Death of Distance and the End of Time

I was fortunate to spend an hour with a group of about 30 people and Tom Wheeler, the chairman of the FCC yesterday morning. It was a super interesting and stimulating conversation that preceded an excellent speech that Wheeler gave on his Net Neutrality proposal. Go read it and ponder it. It’s in English (not legalese), is blunt, direct, and at times humorous. And it hits the soundbites that are being used against “the government takeover of the Internet” and “the end of the Internet as we know it” crowd quite effectively.

But in this post I want to talk about a phrase Wheeler tossed out early in the conversation that really stuck with me. He said:

“In the 1800s, in a very short period of time, we experienced two innovations that created the death of distance and the end of time.” 

If you don’t know what these two innovations were, they are the railroad (death of distance) and telegraph (end of time).

I’ve been very open about my belief, which I wrote about for the first time in my book Startup Communities, that the global financial crisis was the point at which networks overtook hierarchies in importance in our society. And, while I’ve read about the history of railroads and the telegraph, I never really thought about them as the starting point for the creation of networks given the death of distance and the end of time.

It’s a powerful construct. Today we are starting to see the self-actualization of networks and the path to what many refer to as the singularity. Regardless of whether you believe this, are comfortable with it (like I am), or are afraid of it (like many others are), it is inevitable that innovation, networks, machines, and AI will continue to evolve at an extremely rapid pace. If you don’t believe me or understand this, go read William Hertling’s amazing Singularity Novels.

As a species, I do not think we can control this. Nor should we. We should enable it. We should explore ways to make us a more amazing species. A more fascinating society. We should embrace our innovations and evolve with them.

The path we are on started in the middle of the 19th century. The debate over Net Neutrality is a tiny blip on this path. If we study history, at all points along this path companies behave in their self-interest. We expect that. Human behavior and economic interest always move toward the question, “How can I maximize the position I’m in?” Think about the evolution of the railroad industry. Think about the evolution of the telegraph, and then the telecommunications industry. Think about where we would be if AT&T still prevented us from putting non-AT&T manufactured things “on their network.” Or, maybe more importantly, think about where AT&T would be, which given the passage of time would likely be still promoting Picturephones. Ok – that was gratuitous and unnecessary, but I couldn’t help myself.

In our discussion yesterday, the idea of epistemological modesty came up, reminding us that we can’t predict the path of innovation even in something we know well. I live this every moment in my business as a VC and strongly believe that we should enable, not try to control, innovation.

After listening to Wheeler, reading his speech, and thinking deeply about this over the past few years, it’s clear to me that he understands this. And for those saying “he’s using 1930s monopoly-style regulation to have the government control the Internet”, you are simply wrong. Read his words:

“We will forgo sections of Title II that pose a meaningful threat to network investment.  That means no rate regulation. No unbundling. No tariffs or new taxes. I would note that when applied to mobile voice service over the past two decades, the use of such light-touch Title II – which, by the way, was sought by the industry – went hand-in-hand with massive investment.”

It’s really hard to ignore the soundbites and dig into the facts. But I encourage everyone to try.

  • Thanks for sharing, Brad — tend to agree (strongly) with your belief that we should enable innovation, even if most of us admit we don’t know what that future looks like, yet.

    I’m not sure if you’ve written about this before, but you mentioned reading about the history of railroads / the telegraph…

    Do you have any book recommendations on the subject? One or two that really stand out as you think about innovation, networks, etc.?

    • Stephen Ambrose’s book is awesome.

      • McGee Young

        Gerald Berk wrote a book called “Alternative Tracks” which looks at the effort to build a regional network of local trains and an economy of scope rather than economies of scale with giant hubs in Chicago and New York. In many ways it echoes the same themes as Brads work on startup communities. It’s a bit – ahem -academic, but worth the read.

  • Ryan Smith

    Hi Brad, I’d highly recommend you checking out Paul Virilio’s work – he writes a lot about the intersection of speed, technology and politics/warfare. He writes some great stuff about the implications of the “death of distance/time”. Speed and Politics is probably his most famous work but I also really like The Great Accelerator and The Information Bomb. He’s probably the leading theorist on speed from a philosophical angle.

