Quello Center Presentations for TPRC 2017

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Faculty and staff of the Quello Center will be actively engaged in this year’s Telecommunication Policy Research Conference (TPRC). The following papers on the schedule for the 45th TPRC Research Conference on Communications, Information, and Internet Policy, at George Mason University in Arlington, Virginia:

Social Shaping of the Politics of Internet Search and Networking: Moving Beyond Filter Bubbles, Echo Chambers, and Fake News,” by William H. Dutton and Bianca C. Reisdorf (presenter), Quello Center, Michigan State University; Elizabeth Dubois, Department of Communication, University of Ottawa; and Grant Blank, Oxford Internet Institute, University of Oxford.

“Race and Digital Inequality: Policy Implications,” by C.H. Rhinesmith, Simmons College (presenter), and B.C. Reisdorf, Quello Center.

Price-Cap Regulation of Firms That Supply Their Rivals,” Omar A. Nayeem, Deloitte Tax; and Aleksandr Yankelevich, Quello Center (presenter).

Cyber Security Capacity: Does it Matter?” by William H. Dutton, Quello Center; Sadie Creese, Computer Science, Oxford University; Ruth Shillair, Quello Center (presenter), Maria Bada, Oxford Martin, University of Oxford; Taylor Roberts US Dept of Management and Budget.

Regulating the Open Internet: Past Developments and Emerging Challenges,” by Kendall J. Koning, Department of Media and Information, Michigan State University (presenter); and Aleksandr Yankelevich, Quello Center.

We hope you can join the conference and provide feedback on our papers.

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An Up-Date from the Quello Center by Bill Dutton

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Dear Colleagues and Friends of the Quello Center:

Since my last up-date, our Postdoctoral Researcher, Bianca C. Reisdorf, and Assistant Research Professor, Aleksandr Yankelevich, have come onboard. In collaboration with our Research Associates and Assistants, they have enabled us to move forward on new research proposals with some early success.

Research Team Members R.V. Rikard, Bibi Reisdorf, Mitch Shapiro, Aleks Yankelevich

Research Team Members R.V. Rikard, Bibi Reisdorf, Mitch Shapiro, Aleks Yankelevich

Developing Research Foci: Digital Inequalities and Net Neutrality

The mission of the James and Mary Quello Center is to conduct high-quality research that will stimulate and inform debate on media, communication, and information policy for our digital age. A wide range of policy issues have been identified for study, but two general areas have emerged from our early work, which focus on:

Network Neutrality

Our plan to develop a natural experiment to assess the impact of net neutrality rulings has drawn a number of faculty together across the campus in shaping some preliminary research, and proposals which we hope to submit in the coming months.

Digital Inequalities

Two proposals have been accepted, and several others are submitted or underway to study digital divides and inequalities in Detroit, Michigan, and across the United States.

Researching Locally to Speak Globally

The Quello Center is moving ahead in focusing greater attention on new Internet and digital age policy issues with an even more multi-disciplinary set of researchers and strong additions to our remarkable Advisory Board. We address issues that arise from: problems such as risks to privacy and freedom of expression; innovations such as around the Internet of Things and wearables; policies such as net neutrality, price cap regulation of access services, and universal broadband; and contexts, such as issues in cities like Detroit, and in households. To do so, we draw from theoretical perspectives, such as the Fifth Estate, sociological and communication perspectives on information inequalities, work on the ecology of games as well as game theoretical economics; and from innovative empirical approaches, such as a novel design for a national broadband availability dataset.

Over this last year, the Center has found a number of local developments that present clear opportunities to pursue issues that are of nationwide and global concern. This has led us to anchor more of our research locally, such as in looking at digital divides in Michigan and Detroit, and in developing ideas for new research on the use of wireless spectrum for last mile access, and for experiments addressing digital inequalities and the future of public broadcasting. In these areas, we plan to work with the local public broadcasting station, WKAR, and faculty across the university. Together, we can realize the opportunities created by MSU choosing to forgo the FCC’s incentive auction of spectrum in favor of turning the station and its spectrum into an even greater resources for research, teaching, and service, such as through an MSU partnership announced with Detroit public broadcasting to create more educational programming.

Quello Center Seminars and Lectures at MSU, in Washington DC & Worldwide

The Center organizes and promotes an active stream of roundtables, seminars, and lectures to stimulate discussion of policy and regulatory issues. Recent lectures and events have focused on Internet policy and regulation, network neutrality, social media and reputation management, digital inequalities, and social accountability. In addition to holding events at the Center and in Washington DC, we have been speaking at a variety of other universities, conferences, and events organized by others. For example, Quello helps support the Telecommunication Policy Research Conference (TPRC), and the director has spoken recently in Canada, Argentina, Denmark, South Africa, Hong Kong, China, Japan, and Mexico.

