The Future of Music: is Entrepreneurship

About a month ago, we posted about a study we sponsored entitled The Sky is Rising. The findings of the research confirmed that the moral panic surrounding the purported demise of creative industries (music, film, publishing) is largely unwarranted. The fact of the matter is, fuelled by increased exposure and new methods of distribution, our creative industries are actually growing rapidly. What’s more, the artists are seeing more direct financial benefit than before, and are more in control of their careers -- which goes a long way toward explaining the chagrin of traditional content distributors (record labels, big name publishers), who lose out in a scenario where a middle man is no longer required.

Today in Austin at SXSW Music, the Future of Music Coalition released research that explores the revenue streams of musicians. The findings of the research follow the same vein as The Sky is Rising: artists across all genres are collecting a relatively low percentage of their incomes from affiliations with record labels, and instead are generating revenue across many different, self-directed revenue streams (The FMC identified over 40 different revenue streams associated with a music career).

The upshot is, musicians -- and especially musicians who are “full-time” and earn all of their income from music -- are a lot more like entrepreneurs than anything else. While the findings showed an across the board reliance on revenue streams associated with performing, and performing costs were not scalable, performances were crucial to generating other revenue streams -- such as sales of CDs and merchandise. The FMC study not only presents a valuable data set, it also gives us a new way of conceptualizing the music industry. New technologies, like it or not, have changed the face of the industry; traditional gatekeepers no longer dominate the industry and there is now much more room for the “self-employed” artist.

We encourage you to go and check out the study, and chew on the findings. Let us know what you think. Will small-business music ever really replace traditional record labels?

Advocating for the Intersection of Policy and Technology at SXSW

The Engine Advocacy crew is on its way home from its first SXSW. We found ourselves among friends there: entrepreneurs trying to build partnerships, consumers looking for the next great app for business or personal use, investors in search of the next high growth or long-run bet, reporters who actively engage with new media channels, and activists who, like us, want to advance policy that fosters new technologies and technology startups.

Engine’s panel featured a cohort of voices that had been active against SOPA and PIPA -- Andrew Rasiej, the chair of NY Tech Meetup; Mark Stanley, the leading communications voice from the Center for Democracy and Technology; Laurent Crenshaw, the legislative director for Rep. Darrell Issa; Mike McGeary, Engine co-founder and director; and Boonsri Dickinson from Business Insider, who moderated the panel.

The panel was both a discussion of the tactics that made the SOPA/PIPA protests so effective, and of how to use those tactics and others to mobilize the SOPA and PIPA protesters to take a proactive stance on tech policy issues in the future. This has consistently been a sticking point,for all types of advocacy -- how do you take the momentum gained from one urgent campaign, and turn it into sustained, positive action to advance a long term agenda? While the tech community might find it easy to block or defend against a piece or type of legislation, we have yet to determine the best advocacy tools for actively promoting legislation we like.

Our stance: the community needs compelling data that it can take to members of Congress to expand the knowledge on specific legislation, and we need to connect members of Congress directly with startups that employ their constituents.

In essence, we need to facilitate a really effective conversation.

This became more and more evident as we circulated the conference, meeting with entrepreneurs who were pitching innovative, useful products and services and building the businesses to support them; and seeing a fundamental disconnect between this sphere and that of policymakers. This was cemented when we met with Senator Jerry Moran (R-KS), who restated his commitment to assisting startups and fostering high-growth businesses in Kansas, and throughout the country. He highlighted the divide between the tech and non-tech communities by pointing out his own sense of being an outsider sitting at the table with a bunch of tech folks. This discomfort, which seems to be a common problem for members of Congress, clearly stems from a lack of effective communication.

The best possible outcome would be to educate policymakers about what we do; to make technology less alien, and to present them with hard data that proves the overarching value of what we do. The Kauffman Foundation leads on researching these issues, but there are many other groups working toward this goal. We’re working on some exciting research as well that we think can help shift the debate. This easy, effective communication we’re talking about may not happen overnight, but we’re confident that it will happen. Getting together in Austin was a great next step in the process. We look forward to the next phase -- the action phase -- as we move forward.

