In Lawrence Lessig's article Open Code and Open Societies he proposes the thought that Thomas Jefferson's idea, that the laws of Nature make information free, is wrong. Jefferson says that once information is released, "it forces itself into the possession of everyone, and the receiver cannot dispossess himself of it." (Lessig 7) Lessig then counters that this may be true, but not for the Internet due to closed coding. Information is then retained to be "owned" distributed solely by the producer and, unlike copyrights, never expires. This means that it is against the law for the information to be used by anyone, or for anything, not authorized by the one who produces and distributes the information.
"He was wrong to believe that nature would conspire always to keep ideas free. He was wrong to believe that he knew enough about what nature could do to understand what nature would always defend...What Jefferson thought essentially and perpetually free is only free if we choose to leave it open; only free if we code the space to keep it free; only free if we make it so. What Jefferson thought Nature guaranteed, turns out to be a good idea that we must defend." (Lessig 8)
It is interesting that Lessig would say that the notion that ideas want to be free and will find a way to be free does not apply to the Internet. I think that all of us would agree that this "law" (per se) when applied to some communication form (other than the Internet) is completely true. For example, everyone in the United States has heard about the World Trade Center tragedies. It was written about in papers, talked about on the news, and passed through many other manners of communication. Even if you were a person who told themselves that they didn't want to hear the details of what happened you probably found it difficult (I'd wager impossible) to keep that information from reaching you. Has anyone who heard about that event forgotten about it? This is Jefferson's theory in practice. Information was forced upon us and we could not, and cannot, forget or return it.
But is this the case with the Internet? Lessig thinks not. He mentions laws were put in place to increase the protection that content received and that codes and encryptions were developed to protect content. But protect it from what? Protect it from uncontrolled distribution. To make information so that it no longer wants to be free and force itself into peoples possession, never to be released in order to insure a constant stream of revenue unchallenged by outsiders.
I am no expert in this subject, but I believe that Lessig is only partially right on this point. True, laws and encryptions have been made in order to allow companies greater control over their content and information, but how much really? Laws can be broken. They are broken all of the time. No one can or will deny this. Encryptions, like laws, can be, and are, broken. Illegally or not, they are broken. This is in itself Nature in action. The information and the ideas still want to be free, and they find a way.
Some might argue that we, humans, are interfering so the natural law cannot be proven to be true. I suppose my argument is that while this is true, in a way, we too are part of nature. So what if we help it to accomplish its tasks once in a while?
Tuesday, January 25, 2011
Sunday, January 23, 2011
Crash and Burn
Opportunity. One word that summarizes a lot of what the United States, especially its economy, is about. The opportunity to create something new, start a business, make money, succeed...or do none of these. Also, it is the ability to buy whatever product or service you want, the right to pick and choose. It is what makes the United States great, what continues to draw the intrigue and interest of millions of people, and what keeps business thriving and innovation developing in order to allow for economic and state growth.
"It goes without saying that economic vitality - innovation, growth, and opportunity - depends on the freedom of the economic growth system to rise and fall, crash and burn." (Wu 301)
Throughout The Master Switch Tim Wu uses companies-turned-monopolies, such as AT&T and RCA, to demonstrate the effects of the Cycle. For instance, when an industry changes from being open and decentralized, to centralized and closed to outside influence (or change). Herein lies, what I believe, is Wu's most compelling claim, that centralization leads to the restraint of a free economy by stifling innovation, growth, and opportunity, so that economic vitality and the development of a nation is hindered.
Take, for instance, Bell Labs and AT&T. At the beginning of the Cycle, these companies, as most do, started, "in a lonely room where one or two men are trying to solve a concrete problem." (Wu 18) These companies would grow with time and, at the height of their prominence and influence over American telephony, they were given a government grant to act as a monopoly. Under the direction of Theodore Vail they, "promised to do no evil. And the government bought it." (Wu 57) Now, in all fairness, under Vail, AT&T did provide excellent service for a reasonable price. Later however, it became apparent that in order to continue as a monopoly, unhindered by new innovations that threatened to change the way the communications industry (in other words AT&T) was run, new innovations had to be repressed. That's where it all went wrong.
The smothering of innovation is proven by the work of Clarence Hickman, a scientist for Bell Labs, who in 1934 invented magnetic storage and the answering machine. However, "soon after Hickman had demonstrated his invention, AT&T ordered the Labs to cease all research into magnetic storage, and Hickman's research was...concealed for more than sixty years." (Wu 106) This was done, according to Wu because, "the very knowledge that it was possible to record a conversation would 'greatly restrict the use of the telephone,'" and therefore AT&T's business. (Wu 106)
Because of the control that AT&T held over the telephone industry they could literally decide what things were allowed to be developed, produced, and sold. This undoubtedly limited innovation, growth, and opportunity in the United States economy. They even had laws put in place to hinder innovators and inventors from developing technologies that would rival, or replace, theirs. The magnetic tape would eventually be brought to America, despite the wishes of AT&T, "via imports of foreign technology, mainly German." (Wu 106) Now not only had AT&T missed out on that new technology, but it had prevented America from being the first to develop, produce, and capitalize on the innovation, damaging the dominance of the U.S. in the global marketplace.
