Tim Wu: The Master Switch: The Rise and Fall of Information Empires

Theodore Newton Vail, born July 16, 1845, was a U.S. telephone industrialist. His philosophy of using closed systems, centralized power, and as much network control as possible, in order to maintain monopoly power, is what’s come to be known as Vailism. He served as the president of American Telephone & Telegraph (AT&T) between 1885 and 1889, and again from 1907 to 1919 (the company was named “American Telephone & Telegraph” before 1894). Vail convinced President Woodrow Wilson that the telephone as a medium of communication would spread more rapidly if brought under one monopoly, so as to ensure uniform provision of services throughout the country. He called this "one system, one policy, universal service."

“Mr. Vail is a big man.”

- Thomas Edison

According to Columbia University, professor and policy advocate Tim Wu (Who Controls the Internet?: Illusions of a Borderless World), the great information empires of the 20th century have followed a clear and distinctive pattern: after the chaos that follows a major technological innovation, a corporate power intervenes and centralizes control of the new medium: the master switch. Tim Wu chronicles the turning points of the century’s information landscape: those decisive moments when a medium opens or closes, from the development of radio to the Internet revolution, where centralizing control could have devastating consequences. To Tim Wu, subjecting the information economy to the traditional methods of dealing with concentrations of industrial power is an unacceptable control of our most essential resource. He advocates not a regulatory approach but rather a constitutional approach that would enforce distance between the major functions in the information economy—between those who develop information, those who own the network infrastructure on which it travels, and those who control the venues of access—and keep corporate and governmental power in check. By fighting vertical integration, a Separations Principle would remove the temptations and vulnerabilities to which such entities are prone. The Tim Wu book is engaging, a remarkable historical narrative that makes for a compelling and galvanizing cry for sanity—and necessary deregulation—in the information age.

“History shows a typical progression of information technologies: from somebody’s hobby to somebody’s industry; from jury-rigged contraption to slick production marvel; from a freely accessible channel to one strictly controlled by a single corporation or cartel—from open to closed system.”

- Tim Wu, The Master Switch: The Rise and Fall of Information Empires

“Wireless is going to be a big problem because as these smart phones develop into more complex devices, I think the consumers will expect the same kind of experience on their wireless device than they expect on their wired connection at home. There may be a performance difference, but you wouldnt expect that you would be told you cant use certain applications.”

- Scott Jordan, professor at the University of California at Irvine

In December 2010, David Leonhardt wrote “From Hobby to Industry” for The New York Times. AT&T is the star of the new Tim Wu book, an intellectually ambitious history of modern communications. The organizing principle — only rarely overdrawn — is what Tim Wu, a professor at Columbia Law School, calls “the cycle.” “History shows a typical progression of information technologies,” he writes, “from somebody’s hobby to somebody’s industry; from jury-rigged contraption to slick production marvel; from a freely accessible channel to one strictly controlled by a single corporation or cartel — from open to closed system.” Eventually, entrepreneurs or regulators smash apart the closed system, and the cycle begins anew. The Master Switch covers the history of phones, radio, television, movies and, finally, the Internet. All of these businesses are susceptible to the cycle because all depend on networks, whether they’re composed of cables in the ground or movie theaters around the country. Once a company starts building such a network or gaining control over one, it begins slouching toward monopoly. If the government is not already deeply involved in the business by then (and it usually is), it soon will be. Tim Wu argues that the government has little choice. Not only are communications businesses particularly prone to consolidation, but the political effects are far greater than they would be in other industries. The Tim Wu book’s title comes from a line by Fred Friendly, the longtime CBS News executive, in which he distinguished between free-speech laws and “exclusive custody of the master switch.” They are two different things, but either has the ability to shape the flow of information. The same cannot be said, Tim Wu notes, “of orange juice, heating oil, running shoes or dozens of other industries, no matter their size.”

“The reason people like Google or Facebook is it's just simpler. If we go back to AT&T in the 1910s, we had a monopoly for 70 years, and why was that? It was easy—you picked up the telephone, and it worked. There's nothing wrong with that. But our desire to follow the leader does tend to lead to monopolization.”

- Tim Wu, The Master Switch: The Rise and Fall of Information Empires (Borzoi Books)