In October the European Court of Justice invalidated the 15 year old “Safe Harbour framework” which enabled commercial data to flow between Europe and the United States. This ruling was groundbreaking as it sets in motion a domino effect which, unless addressed, may entail serious, uncomfortable consequences for Europe. Let me guide you through this domino effect towards data isolationism and finally point out some possible solutions.
By now you’ve probably seen an article or five taking down the viral Facebook “notice” appearing in people’s feeds, which purports to revoke rights from Facebook regarding one’s Facebook feed content and data (e.g., Jeff John Roberts here, or Caitlin Dewey here). This hoax reappears on Facebook with the regularity of some astronomical phenomenon, and is regularly debunked. But like a horror movie villain, it keeps coming back.
It is one thing to understand that this notice is ineffective. However, it is worth having a clear explanation why such unilateral proclamations aren’t enforceable for when this thing comes back again in six months dressed up with even more preposterous legal incantations citing the Rule Against Perpetuities.
More to the point, the fact that such a declaration is irrelevant actually turns out to be a pretty good thing for Internet users.
The European Commission has today released its new Digital Single Market Strategy. The objectives of the strategy sit within the wider political context: helping to restore a limp European economy to growth, whilst maintaining an effective welfare state and public services. Will this strategy help to deliver the kind of dynamic social market economy Europeans demand?
Vice-President of the European Commission Andrus Ansip has rightly set out an ambitious vision of a Digital Single Market. For those who believe in an enabling set of rules that will take society forward now is the time to step forward to support this vision. The alternative — a set of rules that fragment regulation along member state lines and reverse digital progress — is not a viable option.MORE »
Besides cold temperatures, inevitable musings about an Ovechkin-led Capitals being positioned to make a run at the Stanley Cup (followed by them falling off a cliff), and the occasional wayward arctic fowl, January in the District of Columbia comes with at least one constant ritual: the time honored tradition of speculating on what will be included in the State of the Union. (And, in recent times, the SOTU-themed drinking games that flow from the anticipation… even the Washington Post has one this year). Although some of the suspense has been dampened with media leaks and a multi-week presidential tour highlighting important SOTU themes, some surprises remain.
With political watchers fixated on what President Obama will and will not include in this year’s SOTU, I thought it was a good time for DisCo to lay out a potential tech policy roadmap for what to watch for this year in the President’s annual “setting priorities” exercise.
(Originally published at and cross-posted from CircleID)
On December 17th a US proposal for online commerce in a major trade negotiation, the Trade in Services Agreement (“TISA”) leaked. A flurry of press releases and opinion pieces claim that TISA is a threat to the Internet. The headlines are lurid: “TISA leak: EU Data Protection and Net Neutrality Threatened” and “Leaked TISA text exposes US threat to privacy, civil rights”. Yet the authors of these screeds are far removed from the negotiations and not actively following them; their comments generally assume the 8-month-old text from one country is a reliable base to use to make assumptions about the end result of unfinished negotiations involving more than 40 countries. Because I’ve spent years in Geneva regularly meeting with and advising negotiators on the networked economy I have a very different perspective. Frankly, I believe most commenters have got the main issues wrong and largely missed the significance of the worst feature of the proposal – the extremely broad national security exception.
Last week, the head U.S. trade negotiator, Ambassador Michael Froman, delivered a speech addressing the Trade in Services Agreement (TiSA). What got my attention was the prominence that the Internet and Internet-centric commerce received in the speech.
Although this might seem like common sense given the immense role that the Internet plays in international commerce (particularly trade in services), the international trade regime has been slow to embrace this technological revolution. As I have written before on this blog, Internet trade has traditionally received relatively short shrift from traditional trade negotiators. However, at least in the U.S., that trend is changing.
[As an interesting aside, watch this presentation by J. Bradford Jensen to get a better understanding of the importance of trade in services to the U.S. and global economy.]
