The Manichean World of Tim Wu

For the past dozen years, several distinguished thinkers about law and technology have warned that a golden age of Internet freedom may be about to close. The most influential alarm-ringer has been Lawrence Lessig, who argued in his 1999 book, Code, that under corporate and governmental pressures, the Net could be flipped to serve top-down control instead of individual freedom. In The Future of the Internet and How to Stop It (2008), Jonathan Zittrain showed why this reversal might come about as a result of popular demand. Both the personal computer and the Internet are what Zittrain calls "generative" technologies, free to be built on without corporate or governmental permission. Besides generating positive innovations, however, these technologies invite viruses and other mischief, which drive people toward safe, reliable "information appliances" tethered to particular companies (think Apple's iPhone). Those appliances may be not just convenient but even dazzling in their design and performance, while subtly transforming the once freewheeling Net into a corporate-controlled system.

Now another book in the same vein, Tim Wu's The Master Switch, presents a historical argument that the information industries are prone to cycles -- actually, he calls it the Cycle -- in which an initially wide-open industry gives way to a closed empire, until in time, the empire comes under attack, and the Cycle begins again.

Wu's title phrase, "the master switch," is a clever double entendre: Information industries switch back and forth between open and closed, and when they close down, the result is centralized control through a "master switch" (a phrase Wu borrows from Fred Friendly, one of the pioneers of television news). The basis for Wu's argument is the development of the telephone, broadcasting, and movie industries in the 20th century, and for people who are unfamiliar with this history, the similarities Wu finds among these industries may make his argument seem convincing.

The Master Switch is an entertaining book, colorfully written with paired heroes and villains, typically lone inventors wronged by corporate empire builders. The best part of Wu's book concerns recent struggles in the communications business. His accounts of the reconsolidation of the telecom industry and the battle between Google and Apple are superb. This is the terrain that Wu seems to know best; in fact, the book looks like a case of history written entirely from the standpoint of the present: Wu observed the conflict between the forces of openness and closure in the contemporary world, and sure enough, turning to history, he found the same pattern everywhere.

In the current battles over net neutrality and other issues, my sympathies are the same as Wu's. Although I have never met him, Wu lists me in the acknowledgments as one of several authors to whose work he is "deeply indebted." But despite some strengths such as his analyses of recent conflicts between tech companies, his book is deeply dissatisfying: The history he tells is oversimplified and misleading, and when he turns to what ought to be done, he ends up in a tangle of confusion, pulled one way by his narrative and the other way by free-market ideas that he earlier shows have served mainly as camouflage for corporate ambition. Like many who come out of the tech world, he has an aversion to government that distorts his understanding of what has shaped the past and how to shape the future.

Wu's argument revolves around two claims: The information industries go through a predictable Cycle between open and closed structures, and "industry structure ... determines the freedom of expression in the underlying medium." If both these claims are correct, free expression is periodically destined to be crushed. But neither generalization stands up to close scrutiny.

If the Cycle is to be taken seriously, there needs to be a causal mechanism that produces oscillations between openness and closure. Unfortunately, Wu never provides one. At times he talks about the Cycle as an eternal aspect of all human history, as when he begins the final chapter with the wisdom of the 14th-century writer Luo Guanzhong: "An empire long united, must divide; an empire long divided, must unite. Thus it has ever been, and thus it will always be." Elsewhere, Wu presents the Cycle as a phenomenon of capitalism, invoking Joseph Schumpeter on the role of entrepreneurs in bringing about bursts of innovation and "creative destruction." In still other places he writes of the "exceptionalism" of the information industries, implying that something specific to them produces the Cycle.

To be sure, many industries go through changes in structure, often from an early competitive phase to a "mature," consolidated market, and sometimes new technologies or government policies open those industries to new competition. But because these events do not come with any regularity, there is no law of the Cycle for the information industries. Wu's discussion is limited to the United States during the 20th century. The Cycle doesn't reliably show up in other countries, or in other centuries, or in other information industries that he doesn't mention. The history of the print media -- of book publishing, for example -- is not usefully conceived of as following the Cycle.

Whether industry structure matters for freedom of expression depends on the kind of industry in question as well as policies pursued by government. At the founding of the republic, the United States created a communications network that fostered free expression -- the Post Office. But the government didn't invite rival postal firms to compete; in fact, it created a monopoly. That monopoly, however, was conducive to free expression because of the policies Congress adopted, which subsidized the circulation of newspapers irrespective of their viewpoint and spread postal service throughout the country.

Likewise, in telephone service, after an early period of open competition beginning in the 1890s, the advent of the Bell monopoly around 1920 did not bring about a decline in free expression. In the early competitive phase, some offices had needed both a Bell phone and one from the local independent phone company to reach all their customers since the two networks didn't interconnect. But the shift to one phone network didn't restrict free expression. As in the case of the Post Office, what was crucial for expression was not industry structure but the rules the government established for the network -- in this case, common-carrier regulations that required the Bell system to treat customers and their messages without discrimination.

Wu's real concern about the structure of the telephone industry is not free expression but technological innovation, and in his selective account, AT&T engaged in a long history of efforts to suppress new technologies. But the reader should keep in mind that during the era of the Bell monopoly, virtually every major advance in telecommunications in the world came out of the United States, almost all of those from Bell Laboratories. Here as elsewhere, Wu fails to provide any comparative, international reference for judging U.S. policy and performance. What's also missing is any nuanced analysis of how government policy sometimes stimulates technological progress, even in a regulated monopoly, and sometimes inhibits innovation (as American policy long did in ceding too much control to Bell over devices connected to the network).

