The 463: Inside Tech Policy

Google is Now TOO Effective in Washington

I had previously seen this meme about the spectrum auction results pushed by some irony-loving wonky types, but when it is repeated by members of Congress (who fail to see the irony), it's been taken to another level...

From Bloomberg yesterday....

Google Inc. manipulated a U.S. government spectrum auction by bidding just enough to trigger rules that will open a nationwide set of airwaves to any device and then walking away, Republican lawmakers said.

The so-called open-access requirements, also backed by consumer groups, may have shortchanged taxpayers by discouraging more companies from bidding, Representative Fred Upton, a Michigan Republican, said today at a hearing.

``Google was successful in gaming the system,'' Upton said.

Upton's full comments are here.

The only right thing for Google to do is to begin to shut down its overly effective Washington operation. They are clearly operating on a level that is unfair to all those telecom giant DC neophytes.

Detroit, Innovation City?

Katie Hallen -- Consumer Electronics Association President & CEO Gary Shapiro told the Detroit Economic Club last Monday that free trade and innovation held the key to the economic resurgence of the city and its auto industry. (Video of the speech is here).

The Detroit Free Press reported that Shapiro said in the speech:

"It is true that free trade hurts some people in the short term -- but we must look at the big picture and what's best for our nation. An American worker who lost her manufacturing job may assume it was lost to someone overseas. Indeed, protectionists repeatedly talk about the 3 million manufacturing jobs our nation has lost in the last decade. But what about all the jobs open markets and free trade have created?...

"Detroit leading the opposition to this agreement only reinforces the perception that Detroit automakers cannot compete. Imagine if Detroit was to come out in favor of free trade. Say, 'Hit me with your best shot.' The world's perception of Detroit would change."

Shapiro’s message to Detroit was important for those in the community beaten down by union and political leaders blaming the city’s woes on globalization and free trade agreements. In a speech last month, UAW President Ron Gettelfinger deemed a free trade agreement with South Korea the “theft of American jobs.”

As Shapiro pointed in an accompanying Detroit Free Press op-ed:

“Detroit has all the ingredients for a successful turnaround: a highly skilled workforce, a modern international hub airport, and a surplus of reasonably priced housing, commercial and industrial space.”

America’s innovation boom, driven in large part by trade and globalization, has created 25 million U.S. jobs.

In recent weeks, trade – particularly NAFTA – has emerged as a hotly contested subject in the presidential debates, with most of the tension focusing on jobs. You might have heard a mention or two of NAFTA in Ohio (not so much in Texas, where trade is seen as a benefit to the economy).

This undercurrent of protectionism challenges America’s very place as a global superpower in a flatter world. Free traders say America should compete and win, while protectionists want to rescind free trade agreements and close our borders to imports and exports alike.

With the national debate seesawing on this conflict of global competitiveness versus isolationism, it’s particularly noteworthy that Detroit takes center stage. FDR, in a 1940 fireside chat coined Detroit “the great arsenal of democracy.” He was referring to the auto industry manufacturing weaponry for World War II soldiers. But historians have since adopted the phrase to explain America’s transition from an isolated nation to a global purveyor of democracy.

Trade in my mind is intrinsic to democracy. Economic mercantilism (essentially what Dobbsian protectionists want) historically has led to imperialism. It’s a lesson we should keep in mind as we forge our new economy.

Note: CEA is a 463 client.

(Flickr photo credit)

POTUS 2.0

President Tron

As, we saw in a poll, voters at least want their next president to be as conversant in the Internet as they are. The kickoff panel at yesterday's Congressional Internet Caucus conference (The State of the Net) provided an opportunity for some of the presidential campaigns to show their geek creds. The panel focused on how the next administration should manage and prioritize technology policy. It featured representatives (some ostensible, some actual) representatives of the Clinton, McCain, Obama and Giuliani (RIP) campaigns. Here's GCN's report on it.

My quick take: The new boss may not be the same as the old boss, but, at the very least, the rhetoric will sound strikingly similar. That is, the Mom and apple pie issues were covered extensively. R&D, science and tech education, clean tech, and broadband all were heaped praise.

Hillary's guy, Thomas Kalil, from the Center for American Progress and a Clinton 1.0 official, played right from the classic "Innovation Agenda" playbook shared by many. This isn't necessarily a bad thing. Most of these "no brainer" policies have failed to connect to the right synapse at the right time in the last eight years to fully please many techies. An Administration and a few different shades of Congresses can all look in the mirror.

