Tag Archives: silicon valley

Why telecom and cable companies outmaneuver tech companies in Washington

Ben Smith reports on Silicon Valley tech companies ‘attempts to gain a foothold in Washington, DC. He notes that despite tech companies’ rabid fan bases and ability to throw down cash, they’re still being outmaneuvered by old-school telecom and cable companies:

Tech has been, from the puzzled perspective of Washington’s political class, always arriving, never quite there. Its sheer wealth, enormous economic vitality, and immense cultural force should have brought massive clout. But tech companies instead have a reputation for throwing the most lavish parties at political conventions — and then getting smoked in the back room by old-line cable and telecoms companies. The energy behind a real populist uprising, “Stop SOPA,” never quite forms into a permanent interest. The industry’s highest policy priorities — hiring more foreign engineers, for instance — don’t make it into law.

And then later:

“They’re still punching below their weight,” reflected a top former Obama aide who now consults tech companies. “I mean — who’s got cultural capital in next 50 years? Comcast? Or Google, Facebook, Twitter? Really, it’s bananas that Comcast still gets away with what it gets away with.”

Smith fails to point out in the piece that much of cable and telecom clout is derived from a geographic advantage. Comcast may be hated by customers, but it employs thousands of workers, and not only that, these are local workers. Workers who lay down and maintain the cable lines. Workers who visit and install your cable. These employees are incredibly influential at the Senate and House levels, where cable companies can accuse Congressmen of not supporting local jobs. This packs much more influence than a few high-paid lobbyist and some campaign donations.

Tech companies will start winning these battles once they can mobilize their users at the local level. A good example of this is Uber. Every time local Taxi companies have tried to step in and regulate the company out of existence, it has appealed to that city’s most fervent Uber fans to sign petitions and call their local city council members. And, as Smith’s article notes, Uber has begun winning battles all across the U.S.

Tech companies like Facebook, Twitter, and Google are already utilizing geographic data for their targeted ads. They’re sitting on a wealth of information that can convert their most passionate users into brunt force cannon fodder against local politicians.

The self-inflated egos of techno libertarians

It’s a common refrain that’s become pervasive within Silicon Valley circles: The government has failed us, and the only way for society to move forward is for the coders who inhabit the Bay Area to liberate us via mobile apps. Such is the attitude of King Techno Libertarian Peter Thiel, who laments a world that has no robot maids or cures for cancer:

Thiel’s thesis: if change is going to happen on medical research, on climate change, or on getting a man to Mars, it will come from outside of large institutions.

Such world views ignore the enormous body of evidence that many of mankind’s largest innovations have come at the behest of large institutions. Look at the technologies made possible through NASA research or how DARPA enabled the creation of the internet. Thiel complains about the lack of cancer cures, but we’ve made vast strides just in the last few decades in prolonging the lives of cancer patients, and much of that success can be laid at the feet of the NIH, which contributes $60 billion in research funding a year. Thiel doesn’t explain how venture capitalism will amass and distribute this level of funding when there’s little short-term profit potential.

Thiel also doesn’t acknowledge how the need for bureaucracy grows as your deal with larger and larger populations made up of individuals who pursue their personal short-term goals often at the expense of the betterment of everyone. It’s not clear that a piece of technology can supplant the need for restaurant health inspections, nor can it single-handedly disincentivize companies from wantonly spewing carbon into the atmosphere.

To believe that we can solve the world’s problems by dispelling government is to rely on anecdotal evidence while enclosing yourself in a bubble of delusional self-importance. We will not cure cancer by simply handing over the reigns to people who build photo sharing apps.