Diatribes of Jay

This is a blog of essays on public policy. It shuns ideology and applies facts, logic and math to economic, social and political problems. It has a subject-matter index, a list of recent posts, and permalinks at the ends of posts. Comments are moderated and may take time to appear. Note: Profile updated 4/7/12

16 December 2017

Ajit Pai: Taking Big Brother Private


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    “The code is the law.” — Larry Lessig, Professor of Law, Harvard Law School
In all the media discussion of this week’s repeal of net neutrality, I have yet to see a single piece of writing that hits the nail on the head. Nothing I have read accurately previews what we face under the new, legal-rules-free regime of Internet governance. So I wanted to do my part to explain the danger.

Those who wrought the change are doing everything possible to minimize and even ridicule its significance. The bosses’ principal tool is Ajit Pai, Trump’s FCC chairman and former Associate General Counsel for Verizon. He recently released a video clip of one minute and sixteen seconds, in which he makes light of the public’s well-justified fears.

Pai’s clip is titled “7 things you can still do on the Internet after net neutrality.” But the version available on You Tube shows only six, and only five with block titles. The six things you can still do are: (1) “gram” your food, (2) post selfies, (3) post photos of cute animals, (4) shop for all your Christmas presents online, (5) binge watch your favorite shows, and (6) stay part of your “fave fandom.”

In other words, Pai’s clip shows things that kids do for fun. Nowhere does it mention the Internet’s vast political significance as a source of news and information. Nowhere does it hint that, for most people—and especially for our youth—the Internet has become their primary source of news and information, including “fake news.” Nowhere does it discuss the unanimous view of our nation’s intelligence services that Russian operatives used the Internet, including Facebook and Twitter, to sway our 2016 presidential election toward the man who appointed Pai to head the FCC.

The Larry Lessig quote at the head of this post is simple but profoundly practical. What it means is that the computer code by which Internet businesses run is the “law” insofar as concerns the Internet’s practical impact on its users, i.e., the public.

Of course, “real” law—which legislatures and regulators make and courts interpret—can force businesses to change their computer code. But it takes years of legislation, regulation and litigation for “real” law to force a change. Changes in code can be made in hours or days.

Sometimes it can take many changes in code to bring the digital law closer to what human law requires. And each of those changes can involve months or years of delay in legislating, regulating, and litigating.

In the interim, the “law” wrought by computer code doesn’t just prevail. It has no alternative. With mechanical precision, it dictates just how the Internet operates. The dim understanding that legislators, regulators and judges generally have of how code actually works insures that “real” law perpetually lags the digital reality wrought by code.

Now that Pai and his Republican colleagues have abolished the Obama-era regulations imposing net neutrality, there is no “real” law on the Internet, at least insofar as concerns conveying content. As Pai himself claimed at the outset of his clip, there is only “Internet freedom.” The businesses that provide your Internet signal—the so-called “gateways” or Internet Service Providers (ISPs)—can do whatever they want. Insofar as concerns the content that you receive through them, how you get it, and what you pay for it, their code is the law.

Your ISP could, in theory, develop algorithms to asses your political views. It could record and automatically analyze (using artificial intelligence) the websites that you visit, the emails you write to friends and family, your posts on Facebook and Twitter, and what news stories you read and share. Then the algorithms might decide that you are already too progressive for your ISP’s management’s taste and so delete this blog from the list of Google’s Blogger’s offerings that you can access.

There is absolutely no technical impediment to doing so. Now, after the repeal of net neutrality, there is no legal impediment, either. All it would take is good programmers.

Nevertheless, this kind of extreme control over what you read and view appears unlikely. It would cost a lot to write the code to effect it, and where’s the profit in so doing? So while nothing in post-net-neutrality law prevents your ISP from doing this, it’s not something I predict.

The bosses who want to control your life and your thinking and call their control “democracy” and “freedom” are much smarter and more subtle than that. Instead of controlling what you read, see and hear directly, they will use a tried and true ploy that gateways have used for about a century to manipulate and control content. The ploy goes back to the early twentieth-century chains of movie theaters, which controlled what movies were shown, when, and where. It’s called “bundling.”

As the name suggests, “bundling” is forcing a package of content down users’ throats, rather than letting them choose what they want piece by piece. Bundling offers three advantages to the bundler.

First, it increases income by forcing users to buy things they don’t want to get things they do. Examples are a movie “flop” bundled with an Oscar nominee, or a song the artist or promoter wants to hawk on the “flip side” of an old 45 RPM record. But the worst types of bundling are those that are purely contractual, without even a plausible technological excuse (like that flip side). Most if not all bundling on the Internet, which has infinite technological flexibility, is for this purpose: commercial advantage.

The second advantage of bundling is economic coercion of the buyer. By bundling something unwanted with popular content, the content provider can push a new artist, a new and untried product of a popular artist, or an untried or unwanted political point of view. The whole approach of Fox to propaganda is bundling it with the “entertainment” of alpha males shouting at and “chopping” each other.

The third advantage of bundling is exclusion. Sometimes it’s not what’s in the bundle that matters, but what’s not in it. By excluding a competitor’s content from the bundle, the bundler can gain a commercial advantage. By excluding alternative viewpoints, the bundler can advance propaganda objectives. Bundlers have used the ploy for both purposes.

