Monday, January 31, 2011

The Master Switch

We purchased our first I-pod about a week ago, basically in order to start the Herculean task of downloading my many, many CDs into a little box, thereby obviating the need to hold onto the physical discs, and thereby obviating one of the most frequent issues of domestic discord between me and my always beautiful wife, Jane. As I was doing the downloading, I found myself reading Tim Wu’s new book, The Master Switch: The Rise and Fall of Information Empires (Knopf, 2010), a history and meditation on communications history and policy in the United States since the rise (and fall, and rise, and fall, and rise) of AT&T, and the incestuous relationships between our phones, our radios and TVS, our computers, the companies they created, and the regulators who love them. I can’t think of a book I have read recently from which I have learned more .

Wu is basically, as far as I can figure out, something of a left-libertarian, whose hero is Thurman Arnold, the New Deal trust buster, and who believes that while regulation is necessary for the communications industry, to combat its inherent tendency to monopolization, it needs to be done lightly, and most communications regulation has always been a disaster, accentuating monopolization rather than curbing it, , and points to the 1996 Telecommunications Act as perhaps the worst offender, obviating most of the gains from competitiveness achieved in the initial break-up of AT&T.
Reading Wu, I think I understand for the first time how the packaging of information, so central to the internal, is inherently decentralizing of any communications network. And because no one created or owns the internet the way AT &T owned the long distance lines that were at the heart of its monopoly, this had led, rather than one huge monopoly largely controlling not only the communication network itself, but almost all the R &D associated with it, while the internet has spawned a million communication industry start ups. There surely is no industry that had been more stifled by regulation than communications. Wu is a defender of “net neutrality” and the larger point I came away with from Wu’s essential book is that, as the revival of ATT shows, that despite the inherently decentralized nature of the internet, without new Thurman Arnolds, new monopolies, that benefit only its owners, rather than the public as a whole, will proliferate as much as new technologies.

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