Q: What's the connection between IIPC and democracy?
As a small-town publisher, I became concerned during the 1980s
that the era of "fat pipes" into the home would alter the traditional role
of newspapers as the primary communicator of time-sensitive,
general-interest information to the public. I could see that consumers
would be able to -- and would want to -- seek and acquire information from
many other sources. This would erode the financial base of newspapers
(and broadcast media as well) and constrain their ability to serve as the
voice and watchdog of an informed citizenry. In 1979, I wrote a brief
piece to myself describing an aspect of this problem http://www.newshare.com/vision.html.
While many newspapers have de facto local monopolies and that is "bad" (and will be eroded by the Internet), they also because of their position serve as one of the only common information bonds among an increasingly fractured, special-interest-centric citizenry. I was looking for a way to empower newspapers (or any new entrant wishing to perform this function) to be able to serve as a gateway ("portal" is now the popular term) to information resources anywhere, helping to collate and rationalize the delivery and presentation of those resources to users.
We created a concept called The Clickshare Service, which is embodied in prototype, patent-pending technology.. Now, we've committed Clickshare Service Corp. to help launch the Internet Information Payments Collaborative (IIPC.NET).
The design objectives of what came to be called Clickshare were that we create a system which would allow publishers of any size and inclination to share their users and information with other publishers and audience owners of any other size or inclination, globally -- and profit from doing so. They should be able to offer users the simplicity of a "most-trusted" source for information validation and purchase, but not restrict the users' choice of information sources and points of view.
Q: Why do you worry that our information-based democracy is
threatened?
The inclination of the large publishing enterprises which are
emerging around the world (Bertelsmann, Fox/Murdoch, Disney/ABC,
Time-Warner-CNN, Microsoft-NBC, AOL-Netscape, large newspaper chains) is
to attempt to provide a total information "solution" for their customers
so that the customer never leaves the comfy confines of their information
space. While this is a laudable business objective, it leads ultimately to
the same sort of concentration which is now occurring in the
book-publishing industry, where soon a handful of editors and chain buyers
in New York City may dominate for all practical purposes what books are
written and sold in the mass market.
I take it as axiomatic that an information cartel would be antithetical to robust free expression. In addition, the "corporatization" of the editing process -- focused as it is on profit maximization rather than individual ideas and principles -- leads to the public losing respect for the freedoms granted by the First Amendment, because the public no longer sees the media living up to the responsibilities inherent in the exercise of those freedoms. Instead, it views the media as taking advantage of a special privilege for private financial gain.
Apart from a business mission of enabling information commerce, therefore, a more noble intent of the IIPC, therefore, is to create a common structure which encourages erstwhile information cartels to permit their users free access to information anywhere.
Q: But what induces media combines to participate?
For the same reason that Bell Atlantic as a business matter must
allow its customers to make phone calls which connect seamlessly to Pacific
Telesis. Quite simply, Bell Atlantic realizes that their network would be
of little practical value if it were insular. The lingua franca of
digital-information commerce must be open to all, broadly controlled, in
order for there to be true free expression for voices of all sizes and
shapes. A telephone company which doesn't connect calls outside its grid is
quickly out of business. An audience-owner which refuses its users access
to information it doesn't own and control will quickly find their users
moving to a home base which takes advantage of the full information
marketplace. Thus it becomes critical that there be an infrastructure which
permits open access to information -- at least as a technical matter.
Q: So how do you put a universal information payment protocol into
place?
This is the problem which has stumped us since 1994, when we began
conceiving and then engineering Clickshare. There are some lessons from
recent history.
Because the Bell System was a regulated monopoly, it was able to dictate technology and billing protocols for the nationwide phone system. When it was broken up, the emerging Baby Bells realized that they could prosper by preserving the elements of the system architecture which facilitated universal connectivity, competing on price and value-added service offerings.
Visa founder Dee W. Hocks and his colleagues in the early 1970s managed to achieve in Visa a similar result without the benefit of starting from a regulated monopoly. (See review of Hock's 1999 book, "Birth of the Chaordic Age.") And Bill Gates' did it in the mid 1980s with a combination of IBM's unwitting assistance, superb marketing and, some might argue, business practices which might not have passed Sherman Anti-trust Act muster if anyone had been watching closely enough. But of course the result has been great for consumers at one level -- a "dial tone" platform for computers. There are important arguments about whether it is good public policy to allow this to continue -- but that's beyond the scope of this article.
Q: So how does this relate to the Internet and the IIPC?
The Internet wasn't conceived or engineered with any protocol for
settling information transactions or handling incremental billing of
digital objects or quality-of-service. It is expected to now perform in
these areas. Yet for very important First Amendment reasons, most observers
are loath to see the government play anything but an advisory role in this
process. And yet publishers universally recognize that a payment protocol
which affords one-ID, one-password, one-bill access to information needs to
emerge which handles individual transactions economically below what is
possible across the legacy credit-card settlement systems.
Who is available to forge that protocol and cause its adoption? Technical standards bodies seem ill-equipped to efficiently handle the task. Unilateral action by the very largest technical players (IBM, Microsoft, AOL) would be regarded as suspect by the major publishers and banks. Action by the bank/credit-card orbit would be challenged by content owners and user representatives.