IPO On-Ramp For Emerging Growth Companies

Bill of the week: S.1933, or the Reopening American Capital Markets to Emerging Growth Companies Act of 2011. You might also know it as the Sub $1 billion Revenues IPO Act -- a shortened working title conferred by Fred Wilson at A VC, who championed the bill last Friday.

The bill amends the Securities Act of 1933 and Sarbanes Oxley to ease the time and financial burden of regulatory compliance for small companies going public. Specifically, the legislation would give “emerging growth companies” -- companies with revenues of less than $1 billion -- five years to comply with SEC regulations for an IPO. The temporary exemptions would allow smaller companies an eased path to IPO, while maintaining compliance obligations that protect investors. Eased regulations for IPO would give smaller companies greater access to markets and capital at a critical stage in their growth.

This bill corresponds to part of the Obama Administration’s Startup America Legislative Agenda, a detailed list of priorities released a month ago to spur job creation by addressing the needs of start-ups. We wrote about the agenda in detail here.

You probably already know how vital start-ups are to job growth -- Kauffman research shows that start-ups are responsible for nearly all net new job growth in the country since 1977. But in case you need a refresher, this video is short, sweet, and explains the issues well. Bottom line? Election year or no, stimulating job growth and the economy is a non-partisan issue.This is an important bill, and one that we want to see passed sooner rather than later.

Beyond SOPA/PIPA at SXSW

We're pleased to announce an upcoming panel we're hosting at this year's South by Southwest Interactive Conference in Austin, and we hope that you can join us for a lively discussion. We've put together a great collection of people from the intersection of tech and politics who will take a look at the next phase in advocacy for the tech community on the whole, what we learned from SOPA and PIPA, and how we can keep people engaged to take a more active stance on tech policy and legislation going forward to help guide that debate and work with legislators and regulators to make better choices when it comes to tech and government.

Joining us for the discussion are:

Michael McGeary, Co-Founder/Director, Engine Advocacy

Andrew Rasiej, Founder, Personal Democracy Media

Mark Stanley, New Media, Center for Democracy and Technology

Laurent Crenshaw, Legislative Director, Office of Rep. Darrell Issa (R-CA)

Boonsri Dickinson, Reporter, Business Insider

EVENT DETAILS:

Beyond SOPA/PIPA: Moving Forward with Tech Advocacy

5:00pm CST, Saturday, March 10

AT&T Conference Hotel, Salon C

Note: As this is an official SXSW event, a badge must be presented to join us.

We hope to see you there!

User/Entrepreneur

A Kauffman Foundation study shows that innovative startups are largely founded by users who create products for their own use and then commercialize them -- an inspiring statistic that bears witness to the fact that innovation is closely related to democratic entrepreneurship and economic growth.

A study released today by the Kauffman Foundation looks for the first time in any significant detail the statistics on “user-entrepreneurs” -- entrepreneurs who make products for their own personal use -- and found that these types of entrepreneurs were particularly prevalent in innovative startups, comprising 46% of innovative startup founders.

The study tells us what we have known anecdotally for some time - innovation is intuitive, personal, and easy to sell. User entrepreneurs are not only more likely to get venture capital financing from the outset for products they build with a business purpose than other kinds of startups, but those who create their products for personal use are also more likely to have women and minorities as founders.

Read more about the study here. We’re looking forward to seeing more research that hones in on the amazing potential of bottom-up innovation.

Spectrum: Solved? Not Quite.

A week ago, H.R.3630 passed the Senate, ending the spectrum stalemate that had been ongoing between mobile broadband operators, cable companies, and innovators to gain access to a dwindling supply of spectrum licenses. We wrote a longer piece examining the issues behind the stalemate and tentatively hoping the legislation could help us avoid a spectrum crunch.

