Information empires and democracy

If you ever wanted to know what is this "net neutrality" thing is that internet junkies meander on about, Tim Wu's The Master Switch: The Rise and Fall of Information Empires serves as a great historical primer.

Wu's accessible volume tells the story of what he calls "the Cycle" in communication media beginning with the telephone, moving on into movies, through radio and broadcast TV, and then cable. Today we have the Internet -- and we confront further turns of a long established pattern -- or perhaps a chance to break or modify the Cycle.

…when we look carefully at the twentieth century, we soon find the Internet wasn't the first information technology supposed to have changed everything forever. We see in fact a succession of optimistic and open media, each of which, in time, became a closed and controlled industry …

Each of these inventions to end all inventions, in time, passed through a phase of revolutionary novelty and youthful utopianism; each would change our lives, to be sure, but not the nature of our existence. For whatever social transformation any of them might have effected, in the end, each would take its place to uphold the social structure that has been with us since the Industrial Revolution. Each became, that is, a highly centralized and integrated new industry. Without exception, the brave new technologies of the twentieth century -- free use of which was originally encouraged, for the sake of further invention and individual expression -- eventually evolved into privately controlled industrial behemoths, the "old media" giants of the twenty-first, through which the flow and nature of content would be strictly controlled for reasons of commerce. …

… if the Cycle is not merely a pattern but an inevitability, the fact that the Internet, more than any technological wonder before it, has truly become the fabric of our lives means we are sooner or later in for a very jarring turn of history's wheel. Though it's a cliche to say so, we do have an information-based economy and society. … if the Internet, whose present openness has become a way of life, should prove as much subject to the Cycle as every other information network before it, the practical consequences will be staggering. ...

So there we are: are we going to be controlled by those who own the information pipes (and the political entities those owners buy up) or are there other possibilities?

I really liked this book as clearly written history. Wu leans toward a libertarianism faith in the innovative genius of unrestricted markets that I don't entirely share, but he sure is not ideologically blinkered about this. Highly recommended.***The Master Switch made me think a lot about regulated monopolies. I'm old enough to remember well the days when AT&T was the only game in telephone service. When you moved into a new residence, you called the phone company, they sent a man (always a man) to install one or more instruments that they owned, you paid your bill whose parameters were set by a state regulatory agency -- or you didn't have telephone service. Dealing with the phone company was straightforward -- maybe expensive, sometimes infuriating, but you knew what the game was.

I'm sure I'm not the only one who has found developments in communications since the mid-80s break up of that old Bell monopoly bewilderingly hard to get a grip on, as well as, sometimes cheaper and technologically delightful. These days voice communications over distance is a maze. Unless you are willing to devote significant amounts of time and energy to understand the latest wrinkles, you are almost certainly being overcharged for technologically anachronistic service. Presumably communication providers make much of their profit on lagging consumers of legacy technology, using their surplus to attract the ever-desirable cohort of early adopters with new goodies. Under the regulated monopoly of the past, innovation was the enemy of the business, a danger to be squelched. And as Wu documents, in film, radio, television and communications, the mid-20th century behemoths kept progress profitably at bay for decades. With their monopolies blown away, we're getting the fruit of progress and its confusions.

From a consumer perspective, it feels as if we're condemned to be either captives of soulless monopolies or exploited technological suckers. Neither role is pleasant to occupy. I think there's some evidence that a return to some regulated monopolies would be good for society. That's obvious in the financial sector: how about highly regulated basic banks that make home and smaller commercial loans backed by deposits -- and are the only recipients of government insurance for their customers? If some of the one percent want to play among Wall Street's casino options, let 'em -- with their own money. In telecoms, might most of us gain from regulated monopolies offering basic service with transparent pricing to consumers willing to foregoe the latest wrinkles?

Wu is certainly right the current telecom anarchy will not last. In our information society, it matters how this gets sorted out. Meaningful democracy may depend upon the shape we give to communications. This stuff is never easy and there are always commercial and political incentives to screw most of us ...***Tim Wu is a founder of Free Press which advocates on these issues.