Just as the U.S Congress is about to debate the Internet Freedom Preservation Act, and before the Telecom Package discussion resumes later this fall, one could regret that the concept of openness of our communications infrastructure is not more salient in the public debate.

What is about anyway? And why does it matter?

An open communications infrastructure is developed and used according to the concept of network neutrality. Net neutrality relies on the principle that network management should be free of restrictions regarding content, application and platforms, or the kind of device that may be attached to the network. It guarantees that the flow of information that runs trough the communications architecture is neither blocked nor unreasonably degraded by telecommunications operators, so that end-users can freely and efficiently make use of the network.

The result of more than 25 years of technological innovation, the wide spread of communication and computations capacities in developed countries is having deep structural consequences in our societies. As every citizen or business-oriented organization can now rely on the openness of the Internet to perform their activities, the production and the circulation of information, knowledge and culture are being democratized. The barriers to entry (now a €200 computer and a €30 monthly Internet connection, as well as users’ creativity) are sufficiently lowered for people to participate more fully into the social, economical and political life. However, for these new modes of participation to thrive, Internet users – whether citizens or businesses – have to retain a set of rights and freedom, which are partly preserved through keeping the network open.

In return, openness will make citizens freer by allowing them to engage in the production of the cultural goods that surround us, which are today mostly controlled by the handful of corporations involved in the media industries. In that respect, net neutrality can achieve a fuller conception of free speech, as the French Constitutional Council asserted in its decision on a law aimed at tackling file-sharing. Finding that the law disrespected the Declaration of the Man and of the Citizen, the Council stressed that free access to the Internet was an instrumental part of the freedom of expression and communication. By doing so, the constitutional judges implicitly recognized that an open Internet provides us with the opportunity to deepen people’s freedom and autonomy, and therefore improves democratic processes.

Also, net neutrality allows for more efficient markets, in which information is not held back by a few companies. Studies show that such new market structures facilitate innovation and competition, as economic actors take advantage of the communications network to launch new services [1]. Incumbent actors in the media and the telecom industries have an obvious interest in perpetuating their control over information and communication networks, and try to do so by, for instance, engaging in overt “wars” against file-sharing[2], or by banning innovative VOIP applications from mobile telecommunications services[3]. These actors thereby attempt to avoid competition in order to protect their dominance on these markets without having to adapt their business-models. However, it should be clear that it makes no sense for public policy to support such endeavors.

The principle of openness is undoubtedly economically viable and coheres with current infrastructure management practices. It is indeed a core element of the regulatory schemes that apply to other infrastructure commons[4], such as transportation networks or energy grids. It is clear that given what is at stake – citizen’s rights and economic -, regulators are legitimate in imposing public interest requirements like net neutrality onto telecommunications operators. The strategic role of broadband networks largely justifies that the architecture of such networks may not respond solely to the telecoms operators’ commercial logic. It is all the more obvious when one considers, for instance, the various public funds aimed at supporting broadband deployment (see for example, the subsidies granted for high speed Internet lines in rural areas included in both EU and national recovery plans[5]).

It is evident that society as a whole benefits from an open network. Of course, we need to find ways of funding the deployment of better broadband communications, which require significant investments. But the upgrade of our communication infrastructure should not be completed at the expense of a potentially enhanced citizenship in the political field, or of effective competition in the economic sphere. The derogations to the principle of net neutrality should remain as minimal as possible, and rely exclusively on unequivocal public interest objectives.

[2] For an analysis of the disastrous consequences of such copyright enforcement, see Op-Ed by American legal scholar Lawrence Lessig.

[3] Such strategy is being pursued by telecom operators like Orange and O2 in Europe or AT&T in the United States. These companies have unilaterally decided to disable the use of the Skype iPhone application over their 3G networks.

[4] For an assessment of the socio-economic benefits of open-access provisions in infrastructure commons regulation, see this paper by Brett M. Frischmann.

[5] The EU recovery plan unveiled in January 2009 provides €1 billion for rural broadband.

People in the online advertising business are keen on supporting self regulation when consumers and regulators raise privacy concerns. Yet, there are laws protecting privacy, both in the European Union and the United States. The thing is: they have been designed before the advent of the internet and fail to guarantee this fundamental right in today’s world.

