#677: Cory Doctorow on the Risks of Permanent Regulatory Dominance

Cory Doctorow is a science fiction author, a co-editor for Boing Boing, and consultant to the Electronic Frontier Foundation. He’s been closely tracking the relationship between Tech, Law, Culture, & Markets, and he is seeing a concerning pattern. It’s possible that some of the legal regulations that were meant to protect online users and copyright holders could actually lead down a path of creating a barrier to entry to competitors that results in a permanent regulatory dominance and monopolization.

Doctorow talked about these complicated dynamics in his closing keynote at the Decentralized Web Summit, and I had a chance to talk to Doctorow about some of his ideas ranging from adversarial interoperability, compulsory blanket licensing, and a free market of algorithmic collecting societies that could do a better job at figuring out who to pay better than the algorithmic copyright cops who are figuring out which free speech to suppress.


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Music: Fatality

Rough Transcript

[00:00:05.412] Kent Bye: The Voices of VR Podcast. Hello, my name is Kent Bye, and welcome to the Voices of VR podcast. So at the Decentralized Web Summit, the themes that kept on coming up over and over again was the different regulators to society, being technology, laws, markets, and norms. And Cory Doctorow was giving the final keynote of the Decentralized Web Summit, talking about the interface between these regulatory initiatives, as well as the markets, and these huge technology companies. So what does it mean to have different regulatory obligations that these huge tech companies have to do? But yet, is that then enabling those companies to maintain some sort of eternal regulatory dominance and to either make the barrier to entry so large as to not ever have any competitors and creating these kind of monopoly environments when there's no viable alternatives for communication? So Corey's talking about what are some alternative solutions and potentials to look at the larger ecosystem in terms of what are some of these alternative methods that are going to make it a little bit more competitive, things like adversarial interoperability, for example. So we'll be covering all that and more on today's episode of the Voices of VR podcast. So this interview with Corey happened on Wednesday, August 1st, 2018 at the Decentralized Web Summit in San Francisco, California. So with that, let's go ahead and dive right in.

[00:01:32.151] Cory Doctorow: So, my name is Cory Doctorow. I write science fiction novels and I'm a journalist and I work part-time as a consultant for the Electronic Frontier Foundation. And tomorrow I'm going to talk about how this long-awaited moment in which people start to say, well, we better regulate tech well because it matters when tech gets really concentrated has turned into something of a nightmare. because the governments of the world have decided that the thing we really need to do about the fact that tech has gotten so big is to offer it permanent mastery over the internet in exchange for being deputized to police its users. So we're saying to big tech, We're going to require you to spend hundreds of millions of dollars on moderation or on copyright filtering or on any number of other activities that are meant to address a genuine social problem sometimes. But the quid pro quo is going to be that no one can start a competitor to you because anyone who wants to enter the space has to have $800 million to build out an army of moderators or whatever. And what that means is that the regulatory capture that's already a problem from these big tech platforms is only going to get worse, right? If you think Facebook 2018 is a hard beast to get your head around, wait until Facebook 2028 comes around, after they've had a decade of not even having to bother buying up little upstarts that might compete with them someday, because they've been given the gift of eternal regulatory dominance, and what a better model looks like. And a better model looks like taking away their power to punish people, who use their services in ways that they don't like. And that is what will allow us ultimately to build new services that tear the old services to pieces and use them as spare parts for building something new.

[00:03:20.580] Kent Bye: Yeah, it seems like there's these larger ethical debates that are happening in a technology and there seems to be this trade-off between having safe online spaces that are following the terms of services that are being dictated by these companies like Facebook versus the freedom to be able to say whatever you want but there's risks that are involved with there so there's a certain amount of responsibility that comes with that freedom and so you have this trade-off between the centralization and those safe online spaces versus the decentralization and the freedom that you have to have.

[00:03:46.632] Cory Doctorow: Well, you know, I think that that would actually be a pretty interesting debate to have, but we're not actually having that debate. The debate is in between, do we have spaces that are safe or spaces that are dangerous? The debate we're having is, do we have spaces that have arbitrary safety rules imposed on them that may or may not make you safe, which you have no influence over, no alternatives to, and which are executed in the most arbitrary, high-handed way and you have no appeal? Or do we have the ability to go somewhere else if it turns out that the people who are nominally making us safe have failed to do so?