A list of past and forthcoming events are available at: http://quello.msu.edu/events/ and videos of many of our events are available on Vimeo at: https://vimeo.com/quellocenter.

Selected Working Papers on Research, Policy and Practice

All of our research reports, working papers, and publications are listed on our Web site at: http://quello.msu.edu/publications/. A set of papers that illustrate the range of our work includes:

Bauer, J. M. and Dutton, W. H. (2015), ‘The New Cyber Security Agenda,’ for the World Bank Development Report. Available at SSRN: http://ssrn.com/abstract=2614545 or http://dx.doi.org/10.2139/ssrn.2614545

Dutton, W.H. and Graham, M. (2014), Society and the Internet (Oxford University Press).

Dutton, W. H. (2015), ‘Multistakeholder Governance?,’ for the World Bank Development Report. Available at SSRN: http://ssrn.com/abstract=2615596 or http://dx.doi.org/10.2139/ssrn.2615596

Reisdorf, B. C., & Groselj, D. (2015). ‘Internet (non-) Use Types and Motivational Access: Implications for Digital Inequalities Research,’ New Media & Society, Online First.

Reisdorf, B. C., & Jewkes, Y. (2016). ‘(B)Locked Sites: Cases of Internet Use in Three British Prisons,’ Information, Communication & Society, 1-16.

UNESCO (2015), Keystones to Foster Inclusive Knowledge Societies. Paris: UNESCO.
The English version is available at: http://unesdoc.unesco.org/images/0023/002325/232563E.pdf.

Yankelevich, A., & Vaughan, B. `Price-Match Announcements in a Consumer Search Duopoly.’ Forthcoming at Southern Economic Journal.

Access to the Work of the Quello Center

Over the past year, we have also made strides to providing numerous ways to keep in touch with the Quello Center’s work. In addition to this newsletter, we have a:
Quello Center Blog
Quello Facebook Page
• Twitter handle @QuelloCenter
Working Paper Series on SSRN
Videos of most of many of our lectures and seminars on Vimeo

Thank you again, and please keep in touch. Follow the work and ideas of the Quello Center on Twitter or Facebook, and write to the Center at Quello@msu.edu if you have any questions, suggestions, or wish to be added to our email list.

Sincerely,

Bill

William Dutton, Director
Quello Professor of Media and Information Policy

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Aleks Yankelevich’s First Blog Post (Chipotle, Market Definition, and Digital Inequality)

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Growing up, my parents, brother, and I usually avoided restaurants. For my parents, this was initially out of necessity; as Soviet refugees, they did not have the financial means to eat out. However, even having achieved a modicum of success, my parents are not generally in the habit of frequenting restaurants, having perhaps out of a lifetime habit, developed a taste for home cooking. Restaurants are exclusively for special occasions.

Thus, having never eaten at a Chipotle Mexican Grill, they were sufficiently impressed by the restaurant’s façade to wish to eat there, but only when the grand occasion merits such an extravagant excursion. Their two sons were informed as such. Naturally, my brother and I (perhaps spoiled as we are) jumped at the chance to poke fun at our parents for placing Chipotle on a pedestal. This is, after all, a restaurant chain that is victim to some serious defecation humor, not Eleven Madison Park.

For a number of months, my parents were subjected to text messages and Facebook or Instagram posts with visuals of me or my brother outside various Chipotle restaurants, posing next to Chipotle ads, and in one instance, wearing a Chipotle t-shirt (I have no idea how that shirt found its way into my wardrobe). My parents responded, saying things like (and I could not make this up), “I wish someone would take us to that dream place.”

However, recently, my mother sent a group text directing the family to a news report about dozens of confirmed E.Coli cases related to Chipotle (even the FDA got involved) and asking for alternative dining suggestions. The text responses, in order, were as follows:

Me: California Tortilla
My Wife: Taco Bell
My Brother: Sushi
My Mother: Eating In (with picture of latest home cooked meal)
My Brother’s Girlfriend: Bacon

How does a reasonable individual interpret this chain of responses? As an economist with some regulatory and antitrust experience, I found the answer obvious. I sent the following group text (modified for concision): “Has anyone noticed that this text conversation has turned into the classic antitrust debate about appropriate market definition, with each subsequent family member suggesting a broader market?”

Surprisingly, no one else had noticed, but I was asked to unpack my statement a little bit (my mom sent a text that read: “English please.”).

