A Question of Harm

This Friday I went to see Jonathan Zittrain give a talk at Harvard about his new book, which I have not yet finished reading. Jonathan was his usual incredibly diverting self and he gave gave good precis of the book (at least, consistent with what I have read to this point.

During the Q&A John Palfrey asked the closing question, a classic question to a presenter, which could be roughly phrased as “of all the questions you’ve gotten on this talk, which was the hardest to answer that hasn’t already been asked today.” Jonathan pointed to one of the key questions that have continued to come up in these talks, which is essentially, “why won’t the market just take care of this problem?” Jonathan admitted that, at this point, he really doesn’t have a compelling proof, just a strong conviction.

Which brings me to this little news item, elements of which have been percolating for some time. It seems to me that dealing with the market question ultimately brings us back to two classic policy questions – (1) where’s the harm and (2) is the harm (and thus its remedy) external to the market? So, keeping those two questions in mind while reading this (and pondering appropriate remedies) might be helpful — because showing the harm is not easy, IMHO, but it’s the necessary step before you even get to discussing remedies: HD enthusiasts crying foul over cable TV’s crunched signals (pdf)

As cable TV companies pack ever more HD channels into limited bandwidth, some owners of pricey plasma, projector and LCD TVs are complaining that they’re not getting the high-def quality they paid for. They blame the increased signal compression being used to squeeze three digital HD signals into the bandwidth of one analog station.

The problem is viewers want more HD channels at a time when many cable and satellite providers are at the limits of their capacity, said Jim Willcox, a technology editor for Consumer Reports magazine.

“They have to figure out a way to deliver more HD content through their distribution networks,” he said.

Compressing the signal is cheaper than costly infrastructure upgrades to increase capacity. Satellite TV providers — including DirecTV Group Inc. and Dish Network Corp. — also have the option of launching satellites to boost the number of HD channels on their systems.

Recessions and Online Advertising

Evolving business models: A Web Shift in the Way Advertisers Seek Clicks

In the United States, $21.1 billion was spent on online advertising last year, up from $16.9 billion in 2006, according to eMarketer. Search advertising — Google’s stronghold — is the majority of that spending, according to Jeffrey Lindsay, an analyst at Sanford Bernstein.

According to a report by Imran Khan, an Internet analyst at JPMorgan Chase, ad networks “are growing much faster than the general graphical advertising industry.” He estimated that the top 20 ad networks had earned $2 billion in 2007, or 14 percent of the display market.

The reasons ad networks are thriving are price and improved technology. Ad networks charge much lower cost per thousand ads served (known as CPMs), as low as $4 on an ad network with some targeting, compared with $40 and up for some ads on premium sites like MSN or Yahoo.

“While the home pages are still very effective media buys, the price tags on them have become a little outrageous for many advertisers. For all the growth that has gone on from a site standpoint, there are other ways to amass that type of audience fairly quickly that are more efficient,” said Margaret Clerkin, the chief executive of Mindshare Interaction, a media-buying firm.

A Good Question

Tension Over Sports Blogging

Tension over sports blogging is one of the strains between sports franchises, leagues and reporters to have emerged during the digital age.

The dispute has grown lately between the press and organized sports over issues like how reporters cover teams, who owns the rights to photographs, audio and video that journalists gather at sports events, and whether someone who writes only blogs should be given access to the locker room.

The explosion of new media, especially with regard to advertising income, has made competitors out of two traditional allies — news media and professional sports.

At the heart of the issue, which people on both sides alternately describe as a commercial dispute and a First Amendment fight, is a simple question: Who owns sports coverage?

Of course, the question to resolve first is “Should sports coverage be ownable?” Some other great questions posed in the article.

A Different Sort of Privacy Question

From DNA of Family, a Tool to Make Arrests (pdf)

He was a church-going father of two, and for more than 30 years Dennis Rader eluded police in the Wichita area, killing 10 people and signing taunting letters with a self-styled monogram: BTK, for Bind Torture Kill. In the end, it was a DNA sample that tied BTK to his crimes. Not his own DNA. But his daughter’s.

Investigators obtained a court order without the daughter’s knowledge for a Pap smear specimen she had given five years earlier at a university medical clinic in Kansas. A DNA profile of the specimen almost perfectly matched the DNA evidence taken from several BTK crime scenes, leading detectives to conclude she was the child of the killer. That allowed police to secure an arrest warrant in February 2005 and end BTK’s murderous career.

The BTK case was an early use of an emerging tool in law enforcement: analyzing the DNA of a suspect’s relatives. […]

[…] As things stand in some states, lab analysts who discover a potential suspect in this way may not be permitted to share that information with investigators. Such a policy, said William Fitzpatrick, a New York state district attorney, “is insanity. It’s disgraceful. If I’ve got something of scientific value that I can’t share because of imaginary privacy concerns, it’s crazy. That’s how we solve crimes.”

But the technique is arousing fierce objections from privacy advocates, who maintain that it turns family members into genetic informants without their knowledge or consent. They complain that it takes material collected for one purpose and uses it for another. And with the nation’s DNA database disproportionately comprised of minority offenders, they say, it amounts to placing a class of Americans under greater scrutiny merely because their relatives have committed crimes.

“If practiced routinely, we would be subjecting hundreds of thousands of innocent people who happen to be relatives of individuals in the FBI database to lifelong genetic surveillance,” said Tania Simoncelli, science adviser to the American Civil Liberties Union.