[00:04:20.088] Kent Bye: So I see this with Facebook, for example, in the realm of virtual reality. They have VR venues that they're going to have AI moderation. They're going to record everything that you do. And they're trying to, I guess, inform of terms of service. So what is the alternative? And there's also a lot of talk about regulation. So what is sort of the trade-offs in terms of what you see as kind of the viable solutions to some of these what seem to be intractable problems at this point?

[00:04:44.482] Cory Doctorow: So when Facebook started, the way that they started is they made a tool that would log into other networks like MySpace on your behalf, and when people tried to send you MySpace messages, it would show them to you in Facebook, and you could reply, and it would come back with a little footer that said, why the fuck are you still on MySpace? I'm on Facebook now." And that worked really well. Facebook successfully sued into oblivion a competitor of theirs who was doing exactly that, a company called PowerVentures that wanted to let you have all your different social networks on one screen. And they wrote little autopilot bots that logged into those networks on your behalf and grabbed your messages and let you send messages to them and so on. And, you know, every pirate dreams of being an admiral. When Facebook did it naturally, they view it as kind of the natural progression of things. And when someone did it to them, they view it as a great affront to the proper order of the universe, which is where Facebook is in charge of everything. The difference is that when Facebook did it to all of their competitors, they were small companies that couldn't wield the instruments of power such that they were able to prevent this upstart Facebook from doing it to them. But Facebook was so large by the time someone tried to do it to them, that they were able to wield power to prevent someone from doing it. There is this thing that we used to have called adversarial interoperability, which is when you made a product that worked with someone else's product, even if they didn't like it. Adversarial interoperability was how we kept companies from getting too big. Because when companies got really big, they became these kind of enormous reservoirs of nutrients for new, smaller, nimbler companies that nibble them to death. by saying, oh, well, you've got this entire installed base of people who know how to use Word, and you charge money for Word. I'm going to give away a Word-compatible product with my online service. And the fact that Microsoft couldn't sue you for making a product that could read and write Word documents meant that you could keep them in check. We're losing that, right? That's the thing that we're losing. And it's not sufficient to establish a competitive market, but it is necessary to establish a competitive market. If we're going to have a future Facebook, the way we're going to get there is by not expecting everybody that you ever want to talk to who's on Facebook to all leave on the same day and go somewhere else. It's by allowing you to have one foot in Facebook and one foot somewhere else and to gradually move the foot that's in Facebook over to the new platform And the way that we're going to do that is by not giving Facebook the legally enforceable right to make whatever makes them sad into a crime.

[00:07:20.827] Kent Bye: Well, I think that things like YouTube, they've built in within the algorithm to be able to detect whether music's being played. And then they could potentially, whoever was the creator of that music, get handed over all the ad revenue if something was not used with explicit permission. And so there's these AI systems that are able to do this, I guess, copyright enforcement. And it seems like this copyright enforcement is, I guess, the Trojan horse by which there's these larger mechanisms to be able to, I guess, in some ways limit how many of these distribution platforms are out there. What is the alternative, or what is the counterweight to being able to tell artists that they should be able to just deal with a little bit of piracy on the edges and still get stuff out there? Or what is, I guess, the viable alternative to something that is the existing system of those content moderation systems?