Larry Downes wrote a really informative post on CNET this week warning that this may not be the case, for the following reasons:

• The FCC said that mobile users will need an additional 300MHz of spectrum by 2015, and an additional 500 MHz by 2020. Problem is, legislation or no legislation, there isn’t that much usable spectrum to go around. Nowhere near enough, according to Downes.
• There is spectrum which is not being used(including swathes of warehoused government spectrum), or not being used to its full capacity, but the nature of the FCC’s “increasingly outdated licensing system” makes it extremely difficult to re-purpose this spectrum to be more effectively used with today’s technologies. The new legislation takes steps to fix this, but we won’t see results of this for probably 10 years -- seven years too late for the aforementioned 2015 deadline.

All of which sounds pretty sinister.

But Downes advocates for the following short to medium term solutions to help close the gap and keep us from mobile broadband disaster. While not negating the threat entirely, they might at least constitute better solutions than burying ones head in the sand and hoping against all hope that spectrum learns how to multiply itself organically.

• Let them merge. When mobile carriers merge, they tend to make better use of limited bandwidth.
• Build more cellphone towers. Local zoning authorities can make it difficult for cell phone companies to update and add to their core infrastructure, which is the next best option for these companies to optimize their services without additional spectrum.
• Let’s all get new phones. Newer technologies make better, more efficient use of spectrum, particularly in the 4G LTE band. If everyone switched over, and there was tiered pricing plans for data use, we could suck a little more spectrum toothpaste out of the tube.

Ultimately though? We’re with Downes on this one: we need to rethink spectrum. We need to spend time hashing it out and crafting legislation alongside innovative processes that will work with our constantly evolving needs. We need to turn spectrum licensing into a responsive and nimble machine instead of a lumbering beast that needs massive overhauls every decade just to keep the system from complete collapse. So let’s look at this as an opportunity, rather than a disaster; as a chance to help shape long-term policy that fosters innovation.

Let us know what you think. Head over to Step2 to tell us your thoughts on spectrum as part of the innovation agenda.

JOBS Act Announced. Let's Get to Work.

The Senate is stalling on actions taken by the House to grow job creation, and if they won’t take them up individually, House Majority Leader Eric Cantor (R-VA) hopes the Senate can consider the bills all at once. Cantor today announced House Republicans would bundle a number of entrepreneur-friendly bills focused on aiding startups in gaining better access to markets and capital, easing regulations to allow crowdfunding, and raising thresholds for compliance. Cantor detailed the plan, dubbed the Jumpstarting Our Business Startups (JOBS) Act, in a POLITICO op-ed published earlier today.

The package includes the following bills:

H.R.2940, - Access to Capital for Job Creators Act

Passed in the House, this bill would revise regulation D offerings to relax limitations for qualified investors to sell securities. Currently, regulation D allows some businesses to sell securities without registering them with the SEC. H.R.2940 would make it simpler for startups to raise capital through crowdfunding by removing the regulation D prohibition of general solicitation and general advertising for accredited investors.

H.R.1070, S.1544 - Small Company Capital Formation Act of 2011

This bill would amend the Securities Act of 1933 to exempt from SEC regulation a class of offerings between $5 million and $50 million, with a provision to review and increase this figure biennally. The Securities Act of 1933 capped exemption at $5 million and is long overdue for an update. Increasing the breadth of exemption would make it simpler for startups to raise capital and still be in compliance with SEC regulations.

H.R.1965, S.556, S.1941- To amend the securities laws to establish certain thresholds for shareholder registration, and for other purposes.

This bill would amend the Securities Exchange Act of 1934 to increase the threshold from $1 million to $10 million for shareholder registration for an issuer of securities. As with the Small Company Capital Formation Act of 2011, this would ease regulations and make it simpler for startups to gain access to capital and still be in compliance with the SEC.