So, how much different would the world have been if magnetic storage had of been "invented" in the 1930's by America and not in the 1990's by Germany? Would 60 years and the pioneers of that innovation really make a big difference? It is impossible to know for sure, but it would have been nice if AT&T had given us the opportunity to have progressed with that technology, unhindered, for all of those decades.
Yet AT&T would not be the only company to stifle innovation and opportunity. RCA would also have its chance to block progress and growth. One example is that David Sarnoff, the president of RCA, blocked the entrance and usage of FM radio, in order to protect the older AM radio that his business was founded upon.
In 1934 Edwin Armstrong invented the FM radio. This new modulation of radio waves was capable, "of a far higher fidelity in sound reproduction than AM." (Wu 129) Not only that but, "FM technology held another promise: as a potential competitor to AT&T's long distance lines," through relay stations. (Wu 129) Finally, Armstrong realized that FM could be used, "as a form of wireless fax," a technology years before its eventual time. While clearly holding a larger benefit of use than the AM radio, Sarnoff would take Armstrong to court in order to stop his invention from reaching the public market. Needless to say, FM radio, "would take until the 1970s for it to catch on, and until the 1980s to reach the popularity of AM." (Wu 133)
Because of one company's absolute control over a certain industry it was "allowed" to hide an invention, that was known to be important, from the public, in order to protect its own interests. If the FM radio had been used as Armstrong had thought, possibly as a way to compete with AT&T phone lines, maybe the invention that AT&T was holding back, the magnetic storage, would have made an appearance in order for AT&T to compete again. Yet again, the limitations placed on innovation deprive the economy of much needed growth and stimulation, as well as the future generations of years of potential technological development.
So how does the economy combat the oppressive forces of centralized industries, or monopolies? By allowing for outside disruptions, innovations, inventions. Developments that will disrupt or change the way companies are run and technologies used, giving the opportunity for competition between those companies. Allowing for the natural rise and fall of these companies. Letting some crash and burn.
Wu writes a little about this in his theory on a Separations Principle. A "law" that would fight vertical integration, the cause of the problems of companies like AT&T and RCA, first by, "protecting entrepreneurial freedom by preventing stagnation and repression of business innovation, especially repression abetted by the state." (Wu 306) Also, the Separations Principle calls for a change in the government's historic role so that it can be a, "check on private power, never as an aid to it." (Wu 308) While all of this is idealistic and gives no concrete examples of how this can be accomplished, it is the correct thought and, if properly developed, could spell the end for the Cycle by finally allowing for long periods of sustained competition.
"It goes without saying that economic vitality - innovation, growth, and opportunity - depends on the freedom of the economic growth system to rise and fall, crash and burn." (Wu 301)
Throughout The Master Switch Tim Wu uses companies-turned-monopolies, such as AT&T and RCA, to demonstrate the effects of the Cycle. For instance, when an industry changes from being open and decentralized, to centralized and closed to outside influence (or change). Herein lies, what I believe, is Wu's most compelling claim, that centralization leads to the restraint of a free economy by stifling innovation, growth, and opportunity, so that economic vitality and the development of a nation is hindered.
Take, for instance, Bell Labs and AT&T. At the beginning of the Cycle, these companies, as most do, started, "in a lonely room where one or two men are trying to solve a concrete problem." (Wu 18) These companies would grow with time and, at the height of their prominence and influence over American telephony, they were given a government grant to act as a monopoly. Under the direction of Theodore Vail they, "promised to do no evil. And the government bought it." (Wu 57) Now, in all fairness, under Vail, AT&T did provide excellent service for a reasonable price. Later however, it became apparent that in order to continue as a monopoly, unhindered by new innovations that threatened to change the way the communications industry (in other words AT&T) was run, new innovations had to be repressed. That's where it all went wrong.
