< Tim Wu's The Master Switch

Transcript

Friday, November 12, 2010

BROOKE GLADSTONE: For anyone thrilled at the wide-open freedom of the Internet, the inevitable question is how long can it last? Tim Wu, a professor at Columbia University Law School, looks to history for the answer, and the answer is, not very long, unless we actively intervene. He sees a cycle in the evolution of all the other great information technologies of the last 150 years – the telegraph, the movies, radio. They start out wild and wooly until they are tamed and caged by men who would be emperors. Their empires, monopolies like AT&T and the early TV networks, wielded extraordinary power over the delivery and often the content of the information all of us received, a power described by a CBS executive in the 1950s as, quote: “the exclusive custody of the master switch.” In his book, called The Master Switch, Tim Wu describes the cycle that transforms a technological revolution into a monopoly. Consider the telephone. What started as a promising but buggy invention by Alexander Graham Bell turned into a juggernaut in the hands of empire builder Theodore Vail.

TIM WU: When Vail came to AT&T in 1970, it was a company that had less than half of the market share for telephones. There were hundreds, maybe thousands of competitors. It was a vibrant, open market. And what Vail did was to unify it all into a single consolidated monopoly.

BROOKE GLADSTONE: Now, as we pursue this cycle, AT&T consolidated its power. It was very efficient in delivering service but, as you note, it only encouraged innovation and invention that bolstered its monopoly and it crushed those innovations that didn't.

TIM WU: There is a repeat pattern we see with America’s information monopolists. A new invention is created by a disruptive inventor and it goes through a period of openness, entrepreneurial activity, a kind of a boom, and eventually, and typically, some great strongman arises who integrates the entire industry into a lasting monopoly. This repeats itself for the radio industry, the early telephone industry, the film industry, and today it may be repeating itself in the Internet industry.

BROOKE GLADSTONE: So how does the cycle end?

TIM WU: Well, once a monopoly is established, it itself is broken up by a new invention – so the telegraph empire was destroyed by the telephone – or occasionally the government steps in and breaks it up. The AT&T breakup and the breakup of the Hollywood studios are the two main examples.

BROOKE GLADSTONE: So then are they left in pieces or are they reassembled?

TIM WU: Sometimes someone new can arise and put the pieces back together. AT&T did that in 2006, reassembled itself. Sometimes something new arises and builds a new empire.

BROOKE GLADSTONE: And you say that American culture in general seems to acknowledge that political power needs to be curbed, but there’s a resistance to the notion that economic power needs to be curbed.

TIM WU: Yeah, we do have a big, powerful federal government but we are constantly asking whether it needs to be less powerful, rolled back, what its limits are. In contrast, the American attitude towards private power, while it has its moments, is much more forgiving. We allow, when we have a massive economic crisis like we just had, we say, well, that’s just kind of the way it works instead of doubting our fundamental approach to these things.

BROOKE GLADSTONE: And you suggest that these times and this new technology calls for something you call “the separations principle.”

TIM WU: We need a sensitivity towards over-consolidation between the people who move information and the people who create it. The, the point is that when you have an over-consolidation of transporting content you can have an influence over politics. You can end up with private censorship. You can end up with suppression of new innovation. And I think we need a principle like separation of church and state, where we say, you know, these are nice institutions but they need to retain some distance. If, for example, Verizon and Google get too close together, if AT&T and Facebook want to become a single company, there are dangers from that.

BROOKE GLADSTONE: What would the dangers be?

TIM WU: What would the dangers be? So Google and AT&T merging would result in a world in which it would be almost impossible to displace Google as the nation’s dominant search engine. It could insulate itself against competition even after it had become antiquated or, or lost its edge, and it could also begin to favor certain companies over others on its search and would have a power over what Americans hear that would be close to unprecedented in American life.

BROOKE GLADSTONE: Okay, so you suggest that the separations principle requires three active sets of participants, first, the federal government, then the entertainment, information and technology companies -

TIM WU: Right.

BROOKE GLADSTONE: - and then us.

TIM WU: The federal government has to provide some oversight of this, but most important of all, I think it is essential that it is a norm, that we see this as something that is dangerous, that we understand in history this has produced problems, because we're used to, on the Internet, the idea you can reach anything you want. That is the separations principle in action. Now, over the summer when the news leaked that Google and Verizon had done a secret deal there was a lot of outrage. And I think that that shows that the public is sensitive to these sorts of issues.

BROOKE GLADSTONE: You are widely regarded as the inventor of the phrase “net neutrality.” The principle of net neutrality is that an Internet service provider, like AT&T, can't cut special deals for faster speeds for larger Internet services, like Google, that are willing to pay more for them. Everybody gets to ride along the information highway at the same speed. This idea doesn't have a lot of support in Congress.

TIM WU: Net neutrality is, I would suggest, the governing principle on the Internet today. Net neutrality is, first and foremost, a norm. And often a norm is more important than a law. It is not irrelevant what Congress thinks, but it’s close to irrelevant. And the reason is that were, for example, AT&T to block Google tomorrow, it would not be tolerated. And so, the net neutrality principle and its acceptance in the Internet space, is a prototype of a broader separations principle.

BROOKE GLADSTONE: What’s at stake if we don't adopt it?

TIM WU: Americans have contradictory impulses in this area. On the one hand, we love convenience and reliability, and that’s what takes us to these monopolists, over history. But our instinct towards convenience is tempered by another instinct which wants choice and freedom. And I'm suggesting that if Americans don't pay attention, it won't be obvious at first but over time we will see that the content we receive is increasingly winnowed, filtered, chosen for us. And I think that while some of us may like that, that the better half of our tradition believes in access to a freer amount of speech.

BROOKE GLADSTONE: Don't you think that even if there is somebody controlling the master switch we'll still have a lot more speech with the advent of the Internet than we ever have had in any era before?

TIM WU: It depends on whether we continue to live in a media environment where everyone can be a creator. There is an effort to return to an age where we mostly listen to simply the professionals and we get rid of all the amateurs. You know, it sounds unlikely now. I agree right now we're in an extremely open phase, and I love it, but I'm suggesting that there is a taste also for fewer channels and that we could move back to something like the 1950s or, or '60s where there were very few channels for information.

BROOKE GLADSTONE: Tim, thank you so much.

TIM WU: Thank you.

BROOKE GLADSTONE: Tim Wu teaches at Columbia Law School. His book is called The Master Switch: The Rise and Fall of Information Empires.

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