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The Internet, which has given birth to so much innovation in recent years, is on its way to being neutered, Lawrence Lessig warns in The Future of Ideas: The Fate of the Commons in a Connected World. Lessig says that legal protection is becoming much too broad, especially for intellectual property, because existing companies are interested in stifling any innovation that might threaten them. Lessig, a professor of law at Stanford University (www.stanford.edu), notes that the Founding Fathers tried to encourage innovation by initially limiting copyrights to maps, charts, and books and, even with those, restricting the initial term of a copyright to 14 years. Now, he says, copyrights automatically attach to almost anything that anyone writes and last practically forever. He says protection is so broad that anyone making a movie has to hire teams of lawyers to check whether a copyright will be violated if, say, a poster shows up in the background. He writes: “The film Twelve Monkeys was stopped by a court 28 days after its release because an artist claimed a chair in the movie resembled a sketch of a piece of furniture he had designed. The movie Batman Forever was threatened because the Batmobile drove through an allegedly copyrighted courtyard, and the original architect demanded money before the film could be released.” Lessig argues for a return to “the commons”—which was once a pasture where anyone could let his animals graze. He doesn’t say that intellectual property should be free. After all, who would try to write the Great American Novel? Lessig does insist that the vast majority of intellectual property, such as a few bars of music, should be available to all for a government-regulated licensing fee. That way, while creators would be paid for their work, others could build on existing art without fear that someone may try to stop them or hold them up for an exorbitant sum. The right rules, Lessig says, will allow for the continuation of the kind of innovation that created the Internet. The wrong rules, he says, will lead to the kind of stifling of invention that he describes in the excerpt that follows—a stifling that delayed the development of the Internet for years and that could have kept it from ever happening. In the U.S. in the early 1960s, the fear was slowly dawning upon the leaders of the world’s largest nuclear arsenal that the communications system controlling that arsenal was vulnerable to the smallest of attacks. An accident, or a single nuclear explosion, could disable the ability of the commander in chief to command. Chaos—or worse—would be unavoidable. Paul Baran, a researcher at Rand Corp. from 1959 to 1968 [www.rand.com], had the task of exploring a more secure telecommunications system. He asked American Telephone & Telegraph Co. [www.att.com] to see the plans for its network. AT&T balked. Though Baran had the proper security clearance, and though the Defense Department supported his request, AT&T refused. It had studied the matter, AT&T reported. The system was secure. This was “the Bell System.” It is hard for us today to appreciate the power of such a company. This was not just a large company, or even a large company with a very large market share. This was a partner with the government. The company was, in its own view, the governor of communications. States and the Federal Communications Commission might regulate it, but the information and cooperation to make regulation possible came from AT&T. Things were not always this way. Although the Bell companies held the first patents on telephone technology, once those patents expired a vigorous competition emerged to bring telephone service to Americans. AT&T concentrated on businesses. “Independents” focused on residences. The competition produced a rapid expansion of coverage, but today we would not recognize the phone system that resulted. Though the reach of the telephone network was great—in 1920, 39% of farms and 30% of residences had a telephone—the networks did not connect with each other. There was no guarantee that if your grandmother across town had a telephone, you, using yours, could call her. The world was then with telephones as the world was with personal computers 10 years ago, or as the world with instant messaging is today. Though there was a dominant system (AT&T for phones; Microsoft/Intel for computers; AOL’s AIM for instant messaging), there was vigorous competition among other systems (the “independents” for phones; Apple’s Macintosh or IBM’s OS/2 for computers; Yahoo or MSN for messaging). This competition effectively pushed the dominant system to become better and different. Just as Macintosh’s windows pushed Microsoft to Windows, so too the rural service of the “independents” pushed AT&T to extend its reach to farmers. After a while, however, AT&T grew weary of competition. From 1908 to 1913, the Bell System adopted strategies to destroy the independents, either through direct competition or by purchasing them. Initially, regulators and the public attacked AT&T as a monster seeking monopoly. But by the early 1920s, antitrust enforcement in the U.S. was waning. The spirit of the time favored consolidation and rationalization; competition was viewed as ruinous. Thus, AT&T was slowly able to secure agreements with the government that permitted it to extend its reach while protecting it against antitrust review. In 1913, the government entered into an agreement with AT&T that would secure its monopoly in telecommunications in America. Monopolies are not all bad, and no doubt this monopoly did lots of good. AT&T produced an extraordinary telephone system, linking 85% of American homes at the peak of its monopoly power in 1965. It spent billions of dollars to support telecommunications research. Bell Labs invented fiber-optic technology, the transistor, and scads of other major technological advances. Its scientists earned at least half a dozen Nobel Prizes in physics. These were not fat monopolists seeking to rob the nation of a quick buck. These were “soldiers of communications,” for whom control and hierarchy were key. As one publication put it in 1941: “Because