So it is reassuring to see that the U.S Federal Trade Commission, as the Wall Street Journal points out, is now beginning to tackle this issue in order to provide a level playing field for all citizens and businesses. As Europe is in the (painful) process of reforming the telecom sector, it would have been a good opportunity to significantly upgrade the ePrivacy directive…

American novelist Mark Helprin has a new book out called “Digital Barbarism” in which he defends – among other things – copyright extensions. This manifesto against the free culture movement seems to be a accumulation of insults and conservative claims on how culture should be produced and circulated.

For instance:

The vast bulk of this ["free culture"] army may be just a bunch of wacked-out muppets led by little professors in glasses, but they will do more damage to the underpinnings of civilization than half a million Visigoths smashing up the rotted, burning cities of Rome“

Interesting (though biased) review of the book, here.

French competition regulator released an important report, saying an internet provider should (Orange in this case) not be allowed to use exclusive broadcasting rights to make some media content available only to its suscribers.

France is thus drifting away from poor regulation that would have been detrimental to both the role that the media play in the democratic process as well as technological innovation.

Competitive markets require sound regulation, as it should be clear for everybody by now.

Google executives face (ridiculously high) legal charges for failing to check user-generated content before it is made public on a website.

Check out this BBC article.

Take-down practices can and should be improved to respect people’s privacy but this is just another dumb legal argument that runs counter to the internet’s progressive potentialities.

Yesterday at 5P.M, the French Constitutional Council – in charge of checking the conformity of legislation with the Constitution – rendered a groundbreaking decision regarding the highly controversial “three strikes law” (or graduated response), passed last month by Parliament to fight illegal downloading.

The law established a penalty amounting to the suspension of downloaders’ internet connection without appropriate judicial safeguards. Yet, the Constitutional Council affirmed in very strong words that under no circumstance should people’s freedom of expression and communication be denied by a non-judiciary authority (in this case, and independent administrative agency, which does not guarantee a fair trial). According to Article 66 of the French Constitution, the judiciary authority is the “guardian of individual liberty” and as such is the only one authorized to pronounce sentences infringing on fundamental liberties, which are at stake in this law as the Council asserts.

It based its legal argument on one of the first Declaration of Human Rights in history (the Declaration of the Rights of Man and of the Citizen, pronounced in 1789 at the beginning of the French revolution). In the decision, the ten justices stress that the Declaration’s Article 11 provides that “the free communication of thoughts and opinions is of one of man’s most precious rights”, and they declare that the internet now plays an instrumental role in guaranteeing the effectivity of that right – free speech. To be even clearer, they emphasize its importance for citizens’ “participation to the democratic life and the expression of ideas and opinions”.

A year ago, when this law was only a bill on the verge of being introduced in Parliament, I wrote that given some of the Council’s past landmark decisions, the so-called “graduated response” would be condemned as unconstitutional. I based my reasoning on a 1989 decision on a law regulating the audiovisual sector. This law basically proclaimed the media’s independence from the State, which has exerted a monopoly over TV and radio broadcast until the early 1980 in most liberal democracies, on the ground of freedom of expression. To protect the latter, the Council imposed significant limits on the sanction powers of the administrative agency in charge of regulating the media. Yesterday’s decision follows the same logic, on the ground that suspending people’s internet connection patently undermines their freedom of expression and communication, and that only a judge in accordance with due process can do so.

But this is not all. Since 1989, due to a lack of transparent regulation along with the emergence of new forms of collusion between media companies and political personnel, the traditional media landscape has failed to deliver on its promises. The Council’s decision underlines the opening of  new era, recognizing the internet’s key contribution to offering new spaces for democratic participation.

During both French and European debates, proponents of the bill abusively referred to a European Court of Justice decision that argued for some balance between the rights of copyright-holders and people’s privacy in the fight against illegal downloading (I wrote about it in a analysis for La Quadrature du Net, a digital rights organization I have worked with these past few months). Misinterpreting the Court’s ruling, the government’s allies used this decision to back up the “graduated response”, simply saying that the Court had deemed necessary to conciliaite both freedom of communication and copyright. In fact, by no mean did this case touch on freedom of expression and communication. Had the Court called upon member states to better protect copyright, the European Parliament would never have been able to massively oppose the graduated response, as it did on three occasions since April 2008.

