Streaming and Wi-Fi: A perfect storm of permissionless innovation

The most transformative technologies don’t arrive with a government blueprint. They emerge when entrepreneurs and technologists are free to experiment and innovate. Today’s transformation of the video marketplace has resulted from the convergence of two technologies with a principle that has been validated again and again. 

Streaming video and Wi-Fi form a perfect storm of permissionless innovation.

Permissionless innovation allows experimentation with technologies and business models unless a compelling case can be made that a new invention will bring serious harm to society. It stands in stark contrast to the precautionary principle, which holds that innovations should be curtailed or disallowed until they are proven not to cause harm.

Streaming doesn’t utilize broadcast spectrum and therefore falls outside of the legacy broadcasting regulatory regime created by the Communications Act of 1934 and enforced by the Federal Communications Commission (FCC). That legacy regime includes public interest obligations, ownership limits, and content regulations such as the news distortion standard. Freedom from these rules allows streamers to experiment with different business models and content offerings without government oversight.

Netflix didn’t need government permission to pivot from DVDs to streaming nor to evolve its subscription-on-demand model to include live events and podcasts. Netflix popularized binge watching by releasing a full season of episodes at once – an innovative contrast to the “wait until next week” approach of traditional episodic programming.

YouTube didn’t need a broadcast license to allow anyone to upload videos and for millions to watch them free of charge. Disney+, Apple TV+, Prime Video, and niche services like BritBox offer a diversity of choices unheard of in legacy television. Social media platforms like X now serve as conduits for streaming video. 

Streaming has thrived in the absence of regulation and Wi-Fi has made it accessible everywhere.

Wi-Fi uses unlicensed spectrum that is largely free from FCC regulation. So little was originally thought of the unlicensed spectrum bands that they were deemed “junk bands,” but entrepreneurs and technologists were allowed to invest and develop the technology free from cumbersome government regulation.

Device makers have embedded Wi-Fi into smart TVs, tablets, laptops, mobile phones, and streaming devices such as the Amazon Fire Stick, Apple TV, and Roku. There was no government mandate to adopt Wi-Fi – the technology spread because it worked and unlocked new user experiences.

The primary beneficiaries of this perfect storm of permissionless innovation are consumers. Consumers have more video choices than ever: 83 percent of US adults now watch streaming services, while only 36 percent subscribe to cable or satellite TV. More streaming content is now watched on television sets than broadcast and cable combined. Consumers increasingly expect video to be available on any device, anywhere, any time – an expectation made possible by Wi-Fi.

Herein lies an important policy lesson: permissionless innovation works and it has made consumers the clear winners in this perfect storm.