[00:08:03.864] Cory Doctorow: So content ID, this thing you're describing on YouTube, nobody likes it. Google spent $60 million on it. They hate it. All the rights holders hate it. They say that it doesn't catch infringement and that they don't get enough money from it. And part of that is because the users of YouTube are adverse to content ID. They don't want their videos content ID'd because what being content ID'd means in part is that some of your videos get taken down, right? So there's another model, and it's the model we've used for literally all technology until we got the internet, which is compulsory blanket licensing. And the way that that works is, if you want to play a song on the radio and you're a DJ, you don't call up the composer and ask them how much it's going to cost you to drop the needle. You just play all the music, any music you can find, recorded anywhere in the world at any time by anyone. And we use statistical sampling methods to figure out how much of the license fee you pay should go to the artist. Now, not all collecting societies. Necessarily like ASCAP or things like that? ASCAP, BMI, et cetera, Harry Fox. Not all those collecting societies are very good. In fact, most of them are terrible. Most of them are like barely one step above the mob. But I can imagine an algorithmic collecting society that does a much better job of figuring out who to pay much more easily than I can imagine an algorithmic copyright cop that can perfectly detect which speech should be censored and which speech shouldn't. And moreover, inadvertently allocating someone's fractional penny to the wrong account is a lot less important than silencing someone's speech. And so the failure mode is a lot more graceful. So if we decide that that's the thing we need to do, we have the means to do it. And moreover, we can do it with things like standards that make it possible for more people to compete. You know, it's not good for artists that to start a competitor to YouTube, part of the table stakes is $60 million to build another content ID. All that means is that YouTube has managed to enjoy what now amounts to permanent dominance of the way you promote your music. And that's played out really badly for musicians. I mean, for one thing, when YouTube started its streaming music service, it got the four big record labels around a table, negotiated terms as an equal with them, and then turned around to all the indies who were using YouTube to promote their music and said, you are going to take the deal that we got with the big four, or you're no longer allowed to use YouTube ever again to promote your music. So it turns out that even if you don't sign to a label, you have to take the shitty deal the labels created. It is not good to have a buyer's market when you're a seller. And we creators, because that's my major day job, is making art that I sell. It's copyrighted works that I sell through a major multinational entertainment company called Macmillan. We creators are better served when there's lots of bidders for our work to be the intermediaries to our work. And so a system where there was a standard way to represent music, to count music, to account for music, that anyone who wanted to compete with YouTube could implement, and then they could allow their users to upload as much music as they wanted, and that would be another place where musicians could promote themselves and get paid, is a much better system for musicians than one in which the big four labels become the big four labels plus YouTube, and the deal is take it or leave it for all five of them.

[00:11:23.549] Kent Bye: So for you, what are some of the either biggest problems that you're trying to solve or open questions that you're trying to answer?

[00:11:31.441] Cory Doctorow: Right now, I think the big question everyone's trying to figure out is competition. This is what I'm going to talk about as well on Thursday when I do the keynote. We, 40 years ago, pretty much got rid of competition law. Ronald Reagan was a big fan of these economists at the University of Chicago who thought that the only time the government should step in is when you had price fixing to raise prices to consumers. which nobody does anymore. Instead, they do anti-competitive things like buying all their potential competitors or lowering payments to their suppliers. The amount of money that you get from Spotify or from Walmart or from iTunes is a lot less than it might be if there were more people bidding for the right to have your work. How do we get back to vigorous antitrust enforcement when we now have a whole generation of regulators, company lawyers, entrepreneurs whose instincts and whose professional views have all been distorted by 40 years of bad policy? That's a question we don't have an answer for that's really good right now. In particular, one of the things that companies getting really big does is it puts them in a position of enormous power over policy outcomes. All the policy starts to be stuff that the giant companies can live with. When your sector only has four companies in it, then anyone who could possibly regulate it probably worked for one of those four companies, and more likely worked for all four of those companies, and moreover is married to someone who works for one of those companies, and godparent to someone who works for one of those companies, and maybe the executor of the will for someone who works for one of those companies. And so how you get those regulators to actually start regulating those companies in earnest? It's a hard question. John Oliver said, when Obama named an FCC chairman who used to work for Comcast, he said, that's like having a dingo as your babysitter. But every industry is filled with dingo babysitters at the regulatory level. How we bootstrap effective regulatory enforcement, antitrust enforcement, against industries whose regulators are drawn from their own executive ranks, that's the hard problem right now.

[00:13:36.349] Kent Bye: Great. And finally, what do you think is kind of the ultimate potential of all these decentralized systems and what they might be able to enable?

[00:13:47.686] Cory Doctorow: The thing that computers and networks let us do is the same thing that our most profound technologies, since our earliest technologies, technologies like language, have let us do, and that's it allows us to collaborate. When you can work with someone else, you can do something that is literally superhuman and that transcends the ability of one human. And when you lower the cost of collaboration, you make it cheaper and easier to be a superhuman. And I think we'll have superhuman powers. I think we'll be able to conceive of a thing that maybe only five other people in the world want to do. And we'll be able to find those five people. And we'll be able to work with them to make that thing happen. We will lower transaction costs. Now, that's not going to be an entirely great thing. There are going to be people whose rare and weird thing that they want to do is carrying tiki torches through the streets of Charlottesville. But I think that the lesson that we can take from the fact that we live in a world made up of things that required enormous cooperation to build skyscrapers and aviation and space programs and molecular biology is that on balance, in the long run, we are collaborative people.