These bills are no-brainers, and what’s more, many of these provisions appear in the President’s Startup America legislative agenda, released in late January. In our view, what’s good for startups is good for job creation and the overall economy. Now let’s get them through the Senate.

What else should legislators consider this year? Tell us over at Step2 and help define the Innovation Agenda.

Techdirt Hit by Phony DMCA Takedown

Another SOPA-in-practice moment: Our friends at TechDirt have had an anti-SOPA/PIPA post taken down in the name of the Digital Millenium Copyright Act (DMCA).

Only problem is, there’s no infringing content to be found anywhere near the post. Not in the post itself, not in any of the comments. Nowhere. Which, since the post has now been surreptitiously disappeared from search engine results, is more than a little worrying, as it gives substance to the fear that anti-copyright measures can be and are used to suppress free speech. The Techdirt team was given no notification of the takedown or opportunity to remove the so-called infringing content, either. They stumbled on it a month later doing a regular Google search.

And given that the post that was taken down was a primer on how to fight SOPA/PIPA copyright legislation, it all leaves a pretty bad taste in the mouth.

Read the Techdirt post here. We’ll be watching what happens.

What's Next?

We want to know what issues around technology and innovation are important to you. Our friends over at Techdirt have created a Q&A platform on which you can vote up the issues you care about most, and add your voice to the conversation about how to implement positive policy change.

In the fight against SOPA and PIPA, the internet community proved itself to be active, engaged, and capable of achieving real influence in Washington. A groundswell of action against these bills erupted all over the nation, and through this action, we as a community were able to directly influence the policy that affects us.

Even though we halted the beast, we still have a long way to go on making sure any future antipiracy policy is developed with reference to the needs of the internet community.

We need to get involved in these discussions sooner. We need to bring to the table what matters to us, and get involved in shaping policy that works for us so we’re not just reacting to bad legislation.

Let us know what matters to you most, and we will work with you to help implement policy that will work for you, your company, and your future.

Visit the Techdirt/Engine Innovation Agenda thread to let us know what matters to you.

Combatting America's "Brain Drain"

“America no longer has a monopoly on knowledge”.

So said Vivek Wadhwa; tech entrepreneur, academic and one of the panelists at an information summit we went to today for the Entrepreneurs in Residence (EIR) program. EIR is a Department of U.S. Citizenship and Immigration Services (USCIS) led initiative to get entrepreneurs, experts, and USCIS staff together to discuss the problems and possible innovations around immigrant investors, entrepreneurs, and highly skilled workers, and today was the initiative’s official launch.

The initiative aims to combat “brain drain” -- the idea of highly-skilled workers leaving the US after getting their education here to start businesses in their homelands --by moving on skilled immigration, an issue that’s ostensibly nonpartisan and noncontroversial. A brain drain is what America will experience if we’re unable to attract and retain the best, smartest workers and entrepreneurs -- these people will move overseas and innovate and create businesses there, harming U.S. competitiveness in the global arena.

Studies show that foreign-born entrepreneurs are responsible for creating thousands of American jobs and generating billions of dollars in revenue. Michael Moritz, panelist and partner at Sequoia Capital, said that the number one problem facing the economy today is the need to bring to America these entrepreneurs who want to start companies -- but it’s not just getting them here, it’s keeping them here. Solutions on the table include removing per-country caps on skilled worker visas via H.R.3012, a bill that’s already working its way (slowly) through the legislative process, “stapling” a green card to graduate level students’ STEM degrees, and a startup visa.

In practice, in an election year, and with the Congress that we have, moving on anything is tricky. But, as President Obama noted in his State of the Union address, making some tweaks to skilled immigration has a much better chance of success than comprehensive immigration reform. However, there’s plenty in the pipeline for this issue. California 16th District Congresswoman Zoe Lofgren spoke today about her IDEA Act of 2011 as part of the answer to these problems. And we’re also following the Startup Act, a legislative agenda for startups that includes skilled immigration reform as part of a package of fixes to make it easier for entrepreneurs to start businesses that will create jobs and bolster the economy.

