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Popular Media As you may have heard, Columbia lawprof and holder of the dubious distinction of having originated the term and concept of Net Neutrality, Tim Wu, . . .
As you may have heard, Columbia lawprof and holder of the dubious distinction of having originated the term and concept of Net Neutrality, Tim Wu, is headed to the FTC as a senior advisor.
Curiously, his guest stint runs for only about four and a half months. As the WSJ reports:
Mr. Wu, 38, will start his new position on Feb. 14 in the FTC’s Office of Policy Planning, and will help the agency to develop policies that affect the Internet and the market for mobile communications and services. The FTC said Mr. Wu will work in the unit until July 31. Mr. Wu, who is taking a leave from Columbia, said that to work after that date he would have to request a further leave from the university.
Mr. Wu’s claim that the source of the date constraint is Columbia doesn’t pass the smell test. Now, it is possible that what he says is literally true–and therefore intentionally misleading. Perhaps he asked only for leave through the end of July and would indeed have to request further leave if he wanted it. But the implication that Columbia would have trouble granting further leave–especially during the summer!–and thus the short tenure seems very fishy to me.
So what else could be going on, while we’re reading inscrutable tea leaves? Well, for one thing, it could be that Wu has already signed on for some not-yet-public role at Columbia that he prefers not to imperil. Maybe associate dean or something like that.
But I have another, completely unsupported speculation. I think the author of The Master Switch (commented on by Josh and me here) and one of the most capable (as far as that goes) proponents of Internet regulation in the land is being brought in to the FTC to help the agency gin up a case against Google.
I think with Google-ITA seemingly approaching its denouement, the FTC knows or believes that Google is either planning to abandon the merger or else enter into an (insufficiently-restrictive for the FTC) settlement with the DOJ. In either case, not a full-blown investigation and intervention into Google’s business. So the FTC is preparing its own Section 5 (and Section 2, but who needs that piker when you have the real deal in Section 5?) (for previous TOTM takes on Section 5, see, e.g., here and here) case and has brought in Wu to help. Given the switching back and forth between the DOJ and FTC in reviewing Google mergers, it could very well be (I haven’t kept close tabs on Google’s proposed acquisitions) that there’s even already another merger review in waiting at the FTC on which the agency is planning to build its case.
But the phase of the case requiring Wu’s full attention–the conceptual early phase–should be completed by the end of July, so no need to detain him further.
More concretely, I would point out that it says a lot about the agency’s mindset that it is bringing in the likes of Wu to help it with its ongoing forays into the regulation of Internet businesses. By comparison, I would just point out that Chairman Majoras’ FTC brought in our own Josh Wright as the agency’s first Scholar in Residence. Sends a very different signal, don’t you think?
Filed under: antitrust, federal trade commission, google, technology Tagged: Federal Trade Commission, google, Tim Wu
Scholarship The antitrust landscape changed dramatically in the last decade. Within the last two years alone, the Department of Justice has held hearings on the appropriate scope of Section 2 of the Sherman Act and has issued, then repudiated, a comprehensive Report.
The antitrust landscape changed dramatically in the last decade. Within the last two years alone, the Department of Justice has held hearings on the appropriate scope of Section 2 of the Sherman Act and has issued, then repudiated, a comprehensive Report. During the same time, the European Commission has become an aggressive leader in single?firm conduct enforcement by bringing abuse of dominance actions and assessing heavy fines against firms including Qualcomm, Intel, and Microsoft. In the United States, two of the most significant characteristics of the new antitrust approach have been the increased focus on innovative companies in high?tech industries and the diminished concern that erroneous antitrust interventions will hinder economic growth. This focus on high?tech industries is dangerous, and the concerns regarding erroneous interventions should not be dismissed too lightly.
This Article offers a comprehensive, cautionary tale in the context of a detailed factual, legal, and economic analysis of the next Microsoft: the theoretical, but perhaps imminent, enforcement against Google. Close scrutiny of the complex economics of Google’s disputed technology and business practices reveals a range of procompetitive explanations. Economic complexity and ambiguity, coupled with an insufficiently deferential approach to innovative technology and pricing practices in the most relevant case law, portend a potentially erroneous—and costly—result.
