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TOTM On Friday the the International Center for Law & Economics filed comments with the FCC in response to Chairman Wheeler’s NPRM (proposed rules) to “unlock” . . .
On Friday the the International Center for Law & Economics filed comments with the FCC in response to Chairman Wheeler’s NPRM (proposed rules) to “unlock” the MVPD (i.e., cable and satellite subscription video, essentially) set-top box market. Plenty has been written on the proposed rulemaking—for a few quick hits (among many others) see, e.g., Richard Bennett, Glenn Manishin, Larry Downes, Stuart Brotman, Scott Wallsten, and me—so I’ll dispense with the background and focus on the key points we make in our comments.
Our comments explain that the proposal’s assertion that the MVPD set-top box market isn’t competitive is a product of its failure to appreciate the dynamics of the market (and its disregard for economics). Similarly, the proposal fails to acknowledge the complexity of the markets it intends to regulate, and, in particular, it ignores the harmful effects on content production and distribution the rules would likely bring about.
Read the full piece here.
Regulatory Comments "In this proceeding the Commission proposes to “open” the market for multichannel video programming distributor (“MVPD”) set-top box video interfaces..."
“In this proceeding the Commission proposes to “open” the market for multichannel video programming distributor (“MVPD”) set-top box video interfaces. We believe that the Commission’s proposed rules fail to take account of the fundamental economic realities that govern the creation of content and its distribution, fail to properly respect copyright and contractual rights, and constitute an inappropriate, to say nothing of unwise, exercise of the Commission’s authority under Section 629.
With this NPRM the Commission undertakes an intervention into a market that is robust, competitive, and scarcely in need of regulatory assistance. And Chairman Wheeler is well aware of this reality:
“American consumers enjoy unprecedented choice in how they view entertainment, news and sports programming. You can pretty much watch what you want, where you want, when you want.”
Not only is the market robust, but it is rooted in a complicated set of business negotiations (most notably between programmers and distributors) that contain an enormous number of moving parts.
“Content providers negotiate with MVPDs along many dimensions, including the presentation of content in terms of adjacencies; how a content producer’s brand will be treated; how and when content can be commercialized with advertised; limitations on the use of content as part of a content producer’s larger set of business model innovations; and the legal and regulatory obligations of the content producers themselves, including “self-regulatory initiatives such as the Better Business Bureau’s Children’s Advertising Review Unit (“CARU”) and Children’s Food and Beverage Advertising Initiative (“CFBAI”), and contractual agreements with writers’, directors’, and/or actors’ guilds.”
And not only are the contracts themselves extremely complex, but the various players in content and distribution markets are interrelated in complex and subtle ways. The no- tion that the FCC could focus in isolation even on something as seemingly incidental as set-top boxes without unanticipated and far-reaching ramifications throughout the eco- system is misguided.
On the one hand, the Commission’s proposed rules seem to dramatically underappreciate and insufficiently assess this underlying complexity, thereby misconstruing the likely effects of the regulation and threatening the investment and innovation that have produced this “Golden Age” of television and home video.6 On the other hand, if it does proceed with such rules anyway, the Commission should, and perhaps must under the APA and relevant judicial decisions like Michigan v. EPA,7 take much greater care to identify and evaluate the broad consequences—that is to say the costs and benefits—of its rules than it appears to have so far done in this NPRM…”
TOTM It appears that White House’s zeal for progressive-era legal theory has … progressed (or regressed?) further. Late last week President Obama signed an Executive Order . . .
It appears that White House’s zeal for progressive-era legal theory has … progressed (or regressed?) further. Late last week President Obama signed an Executive Order that nominally claims to direct executive agencies (and “strongly encourages” independent agencies) to adopt “pro-competitive” policies. It’s called Steps to Increase Competition and Better Inform Consumers and Workers to Support Continued Growth of the American Economy, and was produced alongside an issue brief from the Council of Economic Advisors titled Benefits of Competition and Indicators of Market Power.
TL;DR version: the Order and its brief do not appear so much aimed at protecting consumers or competition, as they are at providing justification for favored regulatory adventures.
TOTM Today’s Canadian Competition Bureau (CCB) Google decision marks yet another regulator joining the chorus of competition agencies around the world that have already dismissed similar . . .
Today’s Canadian Competition Bureau (CCB) Google decision marks yet another regulator joining the chorus of competition agencies around the world that have already dismissed similar complaints relating to Google’s Search or Android businesses (including the US FTC, the Korea FTC, the Taiwan FTC, and AG offices in Texas and Ohio).
A number of courts around the world have also rejected competition complaints against the company, including courts in the US, France, the UK, Germany, and Brazil.
Scholarship Abstract This Comment provides an argument for applying a wellbeing-analysis approach to eminent domain compensation, discussing the inefficiencies that result from compensating individuals with only . . .