Now, with great solemnity, France’s highest Court brings some clarity to the debate. Endorsing the European Parliament, it distinctly acknowledges that accessing the internet has become a core component of people’s fundamental rights. The Council’s decision is undoubtedly one of the most eloquent and authoritative ever rendered on digital rights and a represents a milestone for the internet’s nascent history.

I selected the most important excerpts of the decision:

Suspension of internet access

12. Considérant qu’aux termes de l’article 11 de la Déclaration des droits de l’homme et du citoyen de 1789 : ” La libre communication des pensées et des opinions est un des droits les plus précieux de l’homme : tout citoyen peut donc parler, écrire, imprimer librement, sauf à répondre de l’abus de cette liberté dans les cas déterminés par la loi ” ; qu’en l’état actuel des moyens de communication et eu égard au développement généralisé des services de communication au public en ligne ainsi qu’à l’importance prise par ces services pour la participation à la vie démocratique et l’expression des idées et des opinions, ce droit implique la liberté d’accéder à ces services [internet].13. (…) Les conditions d’exercice du droit de propriété ont connu depuis 1789 une évolution caractérisée par une extension de son champ d’application à des domaines nouveaux ; que, parmi ces derniers, figure le droit, pour les titulaires du droit d’auteur et de droits voisins, de jouir de leurs droits de propriété intellectuelle et de les protéger dans le cadre défini par la loi et les engagements internationaux de la France.

15. (…) La liberté d’expression et de communication est d’autant plus précieuse que son exercice est une condition de la démocratie et l’une des garanties du respect des autres droits et libertés ; que les atteintes portées à l’exercice de cette liberté doivent être nécessaires, adaptées et proportionnées à l’objectif poursuivi.

16. (…) Ses pouvoirs peuvent conduire à restreindre l’exercice, par toute personne, de son droit de s’exprimer et de communiquer librement, notamment depuis son domicile ; que, dans ces conditions, eu égard à la nature de la liberté garantie par l’article 11 de la Déclaration de 1789, le législateur ne pouvait, quelles que soient les garanties encadrant le prononcé des sanctions, confier de tels pouvoirs à une autorité administrative dans le but de protéger les droits des titulaires du droit d’auteur et de droits voisins.

Respect of privacy

26.Considérant que les dispositions combinées de l’article L. 34-1 du code des postes et des communications électroniques, tel qu’il est modifié par l’article 14 de la loi déférée, des troisième et cinquième alinéas de l’article L. 331-21 du code de la propriété intellectuelle et de son article L. 331-24 ont pour effet de modifier les finalités en vue desquelles ces personnes peuvent mettre en oeuvre des traitements portant sur des données relatives à des infractions ; qu’elles permettent en effet que, désormais, les données ainsi recueillies acquièrent un caractère nominatif également dans le cadre de la procédure conduite devant la commission de protection des droits.

27. Considérant que la lutte contre les pratiques de contrefaçon sur internet répond à l’objectif de sauvegarde de la propriété intellectuelle et de la création culturelle ; que, toutefois, l’autorisation donnée à des personnes privées de collecter les données permettant indirectement d’identifier les titulaires de l’accès à des services de communication au public en ligne conduit à la mise en oeuvre, par ces personnes privées, d’un traitement de données à caractère personnel relatives à des infractions ; qu’une telle autorisation ne saurait, sans porter une atteinte disproportionnée au droit au respect de la vie privée, avoir d’autres finalités que de permettre aux titulaires du droit d’auteur et de droits voisins d’exercer les recours juridictionnels dont dispose toute personne physique ou morale s’agissant des infractions dont elle a été victime.

This article by John Naughton, professor at the Open University, is one of the most comprehensive ten-page articles you can get on new media. Naughton very well describes some of the characteristics of what he calls the “emerging media ecosystem”: user-generated content, cooperation and sharing.

Referring to Neil Postman, he draws a relevant analogy between the media and ecology. The media ecosystem is extremely historically unstable. Just like newspapers had to find new formats with the advent of television, TV networks will have to adapt to the arrival of participatory media. This is a similar argument to the one Henry Jenkins makes in another article I already mentioned.

But how can we try to qualify this new media architecture that is rapidly growing? Naughton rightly points out that economics, which has been an important analytical tool for media critics all through the twentieth century, seems irrelevant in this new order. It doesn’t allow to understand agents’ motivations, nor the power relations that are at play, simply because economics “is the study of the allocation of scarce resources, whereas an important feature of our emerging media environment is abundance, not scarcity”.

