March 30, 2009
[f2c] Politico-Regulatory talks
[Note: Live blogging. Sloppy. Incomplete. Unchecked. Wrong. Flee! Flee!]
Chris Savage talks about “The Re-Birth of Intelligent Regulation and the Chicago School.” The Chicago School overemphasizes the value of individual thought (= “revealed preference theory”). When people make choices, that’s the best way to know what’s good for them (Chris says). But how can people know which wireless plan they want? “Empirical studies of decision making show that people don’t know what they want.” They don’t act rationally. They have trouble when there are too many alternatives, need to assess risk, etc. But, if you can’t assume that people know what they want, there’s no reason to think that the results from markets are good results. Hence, we need to regulate. If there’s no factual basis to think open competition will lead to the best outcome, regulators may have a role in shaping the outcome. But, timing matters and now is the time to make a “more citizen-friendly regulatory system.”
Derek Slater, a policy person for Google (and a former Berkman Fellow). He’s going to talk about MLab. We have all asked “WTF?” he says, especially when an app starts running badly. We don’t know what’s going on. We don’t have the tools to get the data that would help us understand that. Broadband policy needs data. mLab provides end-user testing tools. (It’s not just a Google project.) “We call it beta but that’s only because most people don’t now what alpha means.” Thirty-six servers at the moment.
John Peha, chief technologist of the FCC, talks about the “Mythology of Rural Broadband.” Myth 1: There’s less interest in broadband in rural areas. Nope. The percentage of US households with Internet overall and rural are almost the same, but rural has less broadband. They probably don’t like their Internet slow. About one third of rural households have no access to broadband of any ttype (except satellite). Myth 2: Customers are unwilling to pay the cost of the buildout. But there are spill-over benefits, affecting the community and not just the individual subscribers. Myth 3: Rural communities may not gain from the broadband they don’t have access to, but it doesn’t hurt them. Nah. “Reducing the size of a network harms those who remain.” Broadband is becoming the norm, hurting those who do not have it. Myth 4: “Government involvement in infrastructure always helps.” Nope. No “one size fits all” solution. We shouldn’t have the gov’t replicate solutions the market is doing well already. We shouldn’t assume that the market solves all problems. We’re getting some more spectrum in 2009 as the switch to digital TV kicks in, and there’s a new national broadband plan under development.
Q: [tim denton, CRTC commissioner] Expand on your point that we don’t know what market conditions will work, Chris?
Chris: We don’t know. It’s important for people, esp. regulators, to remember that.
Q: How can regulators make policy and maintain technological neutrality since technologies offer different capabilities?
Jon: Tech neutrality is a good thing to aim at.
Chris: I want to challenge that. We’re not neutral about houses that have electricity or not, or cars with airbags or not. The market won’t figure this out correctly, necessarily.
Derek: We need to set the goals and look at the data at what different technologies bring to the table.
Jon: The setting of the goals is the key part of that.
[amy wohl] I am a recovering Chicago economist. When the gov’t tries to fix market mistakes, it often introduces a lag that can create a new mistake. How can we help the gov’t make good decisions?
Chris: Elect the right people.
Derek: Infrastructure is special. That’s the message we need to be building on.
David I: Say more …
Audience: Because infrastructure is being built now but not being designed.