In the end, we’re hopeful the EIR process bears fruitful results and finds new pathways to success on the immigration front. If today’s event was any indication, they seem well on their way, and it’s time to step up pressure on Congress and the White House to act on these issues with innovative solutions.

Mapping the Groundswell

Today we’re putting up a page on our website to show some of our data from the January 18th internet protest that stalled internet-harming copyright legislation in its tracks.

It’s been a month since the internet community joined forces to protest against the Stop Online Piracy Act (SOPA) and the Protect IP Act (PIPA), the anti-piracy legislation that threatened open internet, and we’re finally starting to see some of the data from January 18th, the major “blackout” day of action against the bills.

We’re proud to have been one of the leaders on the anti-SOPA/PIPA movement -- our StopTheWall phone call campaign to link online activists directly to their local senator’s offices generated 15,000 calls through our site to local senators, so many calls, in fact, that there was a senate switchboard meltdown. But what’s really exciting to see is how our efforts were part of a much larger whole, proving that the our community is capable of being a formidable force when it comes to protecting the internet.

Our map tool breaks down by region the action that took place on January 18th. The data shown represents the phone calls made to local senators and the number or signatures on petitions. We think its pretty cool. Take a look at it here.

Hey. No SOPA. Remember?

We’ve got our eyes on this one: Form building startup Jotform.com, which hosts it’s domain on GoDaddy, was suspended two days ago by a U.S. government agency in the course of an investigation into content posted on Jotform’s site.

Jotform founder Aytekin Tank posted on their corporate blog defending Jotform and also directing users to move their forms to JotForm.net while the investigation is cleared up. Tank defended his site’s policing methods and results, saying, “This can happen to any site that allows public to post content. SOPA may not have passed, but what happened shows that it is already being practiced.” [emphasis added]

Tank also wrote an agitated post on Hacker News detailing his impatience at the U.S. Secret Service’s lethargy in responding to the case. He said; “I told them we are a web service with hundreds of thousands of users, so this is a matter of urgency, and we are ready to cooperate fully”.

We’re watching to see how this plays out. While there’s not a lot of information at present, it seems as if GoDaddy or the government or both may be dangerously close to the kinds of enforcement rules that were rejected with the shelving of SOPA and PIPA.

Public Parks for the Airwaves

H.R.3630 just cleared House-Senate negotiations, and a consensus has been reached regarding the spectrum related provisions of the jobs bill. The bill contains provisions to take away the FCC’s ability to set eligibility rules for the auctions, and to re-allocate unused TV frequencies -- these so-called “white spaces” -- as unlicensed spectrum. The deal that’s been made retains some of the FCC’s ability to preserve unlicensed spectrum, although not as much as we might have hoped.

All of this legislative language revolves around spectrum auctions, which are part of H.R.3630 in order to offset the cost of the extension of unemployment benefits. Spectrum auctions also have the keen attention of telecom companies and of tech companies, both of which are fearing the effects of a looming “spectrum crunch”. The white spaces between licensed TV frequencies are considered especially valuable “beachfront” spectrum, because of their ability to penetrate buildings, carry data traffic, and extend to rural areas. They are hotly contested; telecom companies want them for their mobile broadband services, but supporters of innovation want them to remain unlicensed so that new technologies can be developed over them as has been done in the past with services like WiFi and Bluetooth.

Let’s break this down.

The problem is, we have a limited amount of airwaves through which to conduct many different and competing services. Mobile broadband operators need to have spectrum licenses to use with an ever-growing demand for data use associated with smartphones -- Apple’s Siri alone causes the iPhone 4S to require unprecedented amounts of data , even compared to other data intensive smartphones. And consumer demand for mobile broadband services isn’t likely to wane -- according to AT&T, mobile data use on their network has risen by 5,000 percent in the last few years . Then there are  more traditional uses of spectrum, like cable TV networks, radio, text messaging, and cell phone lines. Then on top of that, there’s unlicensed spectrum -- the “public” areas of our airwaves where innovations like  Wi-Fi, Bluetooth, and baby monitors operate. The unused TV frequencies, or white spaces, come under this unlicensed spectrum umbrella.