    • Thanks for the recommendation. Grabbing them now.

  • JLM

    .
    The optimism and the creative enthusiasm which colors your words are laudable. The problem when nobility or grandeur confronts reality is that it travels in a very mean spirited wrapper — politics.

    The insertion of the Internet under the umbrella of Title II of the Telecom Act of 1992 has such an ugly wrapper.

    With the election of the Republican Congress in November 2014, the ability for the Obama administration to regulate, tax and control the Internet was lost for the balance of their regime. No Republicans were going to vote for such a law.

    The sudden death bed conversion and decision to shove the Internet under the regulation of the existing Title II is a cynical attempt to use previously granted powers of regulation, taxation and control to impose such powers over the Internet that the election forestalled.

    Short hand — they’re using the existing Title II because they have no chance of passing a similar law today.

    Note that Chairman Wheeler, a telecom lobbyist of some note in a former life, had a rather sudden conversion that coincided with the utterance of the President in favor of “net neutrality” — an idea which in its purest form both you and I accept. Not just accept but embrace and champion.

    The problem is what that means to different people but we get a very good idea if we look at what currently happens to utilities under Title II.

    What is irrefutable is that the Internet — if this rulemaking is allowed to stand — will be regulated, taxed and controlled just like a utility wherein consumers and customers only have those rights that are dipped into their porridge bowls with the consent of the utilities and the FCC themselves.

    We shall no longer have access to the courts. We shall be regulated and taxed and controlled. The FCC will be the final arbiter of everything.

    In Austin, Texas I am writing this while connected to a 1 Gig service provider who was my choice from 4 such providers. I cannot imagine a single service I will obtain that the free market was not doing a very good job of already.

    I can imagine a regimen of taxes and the selection of winners and losers in the future. This is always the fingerprints of regulation when we allow it to grasp our necks. They squeeze us.

    The winners in the long term are always the stakeholders with the largest army of lobbyists. Witness all of Microsoft’s anti-trust legal issues which were dissolved when they put a regiment of lawyers in Washington who had already bought outcomes for other companies.

    This will likely be no different. The biggest armies of lobbyists will twist these regulations to their own benefit.

    There is no daylight between what you and I want. This rulemaking will likely not get us there in my view.

    Let me part with one ominous observance — the FCC and the Obama administration trust us so little they are not going to release the rules themselves until the FCC votes upon them.

    The “most transparent administration in history” has just blinded us. Why? I think the answer is obvious.

    JLM
    http://www.themusingsofthebigredcar.com

    • kywmst

      Well stated.

  • JLM

    http://www.nationaljournal.com/tech/republican-fcc-commissioner-public-is-being-misled-about-net-neutrality-plan-20150210

    I do not endorse the content of this article. It is a very different view of things than Chairman Wheeler states. Bear in mind, that this FCC appointee was not allowed to participate in the drafting process, had no input, was not consulted and yet these rules will eventually be voted on by this Commission.

    The process does not suggest a thoughtful and fair minded set of rules. Rules made in secret, particularly from other committee members, are never well reasoned rules as they have no friction to make them work smoother.

    One has to ask repeatedly — why?

    Why were the rules drafted in secret?
    Why were the rules hidden even from other Commissioners?
    Why are the rules going to be voted upon before public review?
    Why does anyone think that taxes and regulation will not be imposed on the Internet when every other entity subject to Title II is taxed and regulated?

    You realize this is a formality, do you not?

    The FCC is composed of 3 Democrats and 2 Republicans. The Democrat head of the Commission, Tom Wheeler, has had a death bed conversion to forcing the Internet under the FCC and Title II which has only really firmed up since the Republicans won the Congress and he realizes (together with the President) that the Congress is not going to otherwise grant this level of regulation and taxation.

    The signs are so clear, a blind man could see them.

    Still, I could be wrong.

    JLM
    http://www.themusingsofthebigredcar.com

    • Rick

      I pinged you a couple weeks back. I’m wondering if TX is seeing a hit from the gas prices dropping. I saw that many of the oil companies have cut staff and shutdown oil wells. But that was on TV and so well… I thought you could fill us in.