This Comment provides an argument for applying a wellbeing-analysis approach to eminent domain compensation, discussing the inefficiencies that result from compensating individuals with only the fair market value of their properties and arguing that a well-being-analysis approach provides a way out of the practical compromises made in eminent domain jurisprudence. Although happiness regressions do not demonstrate the exact valuation that an individual has of her property, using a multiplier that reflects the average subjective premium generated by a happiness regression is consistent with value-of-life evidence, which uses information about others to estimate an average multiplier that ensures more-accurate damages.
This Comment demonstrates that the BHPS data set, along with certain assumptions about why individuals move, implies that a wedge exists between the subjective valuation of an owned property and its fair market value. Not only does this wedge exist but it measures somewhere around or above 22 percent of fair market value. Given such a potentially large effect, this Comment aims to inspire future survey work with respect to individuals who are required to move. Such survey data would measure changes in happiness when the move—since it is due to eminent domain—is exogenous. For this reason, regression analyses based on such moves will provide even more-accurate estimates for the average undercompensation that occurs when individuals are paid only the fair market value of their properties in the context of eminent domain.
TOTM On March 31, a federal judge gave the city of Boston six months to rectify the disparities between the way it treats Transportation Network Companies . . .
On March 31, a federal judge gave the city of Boston six months to rectify the disparities between the way it treats Transportation Network Companies (“TNC”) (such as Uber and Lyft) and taxicab companies. This comes pursuant to an order by US District Court Judge Nathaniel M. Gorton in a suit filed by members of the Boston taxi industry against the city and various officials. The suit is an interesting one because it reveals unusual fault lines in the ongoing struggle between taxi companies, local regulators, and the way that federal law recognizes and respects property and economic rights.
TOTM Netflix’s latest net neutrality hypocrisy (yes, there have been others. See here and here, for example) involves its long-term, undisclosed throttling of its video traffic on AT&T’s and . . .
Netflix’s latest net neutrality hypocrisy (yes, there have been others. See here and here, for example) involves its long-term, undisclosed throttling of its video traffic on AT&T’s and Verizon’s wireless networks, while it lobbied heavily for net neutrality rules from the FCC that would prevent just such throttling by ISPs.
It was Netflix that coined the term “strong net neutrality,” in an effort to import interconnection (the connections between ISPs and edge provider networks) into the net neutrality fold. That alone was a bastardization of what net neutrality purportedly stood for, as I previously noted…
ICLE White Paper "It’s no surprise to anyone that illegal activity happens online. What may be surprising, however, is that one of the central figures in administering core Internet functions is deeply ambivalent (at best) about its role in preventing illicit online activity..."
“It’s no surprise to anyone that illegal activity happens online. What may be surprising, however, is that one of the central figures in administering core Internet functions is deeply ambivalent (at best) about its role in preventing illicit online activity.
Since 1998, the Internet Corporation for Assigned Names and Numbers (ICANN) has been the organization tasked by the U.S. government with overseeing the Domain Name System (DNS). The DNS is the system that enables domain names to resolve — meaning that when you type “google.com” in a browser address window you will reliably receive Google’s search engine each time. That reliability is a boon for Internet users, most of the time. But much mischief can be conducted through web sites, as well, and a system that reliably serves up these sites imposes costs on its users.
Take one recent example. In July 2015, a Bloomberg News piece from “bloomberg.market” indicated that Twitter was in talks over a $31B USD buyout. Naturally, the value of Twitter stock shot up before returning to normal. The problem, however, was that it was a totally fabricated event, one that the currently lax accountability regime underlying the DNS only makes easier.
One would think that ICANN would have effective procedures in place for removing (or otherwise sanctioning) domain names created or used for illegal purposes. However, even though it possesses contractual control over its registries and registrars (the entities responsible for managing and registering top level domains and domain names), the practical reality is that illegal conduct is rarely ever deterred by ICANN.
The consequences of ICANN’s non-action are evident. ICANN has refused to effectively deter content piracy on the Internet, and pirated content currently constitutes something on the order of 25% of Internet traffic. It has also overseen an inexorable increase in websites dedicated to phishing scams. As of December 2014, phishing occurred in 19% of the new gTLDs — and nearly two-thirds of the phishing occurred in just one gTLD (.XYZ). To date ICANN has steadfastly refused to take action despite the significant cost that its refusal — ostensibly rooted in its desire not to regulate Internet content — imposes on community members.
ICANN has an accountability problem.”
TOTM The FCC doesn’t have authority over the edge and doesn’t want authority over the edge. Well, that is until it finds itself with no choice but to regulate the . . .
The FCC doesn’t have authority over the edge and doesn’t want authority over the edge. Well, that is until it finds itself with no choice but to regulate the edge as a result of its own policies. As the FCC begins to explore its new authority to regulate privacy under the Open Internet Order (“OIO”), for instance, it will run up against policy conflicts and inconsistencies that will make it increasingly hard to justify forbearance from regulating edge providers.