See also Saturday’s Ted Rall cartoon (local copy)

Personalization and Privacy

On the Internet, It’s All About ‘My’

For all its ubiquity, the concept of corporations trying to get up close with consumers is sometimes greeted warily by even those in the marketing community. “It’s a cold, calculated and impersonal attempt to be personal,” said [Igor’s Jay] Jurisich, who says his firm shuns “my” URLs. “It’s about making Big Brother into little brother. No one in their right mind should think, oh, the corporate entity really cares about me personally. But I can only assume that enough people fall for it that companies don’t ditch it.” In a recent survey conducted by OTX, a consumer market research firm, one-third of respondents agreed that a Web site with a “my” function meant “the company cares about me.”

Another major benefit for companies behind those Web pages is the personal data, including e-mail addresses and preferences, that customers provide when registering at one of the sites. “It’s all about the database and getting that personal information,” said Shelley Zalis, the founder of OTX. “That’s what everyone wants.”

Is This Really News?

Or is this just an excuse for the Times to wallow in the mud with everyone else who’s fixated on Tricia Walsh Smith’s video? When the Ex Blogs, the Dirtiest Laundry Is Aired

[I]n an era when more than one in 10 adult Internet users in the United States have blogs, according to the Pew Internet and American Life Project, many people are using the Web to tell their side of a marital saga. Despite the legal end of a marriage, the confessions can stretch toward eternity in a steady stream of enraged or despondent postings.

In separation, of course, one person’s truth can be another’s lie. Often the postings are furtive. But even when the ex-spouse is well aware that he or she is starring in a blog and sues to stop it, recent rulings in New York and Vermont have showed the courts reluctant to intervene.

For the blogger, the writing can be therapeutic.

Well, yeah, but so what? The only real point to me is this bit, which is already part of the “presumption of privacy in plain sight” issue of internet posting:

There will certainly be consequences down the line of all this sharing. “The long-term impact of the persistent information on line has not been fully felt,” [Pew researcher Mary] Madden said.

“People tend to think that they are blogging for a small group of friends or that they are anonymous,” she said. But that is not really the case, she said, because “all it takes is one friend posting a link to your blog to out you.”

Saving the Record Store

Record Stores Fight to Be Long-Playing

NOW added to the endangered species list in New York City, along with independent booksellers and shoe repair: the neighborhood record store.

The hole-in-the-wall specialty shops that have long made Lower Manhattan a destination for a particular kind of shopper have never made a great deal of money. But in recent years they have been hit hard by the usual music-industry woes — piracy, downloading — as well as rising real estate prices, leading to the sad but familiar scene of the emptied store with a note taped to the door.

Some 3,100 record stores around the country have closed since 2003, according to the Almighty Institute of Music Retail, a market research firm. And that’s not just the big boxes like the 89 Tower Records outlets that closed at the end of 2006; nearly half were independent shops. In Manhattan and Brooklyn at least 80 stores have shut down in the last five years.

But the survivors aren’t giving up just yet. […]

Yes, but then there’s this — an ambivalent message if I say so:

Casually dispensed expert knowledge like that is exactly what Record Store Day is looking to celebrate. [Regina] Spektor, who started off selling homemade CDs and is now signed to a major label, Sire, said that independent stores had been the first to carry her music, and that their support helped her career take off. And though she said she now feels contrite that for years her music collection was made up mainly of items copied from friends — “I just had no money” — she is supporting the stores out of gratitude.

“I’m the record label-slash-store nightmare,” Ms. Spektor said. “Everything I had was a mixtape or a burned CD. But I don’t like the idea of all the record stores where people actually know what they’re talking about going out of business. They have their own art form.”

See also this indication of changing times: Longtime Executive Steps Aside at Sony BMG

In a shake-up that reflects the new realities of the music business, the renowned hitmaker Clive Davis is making way for a younger executive known for having an ear toward the pop charts but also an eye on controlling costs.

[…] But the pop hits that Mr. Davis is known for delivering typically require the kind of expensive videos and marketing campaigns that labels are reluctant to finance at a time when music sales have been sliding. Sony BMG’s decision to promote Mr. Weiss underscores the idea that hits alone cannot save the industry.

Reports on Yesterday’s FCC Hearing At Stanford U

FCC wrangles over Net neutrality issue (pdf)

A divided Federal Communications Commission on Thursday grappled further with the thorny issue of how to relieve increasing online congestion, disagreeing sharply over whether government regulations are needed.

The five-member commission met at Stanford University during a seven-hour meeting delving into Net neutrality, the principle that all Internet traffic be treated equal.

Copps, Adelstein, Tate, McDowell Statements; Standford Internet & Society hearing info

From the Washington Post, we get Net Neutrality Hearing Hits Silicon Valley (pdf), which highlights the Christian Coalition’s take instead of Rick Carnes’ of the Songwriters’ Guild:

“The Internet connects people all over the world in a manner and scope of ease that is impossible if it were not online,” said Michelle Combs, vice president of the Christian Coalition, a proponent of rules that would force Internet providers to keep their networks open to content. “Organizations like the Christian Coalition should use the Internet to communicate with our members and worldwide audience without snooping or blocking or slowing down,” she said at the hearing at Stanford Law School.

Later: Larry Lessig posts his testimony as a video — and a quite heated discussion accompanies it.

Also note an earlier House Judiciary hearing: Hearing on Net Neutrality and Free Speech on the Internet.

LATimes Recaps The Rowling v Lexicon Case

With an unsurprising take: Rowling seeks to stop ‘The Harry Potter Lexicon’ from being published (pdf)

Now that the petty wrangling, emotional outbursts and mind-numbing duels over Latin words roots have ended, the federal judge in this week’s Harry Potter trial faces a daunting task: How do you balance an author’s right to protect her copyrighted novels with a publisher’s right to produce a new book that borrows heavily from these bestselling texts?