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6 September 20126 September 2012 Trust in the digital economy: Aberdeen UniversityTrust in the digital economy: Aberdeen University 11
Trust in the Digital EconomyTrust in the Digital Economy
Regulation and trust in the digital Regulation and trust in the digital economy: an uneasy relationshipeconomy: an uneasy relationship
Ray CorriganRay Corrigan
Open UniversityOpen University
22
TheoryTheory
33
EconomicEconomic
44
BehaviouralBehavioural
55
ill-informed regulation DEA, CDBill-informed regulation DEA, CDB
66
StakeholdersStakeholders
77
StakeholdersStakeholders
Public(Citizen consumers)
Innovators/Creators Agents*
* Business, public services, government (& civil society)
88
TrustTrust
99
All 3 need to thriveAll 3 need to thrive
1010
BalanceBalance
1111
Invisible handInvisible hand
1212
Enlightened governanceEnlightened governance
1313
Complex ecologyComplex ecology
1414
Net file sharing v music, online news v Net file sharing v music, online news v newspapers, Amazon v bookshopsnewspapers, Amazon v bookshops
>50 Android patent cases globally>50 Android patent cases globally
Samsung v AppleSamsung v Apple
Government v everybodyGovernment v everybody
1515
Behavioural forces in digital economyBehavioural forces in digital economy
1616
Social normsSocial norms
MarketMarket
Built environmentBuilt environment
LawLaw
1717
1818
1919
Digital Economy Act (DEA)Digital Economy Act (DEA)
2020
S3-18: ISP copyright policeS3-18: ISP copyright policenotify subscribers of reported infringementsnotify subscribers of reported infringements
provide infringement lists to copyright ownersprovide infringement lists to copyright owners
Obligations to limit internet accessObligations to limit internet access
Website blocking provisions (govt to abolish; Ofcom said unworkable)Website blocking provisions (govt to abolish; Ofcom said unworkable)
2121
Z depends on i) term ii) scope iii) penalties iv) case law v)enforcement
Strength of copyright (Z)
Cre
ativ
e A
ctiv
ity
Zero ZC
(a) Creators
Innovators/Creators
2222
Societal welfare = (weighted) sum of consumers, creators & agentsSocietal welfare = (weighted) sum of consumers, creators & agents
Consumers
2323
Music, film, software, media companies and publishersMusic, film, software, media companies and publishers
Za > Zc
Agents of creators
2424
PossiblyZa > Zc > Zconsumers
Lined up
2525
DEA Winners – some agents & creatorsDEA Winners – some agents & creators
DEA Losers - agents & creators & public & trustDEA Losers - agents & creators & public & trust
PublicCreators
Agents
2626
Optimal strength varies for creators, agents and consumersOptimal strength varies for creators, agents and consumersPossibly ZPossibly Zaa > Z > Zcc > Z > Zconsumersconsumers
We donWe don’’t knowt knowVery little empirical evidenceVery little empirical evidence
Case study of specific firmsCase study of specific firms Surveys of creators, firms, lawyers, etcSurveys of creators, firms, lawyers, etc Data & econometricsData & econometrics National or sector trends/comparisonsNational or sector trends/comparisons Sales of CDs, films, etcSales of CDs, films, etc Collecting society dataCollecting society data Legal cases matched to firm-level dataLegal cases matched to firm-level data
Evidence
2727
Communications Data Bill (CDB)Communications Data Bill (CDB)
2828
S1 Blank cheque Secretary of StateS1 Blank cheque Secretary of StatePower to ensure or facilitate availability of data
S9 S9 Authorisations for obtaining data by police and other relevant public authorities
2929
ISPs DEA to CDB ISPs DEA to CDB copyright police to surveillance agents of statecopyright police to surveillance agents of state
3030
Mass surveillance undermines trustMass surveillance undermines trustAlso doesn’t workAlso doesn’t work
3131
CDB Winners – surveillance tech suppliersCDB Winners – surveillance tech suppliers
CDB Losers - agents & creators & public & trustCDB Losers - agents & creators & public & trust
PublicCreators
Agents
3232
Governments don’t understand technologyGovernments don’t understand technology
Computers/Net Computers/Net Magic solution orMagic solution or
Terrifying problemTerrifying problem
Net = TV on steroids / online shopping centreNet = TV on steroids / online shopping centre
3333
Government ignorance bad for:Government ignorance bad for:Innovators/creatorsInnovators/creators
AgentsAgents
Citizen consumersCitizen consumers
TrustTrust
3434
Public Public Hugely forgiving of / blind to agents’ data gatheringHugely forgiving of / blind to agents’ data gathering
(Convenience beats everything)(Convenience beats everything)
But data pollution = environmental disaster of But data pollution = environmental disaster of digital economydigital economy
3535
When regulating…When regulating…
Audience 15 millionAudience 15 million Radio 40 yearsRadio 40 years TV 15 yearsTV 15 years www 3 years (600 million+ in 7 years)www 3 years (600 million+ in 7 years)
Law can’t keep upLaw can’t keep upEmpirical work/evidence neededEmpirical work/evidence needed
On creators, agents and publicOn creators, agents and public
Reed – doctrine of creative inertiaReed – doctrine of creative inertia
3636
Trust in digital economy?Trust in digital economy?
E2E Net: global machine for springing surprisesE2E Net: global machine for springing surprises
Innovators/creators engageInnovators/creators engage
Agents Agents (care with architecture)(care with architecture)
Regulators – get educated & ReedRegulators – get educated & Reed Business – data pollutionBusiness – data pollution
Citizen consumers get educated & active Citizen consumers get educated & active
3737