Tech’s Role in Driving Innovation: Why Over-Regulation Stifles Progress

Recently, The Media Institute shared a commentary by Adonis Hoffman suggesting tech should be highly regulated, blaming it for many problems faced by traditional media.  On behalf of the Consumer Technology Association’s (CTA)® 1,300 tech company members, many of which are leading competitors around the world and collectively are driving economic and stock market growth, I strongly disagree with this perspective.  The notion of using government to “tear down” one industry to “boost” another is misguided and harmful to the competitive spirit that drives American innovation and economic success.  

Tech is tackling global challenges and improving lives for billions of people.  Indeed, CTA and CES® partnered with the United Nations to provide and promote solutions for clean water, clean air, health care, and food availability.  As innovators develop solutions saving lives, some media industry lobbyists whose businesses lost market share to innovative competitors push for unnecessary taxes and restrictions on tech – simply because it has disrupted traditional models. 

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Big Tech and Principled Policy

As the election draws closer and the stakes become clearer, we should not forget the outsized influence of Big Tech in our country.  

Not long ago, Facebook and Twitter emerged as key figures in U.S. elections when foreign propaganda, fake news, and objectionable content became a part of the process. Since then, Facebook, Instagram, TikTok, and X have become embedded in the fabric of American society, affecting democracy itself.  

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American TV Is Changing for Better or Worse

The American TV market is changing before our very eyes, presenting viewers, creators, and advertisers an unprecedented degree of choice, convenience, and competition. We are witnessing a platinum age of television, where an alluring array of movies, sports, and specials is accessible on our phones, tablets, and computers, available anytime and anyplace, on demand. Though we now refer to it as “video,” at its essence it remains television, and we just cannot get enough of it.

But, for traditional TV broadcasters, these changes are both a blessing and a bane. A blessing because more people are watching more video than ever before.  A bane because more people are viewing that video through non-traditional media, which represents an evolving societal shift.

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How Silicon Valley’s Leap Ahead Was Preceded by Visible Government Footsteps

The recent passing of Intel co-founder Gordon E. Moore at age 94 has brought back well-deserved stories about how this tech legend played a leading role in developing silicon microprocessors, which served as the foundation for the exponential growth of our modern computer age. But this Big Bang in Silicon Valley was preceded by a series of events that created the environment that allowed Moore and his brilliant colleagues – notably Intel co-founder Robert Noyce – to achieve the technological breakthroughs that have changed the world.

Silicon Valley is a noted center of technological advancement and entrepreneurship, achieving innovations that have left lasting and unmatched imprints on society, here and abroad. Its centrality to such developments as the personal computer, social networks, and cloud computing has made the region so successful, with continual fueling by venture capital. Few are aware, however, that the staggering growth of the area had its roots in Washington, D.C., during the regulation-intensive climate of the late 1940s through the late 1950s.

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Why Russia Should Be in the Rearview Mirror for Telecom Companies

Since Russia’s brutal invasion of Ukraine in February, companies with a history of operating in complex and challenging markets have been weighing the difficult realities of their responsibilities to the people they serve. Those that supply essential goods and services, such as internet connectivity, pharmaceuticals, food, and consumer products have confronted difficult choices. The war has highlighted which companies must choose between providing essential services and managing the reputational and regulatory risks of operating as usual in Russia.

The risks that telecom companies operate in are evident. This month, telecommunications company VEON – the owner of Ukraine’s largest mobile company, Kyivstar, and Russia’s third-largest mobile company, Beeline – announced it would start selling its operations in Russia. This is a significant announcement because Beeline is a company providing essential internet connectivity service to the Russian population and because it represents a noticeable turning point.

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The Challenge of Harnessing Change in a Global Economy

As the news media know better than anyone, the great story of our times is change – dramatic, accelerating, and often disruptive change.

The key question is whether our economy, our educational institutions, and our system of democratic self-government can harness this change for everyone’s benefit – or whether the tidal wave of change will overrun us.

To meet the challenges of change, we must think big and act boldly.  Our growing divisions, however – our self-selecting news bubbles, the tribalization of our politics, the noxious contempt each side has for the other – are making it harder to solve big problems.  The environment is certainly not conducive to serious dialogue or to constructive problem solving.

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Don’t Let Huawei Control 5G

President Trump has taken a firm stand against Huawei, the Chinese telecom behemoth – and for good reason.  Huawei is not your garden-variety Chinese company in the same vein as Tencent, Alibaba, or Baidu.  By many credible accounts, Huawei is a corporate extension of the Chinese government, replete with Beijing back channels and generous government support. 

In a report released by the U.S. Permanent Select Committee on Intelligence back in 2012, Huawei and ZTE Corp., another Chinese company, were described as potential threats to U.S. security interests precisely because of Chinese government involvement.  Last month, the U.S. Navy reported it was under intense “cyber-siege” by Chinese hackers.  These follow a litany of allegations that have Huawei engaged in spying, commercial espionage, and intellectual property theft over many years.

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Conflict and Compromise Await New Congress in Telecom, Media, Tech

A new era of American history begins when the 116th Congress convenes in January 2019 with one of the most partisan classes in modern history. Depending on which side of the aisle they sit, the members’ mission will be either to balance the ship of state or continue full steam ahead.

Conventional wisdom suggests there will be conflict. Optimists hope there will be compromise. The reality will be somewhere in between as the new Congress will have the opportunity to forge a unified path on things that matter to all Americans. With so many pressing policy issues facing the republic – immigration, healthcare, homeland security, and more – it is a stretch to think telecom, media, and technology (TMT) issues will top the agenda or lead the day.

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TV Owners Need New Rules To Keep Pace

We are living in the platinum age of television. Consumers are enjoying an abundance of movies, news, sports, and entertainment, available anytime and anyplace, in-home or out.  Every communications medium from wireless phones to the worldwide web is in the business of broadcasting content over its platform. Although we now call it “video,” at the core, it is television nonetheless, and the world cannot get enough of it. For legacy broadcasters, this is both a blessing and a bane.

Before the end of the year, the Federal Communications Commission (FCC) will finalize its mandatory review of the national ownership rules – set of regulations governing television and radio station ownership in the U.S. The FCC is expected to expand, and perhaps eliminate, the national ownership cap. If it does, broadcasters will be dealt an unprecedented, but fortuitous, break that will change the media landscape for the foreseeable future. It would be a follow-on to the FCC’s 2017 decision to reinstate the UHF discount, an arrangement that allows broadcasters to count UHF stations as only 50 percent toward the national ownership cap.

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Repealing Media Ownership Regulations: It’s About Time

FCC Chairman Ajit Pai has proposed the most reasonable of actions: repealing or revising 40-year-old media ownership rules that long ago outlived any marginal usefulness they might’ve once had.

This should be a no-brainer. But, Washington being what it is, entrenched interests and politicians bent on maintaining the status quo for their own purposes have pilloried Pai for trying to do something that should’ve been done decades ago.

First, the facts. On Oct. 26, Chairman Pai released an Order on Reconsideration and Notice of Proposed Rulemaking. This proceeding seeks to accomplish the following:

  • Eliminate the Newspaper/Broadcast Cross-Ownership Rule;
  • Eliminate the Radio/Television Cross-Ownership Rule; and
  • Revise the Local Television Rule to eliminate the Eight-Voices Test and to incorporate a case-by-case review provision in the Top Four Prohibition.

The proceeding would also seek to eliminate the attribution rule for television Joint Sales Agreements; retain the disclosure requirement for commercial television Shared Services Agreements; keep the Local Radio Ownership Rule; and create an incubator program to encourage new and diverse voices in the broadcast industry.

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