Good Morning!
As I was working on this preview, it occurred to me that predicting an agenda for Congress is akin to picking who's going to play in the Super Bowl before the season: No matter how much research and logic you use, your choices are almost always wrong. Few if any political observers would have predicted that gun control and immigration policy, both considered politically untouchable just six months ago, would dominate the start of 2013. But here we are, facing one of the strongest pushes for either issue in over decade. In both cases, major news events rattled the status quo and forced lawmakers to re-consider confronting political hurdles they once considered insurmountable; the president's big win in November appears to have brought the GOP to the table on immigration, while the tragedy in Newtown, Conn. has undeniably changed the tenor around the national conversation on firearms.
All that is to stay that as much as Congressional leaders and the President have their own agendas, they are also subject to outside forces that can dictate the policy landscape. Tech issues have largely avoided being sucked into debate due to the headlines, but that is rapidly changing as the digital economy becomes more and more a part of our daily lives. Going forward, the news cycle will have a major impact on determining the course for the two largest tech issues facing Congress: privacy and cybersecurity. At present, legislation on either topic looks like a long shot. But as we have seen, things can change quickly.
Despite attempts by both sides to move the ball in their favor, cybersecurity legislation has been stuck in a stalemate for several years now. Republicans, mostly at the behest of industry, have set themselves firmly against any type of regulatory regime for critical infrastructure providers, even one that is voluntary in nature. Democrats and the White House insist that some type of security baselines are needed, along with a host of other measures including expanded legal authority for the Department of Homeland Security to respond to attacks. Democrats have repeatedly weakened their legislation in response to lobbying pressure, but the watered-down bill has yet to sway the U.S. Chamber of Commerce, which has become the face of industry opposition.
Unfortunately for advocates of legislation, attempts by some to cast a harsh light on the Chamber's opposition is not likely to change much. While they have taken much of the flak, the Chamber's stance on the bill is very much reflective of many of the companies that would be affected by the legislation proposed in the Senate last year. Those companies realize that regardless of how "light touch" any cybersecurity rules are, they would also open the door to further regulation down the road, which could potentially increase both costs and liability for covered companies. The administration has plenty at stake as well, not least of which the host of classified cyber-weapons programs and response mechanisms that are slowly being revealed as the debate unfolds. With neither side having any incentive to budge off their current positions, my belief is that nothing will change in cybersecurity, until something changes. A major attack perhaps, a news event, some revelation of vulnerability or an effective demonstration of the government's ability to repel attacks. Until something manages to spook industry sufficiently, or create doubt over the wisdom of expanding the government's cyber-authorities, the probability of legislation passing remains slim. An information-sharing bill like the one passed by the House last year is also a possibility, but that would still require a good deal of caving on the part of Senate Democrats.
Privacy legislation faces a similar dynamic, in that industry opposition is firmly established and unlikely to soften. Major Web companies have poured millions into lobbying Congress against passing sweeping new rules on how companies can use data collected from consumers, and the stakes are even higher for them than the cybersecurity debate. While a utility company may balk at upgrading its network security practices, the impact would hardly be as damaging to their bottom line as a restriction on targeting advertising would be to Google or Facebook. Unfortunately for privacy advocates, they are also lacking allies on the Hill, where few lawmakers appear to support an overhaul of digital privacy laws. The GOP remains set in its anti-regulatory stance, and Silicon Valley companies remain attractive allies for Democrats, who fear losing the support of the economy's most vibrant sector.
The Obama administration will likely be forced to go it alone on privacy, most likely via the Federal Trade Commission, which has become the government's de facto privacy regulator. The FTC will continue to respond to complaints, but the most effective privacy regulation for the time being will come from users, who have shown themselves to be unusually responsive to news about privacy abuses by popular websites and app makers. Thus far, user backlash has been enough to cow many tech companies into reversing onerous changes to their terms of services. Eventually, a company will either go too far, or refuse to back down in the face of public pressure. If that company is big enough, that could be the headline that changes the game for privacy legislation. But until such an event, any action on the Hill is unlikely.
