IT Matters

Technology policy insights

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World Intellectual Property Day – Highlighting How IP Incentivizes Innovation

Every April 26, the World Intellectual Property Organization (WIPO) celebrates World Intellectual Property Day to promote discussion of the role of intellectual property (IP) in encouraging innovation and creativity. Given the increasing tempest over the role of IP in the Trans-Pacific Partnership (TPP) trade agreement, the day provides an important reminder about the foundational role that IP plays in supporting innovation. IP is more important than ever as it is embodied in many economic sectors, especially across the digital economy, which means it affects not only innovation, but also trade, competition, taxes, and other areas of public policy and society. According to the OECD, investment in IP-protected capital is growing faster than investment in tangible capital.

To analyze this critical relationship between IP protection and innovation, ITIF compared the strength of IP laws and the effectiveness of anti-counterfeiting laws based on data from the World Economic Forum’s Global Competitiveness Report 2015-16 and creative output scores from the Global Innovation Index 2015, a report from Cornell University, INSEAD, and WIPO. The Global Innovation Index applies three distinct measures of creativity in an economy that taken together provide a measure

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Copyright Infringement: Science Pirates Are Still Pirates

The scientific community has become embroiled in a debate around online piracy after Alexandra Elbaykyan, a graduate student based in Russia, setup Sci-Hub—an online database of 50 million stolen scholarly journal articles. After encountering paywalls for scientific journals, she setup Sci-Hub because she said she believed that scientific information should be free to use and share. Elbaykyan can try to justify it in whatever way she wants, but what she is doing still involves the theft of property that is not her own.

Sci-Hub has garnered some support in the online piracy debate as the business model used by scientific publishing firms has clearly not caught up to the digital age and is in need of reform. The firms commonly charge as much as $35 for a digital copy of a journal article. Yet, an annual subscription to a top journal, such as The Lancet, costs $233 for both digital access and a print copy. This means, assuming four journal articles per weekly issue, that they charge 31 times more for a single digital article than a paper one, with zero marginal costs for the digital. While

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New Research Sheds Light on How U.S. Labor Market is Evolving

Although the American labor market is evolving, a scarcity of data has often made it difficult to know exactly what is going on and what to make of it. Having a better understanding of how the nature of work is changing would help individuals prepare for their role in it. It would also help policymakers pass appropriate laws that promote competition, protect workers, and encourage investment in both human and physical capital.

One of the leading academics in this field has been Alan Krueger, former chairman of President Obama’s Council of Economic Advisers. Dr. Krueger has coauthored two recent studies that provide policymakers with a better understanding of how labor markets are evolving on both the macro and micro levels.

Our understanding of macro changes to the labor market is limited by the fact that, because of funding limitations, the Bureau of Labor Statistics (BLS) last conducted its Contingent Worker Survey, which gathers data on people who have contingent and alternative work arrangements, in 2005. In a recent paper, Lawrence Katz, a Harvard economist, and Dr. Krueger included a version of this survey in the RAND American Life Panel,

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Censorship in France threatens to go abroad.

France Demands Right to Censor the Global Internet

In 2014, Europe’s highest court ruled that Europeans have the ability to request that search engines remove links from queries associated with their names if those results are irrelevant, incorrect, or outdated. As a result of this ruling, Google agreed to delist search results from country code level domains—such as Google.fr for France—to remove offending results for European users, without affecting the rest of its users worldwide. Earlier this month, Google expanded its practice so that it now will delist offending results from all Google search domains, including Google.com, for all European users, based on geo-location signals, such as IP addresses. So a user in France would not see delisted URLs even if they visit Google.com instead of Google.fr. France is now saying that this is insufficient and Google must take down offending material for all users visiting any of its domains worldwide.

Last week, the French privacy authority, the Commission Nationale de l’informatique et des Libertés (CNIL), fined Google €100,000 ($112,000) for failing to remove links associated with French right-to-be-forgotten requests from its global search index. France is trying to force its domestic policies on the rest of

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Labor Law and the Gig Economy: Why Stick with an Antiquated System?

The rapid growth of the gig economy—workers using Internet platforms to deliver personal services such as rides, legal services, and plumbing to consumers—has sparked a discussion on their impact and relationship to current law. A major topic in this debate has been whether gig workers should be classified as employees or as independent workers. On March 15, Ross Eisenbrey and Lawrence Mishel of the Economic Policy Institute criticized an earlier paper that Seth Harris and Alan Krueger had written for the Hamilton Project at the Brookings Institution. The Harris and Krueger paper recommended establishing a third legal category for gig workers. But Eisenbrey and Mishel’s assertion that current law can handle gig marketplaces misses the central point. The real question is not whether a centuries-old distinction can be contrived to apply to the gig economy. It is whether doing so is in the best interest of society.