The fact that about anyone with basic computer skills can produce information or culture and disseminate it across the world will probably have dramatic effects on the superstructure (in Marxist theory, the political institutional framework that reflects economic relations). Although it is too early to know exactly what tomorrow’s media landscape will look like, the role of traditional media as “manufacturing consent” (Noam Chomsky) is already seriously challenged by the net. If all goes well, the audience’s power won’t simply depend on their condition of consumers as it is now but rather on their cultural and political creativity (for an example of what political creativity might mean, check out ohboyobama.com).

Photo on Flickr by Dunechaser under Creative Commons License.

A few weeks ago, the French Journal Le Débat published a compelling piece by Benjamin Loveluck entitled “Internet: Toward a Radical Democracy?“. The author, who is writing a Ph.D thesis on “the hypermodern individual and the genealogy of contemporary media regimes” (sic), successfully locates the recent developments of the internet within the history of liberal-democracies. He demonstrates that although the internet is based on humanistic and democratic ideals, it could also undermine some of the very tenets of our societies, such as the positive role the media plays in organizing the public sphere (which is entangled with any sound democracy and dependent on the free circulation of information).

First, the author shows that the internet is rooted in the philosophy of human rights. Its architecture reinforces the principle of equality, from which democracies originate, by allowing people to participate on an equal level and by suppressing “intermediary bodies” (i.e institions traditionally in charge of educational and cultural transmission or some sort of political representation). A giant agora, the internet theoretically brings transparency, equal participation and infinite access to information and represents a unique space for deliberation, without the traditional flaws of representative democracies.

This perfect picture is, according to Loveluck, at the very basis of the Internet. He goes on to outline the philosophy that guided its early development in the 1960s and 1970s, when top researchers with libertarian ideals, like Richard Stallman (founder of the Free Software Foundation), envisioned a new medium that would rely on an ideology of freedom of information and creation.

In that sense, now that cultural goods extensively circulate on the internet, current debates on intellectual property and “piracy” can be understood as the rather merciless confrontation between these founding principles and the way cultural industries have been functioning for the past half-century (exerting tight control over creation, reproduction and circulation of cultural goods).

Adding his voice to this debate and drawing up on Lawrence Lessig’s works on intellectual property, the author notes that the existing legal framework “[tends] to impoverish public domain and create more and more benefits for editors, producers and distributors, at the expense of creativity”. Rather, in the digital era, “a living culture is a culture that allows for, within certain limits to be determined, copy and remix”. Therefore, the author believes with Lessig that the full empowering, democratic potential of the internet has yet to be unleashed.

But far from taking an overly optimistic view about the very nature of this technology, Benjamin Loveluck makes interesting remarks about its consequences on the public sphere. The internet, given that it represents a unique tool for organizing and circulating information, could be seen as the ultimate democratic medium, granting citizens access to a wide variety of news source and thus enabling informed political decisions. So it first appears as an undeniably more efficient system to organize political discussion than today’s media. However, the author invites us to consider how information is being organized on the internet and how it affects the particularly important kind of media that is professional journalistic news.

On the web – the “universe of the free” – content industries’ business models are most often based on advertising. For that reason, websites have a strong financial incentive to maximize their audience. A set of features – from Google’s PageRank system to the “most popular” section found on the New York Times website – aim at making sure that the more a page has been viewed, the more likely it is to be seen again, for it is assumed that it will correspond to what most other users want and generate traffic. The direct consequence of this is that on the internet, more and more, users decide what information gets valorized.

From the author’s point of view, while it might seem as though there are good philosophical and economical reasons for being so, this phenomenon could bear significant danger. The information people access does not depend on editors in chief’s choices anymore but, to an important extent, on the different technological and economical parameters that regulate the way people browse the web.

These observations raise two essential questions.

• First, taking into account the fact that the fragmentation of media sources accelerates the sharp fall in advertising revenues suffered by traditional media, is the emerging landscape capable of producing sound journalistic information (which has a cost)? The conglomeration of media corporations from the 1960’s onward and their growing focus on short-term profit, along with their difficulty to secure their traditional revenues is a real problem for democracy: they have had to reduce costs, which has dramatic consequences for investigative journalism

• Second, are we, as citizens-consumers of information, collectively well suited to decide what information is the most relevant to our political decision-making? It used to be the role of the media – a form of “elite” also called the “fourth power” – to set the political agenda and liven up democracy, and people trusted them to do so. Now, an always-increasing number of news sources (like digg.com) only consist in the aggregation of content produced elsewhere and selected by users themselves.

