CES And A Case For Separation Of Technology And State
As the 2015 Consumer Electronics Show (CES) winds down, there’s a lot of stuff you probably hope doesn’t stay in Vegas.
Creative contributions to the Internet of Things (IoT), an array of autonomous vehicle concepts, different takes on emergent onboard vehicular systems like Apple CarPlay and Google’s Android, drones of all kinds (some writing “Happy New Year” in the skies over Vegas), and fancy medical monitoring devices are all here.
There are giant curved TVs, 3D printers, robots and virtual reality demos. The Lenovo Selfie Flash is popular.
Verge summed up CES’s 2015 theme as “wearable, autonomous and always connected.”
If there’s any downside, it’s that these amazing technologies have policy implications that could derail their potential.
The tech sector excels at pulling America’s economic wagon, but ill-conceived interventions and mandates from Federal Trade Commission (FTC), the Federal Communication Commission and other agencies can do real damage.
Two factors in particular render CES innovators vulnerable to predatory regulation.
One development is the torrent of networked personal and situational data being generated by new devices. The FTC was on hand and reiterated a warning to IoT firms about safeguarding personal data.
Our government wants others to respect privacy? The relevant issue is instead will the government allow privacy. Alas, the TSA’s airport nudie scanners weren’t on display at CES, but in the NSA mass surveillance era, FTC’s “concern” seems aimed at the wrong quadrant.
In fact, mandates hobbling private information customization and experimentation—while government scoops everything!—are one of the greatest threats to the IoT’s potential. Government’s homeland security culture doesn’t allow the private sector to make the privacy assurances people need.
Don’t blame the folks at CES. Left alone, IoT entrepreneurs can satisfy those seeking anonymity, authentication and anything in between.
The other vulnerability is hostile political reactions to technological displacement of legacy industries. The Uber and Lyft wars with taxicabs are a preview. An aerial version has left flight-sharing services Flytenow and Airpooler on the runway.
“Market failure” and “public interest” claims have allowed regulators to build edifices which now seem obsolete. Technology can both overcome market failure, and underscore prior regulatory malpractice.
Free enterprise never did mean companies can run wild. The IoT and the sharing economy need “regulating,” but contractual, insurance and liability innovations to do just that are evolving. We don’t necessarily have to add to the thousands of annual federal rules (where costs approach $2 trillion a year). The new wave of financial rules already impede raising tech startup capital, and the unknowns of Obamacare are real concerns.
Entrepreneurial pressures in the IoT world can assure safety, privacy, fitness for use, consumer protection, access and distribution better than a bureau.
The case for Separation of Technology and State is rather strong. But we need to figure out the relatively simple stuff fast so we can address the paradigm shifts going on.
Cronies will fight back, and bureaucratic turf-builders will rationalize new preemptive regulations to retain power.
For example, antitrust regulation harms consumers by protecting some firms from the need to compete. In this respect the automobile “operating system” wars between Google’s Android vs. Apple’s iOS systems, and their potential influence over automakers bear watching. I anticipate regulators will rationalize stepping in at some point when someone gains “market dominance.”
There is a risk of drone and self-driving car policy morphing into versions of public-utility style regulation; some providers may cozy up to authorities and seek to have their technologies promoted and maybe even integrated with public transportation. Roads already are primarily government-owned and airspace government controlled, and there are no shortages of planners and tech utopians inclined toward sweeping rules. (We see this now in cybersecurity, broadband reclassification to expand FCC authority over the Internet and “net neutrality,” and federal “manufacturing hub” investment.) So it’s hard to imagine the ambitious leaving autonomous vehicles to free market forces.
The irony is that GPS, data storage and mobility and AI technologies combine to overcome “market failure” of the sort that allegedly justified collective ownership of roads and airspace decades ago. But the status quo is a heavy cement. Advocates of “techno-libertarianism” have a tough job.
It’s the nature of the beast that government doesn’t merely pick winners and losers; it heavily influences business models and entire industry configurations.
Government failure has always been at least as pertinent a threat as transitory market failures. Underneath all the glitz and glamour of CES exhibitions, the policy environment needs an equivalent sheen and vision. The pace is faster and the stakes higher than ever.