In January 2007 Steve Jobs, Apple’s late boss, held up the first iPhone. “This will change everything,” he said. Rightly and rapidly so. Alexander Graham Bell patented the landline telephone in 1876, and it took over 60 years for it to reach 40% of the US population, and nearly a century for it to reach market saturation. It took mobile phones 18 years to reach the 40% mark and smartphones just 10 years. Since its first release in 2007, the iPhone has become the fastest selling gadget in history. Smartphones have transformed how consumers interact with technology, and in return sparked an increasingly important debate on privacy, surveillance, and security.
New technologies are evolving markets, too. Goldman Sachs, arguably the world’s most powerful bank, has been quietly transforming itself from the inside out since the 2008 crisis to become a technology company. Today, its tech division contains nearly one-third of its workforce. The company now has more developers and software engineers than traders. In 2014 the top three firms in Silicon Valley—Apple, Google, Facebook—had a market cap of over $1 trillion while employing only 137,000 employees. In 1990 the top three carmakers in Detroit had a market cap of $36 billion and 1.2 million employees.
In short, for lawmakers on the Hill, policies that address privacy, consumer protection, competition, financial markets—you name it—require at least a keen and intense interest in tech. But Congress today is in a difficult position. In today’s political climate, it can be hard to focus on tech issues when some of our most fundamental American values are under attack. Be that as it may, the private sector and America’s innovators will not wait for government to catch up.
Regulations weaved together by processes from an earlier era are already inherently at odds with the pace and culture that drive tech-makers. As a result, some tech companies walk a fine line between pushing on their competitive edge and overstepping existing regulations. Some even make businesses out of regulatory inefficiencies, exploiting or circumventing existing loopholes.
When Amazon sold its first ebook in 2000, book copyright laws had been written with the physical object in mind. Once a customer buys a book, they are free to lend it as many times as they want, and can also sell it. But should this be applied to e-books? More importantly, how would this be enforced? At the time, Amazon borrowed from the software industry’s licensing scheme to decide what it means for customers to buy and own an ebook, broadly known as digital rights management (DRM). But even DRM is under heavy criticism from security researchers and copyright activists for giving rise to anti-competitive practices and violating consumer rights.
Policymakers also face an increasingly difficult battle because of the historically low public trust in government—just 18% according to a Pew survey in 2015. And tech companies have so far been the most vocally anti-Trump sector, pushed by both their employees and customers. Among my liberal circle of friends and colleagues in media and tech, working in government seems to draw a much different and polarizing reaction than I assume it would have previously. “Interesting time to be in politics,” they say.
New legislation on broadband deployment and spectrum policy, upping our cybersecurity against hostile actors, and modernizing our infrastructure are a handful of tech-related issues already on the agenda of the Republican-controlled Congress. But we still need a better way to provide social security and healthcare to the growing number of contingent “gig economy” workers. We need to make sure we keep the internet free and open in the inevitable upcoming FCC reform. We need an update to competition laws that govern tech super-giants. During my year on the Hill as TechCongress fellow I’m hoping to find the right approach to legislation that can keep up with pace of industry, while navigating today’s political reality in this historically tumultuous time.
Don’t take seriously every entrepreneur who holds a gadget in front of a crowd, proclaiming that it will change everything. But let’s hope that it won’t catch us on the Hill by surprise, and that we will not lose track of what laws are meant to enforce—a fair market and progress for society as a whole.