To the extent rising incomes on Wall Street have contributed to the rise of U.S. income inequality, government played a big role by encouraging risk via a de facto policy of Too Big To Fail. A few words on this topic from Milton Friedman via “Capitalism and Freedom”:
Jim makes a good point that Steve Jobs is a reminder of the importance of producing and supplying innovation. Consider John Steele Gordon’s description of the iPhone; in addition to being a phone:
It’s an address book, a date book, a camera (both still and moving), a notebook, a clock that tells the time in any city in the world, a compass, a metric converter, and a calculator. It takes dictation. You can send and receive written messages with it. It will tell you where you are and help you get where you need to go. It will keep track of your investments and tell you your net worth as of that second. You can deposit a check in your bank account with it while lying in bed. It will give you the latest news, via every major news organization. It’s a dictionary, an encyclopedia, and a field guide to birds. It gives you the weather, both where you are and in any city in the world. It will tell you the phase of the moon, send you a bulletin when a new exoplanet has been discovered, tell you the sun rise and sunset times for any place on earth, show you the cloud cover around the globe, and tell you what that bright star in the sky is named.
You can play solitaire on it, or battleship, or chess (it will beat you), or any of thousands of other games. It’s a metronome. It can hold thousands of songs, get new ones on demand, and play them back with breathtaking fidelity.
There are, quite literally, more than 350,000 other things that it can do.
Here’s what Apple’s stock price looks like in the age of the iPhone:
I have seen this bit pop up in numerous pieces on the passing of Apple’s Steve Jobs. This version is from the New York Times:
Mr. Jobs’s own research and intuition, not focus groups, were his guide. When asked what market research went into the iPad, Mr. Jobs replied: “None. It’s not the consumers’ job to know what they want.”
Also note this from the Wall Street Journal:
Despite skepticism about Apple’s ability to enter an already competitive market dominated by the likes of Research in Motion Ltd.’s BlackBerry devices, Apple became a force in the mobile phone market, selling 92 million iPhones as of December 2010.
In the both cases, Jobs focused on producing and supplying innovative new consumer technology to the marketplace, creating demand for them. If you build it, they will come—and spend. To quote the book, “Where Keynes Went Wrong”:
In the circular flow of production and spending, it is production that has the pride of place. If we are shipwrecked on a deserted island, having money to spend will not help at all. If we do not produce, we will starve. Even back in civilization, it is producers who have a chance to grow rich. Spenders more often than not end up poor. It is production that determines how much can afford to spend, not the reverse.
That is what America needs: more producers, more employers, more makers.
In my review of Sonia Arrison’s terrific new book on the revolution in anti-aging technology, “100 Plus: How the Coming age of Longevity Will Change Everything, From Careers and Relationships to Family and Faith,” I didn’t get a chance to discuss the fascinating foreword by Peter Thiel. Philosophically rich and provocative, Thiel’s mini-essay on what he calls “The Problem of Death” is alone worth the price of the book (for a view contra Thiel and Arrison I recommend reading Leon Kass here and here).
Back in July the general counsel for Netflix published an op/ed in the Wall Street Journal (WSJ) arguing that “bandwidth pricing is anti-competitive.”
Wireline bandwidth is an almost unlimited resource due to advances in Internet architecture. Adding more capacity is easy. The marginal cost of providing an extra gigabyte of data—enough to deliver one episode of “30 Rock” from Netflix—is less than one cent, and falling.
The piece argued that “there is no good reason for bandwidth caps and fees to take root” and suggested policymakers may want to intervene to regulate prices. Now, Netflix is a marvelous and admirable company; but Adam Thierer pointed out rightly at the time that Netflix was making a mistake by falling prey to the marginal cost fallacy.
This week Harold Ford and John Sunnunu published a piece in the SJ Mercury News arguing against the Netflix position. While they don’t say it in the piece, it seems pretty clear it’s a direct response to the argument advanced by Netflix in the WSJ. The Center for American Progress’ Matt Yglesias calls the Ford/Sununu piece “extremely strange” and says “it’s difficult to see what the policy issue here is supposed to be.” But in the context of the earlier WSJ op/ed, the policy issue is clear. Netflix is hoping policymakers will impose some sort of price controls on broadband networks. Ford and Sununu are arguing that’s a bad idea. And they’re right.