It might not come as a surprise that AT&T is for provisions that would take away the FCC’s ability to set limits on who can participate in spectrum auctions, at least on the surface. They are one of the largest carriers and stand to lose the most if they are blocked out or limited in the auctions. Smaller mobile carriers, including Sprint and T-Mobile, sent a letter to Congress voicing their opposition to the provision, which they said would limit the FCC’s ability to promote competition. AT&T immediately hit back with a statement saying the smaller carriers want the FCC to “stack the deck in its favor” and that the auction should be “fair and open”. Several commentators have noted that AT&T’s vehemence on the issue is slightly puzzling, given they have managed to do pretty well under the FCC’s rules so far.

Far more pressing to us, though, is what happens to those innovation-friendly white space frequencies. The unused television frequencies are more than just empty white spaces. They are the public parks of spectrum. What happens in these “public parks” is vital to innovation and long term economic growth -- not to mention that everyone benefits from these spaces, including companies like AT&T that regularly use unlicensed spectrum to ease the burden on their own spectrum.

A group of 42 members of Congress, led by Rep. Anna Eshoo (D-CA) and Rep. Darrell Issa (R-CA), drafted and sent a l etter urging the preservation of unlicensed spectrum , arguing that “ exploring the use of beachfront spectrum, specifically in the television band, is vital given its ability to penetrate buildings, enhance rural coverage, and carry more data traffic than traditional Wi-Fi”.  The letter also noted that in the band best suited for mobile broadband, there is currently 5 times more licensed than unlicensed spectrum. Senator Jerry Moran (R-KS), a major proponent for innovation policy and who along with Sen. Mark Warner (D-VA) co-authored the Startup Act , signed the letter and reiterated the sentiment at a Wireless Innovation Alliance and White Space Alliance event , saying “ America would miss an incredible opportunity to enable innovation on unlicensed bands.”

Negotiations, then, have until now been stalled by a lot of competing interests.  It looks as if Congress is opting for a middle of the road approach that hopes to satisfy all sides of the debate.  We’ll be watching to see what the the actual allocations of unlicensed spectrum will be and how this plays out for the innovation agenda.

Who Really Engaged in Misinformation?

As a follow up to yesterday's link to Mike Masnick's rebuttal to the RIAA, Ernesto Falcon at Public Knowledge talks through the content industry's systematic campaign on misinformation around large swaths of SOPA and PIPA.

Read more at Public Knowledge

The App Economy

When Apple opened the iPhone to third party development, it opened a “Pandora’s” box of opportunities to capitalize on (and justify the price tag on) the groundbreaking mobile device. Adding services to this new generation of mobile phones, and later tablets, has turned out to be a fertile ground -- unearthing a sector of the tech industry that, according to a new study released yesterday by Technet, is responsible for just under half a million jobs. Not too shabby.

In his State of the Union address, President Obama vowed to incentivize bringing manufacturing jobs back to the U.S., and halt the unfettered loss of American jobs caused by outsourcing American jobs to offshore operations. And there has been plenty of furor in the media about conditions in Apple’s manufacturing factories in China.

As it turns out, regardless of any changes that need to be made as far as outsourcing and manufacturing, the US economy is seeing a tangible boost from the newly designated “App Economy”. The Technet study found that the total number of jobs related to the creation and distribution of apps since the 2007 release of Apple’s iPhone is close to 500,000. That includes a conservative estimate of around 155,000 tech jobs in app companies, and the same again for non-tech jobs in these companies -- sales, marketing, HR. The study also cites an estimate that the App economy generated almost $20 billion in revenue last year.

