Home > Policy, Regulation > Coming to Grips with Reality

Coming to Grips with Reality

One of the first tasks for government in the new millennium is a gargantuan one: regulating today’s Internet.  At least two federal agencies are taking the plunge, having announced their intent to create comprehensive frameworks that would ensure online privacy (FTC), and access to broadband capability (FCC) for Internet consumers. Both the FCC and FTC continue to conduct workshops and solicit comment on the relevant topics – and we should see an initial draft of these plans shortly.  For instance, Chairman Genachowski’s national broadband plan is now due for release on March 17.

How you feel about the Obama Administration’s invigorated Internet policymaking activities is probably closely related to your view on net neutrality.  Should the Internet be regulated? That question is now moot. The real question is whether effective regulation can even be designed at this stage in the Internet’s evolution.  And before we reach that answer, policymakers and regulators must confront the reality about consumers, business models and the role of data collection on the Internet today.

First, who is today’s Internet consumer?  Arguably, they are a driving force behind the evolution and adoption of Internet technologies and not just passive users.  Witness the recent explosion in mobile web usage (driven mostly by consumers’ need for “anytime, anywhere” access to information) for proof of this proposition.  Indeed, the consumerization of technology (web search, iPhone), has given rise to many of the tech policy issues we wrangle with today. Yet, there is little or no research on how individual consumers view important issues – like online privacy – and how these attitudes can vary depending on age and location (after all, internet consumers are not a homogenous bunch).  Policymakers should take the time to carefully study the Internet consumer– perhaps using technology to reach out directly – and to keep refreshing that research alongside development of any regulatory scheme. Citizen focused initiatives, like the FCC’s Open Internet website, are a start in the right direction.

Second, we must recognize that data collection is part of how today’s Internet works.  The most successful companies of the last decade were those that were able to use data or information in innovative ways, such as enhancing online searches (Google) or providing more relevant recommendations to online shoppers (Amazon).  Information enhances customer relationships; it also fuels targeted advertising – the lifeblood for many companies on the web. Internet policies should be constructed with these realities in mind.  In addition, research is truly needed on consumers’ attitudes towards data collection – is it the gathering or the sharing of information that’s the issue?

Finally, Internet business models are always changing.  The Internet is constantly forcing companies to rethink how they do business (check out Professor Doug Lichtman’s podcast, Can Content Survive Online, for more thoughts on this point). Business models die and are resurrected all the time -who ever thought that the walled garden would make a comeback? Policymakers and regulators must keep current with industry developments to remain both effective and relevant in this area.

Will reality be part of future policy making or regulatory activities?  Already, the first working week of the decade has provided an opportunity for comment:   Is TV Everywhere an authentication technology that secures premium content for subscribers or a collusive effort by media companies to restrain online media competition?

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