Before I chronicle the USTR’s evolution on Internet-enabled trade rhetoric and action, I want to throw out a few recent examples of why trade negotiators — in the U.S. and the rest of the world — should focus on facilitating a free and open Internet if they want to help consumers and global commerce.
At the risk of stating the obvious, I need to lay out the keystone fact up front for the purposes of my argument: the Internet has an enormous positive effect on international commerce: particularly for small businesses. The Boston Consulting Group estimates that the G-20’s Internet economy will be worth $4.2 trillion by 2016 and that more than one-fifth of the growth of modern economies from 2007-2012 is attributable to the Internet. These effects are predicted to significantly increase as Internet penetration grows in the rest of the world.
For major U.S. Internet companies, international markets have become increasingly more important. And the potential for international competition has become more robust. In the latest installment of Mary Meeker’s routinely fabulous annual report on internet trends, she documents this phenomenon. While nine out of the top ten “global Internet properties” are made in the U.S.A., 79% of their users come from outside the U.S. Compare this to 2005, when Google’s total international revenue was 39% of its overall sales. Now, 56% of Google’s revenue comes from overseas. For Facebook, it is a similar story. Currently, 86 % of Facebook’s users are international, while less than 50% of Facebook users were international as of 2008.
Wednesday, the South China Morning Post ran a story that cascaded around the tech world and even made the front page of many business sections.
The SCMP reported that Chinese officials have made a decision to lift the ban on politically sensitive foreign websites, such as Facebook, Twitter and the New York Times, within the Shanghai free-trade zone, a 28 square kilometer free-trade haven where China will relax rules restricting foreign investment and free-trade (the “free-trade zone” opens officially on Sunday).
Much of the subsequent media coverage focused on the opportunity for these companies in get a foothold in the Chinese market. Unfortunately, that framing is problematic. These companies originally had a foothold in China when the Internet market was still nascent. In fact, they were the early market leaders. Unfortunately for them (mostly U.S.-headquartered companies) they were blocked from the Chinese market by “the Great Firewall”. At the time, the purported reasons for the blockings were that these sites presented a threat to public order and national security. However, this thinly veiled rhetoric was pierced by reality, as the Chinese clones (aka copies of Twitter [Weibo], Facebook [RenRen] and Google [Baidu]) that filled the void contained nearly identical “objectionable” content:
Also in the aftermath of the Xinjiang riots, microblogging site Twitter was cut off by the Chinese firewall for similarly dubious reasons. Less than two months later, Chinese Internet giant Sina launched a near identical microblogging service. To further the business-over-politics angle of China’s foreign Internet purge, China’s wildly popular instant-messaging service QQ removed a censorship filter after users’ complaints. Dissidents and riot organizers can now use Chinese versions of Twitter to organize.
Even a seemingly harmless site, like photo-sharing website Flickr, has been blocked in China, while its identical clone Bababian has grown steadily with foreign technology and no foreign competition. Likewise, blog-hosting sites Blogger and WordPress have long been blocked in China. Instead, Chinese netizens use Tianya, the 13th-most popular site in China. Far from being a sanitized land of boring blogs about daily activities, Tianya also hosts China’s largest Internet forum, a vitriolic, sensationalized, and hate-filled arena that makes Western gossip sites seem like the Economist.
One prescient Reuters journalist highlighted the potentially bigger picture in an article whose name says it all: “Facebook and Twitter too late for China’s Internet.” In an Internet world dominated by first-mover advantage and network effects, five years away from a market is an eternity that is going to be difficult to recover from. Sure, if China opened up its Internet to foreign competition now, Facebook, Twitter and Google will surely advance from their current miniscule market share. Unfortunately, they will be starting at an extreme disadvantage relative to the companies and online platforms that the Chinese have been using for the past 5 years.
A few weeks ago I examined how copyright law — like most legal subjects dealing with technology — is lagging behind the fast-moving and disruptive changes wrought by social media to old legal rules for determining rights to Internet content. Part of my critique was that in deciding ownership of user-generated content (UGC), courts have not yet evaluated the difference between posting content “in the clear” and restricting content to “friends” or some other defined class far smaller than the entire Internet community.