each of them has a part in this speeding of the spoken word, the thousands of men and women who are engaged in the telephone service in America are ever conscious of the fact that theirs is a high calling.” Still, AT&T was a monopoly. As Baran describes the company, “[F]or years and years, that was the only place in the country that was doing work in telecommunications.” One could research different telecommunications systems, and one could in principle even develop other telecommunications systems. But there was nothing one could do with one’s innovation unless AT&T bought it. For much of the 20th century, it was essentially illegal even to experiment with the telephone system. It was a crime to attach a device to the telephone system that AT&T didn’t build or expressly authorize. In 1956, for example, a company built a device called a “Hush-a-Phone.” The Hush-a-Phone was a simple piece of plastic that attached to the mouthpiece of a telephone. It blocked noise in a room so that someone on the other end of the line could better hear what was being said. The device had no connection to the technology of the telephone. All it did was block noise, much the way a user might block noise by cupping his hand over the phone. When the Hush-a-Phone was released on the market, AT&T objected. The device was a “foreign attachment.” Regulations forbade any foreign attachments without AT&T’s permission. AT&T had not given Hush-a-Phone any such permission. The FCC agreed with AT&T, and the Hush-a-Phone was history. Hush-a-Phone is an extreme case. The real purpose of the foreign attachments rule was, at least as AT&T saw it, to protect the system from dirty technology. A bad telephone or a misbehaving computer attached to the telephone system could, AT&T warned, bring down the system for a whole region. Telephones were lifelines, and they had to be protected from the experiments of an inquisitive nation. Whatever their intent, however, these rules channeled innovation through Bell Labs. Progress in telecommunications would be as Bell Labs determined it. Baran understood this. As a researcher at a Defense Department-supported lab, he knew how the “military” thought, and AT&T was military. Thus, he had reason to be skeptical about the claims that the existing system would withstand a nuclear attack. He didn’t believe AT&T really understood the threat. If it did, he believed it didn’t want anyone else understanding the system’s weakness. He pushed AT&T to let him examine the system. It pushed back. So, from sources unnamed, Baran secured a copy of AT&T’s plans—the blueprints for the telecommunications system of the U.S. When he saw the plans, Baran knew that AT&T was wrong. He was certain that the system would not withstand a nuclear attack. The network was too concentrated; it had no effective redundancy. Baran continued to press his idea for a different telecommunications system. This different model was not the Internet, but it was close to the Internet. Under AT&T’s design, when you called someone in Paris, a circuit was opened between you and Paris. In principle, you could trace the line of copper that linked you to Paris; along that line of copper, all your conversation would travel. Baran’s idea was fundamentally different. He believed that if you digitized a conversation—translating it from waves to bits—and then chopped the resulting stream into packets, these packets could flow independently across a network and create the impression of a real-time connection on the other end. As long as they flowed fast enough, and the computers at both ends were quick, the conversation encoded in this packet form would seem just like a conversation along a single virtual wire across the ocean. Baran was probably not the first person to come up with this idea, and he was not the only person working on it in the early 1960s. What is important is that Baran outlined a telecommunications system that would have effected a radically different evolution of telecommunications. Baran pushed to get AT&T to help build this alternative design. AT&T said he didn’t understand telephones. Over the course of many months, he attended classes sponsored by AT&T so that he would get with its program. But the more Baran saw, the more convinced he was. In a final push, the Defense Department offered simply to pay AT&T to build the system. The government promised no risk; it wanted only cooperation. But even here, AT&T balked. As recounted in John Naughton’s A Brief History of the Future: The Origins of the Internet: [AT&T’s] views were once memorably summarized in an exasperated outburst from AT&T’s Jack Osterman after a long discussion with Baran. “First,” he said, “it can’t possibly work, and if it did, damned if we are going to allow the creation of a competitor to ourselves.” “Allow.” Here is the essence of the AT&T design. It reserved to itself the right to decide what telecommunications would be “allowed.” It controlled the wires; nothing but its technology could be attached; and no other system of telecommunications would be permitted. One company, through one research lab, with its vision of how communications should occur, decided how this crucial aspect of modern economic life would develop. Now the point is not that AT&T was evil. AT&T had an obligation to its stockholders; it had an obligation to the government to ensure consistent quality service. It was simply acting to ensure that it met both obligations. But what’s good for AT&T is not necessarily good for America. At a certain point, Baran understood. When the project was pushed into the Defense Communications Agency, Baran realized that the project would be bungled. So Baran had the project pulled. There were not “the people at the time who could successfully undertake this project, [and they] would likely screw up the program,” he said. “An expensive failure would make it difficult for a more competent agency to later undertake the project.” Thus, the architecture of control for telecommunications policy—centralizing innovation and protecting an existing model of doing business—would not be questioned by Baran’s work. At least not then.
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