Obama's rep was a VC named Julius Genachowski. He's been a friend of Obama since they went to law school together. Genachowski mentioned Obama's fairly detailed innovation plan that he unveiled at Google a couple months ago [we wrote about it here] and touched on the big themes, namely, that the premise for the plan is that tech is essential to being part of the solution for almost every major issue that is important in this campaign. However, former congressman Tom Taucke and current Verizon policy boss complained in his later keynote that no one on the campaigns were pushing this exact salient point. (Tangent: How would anyone know? While flying out for the conference, I flipped back and forth between CNN and MSNBC's coverage of the campaign and think I got about three minutes of policy substance out of five hours of frothing horse race nonsense.)

Genachowski also noted Obama's call for a federal CTO, but didn't get into specifics on what the roll of this official would play beyond noting that the CTO could help fix "market failures" in key sectors that could spur private tech investments. And, he did echo Obama's call for using tech to create government transparency.

McCain's man, Doug Holtz-Eakin, said that Mr. Campaign Finance Reform is also a big supporter of using tech for transparency. In fact, he was so transparent, that he he let everyone know that through the magic of the Internet, the senator raised $500,000 from Midnight to the morning in his post-Florida glow. Eakin took the only pro-free trade stance for the day (which we highly commend) and called to end the annual R&D tax credit extension "charade". He was notably "on message" when it came to immigration rules that impact the industry: "We will secure the borders before engaging in any other immigration reform."

Someone close to McCain mentioned to me the other day that he thinks that the senator is unnecessarily playing his business and tech creds down. Mitt may have "managed" millions of dollars, but, bygone, Big Mac was the Chairman of the pretty-darn important Senate Commerce Committee. And, as this source said, he didn't punt all of his work to staff. He got his fingernails dirty on all sorts of business critical issues. Yesterday, I don't remember Holtz-Eakin ever so much as mentioning this role and McCain didn't either in the Republican debate.

All and all, an interesting panel that said all the right things. Can't wait to get those right things done.

Lou Dobbs: He May Not Be a Protectionist, But He Plays One on TV

So said Consumer Electronics Association President Gary Shapiro to CNN personality Lou Dobbs in their "debate" last night.

You might remember that Shapiro challenged Dobbs to a live debate when CEA launched their free trade campaign in October. After CEA made significant noise about the value of free trade at their huge CES trade show last week, Dobbs bit on the challenge (to his credit).

Here's the video:

And, here are the facts to the Dobbsisms that he tosses around like Junior Mints (more can be found in CEA's press release about the debate here)...

• While Dobbs claims that trade has resulted in the loss of three million jobs, he ignores the fact that over that same period 25 million good jobs were created.

• While Dobbs rails against agreements such as NAFTA, he conveniently ignores that before NAFTA, the average unemployment rate was around 7 percent and in the 14 years since it has been about 5 percent.

• While Dobbs frets over imports into this country he ignored the fact that $220 billion of high-tech products, which includes consumer electronics, were exported from this country, and that many of the companies that produced those products were small and medium-sized companies that are the lifeblood of the U.S economy. Moreover, he doesn’t even address that the percentage of exports from the United States to the world has gone up by 4,000 percent (1,000 percent in real terms) over the last 42 years.

• When Dobbs belittled the jobs that have been created by the consumer electronics industry, he belittled the hard-working men and women who work for companies here in the United States that help spur the engine of the American economy – the very people he claims to be fighting for.

Yes, New Hampshire (and Nevada and South Carolina...), There is a Tech Policy Issue That Matters

Supporting free trade at CES

CNET's Anne Broache went to the site of Tuesday's big primary earlier this week to file the shocking news that the average voter in New Hampshire doesn't give a rat's rear-end about net neutrality and other geek policy issues fawned over on this page. And, we've said as much here for as long as we've been pumping out posts. At the height of the NN debate, we noted how few average Internet users cared about it. And, we have suggested that it won't be until 2012 for an issue like privacy to become presidential debate-worthy.

But, hold on a minute people. Don't get your geek dawbers down. There is a tech policy issue being debated at every turn of this campaign. You may just be missing the forrest for the trees. The issue is free trade and, if you haven't noticed, the fear-driven creep of protectionism is spreading as the election year rhetoric heats up.

Free trade has a huge impact on innovation, the success of both big and small companies that touch technology and consumers of everything from big TVs to little pacemakers. This is why the Consumer Electronics Association is taking on the issue as a priority and made free trade a front and center focus at this week's massive CES event.

A gaggle of 463ers attended the event and, working with CEA, helped get the good word about free trade out at the show. Part of this meant jumping headfirst into retail politics and manning a booth (above) that helped get thousands of CES attendees to send a letter to their congressional representatives in support of free trade. It was fascinating to hear firsthand how many small business owners attending the show rely on free trade to keep their American employees employed and well-paid.