Our analysis, by contrast, embraces the cautious and evidence?based approach to uncertainty, complexity, and dynamic innovation contained within the well?established error?cost framework. As we demonstrate, though there is an abundance of error?cost concern in the Supreme Court precedent, there is a real risk that the current, aggressive approach to antitrust error, coupled with the uncertain economics of Google’s innovative conduct, will yield a costly intervention. The point is not that we know that Google’s conduct is procompetitive, but rather that the very uncertainty surrounding it counsels caution, not aggression.
ICLE White Paper Summary Fresh off of the most substantial national liquidity crisis of the last generation and the enactment of sweeping credit card regulation in the form . . .
Fresh off of the most substantial national liquidity crisis of the last generation and the enactment of sweeping credit card regulation in the form of the Credit CARD Act, Congress continues to deliberate, with a continuing drumbeat of support from lobbyists, a set of new regulations for credit card companies. These proposals, offered in the name of consumer protection, seek to constrain the setting of “interchange fees”— transaction charges integral to payment card systems—through a range of proposed political interventions. This article identifies both the theoretical and actual failings of such regulation. Payment cards are a secure, inexpensive, welfare-increasing payment mechanism largely unlike any other in history. Rather than increasing consumer welfare in any meaningful sense, interchange fee legislation represents an attempt by some merchants to shift costs away from their businesses and onto card issuing banks and cardholders. In particular, bank-issued credit cards offer a dramatic improvement in the efficiency and availability of consumer credit by shifting credit risk from merchants onto banks in exchange for the cost of the interchange fee—currently averaging less than 2% of purchase value. Merchants’ efforts to cabin these fees would harm not only consumers but also the merchants themselves as commerce would depend more heavily on less-efficient paperbased payment systems. The consequence of interchange fee legislation, as Australia’s experiment with such regulation demonstrates, would be reduced access to credit, higher interest rates for consumers, and the return of the much-loathed annual fee for credit cards. Interchange fee regulation threatens to constrain credit for consumers and small businesses as the American economy begins to convalesce from a serious “credit crunch,” and should be accordingly rejected.
TOTM Will reduction in interchange fees help or hurt consumers? Two posts yesterday made the conjecture that a reduction in one category of fees would only . . .
Will reduction in interchange fees help or hurt consumers? Two posts yesterday made the conjecture that a reduction in one category of fees would only increase other fees, and that the overall sum of fees will not change. This is the fee-neutrality claim. Todd Zywicki writes…
Read the full piece here.
TOTM My colleague Tom Hazlett has an interesting piece in the Financial Times chiming in on the network neutrality debate. Hazlett makes the point that if . . .
My colleague Tom Hazlett has an interesting piece in the Financial Times chiming in on the network neutrality debate. Hazlett makes the point that if “competitive harm” is the concern, isn’t antitrust the answer rather than regulation of this sort?
TOTM My colleague Tom Hazlett (George Mason University) has a characteristically thoughtful and provocative column in the Financial Times on the recent Clearwire joint venture and . . .
My colleague Tom Hazlett (George Mason University) has a characteristically thoughtful and provocative column in the Financial Times on the recent Clearwire joint venture and what it tells us about the “innovation commons” and current public policy debates such as network neutrality, spectrum property rights, and municipal wi-fi. Here’s an excerpt…
TOTM Hanno Kaiser at Antitrust Review discusses the implications of Google’s acquisition of YouTube for the net neutrality debate. Hanno opines that the deal may increase . . .
Hanno Kaiser at Antitrust Review discusses the implications of Google’s acquisition of YouTube for the net neutrality debate. Hanno opines that the deal may increase the likelihood of a neutrality result even without legislation. While Google’s public pro-neutrality stance is well known, GMU’s Tom Hazlett (my office neighbor and fellow UCLA Economics alum) has a great column in the Financial Times highlighting the difference between Google’s “public policy” stance on net neutrality and its business model. Here’s Hazlett on Google’s now well-known position on net neutrality legislation…
