In 1995, the Internet began, in earnest, as a commercial endeavor. Since that time, its growth has been explosive. Starting with only 16 million users that first year, the Internet now has over 3.4 billion users today—almost half the world’s population.
The Internet has become integral to our daily lives, changing how we shop, how we work, and how we communicate with our friends and family. In the United States alone, e-commerce is responsible for $9.6 billion in economic output and 59 percent of Americans are active on social media. As the Internet of things evolves our lives will be event more entwined with the Internet, as cars, medical care, and even the clothes we wear connect to the Internet.
Unfortunately, the Internet and the bounty it provides are under attack by regulators and special interests hoping to shape the digital world’s future to their advantage. If nothing else, the Internet has been disruptive, leaving both regulators and industry struggling to adapt to the new world. The dynamic pace of change has kept the Internet one step ahead of regulators, and the massive expansion of markets has changed the business models for entire industries. Uber and Lyft have challenged the regulated taxi monopolies, Airbnb has shaken up the hospitality industry, and Amazon has fundamentally altered the way we shop.
But as the Internet matures, it becomes more tangible, and more susceptible to outside forces. Regulators have slowly moved away from the hands-off approach first endorsed by President Bill Clinton to the aggressive regulatory stance of current FCC Chair Tom Wheeler. At the same time, business interests have coalesced around the Internet, with a ramped up presence in Washington as they attempt to influence the regulatory framework surrounding the Internet. With the FCC’s new Open Internet Order, the permissionless innovation that has so far characterized the Internet could lose out to a mother-may-I world, where the FCC and other regulatory agencies play a larger role in shaping Internet policy.
Already, the innovative power of the Internet is facing challenges. Consider these recent cases:
- Uber and Lyft leave Austin: More than 10,000 drivers in Austin are no longer working as the popular ride-sharing companies opted to the leave the city in the wake of a vote that imposed new burdens on the companies and drivers.
- Federal agencies continue to push for access to private cell phone data: The highly public battle between the FBI and Apple over access the cell phone in the San Bernardino demonstrated the tension between privacy and security. While the FBI eventually unlocked the cell phone, it continues to push for legislation requiring a backdoor to encrypted smart phones and apps. While the FBI may approve, this creates a new vulnerability for consumers not just to government snooping, but any hackers with the skill to exploit that back door.
- Internet sales taxes to give extra-territorial power to state tax collectors: There is a real threat that states will gain new powers to collect taxes on Internet sales. Often framed as a debate over fairness between online and local retailers, the real threat is redefining the scope and reach of state tax collectors in ways that raise significant constitutional questions about the legal authority of tax collectors to act beyond their boundaries.
- Copyright creep and the Internet of things: As appliances, cars, and the things we use in everyday life become smarter, the concept of ownership is blurring, and new restrictions on how we use what we buy can harm consumers and innovators. Smart appliances rely on copyrighted software, and often software relies on a license of use versus actual ownership. For example, John Deere famously told the Copyright Office that farmers do not own their tractors; rather, they simply have “an implied license for the life of the vehicle to operate the vehicle.”
- SLAPP me silly: Go to a restaurant and write a bad review on Yelp complaining about the service? You may want to think twice. Restaurants, service providers, and others may file suit, using a Strategic Lawsuit Against Public Participation (SLAPP) suit to chill criticism. These expensive lawsuits are a direct threat to free expression online.
Clearly, the Internet is under pressure from a variety of interests and a mix of market, legislative and regulatory forces, will shape its future.
To protect the innovation and entrepreneurship driven by the Internet, FreedomWorks has drafted a Digital Bill of Rights, which seeks to ensure that the rights we enjoy in world transfer to the digital world. The founders established an institutional framework that created the most prosperous nation on earth. As our lives move online, we must ensure that we enjoy those same benefits.