[governance] Is This An Issue for Internet Governance/Internet Human Rights?

Milton L Mueller mueller at syr.edu
Sat Jul 23 17:24:25 EDT 2011

Let's look at the details of the case.

Taipei said it wanted Android platform users to comply with local regulations regarding trial periods and refunds.
Google said, if you force us to do that, we will withdraw Android market service from Taipei.
To me, that seems fair enough. An agreement to disagree; a failure to transact. That should be the end of the story.

Those who are complaining about this result seem to be either disconnected from economic reality or, at worst, hypocritical believers in having your cake and eating it, too. Apparently, they want to tell Google: you CANNOT offer services here on terms that you find necessary to meet your needs as a supplier, but if you withdraw service we will whine about it and imply that you should be forced to offer service in a locality you do not want to do business in.

There is a very simple form of governance at work here, it's called rational mutual adjustments to local circumstances.
The Taipei government says, "we will impose regulations on what you do." Google says, in response, "well, those regulations are too costly to us, we shall choose not to do business there." This kind of choice occurs in thousands of different industries in thousands of different ways. You don't want to live in a world in which that kind of adjustment is not possible.

This process of choice provides checks and balances on both players. If Google is too unreasonable in its unwillingness to comply with local consumer regulations, it will be barred from many markets and lose out to others. If Taipei is too unreasonable in its demands on external businesses, it will only prevent its citizens from getting access to many valuable products and services.

Please tell me what is a better alternative?

Should a local government have the authority to tell a supplier based in another country that it MUST offer its services in its locality, under terms and conditions it does not find profitable or sustainable? Aside from being impractical, it sounds self-evidently crazy to me, but if it doesn't seem so to you consider what would happen if that kind of obligation were established.

So, there's a company in Hong Kong offering 1 Gb broadband at US$20/month. I'd like the Syracuse city govt to tell them they HAVE TO offer it to my home. Never mind the fact that cost conditions in Syracuse, with US-style suburban homes spaced hundreds of feet apart aren't quite the same as HK high rises, where one fiber can serve thousands of small apartments. I want my 1 Gb broadband for $20, and I bet 80-90% of other Syracusans do too.

OK, so that involves non-transportable physical infrastructure, rather than virtual services, so maybe you think it's not a valid example. So let's go with local/national regulation involving a potentially global, virtual service. Let's say the national government of China says to Google, "we think you have the best search engine so we want it here, but we want it to comply with our censorship regime. So you MUST offer Google search here, but all your servers serving the china market MUST be in the country, all your Gmail accounts MUST provide backdoor access to the public security bureau, and all search results MUST implement our censorship by allowing our censors direct access to your results display process." Under my preferred regime, Google has the right to say, "sorry, no deal." In the Parmindered world, what happens? They MUST go in?

So here is a more direct answer to this question:

Do Milton and others who seemed to have great reservation about appropriateness of Taipie city government's regulatory competence in that case still think, after reading about the case of unilateral withdrawal of google service, still think that users of these services should have no legal recourse with accountable public governance entity?
[Milton L Mueller]

First, they do have recourse. They can insist that their government apply local regulations. This may drive the multinationals out altogether. Or they can get their local government to avoid applying those local regulations, or to adjust them, in order to gain access to the services. There are two parties at interest here. There is no requirement to transact at all if either's needs are not met.

If local or national governments should *not* be the entity that people should be able to turn to, and these governments should *not* have the regulatory competence, who should?
[Milton L Mueller]

As usual, you over-dichotomize and -polarize the options. Our real disagreement is on the nature and scope of the regulations. You seem to think that any demand placed on a supplier by a consumer or a government is de facto legitimate and right. I am saying that there are constraints. Suppliers of services cannot be taken for granted as a natural resource, just sitting there waiting to be milked. People produce Internet services, and the people who produce them have legitimate incentives and needs that have to be met, otherwise they will withdraw their services from the market (or die a slow death in the market). Governments that assert controls and regulations in a globalized economy have to face the fact that unfair or overly burdensome regulations will lead private actors to withdraw from their market. Full stop. Likewise, corporations who do things that lots of locally responsive governments can't allow them to do will be barred from many local markets, limiting their growth and profit.

What's wrong with that exchange?


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