The smothering of innovation is proven by the work of Clarence Hickman, a scientist for Bell Labs, who in 1934 invented magnetic storage and the answering machine. However, "soon after Hickman had demonstrated his invention, AT&T ordered the Labs to cease all research into magnetic storage, and Hickman's research was...concealed for more than sixty years." (Wu 106) This was done, according to Wu because, "the very knowledge that it was possible to record a conversation would 'greatly restrict the use of the telephone,'" and therefore AT&T's business. (Wu 106)
Because of the control that AT&T held over the telephone industry they could literally decide what things were allowed to be developed, produced, and sold. This undoubtedly limited innovation, growth, and opportunity in the United States economy. They even had laws put in place to hinder innovators and inventors from developing technologies that would rival, or replace, theirs. The magnetic tape would eventually be brought to America, despite the wishes of AT&T, "via imports of foreign technology, mainly German." (Wu 106) Now not only had AT&T missed out on that new technology, but it had prevented America from being the first to develop, produce, and capitalize on the innovation, damaging the dominance of the U.S. in the global marketplace.
So, how much different would the world have been if magnetic storage had of been "invented" in the 1930's by America and not in the 1990's by Germany? Would 60 years and the pioneers of that innovation really make a big difference? It is impossible to know for sure, but it would have been nice if AT&T had given us the opportunity to have progressed with that technology, unhindered, for all of those decades.
Yet AT&T would not be the only company to stifle innovation and opportunity. RCA would also have its chance to block progress and growth. One example is that David Sarnoff, the president of RCA, blocked the entrance and usage of FM radio, in order to protect the older AM radio that his business was founded upon.
In 1934 Edwin Armstrong invented the FM radio. This new modulation of radio waves was capable, "of a far higher fidelity in sound reproduction than AM." (Wu 129) Not only that but, "FM technology held another promise: as a potential competitor to AT&T's long distance lines," through relay stations. (Wu 129) Finally, Armstrong realized that FM could be used, "as a form of wireless fax," a technology years before its eventual time. While clearly holding a larger benefit of use than the AM radio, Sarnoff would take Armstrong to court in order to stop his invention from reaching the public market. Needless to say, FM radio, "would take until the 1970s for it to catch on, and until the 1980s to reach the popularity of AM." (Wu 133)
Because of one company's absolute control over a certain industry it was "allowed" to hide an invention, that was known to be important, from the public, in order to protect its own interests. If the FM radio had been used as Armstrong had thought, possibly as a way to compete with AT&T phone lines, maybe the invention that AT&T was holding back, the magnetic storage, would have made an appearance in order for AT&T to compete again. Yet again, the limitations placed on innovation deprive the economy of much needed growth and stimulation, as well as the future generations of years of potential technological development.
So how does the economy combat the oppressive forces of centralized industries, or monopolies? By allowing for outside disruptions, innovations, inventions. Developments that will disrupt or change the way companies are run and technologies used, giving the opportunity for competition between those companies. Allowing for the natural rise and fall of these companies. Letting some crash and burn.
Wu writes a little about this in his theory on a Separations Principle. A "law" that would fight vertical integration, the cause of the problems of companies like AT&T and RCA, first by, "protecting entrepreneurial freedom by preventing stagnation and repression of business innovation, especially repression abetted by the state." (Wu 306) Also, the Separations Principle calls for a change in the government's historic role so that it can be a, "check on private power, never as an aid to it." (Wu 308) While all of this is idealistic and gives no concrete examples of how this can be accomplished, it is the correct thought and, if properly developed, could spell the end for the Cycle by finally allowing for long periods of sustained competition.
Tuesday, January 18, 2011
Don't Bite The Hand That Feeds You - Monopolies vs. Innovation
Every business that is made is made with the purpose of making a product, or performing a service, in order to make money and become successful. Success however, is hard to measure and so most companies try to grow as large and make as much money as they possibly can. So at one end of this spectrum there is of course a company with a product/service (or maybe more than one), yet with no clientele, and, therefore, no money. On the other end is a company with products/services, all of the clientele available for their goods, and, therefore, as much money as they wish to make. The latter company was allowed to exist in decades past as monopolies and trusts such as AT&T, Microsoft,and RCA. However, the government would end up finding them in violation of anti-trust laws and proceed to break them apart. With these companies as examples, the goal of big business is to get as close to a monopoly or trust as possible while still having enough inter-company competition to be deemed legal.
Tim Wu, the author of The Master Switch: The Rise & Fall of Information Empires, writes about such companies as AT&T and RCA and their histories. These companies were founded upon innovations and inventions such as the telephone and radio respectively. While they were founded on innovation, once in operation these companies demonstrated that they would attempt to stifle any so called "disruptive technology" that came about. As David Sarnoff, president of RCA, said to the inventor of FM radio as he persuaded him to keep quiet about the new technology, "...this is no ordinary invention. This is a revolution." (Wu, pg. 127)
So my question is, why would a company founded on, and made successful by, a certain innovation then refuse to continue to innovate? Obviously there are some advantages, in the business sense, to holding a technology back for a little while in order to fully reap the rewards of an older technology. But the thing is, when is the perfect time to introduce a new product? Is it as soon as it is invented in order to capitalize on the exclusivity of the good or is it 60 years after the discovery (as was the case with answering machine and magnetic storage)?