In a much-commented Op-Ed, German critical theorist Jürgen Habermas adresses these questions. His response to both is clearly “no”, as he explains what is at stake in the ongoing journalism crisis :

The public sphere does its part in democratically legitimatising state action by selecting objects relevant for political decision-making, forming them into issues and bundling them into competing public opinions with more or less well-informed and reasoned arguments.

In this way, public communication is a force that stimulates and orients citizens’ opinions and desires, while at the same time forcing the political system to adjust and become more transparent. Without the impulse of an opinion-forming press, one that informs reliably and comments diligently, the public sphere will lose this special type of energy.” (my emphasis).

So on the one hand, the internet, arguably the most advanced communication technology ever invented, allows for the emancipation of the individual and the democratization of the “means of production and circulation of information”, fostering deliberation in liberal democracies (which is at the core of Habermas’ political theory). But on the other hand, the internet could eventually undermine the capacity of the information produced to act as an enabler for citizenry to positively engage in their political community, by reinforcing older structural problems faced by the newspaper industry (which has this unique function described by Habermas in vitalizing the public sphere).

The philosopher argues for some kind of public intervention to make sure that high-end journalism can remain free from damaging market constraints and carry on its fundamental role in democracy:

One-off [State] subsidies are only one possibility. Others are foundations with public participation, or tax breaks for family holdings in this sector. These experiments already exist elsewhere [see for example ProPublica], and none of them are unproblematic. But the first step is getting used to the very idea of subsidising newspapers and magazines.”

Another less radical solution could come from the actors themselves. Google and newspapers owners should engage in further discussions in order to find a way to cooperate, so as to sustain this fundamental public good that are journalistic news. Eric Schmidt, Google’s CEO, recently said in an interview that he is willing to do just that. Nevertheless, as he righlty points out, most of the answer will have to come from the newspapers themselves. They will have to successfully rethink their role in the emerging media ecosystem, regain citizens’ trust, and adapt their business models as they migrate online. They need to find a way to coexist with new forms of media that reinvigorate democracy. This is of the utmost importance if we are to build an internet that empowers people without impairing their capacity to take charge of their collective destiny.

Photo on Flickr by jk5854 under Creative Commons License.

Determined to act swiftly to pass an $825 billion stimulus package, US President Barack Obama used his weekly address (on a revamped whitehouse.gov website) to give more details about this recovery plan. As it stands now, the proposal includes public spending programs in three high-tech areas :

1. computerization of medical records;
2. creation of smarter, high-tech enhanced electrical grids;
3. expansion of high speed internet lines in undeserved areas.

House Democrats and Obama’s economic team, who conjunctly designed the stimulus package, see these investments in digital technologies are an enabler for economic gross.

Barack Obama himself, whose campaign received important financial and political support from the high-tech industry, is widely perceived as having a sound understanding of the many challenges our societies face as they enter the digital age. As a matter of fact, Obama outlined on several occasions the importance of investing in next-generation broadband infrastructure to maintain the United States global competitiveness.

So it is no surprise that the stimulus plan includes provisions aimed at implementing the new President’s agenda in the field of new technologies. According to studies released by Obama’s aides, the economic impact of such measures is very significant. Current estimates quoted by the International Herald Tribune evaluate that the $30 billion investment could create up to more than a million jobs (see article). John Irons, an economist and research director at the labor-oriented Economic Policy Institute in Washington argues that “The jobs involved do tend to span the spectrum of skills and income levels. And they are not going to be outsourced offshore”.

Moreover, investing in next-gen broadband lines will provide the US economy with a fundamental infrastructure for the trading of goods and services in the 21st century. Perhaps more importantly, it will ensure that the United States remains a prominent player of the knowledge economy, spurring innovation in the Information and Communication Technology (ICT) sector. Most American opinion leaders now seem ready to agree on this. As Blair Levin, a former senior official at the Federal Communications Commission who was a technology policy adviser on the Obama transition team, puts it in the same article : “The appeal of these kinds of investments is that you not only get the stimulative effect but also build a platform for productivity gains and long-term growth”.

