1 October 2007
We think we understand the rules of commerce. Manufacturers and sellers advertise; we buy or not, as we choose. We have an intuitive understanding of how advertising works, up to and including a rather vague notion that advertisers try to target "suitable" customers. Similarly, manufacturers and sellers have an understanding of how people buy and use their products. However, technology has been changing what's possible for all parties, frequently faster than people's assumptions. This mismatch, between what we expect and what is happening, is at the root of a lot of high-tech conflict, ranging from peer-to-peer file-sharing to Apple's iPhone.
Let's look at the iPhone first. People who have purchased one feel, not unreasonably, that it's theirs and they can do whatever they want with it, from making phone calls to tossing it into a blender. However, Apple has a different view. They think they're selling a device and a service, and that the requirements of the service preclude user control of the device. It's not that Apple is necessarily wrong in their approach (though I think so); rather, it's the mismatch between consumers' expectations and Apple's plans that has caused trouble. The result? Dueling news stories about iBricks versus newer, better "hacks".
The converse happened with peer-to-peer filesharing. Consumers were the ones to adopt new technology — digital distribution of songs — while the music industry was holding back. This isn't a new reaction by the music industry to changing technology. Twenty years ago, the RIAA tried to persuade Congress to mandate Copycode, but tests by the National Bureau of Standards (now NIST) showed that the scheme didn't work. In 1942, in an incident that is now largely forgotten, the American Federation of Musicians went on strike for royalty payments from the record industry; this incident is generally known as the Recording Ban of 1942.
Fundamentally, these incidents are all the same: people had a mental (and sometimes legal) model of what was "normal" and possible; technology changed, and one party's behavior changed with it, to the shock of the other. The reaction was the same, too: effectively, the creation of a new crime or form of misbehavior I call "felony interference with a business model".
The same dynamic has hit the Internet advertising market. Ad blocking on the web is catching on — after many years of not doing so — so we see accusations that using it is tantamount to theft. But note the explanation given here:
No flashing whack-a-mole banners. No highly targeted Google ads based on the search terms you've entered.to say nothing of pop-ups and pop-unders.
What happened? Both parties found their expectations weren't met. Advertisers felt that ads modeled on newspaper ads weren't effective, so they used technology to enhance ad visibility. Consumers resented the distraction, annoyance, and bandwidth consumption; some have resorted to ad blockers.
Turning again to the iPhone, we see that one party — Apple — is trying to use technology to tilt the balance in its favor. This is resented even by people who have no desire to switch phone carriers or to install non-Apple applications, because they correctly perceive a shift in their model of the world.
In one sense, there's no need to panic: there are always shifts. People and institutions are remarkably flexible over time. Consider "traditional" newspaper ads — which used to appear on the front page. The danger comes with enforcement of the existing model, whether by law or by technology. That sort of thing freezes innovation, by blocking technologies that threaten today's behavioral model.
From my perspective, Apple's attempts to lock down the iPhone via repeated updates won't work; people will break through each new locking technology. Strange excuses for their behavior will be seen as just that: strange excuses. If nothing else, the market will have the final say; if people really want a freer device, someone will build one that's even better than the iPhone, though perhaps not cooler.
The danger will come if Apple succeeds on the legal front, via the DMCA or the like. Technologies change, which upsets people; eventually, people adapt, and a new norm is reached. We have to avoid artificial interference with that dynamic.