Re-arranging The Deck-chairs

[David Farber <farber () central cis upenn edu>]

Date: Mon, 17 Oct 1994 21:42:05 -0400
From: John Murray <jxm () engin umich edu>
To: farber () central cis upenn edu


Subject: Re-arranging The Deck-chairs




                REARRANGING THE DECK-CHAIRS
                ---------------------------
                        John Murray
                   University of Michigan


              (C) Copyright 1994, John Murray




On September 30th, a symposium was held at the University of
Michigan entitled "Competition and the Information Superhighway".
It was sponsored by the Michigan Telecomminications & Technology Law
Review, and was focused on the legal, business, and regulatory
issues associated with the NII.


Among the speakers were formal representatives of interested parties
like AT&T, Bell Atlantic, Ameritech, and the FCC.  One member of the
audience characterized the apparent NII policies of these organizations
as "rearranging the deck-chairs on the Titanic" - a desire by super-
large bureaucracies to stay afloat by bringing privately-owned,
centralized management and control to a hopelessly distributed and
anarchic network.  This perception seemed to be widely shared among
the attendees, including this writer.


There was an obsession with the supposed need to find source
material to take advantage of "all this bandwidth".  However, it wasn't
clear to me how this obsession was linked to the expressed desire not
to "squander these gifts provided by the scientists and engineers"!
Several speakers sought to justify covering the basic infrastructure
costs by vertical integration of source and distribution -  "acquisition of
content or rights to content" as one telecom representative put it.  None
of the platform speakers seemed able to consider alternative models -
one involving a simple common carrier system between consumers and
small businesses, for example.  Thus, the "initial entry product"
(the inevitable video-on-demand, of course) was always assumed to
come from some vast Blockbuster-style video-base, rather than from
numerous specialized providers and independent niche market servers.


When asked if he was describing "the follow-on to the Internet", the
Bell Atlantic speaker side-stepped the question by discussing router
capacities and broadband satellite networks rather than address the
content issue.  Similarly, another audience comment about high
bandwidth community-wide networks linked by nationwide backbones
drew disparaging responses about Internet jocks and arcane user
interfaces.  In a side discussion, a telecom policy consultant and
former FCC official seemed unable to understand how low-cost the
existing Internet really is.  There's an all-pervasive impression that
current low-cost or free Net access is being subsidized by literally
billions of dollars of support from industrial and research entities.
While the financial support certainly exists, net Net running costs
are not nearly as high as such individuals imagine.


It was disappointing that those charged with representing the public
interest - namely, the FCC - seemed so little interested in under-
standing if and how the public interest is currently being served by
the existing Internet.  There seems to be no-one asking the real NII
decision-makers the awkward questions on behalf of Joe & Jane Public.
It was recently pointed out to me that community access TV became
possible precisely because municipalities had leverage on cable
companies - public access channels were part of the payoff for the
right to run cables on city streets.  With the Infobahn, who else can
play that public interest role except the FCC?


Legal topics were discussed of course, and inevitably the issues of
copyrights and royalties were considered.  The necessity for input from
lawyers on corporate strategy and organizational structures was also
mentioned.  However, two law-related phrases used by corporate
representatives stick uncomfortably in my mind - how to go about "the
identification of new legal opportunities" and the need to "protect our
own first amendment right to freedom of speech over our own
network".


Luckily, there were some encouraging signs amid all this suit-speak.  A
venture capital investor from Silicon Valley calmly announced that "the
evolution of the superhighway isn't going to come from any of the big
companies heard from today".  Instead, he predicted that numerous small
companies and start-ups will provide what's needed.  Some amount of
government involvement will be required, mostly to prod the Internet
into what's needed - perhaps this may be a type of "teaser" for what
can be done on the bigger network where the "real" commerce takes
place.  And the founder of PageNet described how his company had
evolved from a start-up in 1981 to the largest paging company in
America.  It was refreshing to hear of a business which had grown
simply by providing a communication link, without needing to "acquire
content" so that it could then exert its own right to free speech.


Speaking as a supposed "internet jock", I found the symposium quite
interesting but also rather disheartening.  It made me reallize how wide
the "gulf" is between "us" and "the suits", and how much work still
needs to be done to demonstrate that the video-on-demand model is
not the only option.  It was unfortunate that no-one here at the
University of Michigan was in a position to set up a few Mosaic
demonstrations in the hallways for the symposium participants.  Little
things like that CAN make a difference!!