There are of course other tech issues that could see action in the next two years:
Antitrust: The Obama administration has set an aggressive tone on antitrust issues, blocking the AT&T/T-Mobile USA merger and prosecuting Apple and the e-book publishers, among other cases. Expect tech to keep featuring prominently in antitrust investigations, though Google appears to have escaped its FTC probe relatively unscathed for the moment. While another Google probe from the Justice Department is always possible, the investigation of the cable companies may be the one to watch. Whether the topic is broadband, retransmission, cord-cutting or the bundling of channels, cable companies are at the core of many of the technologies driving change in the digital economy. Most consumers must still rely on their cable company for home broadband service, which creates an inherent tension as users increasingly seek to avoid rapidly escalating cable bills by watching programs online. That rise in demand for mobile and on-demand video has created a spike in bandwidth consumption, which cable carriers have dealt with by gradually implementing data caps and raising their rates. Meanwhile, at least one major wireless carrier, Verizon Wireless, has signed marketing agreements with the major cable companies that critics have compared to collusion. But the cable providers are not without a voice in Washington, their pockets are deep, and they still control some of the most valuable markets in the country. Expect them to put up a fight against any effort to weaken their tight grip on the future of communications and media services in the U.S. Spectrum: The FCC is moving full speed ahead on the planned spectrum incentive auction, which will transfer airwaves from broadcast TV stations to wireless carriers at some point in 2014. The auction itself is expected to go as planned, though there is always the possibility of some political backlash when local TV stations choose to take the money and go out of business. However, stakeholders are also aware that the planned auction is unlikely to meet the growing demand for mobile data, driven as mentioned above by the popularity of mobile video on smartphones and tablet computers. We've already seen the wireless companies seek out almost any available spectrum on the private market, which leaves basically one source left: the Pentagon. The government has long resisted an inventory of its spectrum holdings, likely in part because such an inventory would make it easier for outside observers to demand the release of valuable airwaves that aren't currently in use. Instead, the Obama administration's telecom wonks have been talking up the prospect of spectrum sharing: allowing multiple companies to use the same band of airwaves for their wireless networks. Such plans will no doubt take years to formulate, but expect the gradual transfer of spectrum from the government to the private sector to become a hot topic after the incentive auction concludes. Online Piracy and Cybercrime: No issues have been more affected by the events of the past year than online piracy enforcement and cybercrime, which both used to be one-way streets when it came to policymakers. Barely more than a year ago, the entire debate around online piracy was focused on the severity of the problem and giving law enforcement more tools to combat it. Now, one year after the SOPA and PIPA battles, the discussion centers mostly on the patent system itself, and whether it has adapted for the digital age. The Obama administration remains more aggressive on intellectual property enforcement than any of its predecessors, particularly online, and that is unlikely to change, given the president's strong ties to Hollywood and the entertainment industry. But new laws to fight online piracy have now become a third rail themselves, as lawmakers seek to distance themselves from anything that could potentially be labelled interference with the operations of the Internet.Likewise, increasing the penalties for hacking and other cybercrimes used to be like a Congressional pay raise: something most lawmakers could get behind. That equation may have been changed by the death of Internet activist Aaron Swartz, who faced many years in prison for downloading millions of academic articles from a subscription service at M.I.T. when he killed himself earlier this month. Swartz's death has prompted some soul-searching, perhaps overdue, from policymakers that could help them re-focus their efforts on malicious actors rather than anyone guilty of violating a company's terms of service. His death has also added further scrutiny to the patent system and how it applies to digital works; however, changing those laws would appear to be a bridge too far for this Congress.
Finally, there is the issue of Internet freedom, which has been invoked in everything from the SOPA fight to Republican opposition to net neutrality. As it is commonly understood, Internet freedom refers to the Web's independence from censorship or government interference, a hallmark of its virtue in the eyes of many. While there are some exceptions, particularly regarding potential terrorism or child pornography, the overwhelming sentiment is that any blocking of content online is akin to censorship and against American values. Of course those values don't translate the same way in countries like China or Iran, where censorship of the Web by the state is common.
As the Web becomes increasingly intertwined with life around the globe, other countries will undoubtedly seek to alter its structure to fit their world views. This is perhaps reasonable, but also highly dangerous in the eyes of U.S. policymakers. The goal for many is to avoid balkanization into a Chinese Internet, an E.U. Internet, a Russian Internet etc. in favor of one common, open communications network capable of engaging the entire planet and providing access to the vast majority of human knowledge. Indeed, it would be easy to argue that such a network would be the crowning achievement of human civilization. Given the stakes, it's heartening to see U.S. lawmakers from both sides of the aisle united in their opposition to any international interference in the governance of the Web. No issue is likely to have a greater impact on future generations, both here and abroad.
It has been an honor and a pleasure to bring you my thoughts and our top-notch reporting on tech policy and other topics for the past year. Follow me on Twitter, check CQ Roll Call for more of my reporting, and please contact me with any questions, tips, or concerns: 202-650-6659 or gnagesh@cq.com
Thank you for your time, and remember: Everything online is public.