There’s lots of pessimissm out there, from Wall Street to Pennsylvania Avenue. But if you look in the right places (say, the telecom sector) you’ll see lots of good news: tons of investment, innovation, and technological change:
— Steve Perlman and his team at Rearden Labs have developed a new technology that apparently breaks Shannon’s Law (h/t AT)
— Harald Haas demonstrates LED lights delivering wireless data
— Lightsquared continues with its plans to develop a nationwide wireless network, with FCC support for their efforts
Against this backdrop the drums keep beating to block the merger of AT&T and T-Mobile. The argument against the merger is that there’s insufficient competition in the industry. But gobs of investment, new entrants, and constant technological innovation are not the hallmarks of uncompetitive industries.
This sale validates the notion that patents will be a fundamental tool in the tech industry. They had been moving toward that position for years, but the magnitude of Nortel’s sale shows that they have arrived. Patents virtually define the pharmaceutical and biotech markets, and in the future they could play the same role for tech.
What’s next? The history of mergers and acquisitions suggests one possibility. Once upon a time in the clubby atmosphere of corporate America, hostile takeovers were rare; gentlemen just didn’t do such things. Then, in the 1960s, the hostile takeovers came to be accepted as a legitimate business tool. Similarly, the strategic use of patents now appears to be accepted in the technology industry. If that’s true, then Nortel is just the beginning.
That’s from Nathan Myhrvold, throwing down a guantlet. This will not please the anti-IP crowd. Things in tech world are about to get a lot more interesting.
Last week, Washington’s Seizure of Sunk Capital: Part II speculated about the legal situation on appeal of the Federal Reserve Board’s then-imminent regulations pursuant to the Durbin amendment, starting from the premise that the final rule would not change much from the proposal.
But a funny thing happened on the way to the courthouse—the FRB changed the rule substantially. It greatly expanded the types of costs that can be considered by the FRB in setting interchange fees, and it almost doubled the allowable price cap.
On the crucial issue of requiring that more than one processing network be available, the final rule makes clear that having one PIN and one signature network satisfies the law. Since this is the almost universal practice for current debit cards, compliance is easy. Also, it makes clear that the issuing bank gets to choose the networks with which it will deal; the merchant cannot select Fly-by-Night, Inc. This, too, eases issuer concerns.
These modifications greatly change the legal situation. While the language of the Durbin amendment is still as described in the article—it is a “the moon is green cheese” statute—as interpreted by the FRB it allows the issuer bank to recapture capital and most overhead costs, eliminating only corporate overhead and other remote expenditures. Reversing for such trivia will not appeal to a reviewing court, and rightly so. Serious constitutional matters should not ride on arcane cost accounting, even if the basis of the law remains a bad one.
The banks and their allies may well decide that, while they may not have dodged the bullet, it only winged them, and they are best off to call it a day.
Whether the merchants will see it the same way is an interesting question. They may feel that the final rule deprives them of the fruits of their successful lobbying, as it does, and attack the FRB’s interpretation.
Under the famous (to admin law geeks) Chevron doctrine, a reviewing court gives huge deference to agency interpretations, but the FRB really does push the Chevron envelope with this one, however much I agree with the result. If the rule is attacked, then of course the Fed, joined by the banks, will argue that this interpretation was necessary to avoid unconstitutionality. Then the same basic issues anticipated in my earlier article would be litigated, but with the FRB on the side of economic liberties instead of against them.
Other issues, such as the possible impact on innovation, remain in limbo. The rule will apply to debit card substitutes, but it is difficult to guess how this will work. For example, suppose someone comes up with an iPhone app that enables a network that will debit an account at any bank that signs up with the service—how would the multiple network rule affect this? Is it forbidden, a priori? This does not seem to have been the FRB’s intention, but I don’t see how to avoid this conclusion.
The time for filing appeals is running, so stay tuned. It ain’t over ‘til it’s over.
Finally, speaking as a one-time supervisor of rulemaking proceedings, the FRB staff deserves tremendous credit for the job it did in a very difficult situation. The final product is thoroughly professional and thoughtful.