Here’s a simplified picture of how bundling might work on the Internet. It’s “simplified” only because the actual bundles would include more items, both to obfuscate the intrinsic political/social bias and to make more money. But this table illustrates how Internet bundling could work both to extract your dollars and control your access to information at the same time:

Your ISP’s Bundles and Internet Pricing

BundleContentMonthly Rate
AFox News
Amazon shopping, Google search (limited*)
Facebook and Twitter
$10
B Fox News, ABC, CBS
Amazon shopping, Google search (limited*)
Facebook and Twitter
$25
CFox News, ABC, CBS, CNN, MS-NBC, PBS
Amazon shopping, Google search (limited*)
Google Blogger, Facebook, and Twitter
$50
DUnlimited Internet Access, as under net neutrality$100


* A limited Google search would allow you to see all the results but only to “click through” to those search results consistent with your paid bundle.

Note that Fox “News” appears in every bundle but is the only “news” source in the first and cheapest. That is precisely how Rupert Murdoch made his fortune in cable TV. He sold his right-wing “news-as-entertainment” propaganda cheap but made his money in volume. He also bundled his propaganda with sports and entertainment packages from Fox’ other subsidiaries.

Sold this way, his “news” came to dominate the thinking of those who could afford the least. He did not waste time, or money, putting propaganda before a more affluent audience that might be or become resistant to it. He took his “bread and circuses” right to the masses, just like Caesar.

Thus Murdoch’s Fox came to dominate the “news,” becoming the most effective single propaganda organ in human history. It dominated the bundles—and especially the cheapest—of content offered on the newest, highest-tech medium of a generation ago: cable TV.

All that changed with the advent of the Internet, at least under Obama’s rules for net neutrality. A blog like this one could, in theory, compete with Fox and all the rest, if only it could get noticed, because there were no bundles.

Pai’s abolition of net neutrality takes us right back to the bad old days of bundling on cable TV. Our electronic media will snap back into the old oligarchic model like a bunch of rubber bands. The “new” regime won’t even require the old dog Rupert to learn new tricks.

There’s nothing new about bundling. Every single electronic medium of communication has permitted if not fostered it, beginning with silent movies and running through “talkies,” radio, television and cable TV. The net neutrality rules promised something different for the Internet, but now Pai’s FCC has killed that promise.

In the past, the last resort for legal restriction of bundling has been antitrust law (what Europeans, more sensibly, call “competition law”). Maybe that’s why Pai’s FCC, in abolishing net neutrality, punted regulation of the Internet to the Federal Trade Commission (FTC). The FTC shares joint jurisdiction over federal antitrust law with the Antitrust Division of our Department of Justice.

But this feint at regulation is a charade. Antitrust law is a blunt instrument, a weak weapon against the practice of bundling. I know: I taught antitrust law, in various law schools, for nearly two decades. The history of the twentieth century is rife with expensive, years-long antitrust litigation to establish the most rudimentary restraints on content bundling in movie distribution, television, and cable TV.

As it turned out, antitrust law is a particularly weak instrument for ensuring diversity of political and social views. Why? It’s economic law. Its sole focus is on maintaining free competition among businesses. And bundlers have become highly skilled in inventing plausible arguments why forcing the consumer to buy the unwanted with the desired is more efficient or somehow beneficial to the forcee.

More important, antitrust law doesn’t care about the character of content. It cares only whether giant ISP gateways like AT & T, Comcast, Time-Warner, and Verizon are playing fairly, not suppressing competition among themselves, and treating their consumers fairly as consumers. Keeping the Internet a vibrant and diverse sphere of public discussion, as our First Amendment intends, is not even remotely a goal of antitrust law.

When this sort of bundling occurs—and it will—the ISPs will disclaim any intent to slant or bias political views. They will claim, with an absolutely straight face, that all they are doing is bringing content to consumers, according to their ability to afford it, with the greatest speed and bandwidth they can afford.

But Rupert Murdoch will have propagated his successful near-monopoly on right-wing political propaganda from cable TV into the modern Internet. He will have done so by the simple expedient of a 3-2 party-line vote on the FCC, abolishing a poorly understood abstraction called “net neutrality.” Then the Internet will become just another medium controlled by the biggest, toughest, and strongest bosses, those smart enough to push their personal political views and make money at the same time. Can we all say “Rupert”?

In fact, the recently announced sales of large parts of Murdoch’s sports and entertainment empires are likely designed to accumulate a war chest for precisely this purpose. Murdoch is a news-and-propaganda man. He got his start as such. He can see the opportunity to extend his propaganda empire better than I can, and by the same ploys he used in cable TV. And he has two young sons to carry on that empire well into this century after he goes.

It’s too bad that Ajit Pai can’t see this, or is in cahoots. At the end of the day, by helping Murdoch and others like him, Pai will have helped take Big Brother private. Weep for lost democracy, George Orwell!

Endnote: ISP gateways could enforce this sort of bundling in two ways. First, as suggested in the note (*) below the table, they could produce a truncated Internet by rendering inoperative links in Google searches not included in the paid-for bundle. That approach would make each bundle (except the last and most expensive) like the Internet in China, in which certain sites that the Communist party deems too “political” are off limits.

The private gateway operators in our country of course would argue that their system is different from China’s because customers can always buy full access to the Internet at a higher price. But the effect would be to limit full access here to the affluent, as to the Party in China.

The second means of enforcing this bundling would be to allow all links to operate, but just to slow the operation of unbundled links down. For example, clicking on a link not included in the purchased bundle might eventually take you to the linked site, but that site might take an entire minute to load into your computer—or even more time if the site’s page contained complex graphics or video clips. This method would be an even subtler means of controlling access to content: relying on the user’s own impatience and short attention span, which media like Facebook and Twitter cultivate.

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