But as IBM’s CEO Samuel Palmisano pointed out in a recent Op-Ed in the Wall Street Journal, the effect of such public spending could go far beyond mere economic objectives. They can have a long-term, transformative impact on the American society.

To be sure, new technologies are seen as a catalyst for the change Barack Obama relentlessly advocates for. In the stimulus plan alone, the introduction of ICT does not only drive healthcare costs down. For the new American Administration, it also paves the way (as the IHT article interestingly explains) for an upcoming broader healthcare reform aimed at a better costs management and improved patient care.

Similarly in the energy sector, upgrading networks with digital technologies would ensure a better supervision of the power grid. It would help promote renewable sources of energy and change consumers’ behaviors thanks to a better pricing system, which are both crucial aspects of any renewed energy policy.

Lastly, investing in broadband lines will grant internet access to more US citizens, thus filling the digital gap and taking on an issue that Bush once promised – but failed- to address. This will eventually foster Barack Obama’s commitment to revitalize the American democratic process by granting everyone access to many more informational resources and increasing both transparency and interactions between the Government and the people (using tools and methods that have largely contributed to the success of the Obama campaign).

European Union leaders, and notably French President Nicolas Sarkozy, have taken pride in the leadership displayed by the bloc’s quick reaction to the financial crisis, early last fall. But now that the crisis is rapidly spreading to the real economy, the EU’s lack of unity around a common strategy is unfortunate. If long-term challenges such as climate change are somewhat addressed by national recovery plans, inspired by EU environmental regulations, they neglect any significant public investment in new technologies.

As a sign of this lapse, early December in France, local authorities asked the government to initiate a €10 billion program aimed at connecting 90% of the French population to fiber-optic internet over the next 10 years (another €20 billion would come from the private sector, while contributions from local authorities themselves would amount to €10 billion). The Government declined to put the money on the table, arguing that more time was needed to assess whether public intervention was needed (which is likely if optic-fiber deployment follows the same pattern as broadband).

Overall, the EU member-states’ lack of serious commitment to investing in new technologies as a way to prepare the European society to the 21st century sounds like a rebuff to the its project of becoming a leading player in the global knowledge economy. A recent European Commission report showed that the EU is still way behind its main contenders in terms of innovation. Yet, it appears that European governments are unable – or unwilling – to seize the opportunity of the current crisis to invest in new technologies, following the US example. This lack of vision might have unlucky consequences on the long-run, as Europe could fail to sufficiently sustain its economy in these difficult times and fall flat of harvesting the benefits that digital technologies will bring in other key policy areas.

—–

Photo on Flickr under Creative Commons License.

As some telecommunication companies slowly turn themselves into producers and distributors of media content, new issues arise for competition regulators. Public officials have hinted at several ways of dealing with this issue. On the one hand, market regulators are keen on maintaining a clear differentiation between these two sectors. On the other hand, some government officials seem willing to accept greater interconnections between them. For example, France is considering merging two agencies that regulate the media (TV and radio) sector and the telecom sector as well as extending audiovisual regulation to the internet. However, such a move would probably turn out to be detrimental to both the role that the media play in the democratic process as well as technological innovation.

The media and the telecom sector, even though they complement each other, respond to different needs. Historically, different regulations have been applied:

-    telecom regulators pursue technological innovation and greater access to new technologies for consumers;

-    media regulators apply ethical rules in order to guarantee that market forces do not jeopardize the peculiar role that the media play in our democracies, thus protecting citizens.

Yet, the current evolution of the telecom sector risks undermining both forms of regulation. Things started to heat up in February when Orange bought broadcasting rights for the high-profile weekend games of the French soccer league. It outbid Canal +, the TV network owned by the media conglomerate Vivendi and traditional broadcaster of the French league. Last Spring, Orange also passed an agreement with HBO, Warner and Gaumont that grants the French telco company exclusive broadcasting rights over part of their catalogs. Thanks to this strategy, Orange seeks to propose attractive movies and TV shows to its mobile phone and triple-play subscribers (combined fixed-line, internet and phone services) through its video-on-demand services.

