cr> Reply to Arun on QUESTION of open net survival


Richard Moore

Dear Arun,

You wrote:
>I suppose I helped start this thread

Yes indeed.  There's _lots_ of optimistic talk on the net (cyberpunks an
easy example) about how technology and cleverness will maintain the net
culture, but that's a viewpoint that hasn't been heard much on c-r.  When I
saw your original note about telcos being out-of-date, it seemed like
something we should discuss, and see if any kind of consensus could be
reached -- the issue seems fundamental to our whole political perspective.
If we could always "program around" monopolism, then many of us wouldn't
have much interest in the irrelevant politics, and c-r would lose most of
its motivation for being.  We wouldn't need "rights" if there were no
effective danger facing us.

I think perhaps the difference in our perspectives (India context vs. U.S.
context) influences which trends we notice, and how we project them into
the future.  In India (from what you've told us), you're starting from a
backward, government-run monopoly in telecom/internet, and you're seeing
the monopoly being undermined by foreign sattelites and other
techonologies.  You see a trend toward openness and competiveness, and one
which will probably continue for a while there.  It seems you have nowhere
to go but up, as big changes come to your infrastrucuture.

        In the U.S., we're starting from an open, anarchistic net with
multiple co-operating operators and vendors, and competive access-providers
offering good prices and unrestricted net access.  We have nowhere to go
but down, as big changes come to _our_ infrastrucuture.  Your optimism
existing simulataneously with my (our?) pessimism is not surprising.

The political contexts are also radically different.  In the U.S. the
situation is that an implicit coalition of large telco, cable, and media
conglomerates is writing the agenda for the cyber-future, and is brokering
it through government via its retained lobbyists, led by Newt Gingrich.  In
our case, there's no real distinction between telcos as the "enemy" vs.
government as the "enemy" -- one is the agent of the other.

        In India, if I understand correctly, the government has
traditionally seen communications as its own territory -- subject to its
economic (and political?) control, and presumably a profit center
supporting other government operations.  So over there, government and
industry are in tension, with industry pushing (in effect) for more
openness and more alternatives.

I would argue that the U.S. context is the most likely to determine the
cyber outcome for all of us, based on several considerations:
        o  U.S. telecom & media firms are expanding globally (the
           McDonalds Phenomenon).

        o  The U.S. is actively exporting its paradigm for the future
           in G7 meetings (where business executives were included for
           first time at a ministerial level) and by other means.

        o  The phenomenon of BBS-busts, porno-mania, and government
           censorship are cloning outwards from the U.S. (like migrating
           cancer cells).  Germany seems to be becoming a co-center
           of net-repressive infection.

        o  The more general trend toward global homogeniety will play out
           in telecommunications, just as it has in tarrifs, trade, and
           regulations in general.

        o  The U.S. is looked-to as the de facto leader in networked
           communications, and its programs and policies tend to be
           emulated by those wishing to catch up (excepting perhaps France,
           Iran, and a few others).

My responses (below) to your recent comments, I believe, come from this
difference in our contexts (My cyber-conciousness is centered in the U.S.,
not Ireland, by the way).

>GEO's could also offer
>services of the kind that LEOs plan to offer -- so there is no question
>of a monopoly here.

Yes, new technologies do offer the _opportunity_ for new constiuencies to
achieve control over infrastructure -- it is conceivable that a "Global
Communications Co-Op" (for example) could buy its own satellites and offer
anonymous-remailer fully-encrypted services at near-cost rates to
untraceable subscribers armed with low-cost portable tranceivers.

The question is whether such ventures will be allowed to develop, given the
economic context, regulatory regime, and legal environment we are likely to
be facing.  I think the answer to this question is no, they won't be
allowed to develop, not in the long run.  Right in front of us is the
Communications Reform Act, with its monopoly provisions and Exon language
(aimed at independent operators), and Clinton urging its progress.  While
this has been unfolding, we also saw parallel forces at work: the
de-funding of public broadcasting, the cancellation of a progressive cable
broadcast network in Texas, a spate of mega-mergers in
entertainment/news/communications, increasing climate of public porno-fear,

To borrow a phrase from the inimitable Mr. Perot, I hear a "great sucking
sound" as the open and affordable net is being flushed down the toilet, and
the shiny new privately-owned cyber propaganda-mill & yuppie-priced
media-mall is being prepared for market.  There are VERY BIG money
interests behind these initiatives, they've nearly achieved their
duly-paid-for legislative mandate, and they will pursue their monopolist
goals aggressively.  They have many tools at their disposal, including
buying out potential independent competitors, driving them out of business
through selective discount pricing, or seeking additional "favorable"
legislation.  Deep pockets, legislative influence, and determination to
succeed make their designs the most-likely-scenario for the future.