      • JLM

        .
        Texas will do just fine. Remember that royalties continue to flow even if the price is lower. Texas has enormous production and a big Rainy Day Fund, so the state is going to do fine.

        The industry has been a boom and bust industry since its inception. The industry has already trimmed its sails. There have been layoffs and companies are right sizing their field forces.

        The Texas economy is diverse enough to continue to grow. As an example, there are no oil wells in Austin and it will do just fine.

        Would we rather we had a more stable and growing energy business. Of course, but the favorable impact of cheap energy — the largest tax cut on the horizon — is going to make everything else blossom.

        What is taken away in the Oil Patch will be more than returned in the balance of the economy.

        We are also one missile attack from Iran away from $150 oil.

        JLM
        http://www.themusingsofthebigredcar.com

  • Yeah. And Obama said we can keep our health plans.

    The problem you don’t seem to get is that by bringing in Title II, the Internet has been dumped into the realm of POLITICS. What happens when Obama calls Wheeler and tells him to raise taxes (which is why Obama forced this down his throat to begin with)? What happens when Wheeler says no and Obama replaces him with J. Edgar Hoover?

    You guys seem to think that the govt is some benevolent authority thats going to hold your hand while you spew your flowery rhetoric about how “powerful” and “forward thinking” this all is. Its a power grab. Obama needs revenue and hes found a good source that he doesn’t have to go to Congress for. If you really think this has anything at all to do with “preserving the essence of the Internet,” I would suggest you change your reading list from way out sci-fi to some more American poltical history texts.

    • Rick

      Uh oh… Sounds like someone has been doing his OWN thinking! You keep that up and you’ll be sent in for re-education. lol

    • DCH

      You’ve nailed it Frank. This is a complete power grab and I’m surprised that Mr. Feld who is obviously a very smart man, believes in this scam. Do you really believe that the government won’t use this as a ploy to control, tax, and punish their enemies via the Net Neutrality lie? This administration is using all the levers of government to consolidate power for the Democrat/Socialist/Marxist party while claiming to be doing it all in the name of “fairness”. Its amazing to me how liberals continue to believe in the non-stop lies of this administration especially given their track record so far. Yeah, you guys are the “smart” ones. Unbelievable.

    • Sam

      Late to the discussion on this, but important… “The Internet has been dumped into the realm of POLITICS.” No one has suddenly dumped the Internet into the realm of politics. As a public good, the Internet was already squarely in the realm of politics. There are too many externalities for it not to be regulated. (If you don’t see that, then it’s worth spending some time with your economic texts. This is not a question where a simple “free markets know best” can provide the answer.) The only real question is what flavor of regulation we would like to have. That is the starting point for the conversation. Complaining about this reality because you are not a fan of Obama misses the point.

      • I wouldn’t care if it was Obama or Reagan, I still wouldn’t want them bringing in Title II. Having built telecom equipment under the Title II yoke, its sucks, alot. Not only does it enable additional taxes that it was NOT SUBJECT TO BEFORE (but I guess taxes aren’t political are they), it burdens the equipment makers/providers/everybody with all kinds of stupid regulatory crap that equals cost, aka another tax.

        Ever heard of CALEA? Remember (likely) your hero Snowden? What you gonna say when you find out all the routers have legally imposed backdoors on them that run straight to the NSA?

        What you gonna do when Comcast and Verizon decide to completely pull out of markets because they can’t make any money? Oh, I forgot, you’ll use the govt and the Rural buildout clauses of Title II to force them to serve those markets. Where do you think the cost for that is going to come from? Watch your ISP rates start to climb, aka another tax.

        Speaking of those textbooks, maybe you should go back and review the pace of innovation in the landline phone system that took place over a hundred years and then compare and contrast that to the innovation that’s taken place in just the last 20 years with the Internet. Yeah theres porn and spam and hacking but I’ll take it any day over your govt “utopia”.

        • Sam

          You misunderstand my point.

          I’m not saying the FCC proposal is the right answer. I’m also not saying the FCC administrators appointed by Obama, or the ones who will come after, are beyond our suspicion. That may very well be a fatal flaw in the proposal.

