November 17, 2017

iPad: The Disneyland of Computers

Tech commentators have a love/hate relationship with Apple’s new iPad. Those who try it tend to like it, but many dislike its locked-down App Store which only allows Apple-approved apps. Some people even see the iPad as the dawn of a new relationship between people and computers.

To me, the iPad is Disneyland.

I like Disneyland. It’s clean, safe, and efficient. There are lots of entertaining things to do. Kids can drive cars; adults can wear goofy hats with impunity. There’s a parade every afternoon, and an underground medical center in case you get sick.

All of this is possible because of central planning. Every restaurant and store on Disneyland’s Main Street is approved in advance by Disney. Every employee is vetted by Disney. Disneyland wouldn’t be Disneyland without central planning.

I like to visit Disneyland, but I wouldn’t want to live there.

There’s a reason the restaurants in Disneyland are bland and stodgy. It’s not just that centralized decision processes like Disney’s have trouble coping with creative, nimble, and edgy ideas. It’s also that customers know who’s in charge, so any bad dining experience will be blamed on Disney, making Disney wary of culinary innovation. In Disneyland the trains run on time, but they take you to a station just like the one you left.

I like living in a place where anybody can open a restaurant or store. I like living in a place where anybody can open a bookstore and sell whatever books they want. Here in New Jersey, the trains don’t always run on time, but they take you to lots of interesting places.

The richness of our cultural opportunities, and the creative dynamism of our economy, are only possible because of a lack of central planning. Even the best central planning process couldn’t hope to keep up with the flow of new ideas.

The same is true of Apple’s app store bureaucracy: there’s no way it can keep up with the flow of new ideas — no way it can offer the scope and variety of apps that a less controlled environment can provide. And like the restaurants of Disneyland, the apps in Apple’s store will be blander because customers will blame the central planner for anything offensive they might say.

But there’s a bigger problem with the argument offered by central planning fanboys. To see what it is, we need to look more carefully at why Disneyland succeeded when so many centrally planned economies failed so dismally.

What makes Disneyland different is that it is an island of central planning, embedded in a free society. This means that Disneyland can seek its suppliers, employees, and customers in a free economy, even while it centrally plans its internal operations. This can work well, as long as Disneyland doesn’t get too big — as long as it doesn’t try to absorb the free society around it.

The same is true of Apple and the iPad. The whole iPad ecosystem, from the hardware to Apple’s software to the third-party app software, is only possible because of the robust free-market structures that create and organize knowledge, and mobilize workers, in the technology industry. If Apple somehow managed to absorb the tech industry into its centrally planned model, the result would be akin to Disneyland absorbing all of America. That would be enough to frighten even the most rabid fanboy, but fortunately it’s not at all likely. The iPad, like Disneyland, will continue to be an island of central planning in a sea of decentralized innovation.

So, iPad users, enjoy your trip to Disneyland. I understand why you’re going there, and I might go there one day myself. But don’t forget: there’s a big exciting world outside, and you don’t want to miss it.

Information Technology Policy in the Obama Administration, One Year In

[Last year, I wrote an essay for Princeton’s Woodrow Wilson School, summarizing the technology policy challenges facing the incoming Obama Administration. This week they published my follow-up essay, looking back on the Administration’s first year. Here it is.]

Last year I identified four information technology policy challenges facing the incoming Obama Administration: improving cybersecurity, making government more transparent, bringing the benefits of technology to all, and bridging the culture gap between techies and policymakers. On these issues, the Administration’s first-year record has been mixed. Hopes were high that the most tech-savvy presidential campaign in history would lead to an equally transformational approach to governing, but bold plans were ground down by the friction of Washington.

Cybersecurity : The Administration created a new national cybersecurity coordinator (or “czar”) position but then struggled to fill it. Infighting over the job description — reflecting differences over how to reconcile security with other economic goals — left the czar relatively powerless. Cyberattacks on U.S. interests increased as the Adminstration struggled to get its policy off the ground.