It would seem that there are really two options then for companies, refuse to innovate and allow a technology to go, fundamentally, unchanged for decades or continue to develop new technology and adapt along with it. As is seen in Wu's description of "the Cycle" an un-innovative company, in the end, does not survive. AT&T allowed no outside tampering any aspect of its phone service, even suing a company over the production of a plastic cup telephone silencing device. In the end, the company was broken apart into many pieces.
While RCA was also an example of a monopoly and they too refused to innovate on some things (FM radio), Sarnoff and company made the wise decision of incorporating television into its business instead of keeping it off the market altogether. Because they did not come up with the technology first (not the case with FM radio) they ended up having to fight off many other companies for the ability to be the major distributor of televisions and its service in the country, delaying the broad use of television by several years and HD quality television for many, many, more.
So as is seen with both examples, the company that innovates generally succeeds and the one that doesn't general dies away. However, it can be noted that society is hurt by both of these options. In both, historically significant technologies are not developed for decades, hindering the overall technological growth of a nation. The way that the United States tries to insure this does not happen is to promote, and institute, a capitalistic economy.
The capitalistic style economy that the Unites States offers helps with the development of new technology, that monopolies tend to stifle, in that companies are forced (sometimes literally) to compete with other companies. This competition leads to these new technologies and discoveries so that one company can get a leg up on the other. The older, outdated, un-innovative companies are forced out of business and the world goes on, better without them.
Still, even though we do not think of any of today's companies as being a monopoly, there are industries where there are only a few very large companies who control and entire product/service and share some similarities with trusts. For example telephone service is mainly controlled by AT&T, Verizon, Sprint, and T-Mobile (the first three being the largest). With so few companies controlling so much there really isn't a lot of competition that can take place, and therefore not a lot of innovation. Will Wu's "Cycle" go around?
Tim Wu, the author of The Master Switch: The Rise & Fall of Information Empires, writes about such companies as AT&T and RCA and their histories. These companies were founded upon innovations and inventions such as the telephone and radio respectively. While they were founded on innovation, once in operation these companies demonstrated that they would attempt to stifle any so called "disruptive technology" that came about. As David Sarnoff, president of RCA, said to the inventor of FM radio as he persuaded him to keep quiet about the new technology, "...this is no ordinary invention. This is a revolution." (Wu, pg. 127)
So my question is, why would a company founded on, and made successful by, a certain innovation then refuse to continue to innovate? Obviously there are some advantages, in the business sense, to holding a technology back for a little while in order to fully reap the rewards of an older technology. But the thing is, when is the perfect time to introduce a new product? Is it as soon as it is invented in order to capitalize on the exclusivity of the good or is it 60 years after the discovery (as was the case with answering machine and magnetic storage)?
It would seem that there are really two options then for companies, refuse to innovate and allow a technology to go, fundamentally, unchanged for decades or continue to develop new technology and adapt along with it. As is seen in Wu's description of "the Cycle" an un-innovative company, in the end, does not survive. AT&T allowed no outside tampering any aspect of its phone service, even suing a company over the production of a plastic cup telephone silencing device. In the end, the company was broken apart into many pieces.
While RCA was also an example of a monopoly and they too refused to innovate on some things (FM radio), Sarnoff and company made the wise decision of incorporating television into its business instead of keeping it off the market altogether. Because they did not come up with the technology first (not the case with FM radio) they ended up having to fight off many other companies for the ability to be the major distributor of televisions and its service in the country, delaying the broad use of television by several years and HD quality television for many, many, more.
So as is seen with both examples, the company that innovates generally succeeds and the one that doesn't general dies away. However, it can be noted that society is hurt by both of these options. In both, historically significant technologies are not developed for decades, hindering the overall technological growth of a nation. The way that the United States tries to insure this does not happen is to promote, and institute, a capitalistic economy.
The capitalistic style economy that the Unites States offers helps with the development of new technology, that monopolies tend to stifle, in that companies are forced (sometimes literally) to compete with other companies. This competition leads to these new technologies and discoveries so that one company can get a leg up on the other. The older, outdated, un-innovative companies are forced out of business and the world goes on, better without them.
Still, even though we do not think of any of today's companies as being a monopoly, there are industries where there are only a few very large companies who control and entire product/service and share some similarities with trusts. For example telephone service is mainly controlled by AT&T, Verizon, Sprint, and T-Mobile (the first three being the largest). With so few companies controlling so much there really isn't a lot of competition that can take place, and therefore not a lot of innovation. Will Wu's "Cycle" go around?
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