[00:15:00.180] Kent Bye: Awesome. Great. Well, thank you so much for joining me today. So thank you. Thank you. So that was Cory Doctorow. He's a science fiction writer and a consultant to the Electronic Frontier Foundation, and he was giving the final keynote at the Decentralized Web Summit. So a number of different takeaways about this interview is that first of all, so the main points here seems to be that There's these companies that are so huge that they are essentially creating these monopolies and that they're doing all sorts of anti-competitive behaviors by either buying up their competitors or preventing other competitors to be able to not do the things that they don't like. So what Corey is saying is that if there's something that Facebook doesn't like, then they can sue their competitors into oblivion to do anything that used to be within the purview of adversarial interoperability, which is to make your product to be able to interface with other products. more and more we have these walled gardens where there's like no interfaces from these companies. And so as you have that, then you have like this lack of competition within the context of these websites. So what are the implications of making it so that there's all these large obligations that these companies have to abide by? You're essentially creating this eternal regulatory dominance. And you know, what are the implications of that? Well, there's this issue of like, if there's no viable alternatives for you to do these social interactions online, then you essentially have this consolidation of power and this limitations of free speech. And then each company has their own terms of service. But the thing that Corey says is that there's a set of arbitrary safety rules that are opposed on people that may or may not be making you more safe within the context of an environment. You have no influence over those terms of service. You have no alternatives to go to any other place on the internet. And they're executed in the most arbitrary and high-handed way with no appeals process at all. And so basically if they say that you're out, there's no details as to what happened and you're basically banned from that section of the internet. And as more and more of these companies are able to have more centralized power and be able to have more and more people have those ways that this is where they communicate, and with augmented and virtual reality, as there continues to be this blurring of the line of what is digital and what is real, you're going to start to have these real issues as to what is a larger issue to be able to either have a more of a truth and reconciliation or a process of justice if you know if it turns out a lot of these technology companies are turning into governments as if they're at the scale of that then what are those types of justice processes that we should start to implement because you know there's people that put up stuff and if people that are reporting things for being against the rules of the content moderation, then you could get flagged and then get sent off and have some person that may not even be from your culture making a decision about the fate of whether or not you could have a digital identity within that platform anymore. So that adversarial interoperability is key, and just in terms of being able to allow your competitors to interoperate with you in different ways, and so that you're not such a walled garden, but they're actually interfacing with these other web apps. But also the content ID problem of, as a content creator, how do you actually protect your content that's out there? right now it's done by these algorithmic copyright cop who the failure mode is not graceful is what Corey says and that an alternative would be to do something like compulsory blanket licensing so that you could maybe do a place where you're represented and it's like ASCAP in the music world where they do these statistical sampling methods and trying to figure out who's using what and that you pay a fee to be able to actually use the content and then From that, that money gets slowly redistributed out to all the different content creators. So Corey admits that the existing implementations of that are not that great, but perhaps that might be a more effective approach to create a marketplace for creators rather than to have these centralized places where the deal that you get is not exactly a great deal. And if there was a little bit more of a marketplace for you to get compensation, then that could be an alternative as well. And finally, just where all these technologies are going is that it's allowing us to communicate and collaborate in different ways with each other, and that Corey kind of calls that a superpower, is that if you have an idea, then you have the capability to not only broadcast that idea, but to get other people who also want to make that idea happen, and to get together and figure out a way to actually make it happen. So that seems to be what is starting to happen within this movement of the decentralized web and trying to create these resilient networks and alternatives to these centralized systems to be able to be able to have a little bit more control over your own destiny online. And I think there's going to be a lot of things in the short term in terms of actually what are the logistics to actually make that work. What I got from the Decentralized Web Summit is that there's a lot of idealism as to what's possible, but also just a lot of pain points of the existing systems. And I think there's starting to be a critical mass of people who are really starting to think about all these things, who are wanting to go out there and use all these different open protocols to build something completely different. So, that's all that I have for today, and I just wanted to thank you for listening to the Voices of VR podcast, and if you enjoyed the podcast, then please do spread the word, tell your friends, and consider becoming a member of the Patreon. This is a listener-supported podcast, and so I do rely upon your donations in order to continue to bring you this coverage. So, you can donate today at patreon.com slash voicesofvr. Thanks for listening.

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