I’m getting chills realizing that this may be the last time in my lifetime that I hear Houston launch control departments say “Go” when polled on whether to launch Atlantis. Thirty years ago, I watched the first shuttle flight, Columbia, take off on a crisp spring morning. For 50 years, since Alan Shepard’s first sub-orbital flight in May 1961, the pre-launch confirmation polling became an icon of pop culture. Knowing that lives were on the line, tragically proved by the Challenger and Columbia disasters, only heightened the sense that this was what taking responsibility meant. Questions of NASA’s bloat, waste, and loss of mission helped President Obama kill America’s manned space program last year, but no one can watch the pre-launch ritual without enormous respect and pride in what we achieved in half a century, along with a deep and frustrating sense of regret that the country now is narrowing its horizons and seems neither to notice nor care.
… it’s not possible for the U.S. to both lead the world by a large margin in Internet usage and lag so far behind in broadband. We think these traffic per user and per capita figures show that our residential, mobile, and business broadband networks are among the world’s most advanced and ubiquitous.
Lots of other quantitative and qualitative evidence — from our smart-phone adoption rates to the breakthrough products and services of world-leading device (Apple), software (Google, Apple), and content companies (Netflix) — reaffirms the fairly obvious fact that the U.S. Internet ecosystem is in fact healthy, vibrant, and growing. Far from lagging, it leads the world in most of the important digital innovation indicators.
More here from Bret Swanson, who dives in to the latest OECD figures on global Internet use.
And here’s a useful chart.
All of this is worth keeping in mind as various Internet regulations from the White House, Capitol Hill, and the FCC are floated.
The proposed ATT/T-Mobile deal is getting pushback. None of that is surprising. It’s the standard Washington table-setting that occurs before a big, sensitive deal during which various parties jockey for carve-outs, favors, hand-outs, pounds of flesh, exceptions, and so on. Odds are still good the deal will go through, though. One reason is the wireless sector is so dynamic its future is extremely hard to predict. That makes prudent regulators inclined to sit on their hands as investors and entrepreneurs feel their way amid an unknown frontier. To wit: now there are talks of a big deal between LightSquared and Sprint that would pump $20 billion into Sprint’s war chest. We are living in exciting telecom times.
One of Washington’s worst kept secrets is finally out: liberal political activist FCC Commissioner Michael Copps and the liberal activist group Free Press apparently coordinated their push for net neutrality regulations. The Examiner has the story.
While this certainly looks bad, there’s probably nothing illegal about it. Those of us following the Internet/telecom space are not surprised since it’s been obvious they’ve been coordinating messaging, news leaks, and so on for a very long time.
I do wonder what Obama reg czar Cass Sunstein thinks of something like this. Lots of folks on the far right don’t like Sunstein for… I can’t remember precisely what for really (Glenn Beck had a strange hang-up about him for a while). Sunstein is an interesting and original thinker who has done a lot of substantive scholarship on a multitude of topics. He may be wrong about a lot of stuff, but he’s certainly not the devil the far right made him out to be. He was just at AEI speaking about the Obama administration’s regulatory reform efforts, many of which deserve wide support. In any event, I can’t imagine a guy like Sunstein thinks too highly of this kind of activity.
Terms of service agreements—for credit cards, software, etc.—are becoming a hot-button issue these days. One of the latest flare-ups comes in response to this photo of the space shuttle emerging from the clouds. A woman took a picture of the shuttle, uploaded it to her Twitter account via the twitpic app, and then forgot about it. The picture got picked up by the wires, commercial publications, TV networks, etc. Normally, the person who took such a picture could make a pretty penny from such a coup. But no. According to the terms of service agreement for Twitpic, the company owns all of the sales rights to any photos people put up to their personal accounts.
Consumer affairs is hardly my bailiwick and for all I know some firms already do this, but I have an idea: Why don’t companies include a “Decline with Explanation” option? I’ve never seen one. But when I unsubscribe from email lists, the vendor/sender almost always wants to know why I’m unsubscribing. My answer is usually something like “I never signed up for your no doubt vital newsletter on the cat litter box liner industry and I’m not all that interested in it.” But with various applications, you’d think companies would want to know why potential customers don’t want to say “yes” to their service. At minimum it might provide some useful market research. Ideally there’d be even more granularity. I’d like a “Yes, but” option too. So I could let Apple, Microsoft, Google, or Twitter that “If you do X, I’m gone!”
I’d hate to give government regulators any incentive to impose this kind of thing, but I’m at a loss as to why at least some companies don’t do something like this.
By all measures, last night’s American Enterprise Debate between economist Tyler Cowen and philosopher Roger Scruton was a success. Just look at the tweets and you’ll see that Roger and Tyler’s exchanges generated a ton of dialogue.