>while some in the US might be
>fleet-footed enough to be cause for worry, most countries in the world,
>including in Europe and Japan, have telcos that are incapable of changing
>at any susbtantial speed.

Yes, this is our difference in context.  Such differences won't go away
overnight, but the tidal wave of globalization moves inexorably onward.

>You simply cannot throw enough bandwidth at it. Now,
>why would these capitalists want to fool around with such a good client,
>particularly when there is no alternative?

In today's _commodity_ telecom market, Internet _is_ a growth opportunity
for telecom providers, especially in developing countries (since they're
starting at such a low level).  The whole point of the new regime is to
re-engineer the economics of cyberspace so that information transport is no
longer a competitive commodity business, but instead a monopolized
_value-added_ business.

        Television networks, to cite one relevant precedent, don't sell
airtime as a commodity to program producers, instead they sell access to
caputured consumer-segments at premium prices to advertisers.  Cable
operators, to cite another, don't primarily lease commodity bandwidth to
broadcasters, instead they sell content, at the highest price they can,
using sophisticated bundling strategies, to their captured subscriber base.

        In the U.S., the telcos and media companies are VERY familiar with
such structural-economics thinking.  During the many years Negropante has
been talking about the merger of communications-computing-and-information,
and the changing roles of satellite and fiber, the relevant corporate
players have been listening, have been talking to one another, and have
been running their spreadsheets.  I've worked and talked with many of the
individuals involved, over the course of a career in computers and

        The game plan for cyberspace, as documented in PFF's Magna Carta,
and as embodied in the Communications Act and other initiatives, is for
information to be owned at birth (strong copyright), be traceable as it
moves through cyberspace (no strong encryption), and sold at premium prices
to consumers (no price regulation), via enforceable online transactions
(digital transaction standards initiatives).  With the physical
infrastructure under monopoly/oligarchy ownership (no entry or merger
regulation), and news/entertainment content controlled by a handful of
global conglomerates (minimal anti-trust enforcement), the cyber
marketplace is most likely to resemble a McDonalds chain of movie theaters,
where you only get the blockbuster Rambo-style films, there's always a
preview of the coming attractions, there's a big markup on the popcorn, the
commercials intersperse the features, and the newsreels create public
opinion, rather than expressing it.

_That's why_ the "capitalists want to fool around with such a good client",
they _do_ have an "alternative", it has much higher profit margins, is on a
much grander scale, and best of all -- they own it.

>Lots of people are willing to fight for the Internet to stay the way it is.
>This includes the cypherpunks, the Joe Sheas (editor of American Reporter,
>who will break the black net censorship law the day it comes into force)
>and, I hope, most people on cyber-rights. If enough people show
>determination, can organise, are vocal and even willing to break the law,
>I don't see how those wimps in Congress are going to stop them.

Well, that's been the hope.  That's why we formed cyber-rights, and many
other parallel efforts were launched.  But the bottom line is that "those
wimps in Congress" have steamrollered merrily ahead, completely ignoring
"lots of people", catering to the agenda of a much better organized and
well-funded constituency.

>I suggest we fight these encroachments, precisely
>because I think we can win. I've suggested on cpsr-global that we form an
>international organisation to coordinate such actions, modelled on a
>combination of Amnesty International and Green Peace

Since you have such large-scale projects in mind, perhaps we're in more
agreement than I thought, as regards the magnitude of the threat.  Please
share your proposals with the C-R.



Date: Thu, 25 Jan 1996
Sender: Off the Edge <•••@••.•••>
Subject: Re: cr> Eppley on QUESTION of open net survival

>The net could enable a number of political applications which the
>corporatists would fear.  Cheap organizing, as Richard mentioned
>above.  Online databases for boycotts & goodguy alternatives.
>Electronic townhalls where the issues which don't get aired in the
>corporate media would get addressed.  These apps don't need the
>bandwidth of video-on-demand; they need new software (mobware).

        Yes the Net could do this now, but is not. How newsworthy is 100,000
people online vs. 100,000 people in the streets? Cheap organizing is all we
have because we cetainly don't have the ear of those in power or the
sympathy of the general public. Untill we can get the real world press to
report on the benefits of the net we might as well continue to pat ourselves
on the back with this discussion group. The only reason the majority of
people get on the net is to make a fast buck, not to change government. A
government ignorant of the Net is a government that is wise to media

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 Posted by Richard K. Moore (•••@••.•••) Wexford, Ireland
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