          What I am saying is that you have to offer up an alternative. You can’t simply have a “free markets know best” answer here. Why? Because the potential for negative externalities is too great, and free markets won’t solve them. Comcast throttling Netflix is a great example.

          We are talking about the fundamental structures that allow free markets to operate in the first place.

          • The alternative is to leave it like it is now. And with all due respect, why do you get to tell me I have to propose an alternative?

            Yes I am a believer in unfettered markets. Yes unfettered markets sometimes get out of whack. This has nothing at all to do with that. As I stated, it has to do with our $18 trillion dollar debt and how to pay for it. Obama has found way to garner potentially huge amounts of additional revenue without having to deal with Congress. It just so happens it means taxing the biggest driver of commerce in the world right now which is not a good idea.

  • SD

    I would like to see Net Neutrality combined with a new, open spectrum usage regime: specifically, I would like to see the large swaths of spectrum cleared by broadcasters and allocated for very lightly regulated, open, short-range use (i.e.-public wifi).

  • “Today we are starting to see the self-actualization of networks and the path to what many refer to as the singularity.” I have always been intrigued by fiction that deals with a future between now and the coming singularity. Vernor Vinge’s Rainbows End comes to mind. Would love to see more posts on your take on specific science fiction motifs and tropes and instances where reality is finally catching up with fiction.

    • I’m a huge scifi fan. Lots of old posts on this and more coming.

  • Matt Kruza

    I generally agree with the death of distance / time.. but then this necessitates the premium in certain geographies should go away over time. Put simply, the wage and real estate differential should mean revert, not go hyperbolic like it has right now. This is no more evident than in the tech world. Tech hubs (SV, new York, boston, Austin, seattle, boulder) are all between 50-250% above median home prices and significant premium on labor just based on location. I am 98% this will correct over a 20 year or more time period (perhaps sooner), but I am curious of your view on how this economic reality doesn’t square with the “death of time and distance” and getting rid of a hierarchy.

    • Rick

      But if distance is no longer an issue. Why would there be pricing problems related to only certain areas. If distance has been eliminated then should not everyone be working from wherever they choose?
      .
      I’m beginning to think the premise of the post is not valid. If distance and time were done then the problems you mention would not exist.

      • Matt Kruza

        I think the premise of the post (and my thoughts) is the death of time and distance is ongoing… its the end state which we have yet to reach. Not sure if Brad feels that way (hence my question of why the price differentials exist) but I think you accurately call out that we are not there yet.

  • kywmst

    Who is “We” (from the Wheeler quote, excerpted below)??? Will the ostensible forebearance of these ‘things’ be upheld for decades to come? Or only as long it takes the Politicians and White House to insert themselves into the process??

    “We will forgo sections of Title II that pose a meaningful threat to network investment. That means no rate regulation. No unbundling. No tariffs or new taxes. “

  • very cool read. see you manana

  • Gregg

    Regarding you being comfortable with the singularity, I too was in your shoes until quite recently. I’m still looking forward to the possibilities and feel the singularity is inevitable, but after having researched some of the arguments in detail, I believe that if you are NOT worried about Artificial Superintelligence, than you’re really not understanding the inherent dangers.

    • Oh, I’m very aware of the inherent dangers. I think as a species we need to accept and confront them, not try to control them.

  • kermit64113

    Two comments: The dial-up folks succeeded because it was a ubiquitous solution. I know it’s hard to remember a day before Wi-Fi but there was one and that was the world Mr. Wheeler lived in. The competition was between the RJ-11 telephony jack (in many rooms in all houses) vs. the RJ-45 Ethernet jack (not in a lot of existing houses). This has a lot less to do with the deployment of High Speed Internet by cable companies (which was less prevalent 15 years ago as Hybrid Fiber Coax cable was in the middle of being deployed) than the failure to understand the addressable market. NABU did not due its due diligence, and Steve Case did. Chairman Wheeler should stop blaming cable for what is a less than slam dunk case against them.