As expected, the most frequent question I heard after the debate was, “Who won?” My sense is that Scruton’s persuasive arguments about virtue and the spirituality of friendship won over many hearts; and Tyler Cowen’s empirically based rejoinders about the utility of social media won over many minds.
But here’s a bit of insider info—which Jonah figured out yesterday—there was indeed no “therefore what?” goal for this debate. Normally debates are held to reach a conclusion—pick a winner and a loser. But in this case, the mission was to create an exhibition for the debate itself. Ultimately, the debate wasn’t just about social media but rather about many other recurring questions in our society—from the academic dispute over rational-choice empiricism to the question of democracy in the developing world to the issue of human liberty itself.
Indeed, the question of social media is most of all a question of liberty, as social media is inherently a liberating tool. Just ask a rural farmer in India who no longer relies on a middleman for his wheat prices and can instead get them from text messages, or a poor Brazilian teenager who teaches himself English online.
With liberty comes duty. Humans can get drunk on liberty. And therefore we need checks on ourselves. And this is where the debate on social media exemplifies the American experience. Our republic continually tries to balance its liberty with checks on that liberty. It’s what makes our Revolution so different from others. The French revolutionaries believed in liberty too, but they had too much of it, and it quickly devolved into another form of slavery and terror. Wasn’t Scruton’s argument about social media enslaving its users a similar critique?
So instead of trying to decide who won, I invite our readers and followers to watch the debate again with this in mind. It’s not that one is right and the other is wrong. It’s that neither Roger nor Tyler could ever be right unless the other was standing there arguing with him.
Last night’s energetic debate between Tyler Cowen and Roger Scruton resulted in a flurry of activity on none other than the two most popular forms of social media: Twitter and Facebook. No surprises that most people using these platforms sided with Cowen on this one, but what stood out to me was the discussion of the two leading arguments: that social media replace “real” friendship and that social media allow for more friendships. While the debate raised many interesting questions about technology, society, and the evolving nature of what it means to pursue relationships, the debaters seemed to argue on entirely different wavelengths. It’s hard to determine who “won” when they weren’t addressing the same fundamental question.
So I gather we’ve got a debate on social media around here. Unfortunately I can’t make tonight’s main event (though I’ll be sure to catch the video). It’s an interesting topic and I think it’s telling that so many of the younger brainiacs at AEI are chiming in on it.
But I’m also at something of a loss as to what the “and therefore what?” angle on all of this will be. As far as I can discern there’s no serious public policy aspect to this. If Roger Scruton wins and convinces everyone in the room that social media is bad for human relationships, we will be no closer to Congress banning social media.
That doesn’t mean it’s not worth debating. But I do think it points to the fact that this is less a problem looking for a solution and more a fact of life that simply has to be dealt with.
Indeed, what I find a bit amusing about all of this, as I am increasingly nostalgic for the wild west days of the Internet, is how this is really an old question gussied-up as a new one. More than a decade ago—before Facebook and Twitter—there was a lot of thumbsuckery about whether “the Internet” was bad for human interactions. See this New York Times story from 1998, “Sad, Lonely World Discovered in Cyberspace.”
Those studies proving that the worldwide web is a cold, alien realm—on the Web nobody can hear you scream!—were trotted out regularly. I always thought there was both merit and hype to the claims.
But these complaints pre-date the web. The phone was seen by many as destabilizing to human relationships and the social order—because it was! But it was also a monumental boon. The same can be said of the car, the telegraph, the ocean-going vessel, the printing press, and smoke signals. Technology is inherently destabilizing to the existing order, because the existing order builds up around existing technology. I discussed this point at some length in a piece for Reason years ago reviewing a book by Wendy Shalit, a young “neo-Victorian”:
For example: Shalit writes nostalgically about calling cards and their demise. She points out, correctly, that for most of Western history, people didn’t want unmarried men and women to be alone together, even during courtship. Calling cards expedited the courting process without rocking the boat too much. A gentleman in pursuit of a young lady would drop off a card at her home to request a personal visit. If the woman declined the invitation, both she and her suitor would be saved face-to-face embarrassment.
Shalit loves this idea, and she doesn’t seem to think there’s any reason why we can’t have it back. It has not occurred to her, apparently, that people used calling cards before we had this neat invention called the “telephone.”