While these apps aren’t always backed by venture dollars and growing companies, like Routesy for example, a majority of them have found a way to create an entirely new sector of the economy - and one that is growing at a significant rate. And while many of these newly created jobs are in the “traditional” innovation areas like San Francisco and San Jose areas, followed by New York and Seattle, other areas like Atlanta, Dallas and Philadelphia, not traditionally thought of as leading technology areas are experiencing significant growth, with even more on the horizon.

With growth in mobile devices expanding and the technological platforms getting more and more robust with each product cycle, the boundaries for the app economy are limitless, and, as the Technet study confirms, we are hopefully only seeing the beginning of the building of a new economy.

A Bipartisan Plan for Job Creation

Senators Jerry Moran (R-KS) and Mark Warner (D-VA) tout their new bill S. 1965 STARTUP Act in today's Wall Street Journal.

Honeywell, Nest, and the Next Wave of IP Protection

Intellectual property is vitally important to innovation, but there comes a point where patents are so broad that they stifle new products and technologies.  So seems the case when large, long running companies can quash younger innovators with costly, time-consuming patent lawsuits.

There’s been quite a little buzz over startup company Nest’s Learning Thermostat. Designed by former Apple engineers, it features sleek, minimalist styling with a track wheel control, like the original iPod. It operates a self-programming system based on an interview-style interface, and learns your habits in order to predict when to change the temperature and save you up to 30% on your energy bill. It can also be remotely controlled from your computer or smartphone. It’s been receiving accolades as a nifty, attractive and innovative design and has been sold out since early November.

Thermostat giant Honeywell has taken a rather sour grapes attitude to all of this and has filed a patent infringement lawsuit accusing Nest of seven separate instances of infringement.  

These alleged infringements cover the sleek, minimalist styling, or at least the rotatable ring control. The interview style interface. The energy saving features. And the feature to control remotely via the Internet. Honeywell claims that the core design and functionality of Nest’s thermostat are the direct result of years of research and development carried out by Honeywell. The 2008 Honeywell thermostat, the Prestige, does appear to offer many of the features Nest’s does.

But can you really patent the shape of a device?  Or something as ubiquitous as WiFi connectivity now is?  And if you can, should you?

Honeywell’s crusade to “protect its intellectual property” is, for the moment at least, exclusively targeted towards Nest (and Best Buy, who is selling Nest’s products) -- which seems to suggest Honeywell is more interested in keeping innovative startup competitors from entering the market than IP.  But Nest’s thermostat is not the only competitive device on the market right now.  General Electric also offers the ability to manage a “GE smart thermostat” via the internet.  When asked to comment on GE’s system, Honeywell told  All Things D: “I don’t know. I’m not familiar with that product.” Honeywell also told GigaOm last week that it had shelved plans for a “learning” thermostat 20 years ago because they “found that consumers prefer to control the thermostat, rather than being controlled by the thermostat”, and decided to focus on other innovations.

So Honeywell doesn’t (or didn’t) want to pursue this particular innovation. But it doesn’t want a slick little startup like Nest to have it either. The problem is, an industry behemoth like Honeywell has a lot more financial clout and could sink Nest with a lengthy and costly litigation process -- even if it doesn’t win the patent lawsuit, it could at least deliver a critical hit. Which is discouraging for innovation all around.  Because lets face it: Nest’s thermostat is a hot-ticket item because it fuses design with functionality in a way that’s innovative, much like Apple’s recent products have -- not just for its WiFi capability or interview-style interface.

Protection of intellectual property is important, and we must take active steps as a community to find the best solutions to issues which arise out of our new technologies with regard to those protections. But we should not stifle innovation and improvement through overly broad restrictions on the creation of products and ideas.

Google Fiber comes to Kansas City

We’re very excited to see Google announce the commencement of their Google Fiber project in Kansas City today. Google Fiber will be putting down thousands of miles of cables to create a new broadband infrastructure which will eventually see data speeds of more than 100 times faster than the average speed most Americans currently enjoy.   