What worried me, though, were the good number of people who stopped to ask who could possible be against free trade. And, they were surprised to learn that something they took for granted as a motherhood and apple pie issue could be threatened.

As CEA's president Gary Shapiro noted in his CES keynote, there are plenty of people using free trade as a wedge issue for their own interests...

From coverage of Shaprio's speech:

He cited a CEA survey showing that 69 percent of Americans "agree that free trade is important." But that consensus, Shapiro added, is threatened. "Free trade. Given the [political] climate today, it is not a given."

As the enemy, Shapiro identified "protectionists and isolationists," as well as "pundits, politicians and TV demagogues holding out protectionism as a solution to our economic problems."

He said, "I believe that our digital destiny is as inevitable as the discovery of America." But he added, "Never before have I been as concerned that some in our country might restrict our leadership toward that digital destiny." Shapiro said that a trend toward isolationism, which was common in the U.S. before World War II, is "dangerous and disturbing."

Against the forces of economic retrenchment, Shapiro said that free trade, especially in technology, represents America's best hope. "Technology has become the shining star of the new economy," said Shapiro. "We believe that our technologies improve the world." (EETimes)

The Hollywood Reporter also notes how free trade created one of the bigger truces of tech policy (if for a moment this week)...

The Hollywood studios, consumer electronics makers and the music industry have called a temporary truce and are teaming to convince lawmakers of the importance of free trade.

The heads of the groups' major trade organizations told lawmakers in a letter released Monday that it was in the country's best interest to approve a number of trade agreements pushed by the Bush administration.

Gary Shapiro, president and CEO of the Consumer Electronics Assn., told reporters "it was the first time in my career" that he had agreed to sign on with "two organizations I have opposed for years" -- the MPAA and the RIAA.

"While we disagree strongly on the specifics of intellectual property, we agree on this point," he told reporters during a telephone news conference from the CEA's Consumer Electronics Show in Las Vegas.

For more on CEA's perspective, go to the organization's International Trade special section of their Web site and see Sharpiro's CNET op-ed titled "Protectionism Never Works." And, remember, if you are looking for an issue that impacts technology this election year, it may be right in front of you.

Download This (Fact) Book!

If you are the type to make bald-faced claims that rely on volume and emotion for support, read no further.

However, if you aren't like Lou Dobbs, and actually want to have a factual basis for your position, then grab yourself a copy of the Progress and Freedom Foundation's annual Digital Economy Fact Book. 2007's version just came out last Friday, and PFF was good enough to provide it in a pdf format that you can download here.

Really, for anyone that touches tech policy from a research, advocacy, journalism or communications perspective, this book of about 125 pages of facts and stats is essential. And, it's so good that I won't even explore the irony of PFF giving away a valuable digital resource for free (and even sans DRM!).... ;)

Here are just three tasty morsels from the smorgasbord of information in the book...

Yo, Ron, What's Your Top Halo Level?!

G4TV's interview with Internet sensation du jour Congressman Ron Paul makes Michael Arrington's podcasts with presidential candidates seem like sober discussions with Jim Lehrer.

Paul talks censorship, Internet taxes and Net Neutrality among other topics. (Hat tip to Tech Liberation Front).

And, btw, the TechCrunch interview with McCain is pretty interesting and, on one particular note, depressing. Specifically, McCain talks of his support for H-1B visas, but basically says that the American people have spoken and they want their "borders secure" whether this means making the US less competitive or not... Excerpt after the jump...

FCC's Math May Actually Improve

M'kay... Yesterday, I knocked the FCC (again) for their questionable math in calculating their new US broadband penetration figures.  What I missed was, this week, Commission Chairman Martin also proposed a series of positive (albeit long-delayed) steps toward improving how the data is collected, organized and communicated.  Thanks to one astute reader (who happens to be a director of government affairs at a leading Internet company) for pointing out the oversight.  The good Corey Boles at Dow Jones had the story:

In a bid to answer critics who allege the agency hasn't done enough to promote broadband deployment, Martin has circulated a series of reforms to the other four FCC panel members to change the way broadband Internet data is collected, and what speeds of service constitute broadband Internet access.

Specifically...

Martin's proposal would see the FCC begin asking Internet service providers how many customers in each Zip Code have service.

The next step will be to measure the number of subscribers in nine-digit Zip codes from the five-digit Zip Codes that are used at the moment, which are smaller geographic areas.

And...

The FCC defines broadband as any service 200 kilobits per second or faster. By comparison, the typical dial-up telephone connection is 56 kilobits.  It will now move to a tiered system with five different levels of service.

Anything between 200 kilobits and 768 kilobits per second will be considered first-generation broadband.