Calling cards were a small part of an ongoing social compromise with the rising middle class’s increasing willingness to accept romantic choice. Arranged marriages were giving way to the insight that people should be able to select their spouse, or at least have some say in the decision. So elaborate dating rituals emerged, offering ways to pay tribute to tradition while still affording greater liberty in choosing a partner. We still use many of these rituals today, and some of the old traditions are gaining new strength. But Shalit seems unconcerned with all of this. Indeed, she likes arranged marriages too.
So yes, social media is destabilizing, but destabilization isn’t necessarily bad. Social media, like so many other technologies, improves some relationships while it damages others and changes most.
More to the point, this is a “problem” without much of a solution. I suppose it couldn’t hurt for guidance counselors and parents to know that social media has its downsides, but I’m not sure that’s news to anybody, particularly the people who use social media the most—young’ns. I suspect that there’s not a boy or girl in Christendom who wouldn’t rather spend 3D time with friends or who doesn’t understand at some level that living entirely on the computer or the cellphone is lame. At the end of the day, though, you’ve got to trust that people will figure that out and act accordingly on their own, because the “problem” isn’t going away.
The Tommy Boy regulators post is getting a lot of attention. One reader writes:
Working in the regulatory arena myself (environmental regulation) it is easy to see that regulators abhor a vacuum (i.e., unregulated activity). Ronald Reagan expressed it best: ‘If it moves, tax it. If it keeps moving, regulate it. If it stops moving, subsidize it. That explains everything wrong with federal governmental policy (not to mention California governmental policy).’
I thought of this when I saw the comment from Obama’s former technology advisor Susan Crawford about communications companies (h/t Bret Swanson):
“regulating these guys into… an inch of their life is exactly what needs to happen.”
Communications companies are already forced to be tax collectors for local and federal governments. We must be in the “regulate it” phase Reagan talked about. And who knows, in a few years if the FCC gets its way we’ll be able to subsidize them!
My colleague Stuart James and I have started a new podcast here at AEI entitled “Banter.” This time, we sat down with AEI Resident Scholar Andrew Biggs, noted recipient of copious amounts of adulatory fan mail, to talk about Representative Paul Ryan’s new budget plan and its impact on entitlements including Medicare, Medicaid, and Social Security.
In the podcast, Stu and I try to flesh out some of the bigger issues about budgets and entitlements for a non-wonky audience. In Andrew’s field, the terminology can get a bit overwhelming, but he does a great job clarifying issues like “fiscal consolidation” and “premium-support models” for a lay audience. Not only is his work fascinating, it’s immensely relevant for all Americans.
So go ahead and take a listen, and let us know what you think at podcast@aei.org.
You can subscribe to Banter on iTunes here and download the mp3 directly as well as listen to our previous podcasts here.
I’ve received a number of interesting responses from my piece on the IBM computer, Watson, which beat the two reigning human champions in “Jeopardy!,” the popular game show. I advised calm and restraint in response to developments in artificial intelligence, because the “weak” artificial intelligence (AI) that we see in computers does not equal (or even lead to) “strong” AI in which computers are conscious, free agents. No matter how fast and sophisticated they get, we still know what’s going on inside them, and it’s not consciousness. This is entirely different from our own situation, in which we directly experience our own consciousness but have little idea how it works, or how it relates to, say, brain activity.
Unfortunately, many of those who concede the argument still seem worried about AI. So it’s nice to see some common sense from Stanley Fish at The New York Times blog. Fish argues that one of the things that distinguishes us from computers is that we know which rules apply in which situations and when the rules need to be adjusted to take account of new situations. We also often break the rules that we’re supposed to follow. Computers, in contrast, are programmed to follow rules, and that’s what they do.
Though he doesn’t quite say this, one of the implications of Fish’s argument would be that human beings can sin; computers can’t. I’ll have to think more about that argument. But his conclusion seems spot-on. Watson, he says, is
just a bigger and fancier version of my laptop’s totally annoying program. It decomposes the question put to it into discrete bits of data and then searches its vast data base for statistically frequent combinations of the bits it is working with. The achievement is impressive but it is a wholly formal achievement that involves no knowledge (the computer doesn’t know anything in the relevant sense of “know”); and it does not come within a million miles of replicating the achievements of everyday human thought.
Watson’s builders know this; when they are interviewed they are careful to stay away from claims that their creation simulates human mental processes (although they also murmur something about future hopes). But those in charge of the artificial intelligence hype are not so careful and they delight in exciting us and frightening us with the fiction of a machine that can think. It’s great theater, or in Watson’s case, great television, but that’s all it is.
