Tuesday, May 25, 1999

A Major Blunder by the Coalition

Senator Richard Alston's internet censorship bill -- the Broadcasting Services Amendment (Online Services) Bill 1999 -- displays a conjunction of technological incompetence, commercial destruction and political short-sightedness that has rarely been equalled.

The title itself proclaims technological incompetence.  The Internet covers a diverse array of services from email, Internet telephony, chat lines, newsgroups, etc. to the World Wide Web -- which is roughly like a broadcast medium, though of a "pull" (i.e. the user grabs things at will) rather than a "push" variety (with set programs, such as radio or TV).

The Internet is continuing to evolve rapidly while the Web is doubling in size every year and covers hundreds of millions of sites.  To attempt to regulate this by a "tack on" to TV and Radio regulation is profoundly misconceived.  It is like regulating aircraft by additions to the Navigation Act because aeroplanes are bit like ships.

The bill is primarily aimed at regulating Internet Service Providers and other Internet hosts.  Yet the appropriate analogy is not with TV or Radio, but with ordinary mail or telephones.

The suggestion that Telstra, Australia Post, Optus, AAPT, courier services, etc, should censor their clients' mail, packages and phone calls (even on a complaints basis) would be rightly regarded as absolutely outrageous and ludicrously expensive.  Yet this is what the Bill seeks to do with ISPs.

The Government denies that the Bill -- which establishes a complaints-based regime -- imposes mandatory filtering.  This is either nonsense or proof the regulatory regime is not serious.  The Bill requires ISP's not to host material subject to a "take-down" order -- which must be complied with within 24 hours.

Such material can be replaced on a website at literally the speed of a phone call so -- unless the take-down orders are essentially vacuous -- ISPs would be required to continually check content to make sure that such material was not re-hosted.  The expense involved would be considerable, potentially enough to drive many of the smaller of the 600 current ISPs out of business.  And the implication for universities -- home to thousands of technically literate free spirits -- is just nightmarish.

One can just see some Judge saying "well, without the requirement to continue monitoring, a take-down order would be effectively vacuous, and Parliament cannot have meant to enact a vacuous rule, so ..."

The simplistic extension of broadcasting standards to the Internet would imply that, for example, Rothmans or Philip Morris could not have Australian websites because they involve promotion of tobacco products -- and local ISPs would be obliged to block any overseas sites that they operated from.

The Government says that email, chat lines and other ephemera are not covered, but it defines "content" in such a way that stored email and chat logs are covered.  Are you happy with the thought that your private correspondence has to conform to broadcasting standards?  Keep your love life out of your emails and online chats -- unless you are sure it is not stored in a way available to others anywhere!  (Which almost all of it is at some stage).

And this merely touches on some of the technological problems of the bill.  The Government already has before it a June 1998 CSIRO report which demonstrates the technical impossibility of centrally imposed blocking of porn.

Most serious porn requires a credit card to access anyway, and the market has already responded to demands by users for controls, producing far better Internet filters available to any parent than this Bill -- products such as NetNanny and KidSafe (though they are no real substitute for parental supervision).  What the market can't do is respond to demands by non-users to control access by users.  Only regulation can do that.  But should it?

Opinion polling indicates that non-users are more concerned about content issues than users.  Unsurprising, as it is always easier to raise moral panics among the uninformed.  Non-users have a poorer grasp of the value of the Internet than users and are much more likely to have inappropriate mental pictures of what the Internet is actually like.  Polling also indicates that both groups are more concerned about cost than content -- and this bill will certainly raise costs.

The Coalition is making a major strategic blunder with its proposed Internet censorship.  The IT community is young, entrepreneurial, willing and natural denizens of a free labour market.  A clear target group for the Liberal Party, one would have thought.

But no, the Coalition is determined to alienate them by putting them in a futile, yet potentially expensive, regulatory straightjacket with great potential to significantly degrade Australia's participation in IT growth and development.  The IT culture is also liberal and free-wheeling.

The bill is therefore a comprehensive assault on the culture, commerce and intelligence of the IT community:  a combination that screams the Coalition's lack of understanding of, and even hostility to, them and their concerns.

Faced with a hostile regulatory environment, the best and brightest will migrate to the US -- a country not afraid of the future.  In one fell swoop, Australia will move from being one of the two or three most Internet-enabled countries in the world to an also-ran, more restrictive than Singapore or Malaysia in its attitude to the Net.

On the 17 May, the Canadian broadcasting authority announced, after a 10-month review, that it would not be regulating the Internet in anyway.  Canada understands the competitive pressures, difficulties involved and capacity of existing mechanisms to deal with content issues;  why doesn't our government?

The Bill is widely regarded as an attempt to secure Senator Harradine's vote -- though it clearly has not worked for the goods-and-services tax.  Senator Alston is already responsible for the single most outrageous decision of the Howard Government -- the free gift to current TV proprietors of digital TV rights, at the expense to taxpayers of many millions of dollars in forgone auction revenue and to consumers in the frustration of new media entrants.

Also widely regarded as a policy bribe, it also failed -- my study of TV News Federal election coverage on the ABC and commercial stations found TV news coverage was favourable to the ALP on all of them except Nine, where it was broadly balanced.  But at least that policy pay-off did not damage an existing industry.  This latest policy stupidity has the capacity to seriously degrade the Australian IT industry as a vibrant economic force.

The government says the proviso that the measures be technologically feasible and commercially viable will protect the industry -- but such pious hopes remain to be tested on the ground and in the courts.  Looking very much like a patch-up job, the provisions raise the question of technologically feasible and commercially viable to whom?  What is commercially viable to Telstra BigPond may well drive smaller ISPs out of business.

But then, there is a long history of regulation protecting the big guys against their smaller competitors by raising costs.  When and what is the test of commercial viability -- after X number of ISP's have been driven out of business?  What strikes some judge as viable?  Properly designed regulations should be inherently technologically feasible and commercially viable.

Our children may or may not need protecting from naughty pictures beyond the capacity and duty of their own parents to provide.  They certainly need jobs.  Nanny Alston's ludicrous and destructive extension of the Nanny State will not stop Net porn, but will stop Net jobs.

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