Tales of the Sausage Factory

Senator Pryror Angry At Right Problem, But Picks Wrong Solution.

UPDATE: On reflection, I’ve decided to modify the tone of this considerably. After all, when someone basically agrees with you (the incumbents have too much market power), slapping them around for relying on the press is a pretty stupid and counterproductive move. Besides, my real frustration is with the press for offering up speculation as if it were fact, not Pryor for reading the press and getting upset about the supposed failure of the auction to produce a new competitor. So with apologies to Pryor for needless snark the first time around, here we go again.

Senator Mark Pryor (D-Ark) is upset with reports that AT&T or Verizon probably won C Block. More specifically, he is angry that we don’t have more wireless competition. That’s good. But he accusses Kevin Martin of fixing the 700 MHz auction to benefit the telcos. That’s where he goes wrong, in my opinion. As I’ve said before, I don’t think Martin rigged this for the telcos, especially in light of Verizon’s persistent efforts to get the C Block conditions “clarified” away and Martin’s telling them to go take a hike. Further, adoption of the anonymous bidding rules means that we don’t know yet who won the licenses. We may very well be surprised when we see the results.

But if it turns out that, as predicted, the incumbents did win the lion’s share of the licenses, that doesn’t make the outcome Martin’s fault. Rather, Senator Pryor should direct his anger where it belongs — at the statutory requirement for the FCC to auction licenses for use of the public airwaves. As I explain below, and as many of us explained before the auction, incumbents enjoy real advantages even under the best of conditions because they don’t have additional costs new entrants have — like building the network from scratch or pulling customers away from a service they already use. To make matters worse, Senator Pryor’s Republican colleagues are constantly haranguing the FCC to “not pick winners” and objecting to any kind of mechanism that could neutralize these incumbent advantages.

We can’t have it both ways, and Congress makes the call. Either Congress eliminates auctions, or allows the FCC to exclude incumbents from the auction, or gives up on auctions as a way of generating competition and goes back to regulating market power directly. But blaming Kevin Martin and the FCC for the fact that incumbents keep winning auctions makes as much sense as blaming Bud Selig for the fact that the Yankees and the Red Sox always make the playoffs and the Nationals haven’t gotten to the World Series.

More below . . . .

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Tales of the Sausage Factory

Update to last night's post on RIAA v. XM

Something I should have been clearer on but wasn’t. The Audio Home Recording Act, by its terms of course, applies to audio recording not video recording a la Tivo.

My concern for PVRs and DVRs is one of extension. It is an unfortunate tendency in the law for bad law in one area to bleed over into other areas. The bad trademark law around domain names had impacts into trademark law and fair use generally, before the pendulum started to turn.

So while a decision about the applicability of AHRA to the “XM +MP3” service generally, I worry that the emphasis on subscription service v. free service and the nature of the functionalities does. It does not seem to me much of a leap to apply the analysis used in this case to cases applying the Sony standard, as interpreted in MGM v. Grokster.

But, on reflection, that was not at all obvious in my post, which appeared to say that AHRA applied to video recording services. Sorry for any confusion.

Stay tuned . . . .

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Tales of the Sausage Factory

NCMR Day 2: I collapse into an exhausted stupor

First, I must report that Jen Howard, one of the amazing folks at Free Press (formerly one of my colleagues at MAP) was a touch disappointed in my review of the party Thursday night, which she planned. She also informs me that the company that handled the drinks had said that non-alcoholic drinks were free and they were definitely NOT, supposed to charge me $2 for a bottle of water. So I will conclude that Free Press (and Jen) are amazing at everything, including planning parties, and just got ripped off.

And so they proved on Friday Night. Or so I am told. It being Shabbos, I retreated to my room. Alas, I therefore missed the further inspirational remarks of Commissioners Copps and Adelstein. However, I urge all those benighted souls who, like me, missed it, to check them out in the video archive.

I do urge everyone to pay particular attention to Copps’ proposed New America Media Contract. I will have more analysis of this when the brain cells start workng again.

O.K., here is how Harold spent his day. It is a rather disjointed, personal approach that skipped most of the main events with the real news makers. Which is why I don’t call myself a “citizen journalist” (but more on that below).

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Inventing the Future

Towards an Economic Understanding of…Ourselves?

If the dominant medium of a culture defines it, what does it mean for us when TV is changing? How will it change, and how will that change us? A couple of MIT academics are discussing the former at here. Good reading, but missing the point.

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Inventing the Future

Inventing the Future: the Croquet Generation

Older academics generally like Croquet demos, but they often give me the impression that they’re not quite sure what they’re looking at. We gave a demo this week to a young local reporter and she was much more enthusiastic. She wants to use it right now, as is. Julian tells me that anyone under 25 who sees Croquet goes nuts over it.

I was surprised. I assumed that younger folks would be jaded by video games. Our demos don’t have drop shadows or reflection. The fish world is not as cool as the one at the Boston Museum of Science. The avatars don’t walk and bend like the Sims. It’s a proof-of-concept, and the features and effects just aren’t like what you would find in a movie.

But I think people under 25 see Croquet and feel like it’s made for them. What school and office programs are really of their culture? Windows isn’t. (Maybe its for old farts that were too conservative to buy a Mac 20 years ago.) The closest thing to a mainstream generation Y app might be chat rooms, which are not rooms and you don’t actually chat, you type. Successfull, yes, but not exactly laden with Y culture.

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