Developments in AI are fascinating and hold great promise for improving our lives. It’s ironic that “those in charge of artificial intelligence hype” are preventing many people from seeing this.
Reihan notes an interesting interview with Ray Kurzweil in which Kurzweil talks up the potential for radical transformation in the energy sector within a generation.
Today, solar is still more expensive than fossil fuels, and in most situations it still needs subsidies or special circumstances, but the costs are coming down rapidly—we are only a few years away from parity. And then it’s going to keep coming down, and people will be gravitating towards solar, even if they don’t care at all about the environment, because of the economics.
So right now it’s at half a percent of the world’s energy. People tend to dismiss technologies when they are half a percent of the solution. But doubling every two years means it’s only eight more doublings before it meets a hundred percent of the world’s energy needs. So that’s 16 years. We will increase our use of electricity during that period, so add another couple of doublings: In 20 years we’ll be meeting all of our energy needs with solar, based on this trend which has already been under way for 20 years.
I’m a Kurzweil fan (and discuss his ideas favorably in my recent book) but he’s just wrong about energy trends. Energy transitions take a long time. The energy sector is not like IT—there is no Moore’s Law for energy. This is the mistake techno-greens like Al Gore (and, apparently, Kurzweil) make, and it’s a wrong belief that has badly distorted public policy for a very long time.
Voice of America recently hired Ramin Asgard to direct its Persian Service. His selection is curious, given his track record. Asgard has worked in the State Department and, for a time, directed its “Iran Regional Presence Office” in Dubai. More recently, he served as a political advisor on Iran at CENTCOM.
The problem is that it appears that he used both positions to undermine American policy toward Iran.
• According to emails recently shared with me, while managing the “Iran Regional Presence Office,” Asgard suggested a scheme to support the National Iranian American Council (NIAC) with tax dollars. In emails to Trita Parsi, president of the George Soros-funded NIAC, Asgard floated a scheme that would have allowed the anti-sanctions lobbying organization to handpick Iranian-Americans to staff the State Department’s primary field office on Iran. It was around this time that NIAC began its efforts to eviscerate democracy promotion funds meant to support civil society and radio broadcasts into Iran.
• While serving as a political adviser to CENTCOM last spring, Asgard penned an article for a Tufts University journal in which he professed moral equivalency between Iran and the United States, blaming both equally for a lack of “dialogue” and “cultural diplomacy.” Asgard continues to minimize the real issues the United States has with Iran, such as the regime’s sponsorship of terrorism and its underwriting of attacks against U.S. troops and allies, by saying the friction between the United States and Iran is merely a “political difference.”
• Those who have met with Asgard question his Persian fluency. This begs the question: how can Asgard manage U.S. broadcasts to Iran if he can’t understand what is being discussed?
Over the last several years, U.S. international broadcasting has had serious management and content problems (for a small taste, see here, here, here, here, and here). Things will worsen if the Broadcasting Board of Governors fails to start hiring serious public diplomacy experts who can speak the language of their broadcasts and offer a “clear and effective presentation of the policies of the United States Government and responsible discussion and opinion on those policies” (22 USC Chapter 71 sec. 6202).
Julian Assange has become the cyber-villain of the 21st century, and now the New York Post has obtained photos of his underground lair. The paper reports:
This is the underground lair where WikiLeaks’ own Doctor Evil stores the 250,000 secret cables that are wrecking US diplomacy.
It’s a high-tech granite cave, carved out of hard rock and hidden 100 feet below a downtown Stockholm park.
Inside, there are all the trappings of a James Bond villain.
It has a “floating” conference room, with designer furniture, connected by a glass bridge and soaring above the massive work area, with what’s described as a lunar-landscape floor.
To soften the stark atmosphere, there are walls of green plants, solar lighting and humidifiers.
And to keep out Bond, the CIA or any other intruders, there’s a single entrance, with half-yard-thick metal doors.
It was built originally as a World War II bunker, then strengthened in the 1970s to serve as a refuge for Swedish government officials in case the capital suffered an attack by a Soviet hydrogen bomb. Its interior was redesigned by a Swedish architect who was inspired by the futuristic Bond sets of the 1960s.