Eisenbrey and Mishel primarily focus on the case of Uber. This is unfortunate because Uber probably represents the closest case to an employer-employee relationship. But even in this case the authors acknowledge that courts have given different opinions. The waters are muddied even

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Music Piracy: Streaming to an App Near You

The distribution of music has evolved over time, from records, tapes, and CDs, to downloading and streaming online from computers, mobile devices, and a growing array of connected devices in the home and car. Music piracy has also evolved as those peddling and consuming infringing content adapt to new technologies. A new study from MusicWatch (a research firm that focuses on the music and entertainment industries) highlights the changing nature of music piracy and shows that while there is no “silver bullet” to combating online piracy, stakeholders involved in protecting intellectual property need to adapt their efforts to meet this evolving challenge.

The study has four main findings: music piracy is still prevalent; “streamripping” of music has emerged alongside the rise in legitimate music streaming services; music apps and app stores play an increasingly important role in music piracy; and piracy has a substantial negative impact on musicians and content owners.

First, the MusicWatch study shows that music piracy is still rampant, with an estimated 57 million Americans engaged in some form of illegal online downloading or streaming of music. In December 2015, the study surveyed 1,000 U.S. respondents aged

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An Oscar

Policymakers, Don’t Take Your Clues from “Techno-pocalypse” Movies

Movies capture the popular imagination, mirroring society’s hopes and fears. But science fiction is exactly what the name describes: fiction. It is meant to bring enjoyment to the viewer, and these wild depictures of technology run amok should not affect policy decisions. Unfortunately, this is not always the case.

For example, take concerns about Artificial Intelligence (AI). Recently, a number of prominent scientists and well-known luminaries have warned that in the not-so-distant future, humans could lose control of AI, thus creating an existential threat for humanity. This paranoia about evil machines has swirled around popular culture for more than 200 years, and these claims continue to grip the popular imagination. In fact, one 2015 study found 22 percent of U.S. adults are afraid of AI (which is more than fear death), despite no evidence that this technology is anywhere near being as sophisticated as it is portrayed in movies.

But policymakers should not use science fiction films to guide their understanding of science and technology. For example, at a 2013 Senate hearing about threats from space, a senator cited the movie Armageddon—where a team of astronauts try to

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With PrivacyCon, FTC Packs the Stage with “Yes People”

The Federal Trade Commission (FTC) hosted the first annual PrivacyCon in January 2016, an event designed to highlight the latest research and trends for consumer privacy and data security. The FTC’s stated goal was to bring together “whitehat researchers, academics, industry representatives, consumer advocates, and government regulators” for a lively discussion of the most recent privacy and security research. Unfortunately, not only did the event not reflect the diversity of perspectives on these issues, but the whole event seemed to be orchestrated to reinforce the FTC’s current regulatory strategy.

First, the “data security” side of this discussion was almost non-existent in the agenda. Of the 19 presentations, only 3 were about security. Given that the FTC has been flexing its regulatory muscle on corporate cybersecurity practices, this was a missed opportunity to delve into important cybersecurity research that could inform future oversight and investigations.

Second, the FTC mostly selected papers that jibed with its current enforcement agenda. As Roslyn Layton, a visiting fellow at the American Enterprise Institute, noted recently, of over 80 submissions that the FTC received for PrivacyCon, it selected 19 participants to give presentations with

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Innovation Fact of the Week: Commercial Value of Illegally Installed PC Software Totaled Nearly $63B Globally in 2013

(Ed Note: The “Innovation Fact of the Week” appears as a regular feature in each edition of ITIF’s weekly email newsletter. Sign up today.)

The global market for PC software is huge, but 43 percent of all PC programs that individuals and businesses installed in 2013 were not properly licensed, according to the BSA Global Software Survey. The commercial value of those illegal installations was $62.7 billion that year, up from $47.8 billion in 2007 when the illegal rate was 38 percent.

The United States has the world’s lowest rate of unlicensed software use (18 percent in 2013), but it is such a large market that the commercial value of those illegal installations is the world’s highest at $9.7 billion. In China, by contrast, 77 percent of all PC software installations were illegal in 2013, with a commercial value of $8.9 billion, the world’s second-highest total.

By region, the average rate of unlicensed software use was 59 percent or higher in Latin America, Central and Eastern Europe, the Middle East and Africa, and the Asia-Pacific region. That compared to 19 percent in North America and 29 percent

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How Did Data Privacy Day Go From #PrivacyAware to #PrivacyScare?

Today is Data Privacy Day, an annual reminder to all of us to check our digital zippers. But while Data Privacy Day was originally devoted to educating consumers about how to protect their data online, in recent years it has become better known for the privacy activists who participate in such rowdy traditions as midnight Twitter rants and feats of endurance like “Who can sound the shrillest?” The kids might even get swept up in the festivities and help their parents build tin-foil hats.

Some years back privacy activists realized that Data Privacy Day was a perfect opportunity to further peddle their stories of a coming digital apocalypse brought about by Big Brother and Big Data. And faster than you can say “fundraising bonanza,” Data Privacy Day morphed from an attempt to improve people’s cyber hygiene to the activist-fueled orgy of fear, where everyone is invited and tips are appreciated.

Unfortunately, many people have fallen victim to these tales of doom.  While we’ve seen this before—the great grandparents of today’s privacy activists were decrying Kodak for inventing the portable camera—privacy activism has reached new heights and now

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