Wu's selective, Manichean history is nowhere more evident than in his treatment of radio and television. His arch villain is David Sarnoff, the longtime president of the Radio Corporation of America and founder of NBC, portrayed by Wu as being in league with the Federal Communications Commission in squelching a series of independent inventors whose work threatened RCA -- Edwin Armstrong (FM radio), Charles Francis Jenkins (mechanical television), and Philo Farnsworth (electronic television). "Sarnoff's story," Wu writes, "is perhaps this book's most compelling parable of the Kronos effect [a father eating his children to prevent rivals from developing], and what bears most attention is the power of his particular methods. ... Sarnoff managed his empire by using government to restrict inventions, and hence the future."

The key FCC decisions about FM radio and television came in the late 1930s and 1940s. To make his parable convincing, Wu has to leave out critical information that would undermine his case that federal officials were in Sarnoff's pocket. In 1941, the FCC concluded a three-year investigation into network broadcasting targeted at RCA, which at that time owned two radio networks. The investigation resulted in new rules limiting network ownership of stations and control of affiliates and forced RCA to divest itself of one of its networks, which became ABC.

The omission of this history -- indeed, the entire history of federal ownership limits in broadcasting -- is especially strange in a book that claims industry structure determines the limits of free expression. The FCC, according to Wu, "was obsessed with the perceived benefits of 'planning,'" akin, he suggests, to Soviet central planning -- a false comparison in general but especially misleading about the later New Deal, with its emphasis on antitrust policy. After equating FCC regulation with Soviet planning, how awkward it would be for Wu to acknowledge that the FCC sought to promote competition by breaking up RCA and limiting concentrated station ownership.

Yet the more fundamental problem here is that Wu's Sarnoff parable does not explain what he thinks it explains -- the development of broadcasting. If Sarnoff's efforts caused the delay in developing FM, other countries beyond Sarnoff's influence should have seen FM radio spread faster. The typical pattern around the world, however, was for FM radio to develop slowly because AM was so well established. Australia, for example, began FM broadcasting in 1947, shut it down in 1961 for lack of an audience, and restarted it in 1975, but it still took years for FM to spread there. FM took off in the United States in the 1970s.

Wu also argues unconvincingly that Sarnoff's insidious efforts to dominate television explain why TV proved to be so mediocre, "offering programming aimed at the masses, homogenous in sensibility, broadly drawn and unprovocative by design, according to the imperatives of 'entertainment that sells.'" But American television was devoted to mass "entertainment that sells" because of the limited number of channels at the time, the economics of network programming, and -- crucially -- the formative political decision not to invest public funds in broadcasting. Sarnoff's theft of Philo Farnsworth's discoveries was irrelevant.

One of the odd things about Wu's book is that although he criticizes broadcast and later cable television for offering choices "only in the commercial range," he never mentions decisions about public spending as an explanation for that pattern or suggests any remedy that would actually have worked. Nor does he acknowledge the role of public -- spending decisions that contributed to positive results. That blindness is especially noticeable in his treatment of the history of computing and the Internet.

"Coming of age concurrently with an ideological backlash against centralized planning and authority," Wu writes, "the Internet became a creature of its times." In Wu's telling, Friedrich Hayek is the Internet's patron saint. Wu somehow skips over the role of the Defense Department not just in creating the Internet but in financing almost all the early development of electronics and computers in the years after World War II. And it wasn't just money the Defense Department supplied; it provided standards and guidance, which amounted to -- horrible to think! -- planning.

At one point in his treatment of the history of cable television, Wu says that Ted Turner hit upon the brilliant idea of using satellites to create a cable network instead of relying on AT&T's long lines. Then he writes, "To give credit where it is due, the use of satellites to carry television" had originated with Home Box Office. But, wait a minute, how did those satellites get up there?

In his final prescriptions, Wu says he favors what he calls a "constitutional" rather than a "regulatory" system, though he hastens to add in a footnote that he doesn't really mean constitutional in a "formal" sense. Actually, what he means is regulation -- he just can't bring himself to admit it. But the only kind of role that Wu can imagine for government is negative: "Government's only proper role is as a check on private power, never as an aid to it." If the early American republic had followed that principle, it would not have created the Post Office or fostered the rapid development of newspapers, and American democracy would have suffered. More recently, the United States would not have developed the Internet or public broadcasting. Wu's position is not just wrong; it's incoherent. In conflicts that pit opposed models against each other -- closed and open, let's say -- the government's check on private power of one kind is an aid to private power of another kind. Checking one side means favoring the other; there's no way around it.

The trouble with The Master Switch is that Wu thinks he has a master key to the history and future of communications, and he doesn't. A reader who pays close attention to the Cycle in its various iterations will notice a clever sleight of hand: The terms "open" and "closed" change in meaning from one chapter to another. Wu says, for example, that with the fall of United Artists in the early 1980s came "the second closing of the film industry." But this second closing is not a closing in the sense that the first one was; the 1980s brought no movie censorship comparable to the Production Code imposed in the 1930s.

Since Wu wants his readers to agitate for net neutrality, he couldn't very well end his book holding to the notion that the Cycle is inevitable. But his mythical Cycle is a pretty good recipe for fatalism and passivity. Through a distorted account of the past, he gives no sense that politics holds much hope. Government policy, in Wu's distorted recounting, is mostly a record of regulatory capture and craven mistakes that Americans should be ashamed of -- even though, strangely enough, the United States has for much of its history been a leader in communications, partly because of the constructive role government has played. Of course, some political decisions have been mistakes -- that's why we have to fight for good policy, often against great odds. What ought to be gleaned from the past is not the eternal rise and fall of empires -- "Thus it has ever been, and thus it will always be" -- but the necessity of politics, at least for those who have some clarity about it.

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