But Ernst Stavro Blofeld and Auric Goldfinger didn’t have dozens of computer servers, with backup generators from German submarines in their headquarters.
Julian Assange, WikiLeaks’ founder, chose the site, a former Cold War bunker known as the Pionen White Mountain data storage facility, in August as a backup for his servers, which held the secrets he was about to reveal to the world.
You can see more photos here.
Of course, Assange can’t enjoy his Swedish lair—he’s sitting in a London prison fighting extradition to Sweden on rape charges. And ABC News reports there may be other extradition requests forthcoming:
Wikileaks founder Julian Assange, the man behind the publication of more than a 250,000 classified U.S. diplomatic cables, could soon be facing spying charges in the U.S. related to the Espionage Act, Assange’s lawyer said today.
Those charges could not come soon enough.
FCC Chairman Julius Genachowski announced he will force through Internet regulations before the new Congress assembles next month. On the one hand, this is not surprising. The new Congress promises to push growth-oriented economic policies. Regulations on the nation’s most dynamic sector (and one of the few bright spots in the sluggish economy) would not be high on the list of potential action items. So Genachowski, a long-time net neutrality advocate, probably felt he had no choice but to act during the lame-duck.
But, on another level, it’s simply baffling. The country is on its way to rolling out nearly universal, ubiquitous broadband. That rollout is currently being enabled by tens of billions of dollars of private-sector capital investment. Bret Swanson recently noted that “Between 2003 and 2009, broadband service providers invested an average of $30 billion per year in deploying new broadband networks and enhancing existing ones, resulting in some 431,000 jobs created or sustained. In the absence of new regulations, many expect these investment levels to continue apace through 2015.” If Genachowski’s new rules do anything, they will likely confuse the market and retard capital formation. If so, his will be a legacy of stalling the march to ubiquitous broadband. Is this really how he wants to be remembered?
In addition to ObamaCare reform and Dodd-Frank reform, it looks like telecom reform will need to be added to the upcoming congressional to-do list.
UPDATE: Bret thinks it’s not the end of the world. And he’s right that it could have been worse. Then again, Commissioner Copps is already insisting it is just the beginning. Stay tuned. I’ll be interviewing the architects of the REINS Act tomorrow and I’m pretty sure this sort of regulation is precisely what they have in mind.
Internet godfather Tim Berners-Lee is getting a lot of attention for his cri de coeur in Scientific American about the future of the Internet. In “Long Live the Web: A Call for Continued Open Standards and Neutrality,” Berners-Lee frets that the Internet, as originally conceived, is in jeopardy. He says:
The Web evolved into a powerful, ubiquitous tool because it was built on egalitarian principles and because thousands of individuals, universities, and companies have worked, both independently and together as part of the World Wide Web Consortium, to expand its capabilities based on those principles.
The Web as we know it, however, is being threatened in different ways. Some of its most successful inhabitants have begun to chip away at its principles. Large social-networking sites are walling off information posted by their users from the rest of the Web. Wireless Internet providers are being tempted to slow traffic to sites with which they have not made deals …
If we, the Web’s users, allow these and other trends to proceed unchecked, the Web could be broken into fragmented islands. We could lose the freedom to connect with whichever Web sites we want. The ill effects could extend to smartphones and pads, which are also portals to the extensive information that the Web provides.
Berners-Lee believes in an Internet that must evolve within the confines of a certain preconceived—and, it must be said, ideological—form. “The Web is critical not merely to the digital revolution but to our continued prosperity—and even our liberty,” he writes. “Like democracy itself, it needs defending.” In this way, and in this way only, will it achieve Berners-Lee’s preferred social and political ends.
When Jim DeLong wrote in these pages about the need to avoid a regulatory morass in the technology industry, he said:
The temperature of business reporting these days is raised by numerous disputes that lie at the intersection of technology and politics.
Now today we learn:
Several popular online travel companies are joining forces to oppose Google Inc.’s proposed $700 million purchase of ITA Software Inc., the leading provider of flight data, saying the deal would give it too much sway over the travel sector.
Expedia Inc., Kayak.com, Sabre Holdings and Farelogix Inc.—which operate half-a-dozen leading online travel sites—are forming a coalition called FairSearch.org to persuade the Justice Department to block Google’s latest deal.
Stay tuned as we analyze this fight in coming weeks, and this one could get ugly. But Jim’s piece remains an important primer on how to think constructively about the regulation of network/platform technology industries.
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