a person who genuinely is unconvinced by magical faith in authorities.

That’s Reed’s question. Yoo’s response, and my thoughts, after the jump. Continue reading →

Novel Point of View: Dr. Chris Yoo’s Opinion of Dr. Barbara Cherry’s Antitrust Opinion

csyoo.jpg I previously posted a pointer to Barbara Cherry’s examination of antitrust history in response to Dave Farber’s posting of an op-ed against net neutrality. Dave responds:

( INDEED I AM NOT A LAWYER AND SO I ASKED PROF. YOO, ON THE FACULTY OF PENN LAW AND ONE OF THE AUTHORS OF THE EDITORIAL, TO REPLY TO THIS NOT — IN PARTICULAR PROF. CHERRY’S COMMENTS. DAVE FARBER)

— re-distribution of op-ed on Net Neutrality — a reaction and a reply from one of the authors, David Farber, Interesting People, Fri, 9 May 2008 15:23:10 -0400

Here’s Prof. Yoo’s response:

From: “Christopher S. Yoo” <csyoo@law.upenn.edu>
Date: May 9, 2008 2:51:40 PM EDT
To: “David Farber” <dave@farber.net>
Cc: “Faulhaber, Gerald” <faulhabe@wharton.upenn.edu>

Dave Farber forwarded me a recent e-mail asking for a lawyer’s reaction to Barbara Cherry’s recent presentation and paper questioning whether antitrust law can protect against the harms envisioned by network neutrality proponents. As the only lawyer among the co-authors of the op-ed that Dave, Michael Katz, Gerry Faulhaber, and I worked up for the Washington Post, I am happy to offer a few thoughts. (Those interested in a different take on the relationship between network neutrality and antitrust law may want to look here: http://ssrn.com/abstract=992837.)

Barbara’s work is based on a theory advanced by Neil Averitt and Robert Lande that would place consumer choice at the center of antitrust policy. As Averitt and Lande explicitly recognize, their theory would represent a fairly significant break (they would call it a paradigm shift) away from current antitrust law, which focuses on maximizing economic (and particularly consumer) welfare.

Interestingly, antitrust law once was quite friendly toward the consumer choice perspective that Barbara favors. (I review these developments in vol. 94 of the Georgetown Law Journal at pages 1885-87, http://ssrn.com/abstract=825669.) Early cases like FTC v. Brown Shoe (1966) and Times-Picayune Publishing v. United States (1953) invalidated exclusive dealing and tying contracts (which are among the types of antitrust practices most similar to network nonneutrality) because they infringed on unfettered consumer choice.

The rest of Dr. Yoo’s response after the jump, and my response in a following post. Continue reading →

Sitcoms as Gin, or, Looking for the Mouse

Clay Shirky explains why sitcoms serve the same function as gin did in industrial revolution Britain:

Transcript.

This is why traditional media fear the Internet. They have been supplying the gin to keep us all intoxicated instead of doing anything participatory or useful with our leisure time. The Internet (and gaming, and computers in general) provides ways of interacting and participating at every scale from local to global that have never existed before. And people are starting to use them.

Think about that the next time somebody equates “screen time” for television and the Internet.

-jsq

Hamlet in DC: To Legislate or Not to Legislate, That is the Question

EdwinBoothasHamlet.jpg The U.S. Senate takes up net neutrality again, to legislate or not to legislate:
At a Senate Commerce Committee hearing entitled “The Future of the Internet” on Tuesday, Democratic politicians argued for passage of a law designed to prohibit broadband operators from creating a “fast lane” for certain Internet content and applications. Their stance drew familiar criticism from the cable industry, their Republican counterparts, and FCC Chairman Kevin Martin, who said there’s no demonstrated need for new rules, at this point.

— Net neutrality battle returns to the U.S. Senate, by Anne Broache, C|Net News.com, 22 April 2008

Some of the senators seemed to think the Comcast debacle indicated there was need for legislation:
“To whatever degree people were alleging that this was a solution in search of a problem, it has found its problem,” said Sen. John Kerry (D-Mass.). “We have an obligation to try and guarantee that the same freedom and the same creativity that was able to bring us to where we are today continues, going forward.”

Kerry is one of the backers of a bill called the Internet Freedom Preservation Act, chiefly sponsored by North Dakota Democrat Byron Dorgan and Maine Republican Olympia Snowe, which resurfaced at the beginning of 2007 but has gotten little attention since. A similar measure failed in a divided Commerce Committee and in the House of Representatives nearly two years ago.

Unsurprisingly, Martin says he doesn’t need a law to enforce, because he can make it up as he goes along: Continue reading →