Things may at last be getting a bit more settled. A New Jersey federal court ruled recently that nonpublic Facebook wall posts are covered by the federal Stored Communications Act (SCA) (18 U.S.C. §§ 2701-12). The SCA, part of the broader Electronic Communications Privacy Act (ECPA) (18 U.S.C. §§ 2510 et seq.) that addresses both “the privacy expectations of citizens and the legitimate needs of law enforcement,” protects confidentiality of the contents of “electronic communication services,” providing criminal penalties and a civil remedy for unauthorized access. It’s a decades-old 1986 law that was enacted well before the commercial Internet and either email or social media had become ubiquitous. Yet by interpreting the statute, in light of its purpose, to apply to new technologies, District Judge William J. Martini has done Internet users, and common sense, a great service.
Plaintiff Deborah Ehling, a registered nurse, paramedic and president of her local EMT union — apparently a thorn in the side of her hospital employer for pursuing EPA and labor complaints as well — posted a comment to her Facebook wall implying that the paramedics who arrived on the scene of a shooting at the D.C. Holocaust museum should have let the shooter die. Unbeknownst to Ehling, a co-worker with whom she was Facebook friends had been taking screenshots of her profile page and sending them to a manager at Ehling’s hospital.
Ehling was temporarily suspended with pay and received a memo stating that the hospital was concerned that her comment reflected a deliberate disregard for patient safety. After an unsuccessful NLRB complaint based on labor law, Ehling’s federal lawsuit alleged that the hospital had violated the SCA by improperly accessing her Facebook wall post about the museum shooting, contending that her Facebook wall posts were covered by the law because she selected privacy settings limiting access to her Facebook page to her Facebook friends.
Judge Martini concluded that the SCA indeed applies to Facebook wall posts when a user has limited his or her privacy settings. He noted that “Facebook has customizable privacy settings that allow users to restrict access to their Facebook content. Access can be limited to the user’s Facebook friends, to particular groups or individuals, or to just the user.” Therefore, because the plaintiff selected privacy settings that limited access to her Facebook wall content only to friends and “did not add any MONOC [hospital] managers as Facebook friends,” she met the criteria for SCA-covered private communications.
Facebook wall posts that are configured to be private are, by definition, not accessible to the general public. The touchstone of the Electronic Communications Privacy Act is that it protects private information. The language of the statute makes clear that the statute’s purpose is to protect information that the communicator took steps to keep private. See 18 U.S.C. § 2511(2)(g)(i) (there is no protection for information that is “configured [to be] readily accessible to the general public”). [The] SCA confirms that information is protectable as long as the communicator actively restricts the public from accessing the information.
That’s a bold move by a jurist sensitive to the constraints on Congress, especially one as polarized as we have in America today. It reflects a willingness to adapt the law to changing technology by application of the basic principles and purposes of legislation, even if the statutory framework is old and its language somewhat archaic. As Judge Martini observed with a bit of consternation, “Despite the rapid evolution of computer and networking technology since the SCA’s adoption, its language has remained surprisingly static.” Thus, the “task of adapting the Act’s language to modern technology has fallen largely upon the courts.”
When it comes to disruption, the advent of social media communications is decidedly in the front row. But along with revolutionizing personal (and political) relationships, the sharing of content on social media sites like Facebook, Twitter, Tumblr and Instagram — now a Facebook property — is steadily increasing pressures on a quite different regime, namely copyright law. The passage and forthcoming implementation in the UK of what has become known colloquially as The Instagram Act, boringly titled the Enterprise and Regulatory Reform Act, promises only to accelerate the conflict between new social media services and legacy copyright rules worldwide.