This was a much-commented entry in the content industry. Canal + voiced concern that Orange was invading the media sector, outbidding traditional actors (TV channels) and gaining leverage power thanks to the revenues generated by its dominant market position in the telecommunication industry. It had good reasons to denounce Orange strategy. A couple years ago Canal +’s owner Vivendi started consolidating its position on the telecom sector through its shares in a pay satellite distributor (Canal Sat) and a mobile phone company (SFR). Through this consolidation process, the European Commission forced the media giant not to discriminate against other ISPs equal treatment with respect to access to television content owned by Vivendi. A direct consequence of this regulation is the fact that Orange is now able to distribute Canal + programs to its clients.

Various other safeguards also aimed at making sure that Vivendi’s presence on the whole value chain of content production and distribution did not annihilate fair competition. Indeed, regulators have outlined a number of problems arising from such market distortion:

- If a telecom operator is able to use access to content as a way to make its own network more attractive to consumers, then competition in the telecom sector, normally based on technological innovation, diminishes. Less money is directed to networks investments and prices are likely to go up. It creates the same kind of market distortion as tying.

- But this sort of tying is only possible for the telecom companies that already have a dominant position on the market. Indeed, it is dubious that any “pure” content distributor (like Canal +) would have any interest in granting an exclusivity to a smaller operator, given the fact that it needs to reach out to as much audience as it can (after all, advertising is still a prevailing part of the media industries’ business model). Hence, granting exclusive broadcasting rights to telecom operators comes down to reinforcing dominant players, which seems incompatible with the aims of competition policy.

However, while Orange turns into a content producer, it is not bound by any commitment, and Canal + rightly sees this situation as unfair and therefore asks for competition regulators to intervene so that all ISPs are allowed to distribute Orange’s programs. Consumers too have a clear interest in making sure consistent competition is preserved in the telecom sector.

But the current situation is not only unfair to consumers and Orange’s competitors. It also poses a more societal problem. Indeed, if the media market becomes fragmented along telecom operators’ market shares, citizens will be impaired as well. Content industries do not sell a traditional commodity. They entertain and inform people, creating symbols on which our culture develops and according to which opinions and values are formed. The media trade “ideas”, and it is important to ensure that these ideas circulate as much as possible. In the digital age, it is nonsense to perpetuate economic models based on scarcity when the price of reproducing cultural goods is virtually nil. Market regulation instruments, such as competition law or intellectual property, should aim at making sure that the Universal declaration of human rights’ article 27 – that provides that “everyone has the right to freely participate in the cultural life of the community, to enjoy the arts and to share in scientific advancement and its benefits“- is respected, in so far as it does not discourage cultural creation (creator have to be rewarded). Access to such peculiar commodity should be fostered, not deterred, by guaranteeing fair competition between market agents.

In my view, in oder to promote a wide access, it is better to maintain a clear distinction between the telecom and the audiovisual sectors by :

- Limiting the scope of exclusive agreements between content editors and telecom companies.

- Maintaining two separate regulations for each market in order to avoid confusion in the way different regulatory principles are implemented. Foreign examples show that otherwise, it us likely that the subsequent regulatory body will eventually loose track of these different logics. Ofcom, the British audiovisual and telecom sectors regulator is striving to give sense to its concept of “citizen-consumer”. The US Federal Communications Commission, which also supervises both sectors, has also been widely criticized for overlooking the consequences of its telecom market regulation on the public interest.

Unfortunately, in Europe and in France especially, some policymakers seem oblivious to the fundamental distinctiveness of the internet and assimilate it to older, mostly top-down media (press, radio, TV). On many issues (radio spectrum management, advertising), they see that the media industry is loosing ground while the telecom sector boasts colossal profits, as people drift away from traditional media and illegally access cultural goods through downloading. They accuse the telecom sector of capturing value from content industries. As a consequence, these elected officials consider that it is natural that the telecom should be taxed to, say, help funding public broadcasting (as an important bill currently examined by the French Parliament provides). According to them, Internet Service Providers should also collaborate with content industries and bear the costs of hunting down “pirates” (copyright infringers) by monitoring networks.

An old industry is in shambles, and many politicians blame the digital revolution. They think that they can protect it by infusing more regulation in order to preserve old business models. They actually treat new technologies as a threat when they should seek to adapt current regulatory instruments, like intellectual property, so that society can fully benefit of the fantastic opportunities they bring for consumers and also, more importantly, for citizens.

Photo on Flickr by M Name is Rom™ under Creative Commons License.