From 768 kilobits to 1.5 megabits is to be considered basic broadband. This is the range that most basic DSL service from telephone companies starts in.  In between 1.5 megabits and 3 megabits a second will be classified as high-speed service, between 3 megabits and 6 megabits called robust service and anything over 6 megabits a second called premium.

The obvious question is why call 200 to 768 kilobits broadband at all, but, hey, it's a start and it forces further conversation and awareness about the quantification of the figures.  Realistically, though, you can expect that, when expedient, some will conveniently remove the "first generation" qualifier.

Yesterday, Boles had reaction from lawmakers who have been pushing bills to reform the FCC's accounting...

House Democrats have welcomed proposals by Federal Communications Commission Chairman Kevin Martin to improve the agency's broadband Internet data-collection methods, but said legislation is still needed.

Responding to these plans, Reps. Mike Doyle, D-Pa., and Charlie Gonzalez, D-Texas, said they were pleased that Martin had put forward the proposals, but both said they would continue to push for legislation to direct the FCC to enhance its broadband-data collection.

Broadband Reports was more circumspect about Martin's move:

Given the massive and sweeping changes Martin’s regime has implemented based on inaccurate data, these simple corrections are coming very late in the game. Meanwhile, the OECD should release their broadband data later today, which will indicate the United States remains in fifteenth place when it comes to broadband lines per person.

And, yep, here is AP today on that move from 4th in the rankings in 2001 to 15th.  Gentlemen, start your calculators.

FCC's Numbers Still Don't Add Up

[UPDATE:  See our November 3 post on a FCC proposal to update their broadband calculations.]

There are a lot of smart people at the FCC.  Many broadband service providers are creating new, innovative (and even fast) services.

Great.  Then let's be real about the current state of broadband in the US.  Let's celebrate our gains and explore where we are falling short.  Let's not dance around such an important national competitive issue with government ordained obfuscations.

We typed more than a few words about "The FCC's Math Problem" last December.  Apparently, they are still using a faulty calculator.  From yesterday's Broadband Reports:

It's that time of year again; time for the FCC to release U.S. broadband data that's about as reliable as a heroin addict in charge of your retirement funds. Despite years of criticism from everyone from consumer advocates to the GAO, the FCC continues to insist that if one home in a zip-code has broadband, that broadband is wired for service.

The FCC also insists that anything over 200kbps is broadband. Collectively, this methodology makes the state of the broadband union look rosy. This pleases providers, who, with the FCC's help, have done everything possible to keep more accurate penetration data private.

As Mike Masnick at TechDirt notes, "It makes you wonder who they think they're fooling."

And, one update on my December post.  In it I whine about my broadband options in San Francisco.  Well, I moved and now have Comcast.  It's plenty fast.  Though, the rub is that they provide my only real broadband choice in a city of thousands of thousands of geeks.

CEA's Shapiro to Dobbs: Let's Debate; Nation Refutes Image of Buckling Under Fear

Millions of people watch Lou Dobbs' sad decline into economic demagoguery in silence and with a resigned shake of the head. I am one of them. Thank goodness, the Consumer Electronics Association has a CEO with the...um... guts to take the Pompous One on directly.

CEA's Gary Shapiro challenged Dobbs today:

“I am prepared to debate Lou Dobbs live on his CNN show. His anti-trade comments on his cable show and his refusal to grant equal time to opposing viewpoints are inconsistent with CNN’s great legacy as a pioneering news network. We are hopeful that CNN will wish to retain its credibility and allow equal time for pro-free trade viewpoints. We should not promote a climate of fear. A great nation like the United States isn’t afraid to compete and to win on the international market.”

And, perhaps to the surprise of some politicians who may have written the American people off as sheep herded by a climate of fear and pessimism, CEA also released a poll of 10,000 Americans that said:

- 78 percent of Americans polled agreed that it would be hypocritical for an American news anchor to speak out against international trade while, at the same time, promoting their program overseas and generating advertising revenue from foreign services. More than 50 percent "strongly agreed" that such activity would be hypocritical.

-Nearly 70 percent of those polled either "somewhat" or "strongly" agreed that Dobbs is being "inconsistent" by publicly attacking free trade while promoting himself overseas and generating revenue from foreign sources.

- Of those polled, more than 46 percent agreed with the statement that criticizing international trade "sends the wrong message that the U.S. isn't good enough to compete globally" vs. only 23 percent who agreed with the statement that "criticizing international trade sends the right message because the U.S. actually can't compete globally and needs to protect American jobs."

- Of those polled, more than 50 percent of those polled said that they watched Lou Dobbs' show at least a few times a year.

These Americans polled are remarkably like the CEA members who run small businesses and are dependent on international trade to be successful and hire/retain their employees. After the jump are two videos of small business owners who represent the coming (hopefully) less silent majority...