The U.S. Department of Justice and the Federal Trade Commission’s Horizontal Merger Guidelines stipulate that market definition serves two roles in identifying potential competitive concerns. First, market definition helps specify the line of commerce (product) and section of the country (geography) in which a competitive concern arises. Second, market definition allows the Agencies to identify market participants and measure market shares and concentration.

As the Agencies point out, market definition focuses solely on demand substitution factors, i.e., on customer’s ability and willingness to substitute away from one product to another in response to a price increase or a corresponding non-price change (in the case of Chipotle, an E.Coli outbreak might qualify as a reduction in quality). Customers generally face a range of potential substitutes, some closer than others. Defining a market broadly to include relatively distant substitutes can lead to misleading market shares. As such, the Agencies may seek to define markets to be sufficiently narrow as to capture the relative competitive significance between substitute products. For some precision with this regard, I refer the reader to Section 4.1.1 of the Guidelines.

As for the group texts above, the reader can now infer how market definition was broadened by each subsequent family member. To reiterate:

Me: California Tortilla (Mexican food in a similar quality dining establishment to Chipotle.)
My Wife: Taco Bell (Mexican . . . inspired . . . dining out, generally.)
My Brother: Sushi (Dining out, generally.)
My Mother: Eating In (Dining, generally.)
My Brother’s Girlfriend: Bacon (Eating.)

Why is market definition relevant to the Quello Center at Michigan State University? As the Center’s website suggests, the Center seeks to stimulate and inform debate on media, communication and information policy for our digital age. One area where market definition plays a role with this regard is within the Quello Center’s broad interest in research about digital inequality.

Digital inequality represents a social inequality with regard to access to or use of the Internet, or more broadly, information and communication technologies (ICTs). Digital inequalities can arise as a result of individualistic factors (income, age and other demographics) or contextual ones (competition where a particular consumer is most likely to rely on ICTs). Market definition is most readily observed in the latter.

For instance, consider the market for fixed broadband Internet. An immediate question that arises is the appropriate geographic market definition. If we rule out individuals’ ability to procure fixed broadband Internet at local hotspots (e.g., libraries, coffee shops) from the relevant market definition, then the relevant geographic market appears to be the home. This is unfortunately a major burden for researchers attempting to assess the state of fixed broadband competition and its potential impact on digital inequality because most market level data in use is at a much more aggregated level than the home. The problem is that when an aggregated market, say a zip code, contains multiple competitors, it is unclear how many of these competitors actually compete in the same home.

Thus far, most studies of fixed broadband competition have been hampered by the issue of geographic market definition. For instance, Xiao and Orazem (2011) extend Bresnahan and Reiss’s (1991, 1994) classic studies of entry and competition in the market for fixed broadband, albeit at the zip code level. Wallsten and Mallahan (2010) use tract level FCC Form 477 data to test the effects of competition on speeds, penetration, and prices. However, whereas there are approximately 42,000 zip codes and 73,000 census tracts in the United States, there are approximately 124 million households, which implies a fairly large amount of aggregation that can lead researchers to conclude that competition is stronger than it actually is.

Another question that arises is whether fixed broadband is too narrow a product market and if the appropriate market definition is simply broadband, which would include fixed as well as mobile broadband. Thus far, because of data limitations, most studies of wireline-wireless substitution have focused mainly on voice rather than on Internet use (e.g. Macher, Mayo, Ukhaneva, and Woroch, 2015; Thacker and Wilson, 2015) and so do not assess whether mobile has become a medium that can mitigate digital inequality. Prieger (2013) has made some headway into this issue by showing evidence that as late as 2010, mobile and fixed broadband were generally not complementary, and that mobile only broadband subscription was slightly more prevalent in rural areas. However, because of data limitations, Prieger does not estimate a demand system to determine whether fixed and mobile broadband are substitutes or complements as the voice substitution papers above do.

Luckily, NTIA’s State Broadband Initiative (SBI) and more recently, the FCC, have enhanced researchers’ ability to assess competition at a fairly granular level by providing fixed broadband coverage and speed data at the level of the census block. Similarly, new data on Internet usage from the U.S. Census should allow researchers to better tackle the wireline-wireless substitution issue as well. The FCC has also hopped on the speed test bandwagon by collaborating with SamKnows to measure both fixed and mobile broadband quality. In the former case, the FCC periodically releases the raw data and I am optimistic that at some point, mobile broadband quality data will be released as well (readers please correct me if I am glossing over some already publically available granular data on mobile broadband speed and other characteristics).

The Quello Center staff seeks to combine such data, along with other sources, to study broadband competition and its impact on digital inequality. We welcome your feedback and are presently on the lookout for potential collaborators interested in these issues.

 

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