The tech year in review: Net neutrality nonstop, merger mania, the Aereo aftermath, and hacking galore!

2014 was nothing if not interesting for the tech policy wonks among us. As the New Year approaches, we thought it would be appropriate to take a look back at all the wonderfully exciting tech policy debates we have had this year. The year started off with a bang, when The US Court of Appeals for the District of Columbia struck down the latest effort by the FCC to enforce net neutrality. AEI scholars were quick to respond. Director of the Center for Internet, Communications, and Technology Policy, Dr. Jeffrey Eisenach, stated that, “While the Court’s discussion of Internet economics leaves much to be desired, its ultimate conclusion — which leaves in place the freedom to innovate which has applied to the Internet since its inception — is good for consumers, for innovation and for economic growth.” January also marked the start of the House Energy and Commerce Committee’s initiative to modernize the Communications Act. AEI scholars were eager to contribute with a free market perspective, arguing that “Congress should rationalize the FCC, apportioning the majority of its functions and resources to its sister agencies. In particular, Congress should consider merging the FCC’s competition and consumer protection functions with those of the [FTC], thus combining the FCC’s industry expertise and capabilities with the generic statutory authority of the FTC.” In February, a firestorm erupted in traditional and social media alike, as Comcast announced its plans to buy Time Warner Cable. As the story broke, Gus Hurwitz predicted that “this merger is going to be in the news for quite a while.” Oh, how right he was. From the very beginning, AEI’s scholars have been a voice in support of free markets on this issue, arguing that while the merger certainly has challenges related to it, competition in cable Internet service is unlikely to be harmed; the combined market share would still be far from a monopoly; and that the new firm will be in a better negotiating position vis-à-vis Hollywood, which would likely translate to benefits for consumers. Around the same time as the merger announcement, FCC Chairman Tom Wheeler made an announcement of his own: he was prepared to rehash the net neutrality debate, and let both sides make their case – again. This announcement prompted Richard Bennett to draw the comparison between Chairman Wheeler’s approach to net neutrality and LBJ’s experience with the Vietnam war, both men “slipping small step by small step into a conflict from which there is no good outcome instead of decisively stepping away.” Starting in February and slipping into March, we also witnessed the media frenzy around the Netflix/Comcast interconnection deal. Netflix painted a picture as being treated unfairly for (voluntarily!) entering a deal where they paid for transit services, but as Babette Boliek explained, Netflix’s argument translates to “you, the Internet service consumer (whether or not you use Netflix), [subsidizing Netflix’s] growing success.” April marked the first big hacking incident of 2014: Heartbleed. A massive vulnerability in OpenSSL, an encryption tool that is used by as many as two-thirds of all active websites, left millions of users exposed to hackers and snoopers. While ordinary people and Internet firms alike scrambled to patch the leaks, news surfaced that the NSA might have known about the flaw for a substantial amount of time without taking steps to mitigate the threat. In a two-part series, Claude Barfield investigated the validity of these rumors, and also explored the potential political fall-out from a breach of this size. Heartbleed was followed by news about cyber espionage and hacking of US companies by the Chinese in May. The US response to these reports – indicting 5 Chinese military officers – seemed muddled and haphazard to say the least. As Ariel Rabkin pointed out, the indictments were “a purely symbolic move” that seemed to be little more than a “stunt for domestic political purposes that is likely to redound to the detriment of the United States.” May also marked the beginning of the international debate over the “right to be forgotten,” or the right of an individual to request that a search engine remove links to information about the individual that are “inadequate, irrelevant or no longer relevant, or excessive.” While the European Court of Justice ruling tackled a real and pressing challenge, Daniel Lyons pointed out at the time that “the ‘right to be forgotten’ is an unworkable solution that does more harm than good.” In June, the Supreme Court catapulted itself into the news with its decision in ABC v Aereo. AEI scholars had been following the case since its beginning, and were ready to respond. Gus Hurwitz put is nicely when we wrote that “even though it reaches the correct outcome, the Supreme Court’s Aereo opinion is staggeringly, and confusingly, bad,” and offered his own take on what the court’s opinion should have looked like. Mid-July marked the deadline for submission of comments on net neutrality to the FCC. TechPolicyDaily.com contributors Richard Bennett, Gus Hurwitz, Roslyn Layton, and Bret Swanson submitted comments, laying out once again the arguments against sweeping regulation and in favor of a case-by-case, ex post approach based on principles of antitrust and consumer protection. Ours were just a few in what turned out to be a vast ocean of comments, some of which, like the ones submitted by Netflix and Mozilla, received a well-deserved rebuttal from Bret Swanson. August was the month where industry took a firm stance in the security/privacy debate, through Google and Yahoo’s announcements that they would both be creating secure, encrypted, spy-free email services by early 2015. This was followed Google and Apple’s announcements that they would install encryption protection in their smart phones. Given the recent history of the security services in the US, Ariel Rabkin stated that, “law enforcement may be upset about Google and Apple’s encryption efforts – but they should not be surprised.” In the remaining months of the year, the smartphone encryption standoff between industry and the government only grew. And we must not forget the big story of September 2014; Apple revealing the new iPhone 6s and Apple Pay. Bret Swanson took to opportunity to peek into the future, a future where “we should be able to pack the computing, storage, sensing, and communications power of that smartphone into a package costing just $3.” October started off with a bang, when news that JP Morgan was victim to a major cyber-attack hit the wires. The breach, which affected 76 million households and 7 million small businesses, was reported in the firm’s 8K report to the SEC. As pointed out by Shane Tews, this haphazard process clearly highlighted “the absence of clear guidelines, or even a shared understanding, about what information should be shared, with whom, and on what schedule.” In November, net neutrality resurfaced as a major news story once more when President Obama announced his support for Title II reclassification of the Internet, a noteworthy intervention in the processes of an independent regulatory agency. Jeffrey Eisenach said it best; “the White House’s decision to intervene in an ongoing rulemaking makes a mockery of any sense of independence or impartiality.” And in style with the turbulent preceding 11 months, the last 31 days of 2014 proved to be quite sensational. In December, we have seen a record-breaking spectrum auction, a FCC preparing to be sued yet again over net neutrality, and last but not least, a major cyber-attack on Sony Pictures that might just mark the end of the phony cyber war and the beginning of the real one. It’s been quite a year. From all the scholars and staff here at TechPolicyDaily.com, Happy New Year to you and yours! We look forward to seeing you in 2015!

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