    Second, it’s a distant memory for most, but dial-up providers used the 1996 Act to their benefit and this allowed them to keep modem pricing low (this perpetuated dial up infrastructure deployment). Here’s how: Interconnection was paid per minute used to the terminating CLEC who owned the local dial-up phone numbers (in this case the ISP such as Level3 or PSI Net or tw telecom or Sprint where I worked). The payment to Level3 and others came from the terminating local exchange provider where the Internet user lived (Verizon, Qwest, AT&T, or Sprint’s local terminating division where I also worked). While this cash register did not last very long (states and the FCC stepped in over a five-year period), there was a two-sided business model at work. NABU did not have access to this regulatory access piggy bank because the 1996 Act did not fully contemplate hybrid fiber coax access. (Full disclosure – I was a VP Sales for Sprint’s wholesale division from 2002-2004 and VP of Access Management from 2001-2004).

    Chairman Wheeler’s selective memory requires additional clarification. In turn, while he has generally been open in his comments to date, it has become the modus operandi of the Obama Administration to foist legislation without public scrutinization. Why has the FCC not released the details of the plan? What are they afraid of? Or is this, like the HCA, something we will have “Vote on before we find out what’s in it?” Brad, why not ask the Chairman to allow feld.com access to the details? – Jim Patterson

    • kermit64113

      I neglected to include the link to the tech policy institute’s article on NABU. Here it is: http://www.techpolicyinstitute.org/blog/2015/02/the-nabu-network-a-great-lesson-but-not-about-openness/. There is also a reference at the bottom of the article to an IEEE article on early networks. It’s excellent and clearly shows that Chairman Wheeler’s business failure was more about the infancy of the two-sided business model (which includes content which in the mid 1980s was next to nonexistent) than cable company greed.

  • JLM

    http://www.washingtonexaminer.com/dems-on-fec-open-to-new-regs-on-donors-internet/article/2560099

    This little nugget is a great insight into the thinking about the regulation of the Internet. The issue at hand is the amount of money in politics. The Citizens United case is still being litigated in liberals minds.

    So, now they intend to use the FCC’s oversight of the Internet under Title II of the 1996 Telecom Act as the basis for regulating money in politics.

    The fact that the Supreme Court has already ruled on it, be damned!

    This is an insight as to how the Democrats intend to use the powers granted — currently being sought — under Title II.

    If you are comfortable with this arrangement, you are weaving the rope for your own hanging.

    Neither side can really be trusted., Today there are 3 D’s and 2 R’s but I would have no different view if the sides were reversed.

    Dream on, y’all. This is real.

    JLM
    http://www.themusingsofthebigredcar.com

    • kermit64113

      On the issue of Net Neutrality, however, Chairman Wheeler has been extremely open – almost 5 million comments and counting. If press reports are to be believed (WSJ, 4 Feb), calls from Eric Schmidt of Google and Brian Roberts of Comcast to Obama advisor Valerie Jarrett were ignored (David Cohen of Comcast was one of the biggest fundraisers for Obama). This is actually one issue where traditional sources of clout failed. Google, Comcast, AT&T, Verizon, Sprint, T-Mobile were spurned in favor of content developers.

      It remain to be seen how these regulations will increase infrastructure providers’ interest in deploying more alternatives. Perhaps that’s why Mr. Schmidt called the White House.

      Based on the speech Brad links to above, Chairman Wheeler appears to ultimately want a government-funded and built broadband and wireless networks – he should come out and say it and open the discussion for debate. And we should look to the NTIA (rural and special interest fiber and wireless broadband) grants as a proxy for how they would like to see it work (the results have been mixed at best).

      • JLM

        .

        I agree with you, well, not really when you consider the following:

        1. Chairman Wheeler has promulgated 332 pages of rules without any consultation with the full membership of the FCC.

        2. Chairman Wheeler proposes to exclude at least two members from the deliberations — not even showing them the rules.

        3. Then there is Chairman Wheeler’s decision to seek approval of the rules BEFORE they are revealed to the public.

        Really? BEFORE the public even sees them? Really? When did that ever turn out well?

        4. There is the issue that already a Democrat member of the FCC has suggested using their new regulatory powers to control content.

        http://www.washingtonexaminer.com/dems-on-fec-open-to-new-regs-on-donors-internet/article/2560099

        Of course, the FCC is not supposed to have anything to do with elections and fundraising — that being the exclusive province of the FEC, no?