Government transparency: This has been a bright spot. The White House pushed executive branch agencies to publish more data about their operations, and created rules for detailed public reporting of stimulus spending. Progress has been slow — transparency requires not just technology but also cultural changes within government — but the ship of state is moving in the right direction, as the public gets more and better data about government, and finds new ways to use that data to improve public life.

Bringing technology to all: On the goal of universal access to technology, it’s too early to tell. The FCC is developing a national broadband plan, in hopes of bringing high-speed Internet to more Americans, but this has proven to be a long and politically difficult process. Obama’s hand-picked FCC chair, Julius Genachowski, inherited a troubled organization but has done much to stabilize it. The broadband plan will be his greatest challenge, with lobbyists on all sides angling for advantage as our national network expands.

Closing the culture gap: The culture gap between techies and policymakers persists. In economic policy debates, health care and the economic crisis have understandably taken center stage, but there seems to be little room even at the periphery for the innovation agenda that many techies had hoped for. The tech policy discussion seems to be dominated by lawyers and management consultants, as in past Administrations. Too often, policymakers still see techies as irrelevant, and techies still see policymakers as clueless.

In recent days, creative thinking on technology has emerged from an unlikely source: the State Department. On the heels of Google’s surprising decision to back away from the Chinese market, Secretary of State Clinton made a rousing speech declaring Internet freedom and universal access to information as important goals of U.S. foreign policy. This will lead to friction with the Chinese and other authoritarian governments, but our principles are worth defending. The Internet can a powerful force for transparency and democratization, around the world and at home.

Search Neutrality ? Net Neutrality

Sunday’s New York Times featured a provocative op-ed arguing in addition to regulating “net neutrality” the FCC should also effectuate “search neutrality” – requiring search providers rank results without consideration of business entities. The author heaps particular scorn upon Google for promoting its own context-relevant services (i.e. maps and weather) at the fore of search results. Others have already reviewed the proposal, leveled implementation critiques, and criticized the author’s gripes with his own site. My aim here is to rebut the piece’s core argument: the analogy of search neutrality to net neutrality. Clearly both are debates about the promotion of innovation and competition through a level playing field. But beyond this commonality the parallel breaks down.

Net neutrality advocates call for regulation because ISP discrimination could render innovative services either impossible to implement owing to traffic restrictions or too expensive to deploy owing to traffic pricing. Consumers cannot “vote with their dollars” for a nondiscriminatory ISP since most locales have few providers and the market is hard to break into. Violations of net neutrality, the argument goes, threaten to nip entire industries in the bud and rob the economy of growth.

Violations of search neutrality, on the other hand, at most increase marketing costs for an innovative or competitive offering. Consumers are more than clever enough to seek and use an alternative to a weaker Google offering (Yelp vs. Google restaurant reviews, anyone?). The author of the op-ed cites Google Maps’ dethroning of MapQuest as evidence of the power of search non-neutrality; on the contrary, I would contend users flocked to Google’s service because it was, well, better. If Google Maps featured MapQuest’s clunky interface and vice versa, would you use it? A glance at historical map site statistics empirically rebuts the author’s claim. The mid-May 2007 introduction of Google’s context-relevant (“universal”) search does not appear correlated with any irregular shift in map site traffic.

Moreover, unlike with net neutrality search consumers stand ready to “vote with their [ad] dollars.” Should Google consistently favor its own services to the detriment of search result quality, consumers can effortlessly shift to any of its numerous competitors. It is no coincidence Google sinks enormous manpower into improving result quality.

There may also be a benefit to the increase in marketing costs from existing violations of search neutrality, like Google’s map and weather offerings. If a service would have to be extensively marketed to compete with Google’s promoted offering – say, a current weather site vs. searching for “Stanford weather” – the market is sending a signal that consumers don’t care about the marginal quality of the product, and the non-Google provider should quit the market.

There is merit to the observation that violations of search neutrality are, on the margin, slightly anti-competitive. But this issue is dwarfed by the potential economy-scale implications of net neutrality. The FCC should not deviate in its rulemaking.