The project is enabled by the Gigabit Challenge -- a competition sponsored by the Kauffman Foundation seeking entrepreneurial ideas to create innovative and forward-thinking businesses to work alongside Google Fiber. Senator Jerry Moran has been a major proponent of the Gigabit Challenge, which goes hand in hand with the core initiatives he co-authored for the Startup Act -- which we strongly support -- a bipartisan agenda for invigorating the economy through innovation.

We look forward Kansas City’s continued growth as an entrepreneurial hub, and we also look forward to further expansion of high-speed broadband to every corner the country as we look towards building the future of the tech driven economy.

70 Groups Ask Congress to Halt Work On SOPA and PIPA

In the wake of all successful protest movements, once the dust settles, the time comes to take positive action. With SOPA and PIPA dead in the water, thanks to the sustained and comprehensive efforts of the internet community; the thousands of phone calls we made, the millions of us that signed Google’s petition, it’s time for our community to come up with alternative legislation - a solution that addresses online copyright infringement without compromising free speech and innovation. 

A letter sent today to Congress and signed by 70+ companies, including Engine, Mozilla, and Public Knowledge, urged Congress to “to take a breath, step back, and approach the issues from a fresh perspective.” 

The letter warned against repeating the mistakes of SOPA and PIPA, and requested that legislative debate surrounding the issue be “open, transparent, and sufficiently deliberative to allow the full range of interested parties to offer input and to evaluate specific proposals.” That means taking into account the views from tech companies and media companies. It means seeking out information and statistics from unbiased sources.

It means keeping the users of the internet in the loop, because our input matters, and we have shown that we can and will make ourselves heard.

Read the letter, in full, here from Public Knowledge.

#censorship? Not So Much.

The well-publicized January 18th blackout was so effective for SOPA and PIPA opposition that legions of Twitter users refused to Tweet last Saturday, January 28th, organizing their go dark movement via #TwitterBlackout. The protest was over a change in Twitter’s censorship policy, and, perhaps still rabid over the (very real) threat to open internet, Twitter users flew their freedom of speech flags defiantly.  Given a few days to meditate on the issues at hand, though, it seems clear that the righteous indignation of these protesters may have been a little hasty.

Twitter will indeed be censoring tweets - on a country by country basis according to the laws of the country being tweeted in. So, if a country’s government outlaws certain content, offending tweets will be taken down - but only in that country. Olivier Basille, from Reporters Without Borders, drafted a letter urging Twitter to reconsider a policy that from his point of view, kowtows to localized censorship and could therefore potentially contravene international free speech standards.  Basille posits that the change will stifle online dissidents who have previously used Twitter to great effect to stay informed and organize protests, such as last year’s social media fuelled revolution in Egypt.

But there are plenty of arguments to suggest that this won’t be the case.  For starters, the new policy differs from their previous one in only one respect: until now, these tweets would have had to be blocked worldwide. This means that instead of completely censoring any content deemed illegal by any government, all content will be available everywhere, with limitations only in effect for the country with the legality issue. And for those worried that localized censorship will hinder activism, John Castone over at Mashable makes a good point when he says that activists are smart enough to tweet in code if need be.  Twitter explicitly says they can’t block a user unless there is “valid and applicable legal order”.

Furthermore, Twitter will be posting all its take downs on watchdog site ChillingEffects.org. It’s also worth noting that all sites have to censor content to stay within the bounds of the law (in order to avoid being shut down) -- including eBay, Google, and Facebook. Most of them just don’t tweet about it.

On balance, it appears there will actually be less censorship than before - and more transparency when censorship does occur. As effective an activism tool as it has proven to be, even Twitter can’t operate outside of the bounds of the law. By complying with government regulations, despite any questions as to the morality of these laws, the platform can remain in countries where activism might be needed most.