Singularity Law

I was interested in an article that appeared in the Los Angeles Times shortly before Christmas. It indicated that some of the major writers were meeting with venture capitalists to see of they could start their own production companies to create entertainment products specifically for the Internet. The writers apparently see this as one way to regain control of their work and make sure they are paid properly for its exploitation online.

My reaction to the news story was twofold. My initial reaction was “What took you so long to figure it out?” The main reason that the TV networks and movie studios are stonewalling writers’ efforts to get a cut of the money for repurposing their shows for the Internet is that the networks and studios see that the Internet (and wireless) is quickly going to become a major platform for their entertainment products. They want to make sure the stranglehold they exercise over the broadcast channels and movie distribution network will be duplicated online and they don’t want to have to share a major portion of the revenues from online distribution with the writers (or actors, directors, etc.) It is a classic case of monopolists in one industry trying to extend their monopoly into a new field. So, the thinking goes, if the creative talent can bypass the studios and networks and go directly to the Internet, they can break the bottleneck on getting their content to viewers and will be able to keep most of the revenues for themselves.

However, my second reaction was “This is a lot of hullabaloo about nothing.” Because even if Hollywood talent can get away from the current studios and networks that control their lives, they will simply be facing a new host of monopolists unless Congress insures network neutrality. Today, anyone can put up a website and (except for people living under repressive governments) everyone who has access to the Internet can access that site. So, when YouTube got started, every Internet user could go to www.youtube.com and watch the myriad videos posted online by users. And, if the writers want to start their own “network” online to showcase their own programming, anyone will be able to come to their website and watch the programs. But that is not likely to continue unless the government steps in.

Today, there is nothing that requires an Internet service provider, like Time-Warner, AT&T or Verizon, who have millions of subscribers to their Internet services, to allow their users equal access to all websites on the Internet. So far that has been the case, but there is no law that compels them to do so. There are no “must carry” rules, like the FCC used to impose on television networks, that require these ISPs to allow their users to freely surf the net and watch what they want. Thus, if Verizon (which happens to be my ISP) decided that if YouTube wants to be accessible to its subscribers, YouTube would be required to pay Verizon $1 million per month, Verizon could do so. And if YouTube refused to pay the fee, Verizon could block its users from having access to YouTube.

What if the ISPs that provide Internet access nationwide decide to act as the networks and studios have acted for years? What if they decide that only certain websites that carry entertainment content will be accessible to their subscribers? Or that they will only provide full-speed access to websites they control and degrade the quality of all other websites? And the favored websites are those that are controlled by the ISPs or have agreements with the ISPs under which the ISPs receive the advertising revenues from those sites, and pay the “talent” (writers, directors, producers) according to negotiated agreements, like we have today in the movie and television industries?
Nonesense? Paranoia? A lot of people are very concerned about this issue. As stated by the WGA-East on its website:

“The nation’s largest telephone and cable companies — including AT&T, Verizon, Comcast and Time Warner — want to be Internet gatekeepers, deciding which Web sites go fast or slow and which won’t load at all.

They want to tax content providers to guarantee speedy delivery of their data. They want to discriminate in favor of their own search engines, Internet phone services, and streaming video — while slowing down or blocking their competitors.

These companies have a new vision for the Internet. Instead of an even playing field, they want to reserve express lanes for their own content and services — or those from big corporations that can afford the steep tolls — and leave the rest of us on a winding dirt road.

The big phone and cable companies are spending hundreds of millions of dollars lobbying Congress and the Federal Communications Commission to gut Net Neutrality, putting the future of the Internet at risk.”

Net neutrality is extremely important to the future of the Internet and the future of those who operate websites and create content for these sites. Unfortunately, it is below the radar of most politicians and business people (other than the major ISPs). That needs to change.