The Master Switch: The Rise and Fall of Information Empires

by Tim Wu

History shows a typical progression of information technologies: from somebody’s hobby to somebody’s industry; from jury-rigged contraption to slick production marvel; from a freely accessible channel to one strictly controlled by a single corporation or cartel—from open to closed system. It is a progression so common as to seem inevitable, though it would hardly have seemed so at the dawn of any of the past century’s transformative technologies, whether telephony, radio, television, or film.

It is an underacknowledged truism that, just as you are what you eat, how and what you think depends on what information you are exposed to.

The inventors we remember are significant not so much as inventors, but as founders of “disruptive” industries, ones that shake up the technological status quo. Through circumstance or luck, they are exactly at the right distance both to imagine the future and to create an independent industry to exploit it.

It also showed how a single communications monopolist can use its power not just for discrimination, but for outright betrayal of trust, revealing for the first time why what we now call “electronic privacy” might matter. Hayes might never have been president but for the fact that Western Union provided secret access to the telegrams sent by his rivals. Western Union’s role was a blatant instance of malfeasance: despite its explicit promise that “all messages whatsoever” would be kept “strictly private and confidential,” the company regularly betrayed the public trust by turning over private, and strategically actionable, communications to the Hayes campaign.

And so, while the Bell Company may have invented the telephone, it clearly didn’t perceive the full spectrum of its uses. This is such a common affliction that we might name it “founder’s myopia.” Again and again in the development of technology, full appreciation of an invention’s potential importance falls to others—not necessarily technical geniuses themselves—who develop it in ways that the inventor never dreamed of.

we want to define how “open” any industry is, we should start with a number: the cost of entry. By this we simply mean the monetary cost of getting into the business with a reasonable shot at reaching customers. Is it in the neighborhood of $100? $10,000? Or more like $1 billion? Whatever the magnitude, that number, most definitively, is what determines whether an industry is open or closed.

In an information industry the cost of monopoly must not be measured in dollars alone, but also in its effect on the economy of ideas and images, the restraint of which can ultimately amount to censorship.

The story of Daniel Lord and the Legion of Decency goes to a central contention of this book: in the United States, it is industrial structure that determines the limits of free speech.

The problem is that a “speech industry”—as we might term any information industry—once centralized, becomes an easy target for external independent actors with strong reasons of their own for limiting speech.

But if government makes clear that the game is rigged, that there is little room for the independent inventor to score, it removes the potent incentive for becoming a Jenkins, a Bell, or an Edison.

Still, one cannot overlook President Nixon’s immediate and personal motivation to help out the cable industry. In an increasingly pernicious ecosystem of information created by his perceived enemies, the networks reporting on the war in Vietnam and Watergate, he had identified their natural predator. The president had already channeled considerable thought and emotion toward the goal of bringing down the networks and their news departments. The logic of giving new freedoms to the cable industry cannot conceivably have been lost on his ceaselessly strategizing mind.

In the final draft of the TCP protocol, Jon Postel,* another Internet founder, inserted the following dictum: Be conservative in what you do. Be liberal in what you accept from others.14

Not long thereafter, three professors of computer science, David Reed, David Clark, and Jerome Saltzer, would try to explain what made the Internet so distinctive and powerful. In a seminal paper of 1984, “End-to-End Arguments in System Design,” they argued for the enormous potential inherent in decentralizing decisional authority—giving it to the network users (the “ends”).15 The network itself (the “middle”) should, they insisted, be as nonspecialized as possible, so as to serve the “ends” in any ways they could imagine.

Much later, in the early years of the twenty-first century, the phrase “net neutrality” would become a kind of shorthand for these founding principles of the Internet. The ideal of neutrality bespeaks a network that treats all it carries equally, indifferent to the nature of the content or the identity of the user. In the same spirit as the end-to-end principle, the neutrality principle holds that the big decisions concerning how to use the medium are best left to the “ends” of the network, not the carriers of information.

The big picture encompassing the sweep of the past century, however, makes clear that cable television, and later the Internet, haven’t so much splintered a heretofore united America as returned us to the fragmentation of an earlier era that the rise of big concentrated media had suspended. In fact, the triopoly of NBC, CBS, and ABC itself marked an aberrant time in the history of America, or for that matter, of the world.

It may be impossible to say for certain that the reconsolidation of AT&T fundamentally enabled the National Security Agency’s surveillance program, but the need to involve so few companies in the conspiracy undoubtedly made things much easier. Suffice it to say, as the Cold War made clearest, the federal government has usually found an integrated telephone system more malleable to its needs than a fragmentary one.

Today, the information industries are collectively embedded in our existence in a way unprecedented in industrial history, involving every dimension of our national and personal lives—economic, yes, but also expressive and cultural, social and political. They are not just effectively integral to every transaction; they also decide who among us gets heard or seen and when, whether it be the aspiring inventor, artist, or candidate. And that creates a challenge for an American system used to a clean split between the treatment of political and economic power, a strict control of the former and only moderate regulation of the latter.

While the idea of regulation as a safeguard of freedom in any sense has come to seem incomprehensible—at least in the politics of sound bites—it is an idea perfectly at home in any serious understanding of the nature of law and of government. What is the First Amendment, or the Fourth, if not law that restricts power for the protection and promotion of freedom? The controls on private power to protect individual freedom are no different. Whether the state restricts a corporation from dumping toxic waste in a river or toxic assets in the financial markets, would one more reasonably regard this as an abridgment of freedom of the malefactors, or a protection of the freedom of individuals and businesses that would be adversely affected?

And Google, one of the great corporate hegemons of our time, does likewise under its banner “Don’t Be Evil.” Whatever its missteps and shortcomings, that firm has, so far, done more than any other to promote what we have been describing as a constitutional policy of separations for the information industry. And while the extent of Google’s commitment has been exceptional, the basic impulse is not.