The relevance of law in the ‘Internet Age’

Canada isn’t the only country dealing with the legal complexities of the Internet. The Federal Communications Commission in the U.S. is also examining the relevance of traditional regulatory models in an era when more and more communications services are being delivered via the Internet. FCC commissioner Michael Powell recently spoke about these challenges in an address to telecom lawyers in Washington. Below is an edited excerpt of his speech. A link to the full speech can be found here. The Internet is one of the most profound developments of our time, for it affects the most fundamental tenet of human civilization – communication. How we talk, how we love, how we buy, how we sell, how we fight, and how we build. Because this zone of activity is where commerce will be found, where privacy will be violated, where money is transferred and contracts made, and where fraud is practiced, it is unquestionable that government and the rule of law, too, will ultimately be found, though perhaps in very different forms. And, because the FCC has had historical regulatory responsibility for the underlying infrastructure (the "rails") on which communications ride, such fundamental changes in communications will raise serious questions for policymakers as well. The important public policy question is not whether to regulate the Internet or not, as if that were a realistic choice. Rather, it is how to regulate it responsibly in a manner that maximizes consumer welfare and does not stunt its infinite growth and innovation potential. The user rules principle Regulation has had the persistent character of being somewhat paternalistic. Consumers are often presumed to be naïve about the complexities of the industry and in need of a bit of protection from daddy and mommy regulator. Regulation, in part, was designed to help protect and equalize the inequities of power in this relationship with good reason, because many companies viewed customer ignorance as a profit center. But things have changed because of the Internet. For one, the network architecture itself has changed. Previously, the brains of the network were centralized, controlled by a handful of companies and institutions. The Internet is fundamentally different. The brains reside in the hands of the users on the outside of the network. On command, these users eventually will have the power to choose what they wish to hear and perhaps in what form and in what language. In short, the Internet model is shifting the balance of power further toward the consumer. Certainly not entirely, but I am convinced that rules and regulations will have to increasingly yield, or perhaps more appropriately liberate consumers to use the new tools to make personalized, tailored choices about goods, services and risk they want to assume, without the one-size-fits-all interference of governmental rules. The borderless principle (Another) consideration for future regulation is the need to appreciate that the Internet and communications will know no borders and respect no limits. This poses significant challenges for the regulator. Traditionally, we have used distance as an organizational principle. There is long distance service, local service, and intra-LATA tolls. There is state and federal jurisdiction and regulations. There are rules for Europe, and different rules for Asia. The Internet, however, could care less just as, increasingly, could those who use it. Let me conclude by saying that law will matter in the Internet Era, despite the idyllic libertarian predictions to the contrary. The medium may change but humans and their relationships fundamentally will not. Markets still desperately depend on the rule of law for their proper functioning. Questions about whose law will govern in a borderless world will have to be answered. Improved understanding and experimentation in self-governing will be necessary, and use of technological solutions may have to be explored and understood. This is the challenge of our law schools and the bar. We must work diligently to adapt the curriculum, our statutes and the common law to this revolution.

The relevance of law in the ‘Internet Age’

News | 11/20/2000 5:00 am EST

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