This author has written, and ranted, about ownership of user-generated content (UGC) for several years. The gist of the problem is not that social media providers want to claim ownership of UGC. None do, despite occasional outcries to the contrary, although they also insist rather unremarkably via terms of service (TOS) on a license to display UGC posts to those a user authorizes. Instead, the problem arises when third parties want to incorporate user-created content into their own sites or publications. After all, if CNN or Fox News broadcast tweets, status updates and Flickr photos as part of their news stories, wouldn’t these and other organizations be violating the inherent copyright users hold in their own content? Put another way, if posting users have legal rights to their UGC, doesn’t it follow that even “retweeting” constitutes unlawful copyright infringement?
In most of the world today, ownership of one’s creation is automatic, and considered to be an individual’s legally protected intellectual property. That’s enshrined in the Berne Convention and other international treaties, which abolished registration as a formal predicate for copyright interests (although not for judicial enforcement). What this means in practice is that one can go after somebody who exploits a creative work without the owner’s permission — even if pursuing them is cumbersome and expensive — once the work is registered with the appropriate governmental copyright authority.
Social media sharing throws all these regimes into chaos. Take first the issue addressed by The Instagram Act and, in a slightly different context, U.S. litigation over the Google Library service: “orphaned” works. The new UK law theoretically aims to make it easier for companies to publish orphan works, which are images and other content whose author or copyright holder can’t be identified. But whereas in the past, orphan works were often out-of-print books and historical unattributed photos, today millions of images are quickly orphaned online, as they move from Instagram to Twitter to Facebook to Tumblr without attribution along the way. The British response was to adjust copyright law so that an orphaned work can be republished without liability if a third party makes a “reasonably diligent” search to identify and locate the original owner.
Trade is a sensitive political issue — and an extremely uncontroversial economic one. While most economists agree that trade makes everyone better off, that “everyone” often appears limited to multinational corporations and Western powers. As a globalizing force, the Internet is beginning to upset that power dynamic.
It’s easy to see why free trade has seemed like the domain of big business. As Dan has argued, setting up shop in a foreign country is expensive, logistically demanding and impossible without vast resources and knowledge. While foreign markets have always been attractive to businesses, the complications of moving abroad entailed a hefty barrier to entry. Consequently, taking advantage of foreign markets has generally appeared to be the domain of businesses from wealthier countries. Many economists would argue these benefits permeate the global economy, and that each player ultimately benefits, but the political narrative centers on Western multinationals. The Internet, however, may change that. By eliminating costly middlemen, providing a common, transnational space and mitigating the resources needed to launch a successful business, the Internet has lowered barriers to entry for entrepreneurialism in developing nations. Businesses in these countries now have a very direct interest in lowering barriers, as they too can partake in access to new markets.
The Internet economy is still in its early days, but its empowering effects on poorer countries are already beginning to emerge. Ghana’s capital, Accra, hosts MEST, an entrepreneurial school of technology which graduates about 20 students a year. MEST trains young Ghanaians in programming and entrepreneurship, and operates as an incubator, giving teams of students seed funding to launch their own businesses. MEST is just one of a number of tech-based initiatives in Ghana which encourage entrepreneurship. Others include the Kwame Nkrumah University of Science and Technology and the Accra Startup Weekend. Students at MEST regularly attend the startup weekend, where they spend 36 hours building fully viable apps and ready-to-go businesses.
One such business, Dropifi, recently became the first African company to join 500 Startups, a “startup accelerator program.” Dropifi allows businesses to streamline their feedback forms, providing an integrated widget, spam filters, analytics and a host of features meant to simplify feedback forms. These days, Dropifi has around 6,000 clients in over 30 countries.
Dropifi’s success demonstrates the importance of the Internet to the future of international trade. On the one hand, businesses across the world benefit from the ingenuity and genius of David Osei, Kamil Nabong and Philips Effah — Dropifi’s founders. The Internet, with its accessibility, gave Osei, Nabong and Effah a platform to disseminate their idea, which filled a crucial niche in the global marketplace. Osei, Nabong and Effah benefit as well, and as they grow their business, they will bring jobs to Ghana and other parts of the continent, where they hope to “become leaders.”