        5. Then there is the reality that every utility regulated under Title II has substantial taxes imposed not by the House of Representatives but the FCC itself.

        The reason the Chairman has had a death bed conversion has everything to do with the fact that the Republicans in the Congress will never allow a bill anywhere near what Title II entails. So to avoid that unpleasantness, the administration is trying to jam the Internet under Title II. Because they already have authority to regulate and tax anything that fits under that umbrella.

        “If you like your Internet, you can keep your Internet. Period.”

        Ever heard that before?

        I love my country, I don’t trust my government. They have a track record of lying, taxing, wasting money and obfuscating.

        Again, why is this one different?

        JLM
        http://www.themusingsofthebigredcar.com

  • Rosey

    Very timely post, Brad. I hope/wish Jim Patterson (a top tier telecoms analyst) would chime in here, as he’s a whiz on the mechanics, tactics, and financials in this space. Personally, I don’t trust our government to not abuse Title II.

  • I enjoyed the notion of epistemological modesty it engenders a socratic wisdom,
    when we talk of death of distance and time I wonder if we are even in the race yet. There is Moore 😉 to come.

  • DaveJ

    “it is inevitable that innovation, networks, machines, and AI will continue to evolve at an extremely rapid pace” =? epistemic modesty

  • Listening for sure. Mindful of the fact he isn’t immortal and won’t be the FCC commish in 2016. Railroads were ruined by government regulation. Try taking the Amtrak from Chicago to Champaign. It’s never on time either way, and it smells like Chinese trains did in the 1970s.

  • I have only recently been reading up on singularity and the exponential growth of technology. I am stoked for the innovation and advancements that are around the corner.

    Great post!

  • martinsnyder

    “If we study history, at all points along this path companies behave in their self-interest” Surely you mean their perceived self-interest…History is full of nothing but organizations actually failing to act in their self-interests in hindsight…

    As to the singularity? History is also full of periods of rapid progress, then long periods of decline…it may be that as we get closer to “the” singularity it becomes exponentially more difficult to hold things together…this is not unknown throughout the natural world….

    I’m rather less than an optimist when it comes to the macro doings of humankind…

  • Rick

    “the end of the Internet as we know it”
    .
    After some thought I’ve come to this conclusion. The end of the internet as we know it is correct. I’m not saying that will be good or bad. But it appears it will change.
    .
    The real quandary here is not whether these changes will be good or bad. The question is how can these changes be taken advantage of to make money?! We are a group of entrepreneurs and spending time guessing what gov will do is a waste unless you’re gonna’ place a bet ahead of time.
    .
    However it will take more time to get started analyzing what could change than it will for the changes to come. So it’s best to wait and then decide.

  • Very timely. I have been afraid lately of the development of AI, of how fast everything is going, and generally, where WE are going. But after reading this I am a *bit* calmer about it all. It seems that indeed we can’t control it — too bad our first instinct is to control, not let go. Thanks for the reassurance. 😉

  • Rick

    Brad, I grab a temp email and email you but I don’t hear back. You mad? 🙁
    .
    I have to say to everyone out there that temp email is great. You grab a new one when you need it then when you’re done it’s gone for good. No spam or other foolishness. People can’t hack it and send out email from your address. Etc.

    • I’m not sure which email you are referring to. And no, I’m not mad.

      • Rick

        They were just “what’s up” emails. As you know I stopped using email but someone suggested I try temp email. So I did and found it to work well for eliminating spam and hackers. But I think emails sent from a temp email gets caught in the spam folder many times.
        .
        You and another guy I chat with both love email so just to be cool I send you both an email. Just a fun email not business stuff.
        .
        You need to take me off your “no call list”. I could be the first un-important contact on your “ok to call list”. 🙂
        .
        The FCC vote should spark some rumblings no matter which way it goes. Probably a good opportunity for some heated debate here.

  • Thanks, Brad. The PR blitz against can be so confusing but the Right is very good at obscuring the facts in carefully chosen gibberish.

  • is distance next killed by VR, and time next killed by Slack?

    • Doubtful on both.

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