In fact, a good argument can be made that any approach which is "owned" by a small group of equity investors is going to be sandbagged by enough competitors as to fail to gain critical-mass acceptance. Yet establishing the system is a non-trivial assignment, and if the entities doing so are not the government, then private capital must play a role and be rewarded for doing so.
Q: A possible answer -- the member association?
Could the answer be a member association, similar in many respects
to Visa? This model is actually familiar to newspaper publishers, who
formed The
Associated Press in 1848 as a
news-gathering cooperative and
have continued to govern it under the Membership Corporations Law of the
State of New York, without stock and without profits, raising "assessments"
each year to match the operating requirements of the service. Neither of
these organizations, however, recognizes in any formal way the interests of
the consumers of the service they offer. And Visa does not recognize in its
governance structure the rights of merchants. The IIPC member
association will need, if it is to find broad support, to recognize in its
governance structure the interests of at least four different
constituencies: rights-holders (authors/artists), publishers (aggregators),
audience-owners (banks, publishers, billers etc.), and end-users.
Q: If the association is the right form, how do you solicit
members?
As we have spoken over three years with publishers, telcos, ISPs,
banks, researchers and consumers, we have heard universal acceptance of the
notion that one ID, one-bill access to digital information anywhere
represents "goodness" -- and equally universal skepticism that we or anyone
else can scramble the chicken/egg, content/audience-owner mix.
Somehow the realization has to form in the marketplace that the need for a settlement association is so critical, and the solution so obvious, that a critical-mass of participants will agree simultaneously. The largest publishers are waiting for this to occur, but are afraid to sacrifice market share or risk exposure to legal challenge by taking the first steps (and also to some degree concerned about the impact on the dominant model of advertiser-support of information delivery). The idea behind the Internet Information Payments Collaborative is to legitimize and direct the start of that rapid coalescence, or phase change. Quite deliberately, we have not embodied the IIPC in any corporate form as yet, to allow for the possibility of a unique structure suited to the requirements of the task.
Q: What about the antitrust and privacy implications of member
associations?
The government's antitrust pleadings filed recently against Visa
and MasterCard serve notice that the public interest requires significant
consideration of the competitive aspects of any effort to collude around
the formation of an information-payments structure. For our part, we
designed Clickshare with this in mind. The trusted third-party which
authenticates users and logs their transactions never knows the name or
identifying information of the user. Nor does it interfere in anyway with
the process of pricing. Information vendors set a wholesale price;
service providers pay that wholesale price and then "retail" the
information to their end users at whatever price they wish above or below
the wholesale price they are charged. These are entirely market functions.
Clickshare never "owns" any information; it merely notes and processes
settlement data provided by the wholesale seller and the retailing buyer.
Collaboration necessary to establish the system needs to occur around issues such as transmission protocols, field sizes, attributes and contents, levels of authentication and security and optional service features. There need be no common discussion or understanding regarding price or the acquisition or use of personal information. Consistent with the landmark U.S. Supreme Court case (Associated Press et al. v. United States, 65 S.Ct. 1416, June 18, 1945) forbidding The Associated Press to blackball from membership a competing newspaper in a founding member's home city, access to the facilities of Clickshare-like authentication and logging services must be open on an equal basis to all classes of competitors.
Q: If a member cooperative is formed to manage an information-payments
infrastructure, where does this leave the investors in private ventures
such as Clickshare Service Corp.?
The investors in Clickshare Service Corp. are largely people who
share a deep concern for the roots of our democracy. If it were determined
that Clickshare's technology was useful or necessary to developing the
roots of a free market for the exchange of digital information, and if it
became obvious that the most efficient way to empower such a market were
through a sale of Clickshare's intellectual property to a member
association at a liquidating valuation, they would respond.
A MARSHALL PLAN FOR OUR DIGITAL INFORMATION FUTURE
After World War II, the United States was at a crossroads as a
nation. We could have retreated into our isolationist past. But instead,
we chose to accept responsibility for laying waste to Germany and Europe
in the legitimate cause of freedom. Adapting the Internet to the
requirements of the next century appears hardly as dramatic an assignment.
But the consequences of failing to perceive the threat are equally as
great.
Q: And what is that threat?
The Internet may end up controlled by governments, or by a handful
of corporations driven only by the need to maximize profits in an appeal
to the venal instincts of the human animal. In either case, the public
will eventually be driven to erode the principles of democracy in a
dangerous and perhaps futile effort to regain those principles from
government or corporate hands. Individual freedom of expression may be
lost -- either squelched by a tyranny of the governing majority, or
homogenized to irrelevance by corporate mass marketing.
With the Internet Information Payments Collaborative, we have the opportunity to help design an institution and a structure so open, fair, flexible, global and self-sustaining, that it can head off an otherwise inevitable tragedy. The June 16-18 roundtable summit, in Boston, is designed to begin that process.
Which of our media and financial giants will put aside short-term
financial gain and join in the task?
Dr. Leslie Ball
Professor of Information Technology
Room 202-D / Isenberg School of Management
University of Massachusetts
Amherst MA 01003
(413) 545-5654
ball@iipc.net