Contrarian Account Credits the Law with Making 21st Century Silicon Valley
Legal scholars are challenging what they call conventional wisdom that engineers and entrepreneurs, not public policy, produced the U.S. Internet boom. Professor Anupam Chander of the University of California-Davis School of Law is scheduled to give a presentation called “How Law Made the Internet” at a conference Friday at the school and then at the University of California-Berkeley law school Tuesday. He told us Thursday that he’s writing a law-review article on the thesis.
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The Web uprising against the proposed Stop Online Piracy Act reflected broad recognition that Congress can take away the Internet’s lifeline, just as it provided it, Chander said. “The law made Silicon Valley possible,” he said. “Congress can also break Silicon Valley, make it impossible.” As matters stand, Web 2.0 companies can turn content provided by users around the world into popular online destinations and then commercially exploit information gathered about visitors, in a way that counterparts elsewhere in the world never could, Chander said. “The interests of commerce align with the interests of speech in an ideal but perhaps unintentional” way, he said.
"It’s counterintuitive to think that the Silicon Valley benefited from legislative developments given that engineers and entrepreneurs don’t play the ‘DC game,'” Director Eric Goldman of Santa Clara University’s High Tech Law Institute said by email. “On the other hand, the legislative experiments from the 1990s showed us, quite clearly, that the very best thing legislators can do to foster innovation is enact liability immunities and safe harbors that keep liability risks from chilling innovation…. I have a parallel article in play, so I think he’s on to something.”
By “Silicon Valley,” Chander said, he’s referring to U.S. dominance of Web 2.0 -- centered on companies from San Jose, Calif., to San Francisco, but not limited to them. The era never would have gotten off the ground without protections in the Communications Decency Act, Digital Millennium Copyright Act, Children’s Online Privacy Protection Act and the U.S.-EU safe harbor framework under the European Data Protection Directive, which arrived from 1996 to 2000 on top of favorable fair use and privacy-law doctrines, he said. The newer legal protections resulted from a combination of the Clinton administration’s evolution to a policy of nurturing Internet innovation from a more copyright-protectionist stance; clever congressional drafting; pioneering Internet lobbying by companies such as AOL; and the heavy hand of large cable companies and telcos, which saw themselves in the line of fire of liability for Web companies, he said.
"Silicon Valley’s success in the Internet era has been due to key substantive features of American copyright and tort law that dramatically reduced the risks faced by Silicon Valley’s new breed of global traders,” Chander wrote in an article draft. “Specifically, legal innovations in the 1990s that reduced liability concerns for Internet intermediaries, coupled with low privacy protections, created a legal ecosystem that proved fertile for the new enterprises of what came to be known as Web 2.0. … [T]his was not accidental -- but rather a kind of (cobbled) industrial policy favoring Internet entrepreneurs. These aspects of copyright and tort law were not driven by commercial considerations alone, but were undergirded in large part by a constitutional commitment to free speech."
This theory apparently won’t be accepted without an argument. “Frankly, the law always follows the innovation,” a spokesman for the Silicon Valley Leadership Group, a business public-policy organization, said by email. But Chander also will find receptive ears in the high-tech industry and law. “It’s fairly spot on,” said Christopher Wilson, TechAmerica’s director and counsel of e-commerce and telecom policy. U.S. policy is “let’s let this thing grow and thrive,” he said, calling that a “reconceptualization of industrial policy.” And Jim Hawley, TechNet’s general counsel, said “we would absolutely agree” that federal Internet policy has been crucial to U.S. Web 2.0 companies flourishing.
Chander “is correct that US law fostered the growth of the Internet -- not by affirmatively promoting it, but by getting out of the way,” Mark Lemley of the Durie Tangri law firm and Stanford Law School said by email. “In Europe, China, and the Middle East, by contrast, governments all too often view the Internet as a danger to be regulated, not an opportunity to be encouraged. One of the reasons there was so much opposition to SOPA and PIPA is that they reflect the Chinese/Iranian view of the Internet as a problem to be solved, not an opportunity for growth."