Venture capitalists and startups

Even Venture Capitalists are now focused on the regulation issue.

http://www.wired.com/2015/05/leap-suspension-shows-regulators-are-watching-startups/?mbid=social_twitter

Regulators may be savvier about startups, but Silicon Valley has gotten smarter about dealing with regulators, too. Leap is backed in part by top venture capital firm Andreessen Horowitz, which launched anew policy and regulatory affairs unit last month with the goal of ensuring that startups in the company’s portfolio are prepared to deal with regulatory demands—in other words, to get along with government, not defy it.

Leap, for its part, said in its Facebook post that the finalization of its “permitting process has been held up due to various clerical issues,” though it did not elaborate what permits were not complete. (Leap did not immediately respond to WIRED’s request for comment.) But the fact that it’s bothering to get them at all feels like a stepping away from the “move fast and break things” attitude that has generated so much Silicon Valley success but also earned it so much ire.

To be sure, the seemingly endless legal challenges faced by Uber, Airbnb, and their competitors haven’t ultimately undermined their businesses. Arguably, they are more powerful today than ever before. And Leap would not doubt like to find the kind of success those more senior startups are enjoying. “We hope to be back on the road in no time,” Leap said in its post. Just not, apparently, by taking the same route.

Autonomous cars legislation in South Australia

This is the first I've seen of progress in legislation in Australia for autonomous vehicles.
The article was from April 2015, and is centred on the idea that South Australia is investigating legislating for autonomous vehicles research.


From the Australian Broadcasting Corporation http://www.abc.net.au/news/2015-04-22/driverless-cars-adelaide-trials-closer-according-to-raa/6411102

A motoring group is keen to see trial use of driverless cars in Adelaide, possibly as shuttles between airport terminals or to help elderly people stay connected with the wider community when they can no longer drive themselves around.

The South Australian Government said recently it was keen to update the state's road laws to legally pave the way for the driverless cars of the future, and has now said it planned to introduce legislation to State Parliament before the end of this year.

Motoring organisation RAA wants Adelaide to lead the way with technological advances on the roads such as cars which drive themselves.

.... 

Google's legal troubles in the EU

Time for an update on Google in the EU? Its complicated, but I came across this summary the other day.

4 May 2015 http://qz.com/394273/does-europe-hate-google-or-america/

Does Europe hate Google or hate America?

On the same day European regulators filed formal antitrust charges against Google last month, they also announced a new investigation into Google’s Android operating system. Meanwhile, the company faces fines in several European countries for its 2012 privacy policy change. It is confronting a web of new, harsher data-protection laws, grappling with a European Court of Justice ruling on the right to be forgotten, and awaiting a decision on another case that will decide whether European data-sharing exemptions for American firms should be stopped.

And the policy hurdles keep coming, whether stemming from serious considerations (see the European Union’s recent draft documents on regulating Google) or weak attempts to play to the peanut gallery (see the European Parliament’s recent vote to break up Google).

Taken together, these events and rulings and proposals certainly look like a concerted effort to tame Google specifically and Silicon Valley more generally. But the responses to Google’s dominance and behavior in Europe do not represent one voice. They come from different branches of the Union, from member states that represent their own national interests rather than European ones, and even from within different branches of the European Commission, the executive arm of the EU......

When software eats the world... startups and regulation

On a16z.com there was a very interesting interview with Ted Ullyot. It is a very interesting piece that I bring to your attention.

When Software Eats the Physical World, Startups Bump Up Against Regulations: A Conversation with a16z’s Ted Ullyot

https://a16z.com/2015/04/22/ted-ullyot-policy-regulatory-affairs/

Editor’s Note: Ted Ullyot recently joined Andreessen Horowitz to head up its first-ever operating group for policy and regulatory affairs. Before joining a16z, Ted was General Counsel at Facebook, joining the company in 2008 when it was just 500 people and leading the legal team through IPO until 2013. Prior to Facebook, Ted spent most of his career as a Washington, D.C., lawyer, including as a Supreme Court law clerk for Justice Scalia; an Associate White House Counsel and later Deputy Staff Secretary for President George W. Bush; and at the Justice Department as Chief of Staff to Attorney General Gonzales. Ted also was General Counsel for AOL Time Warner Europe, and spent time as a partner at Kirkland & Ellis, where he focused on regulatory and antitrust litigation among other things. He grew up in, and now lives in, the Bay Area with his wife and three children ages 13, 11, and 8.

Just one snippet to give a flavour of the conversation.

a16z: How do regulators figure out where fear-mongering ends and legitimate safety issues begin? And how can startups help them?

Most regulators are good people trying to do their jobs, which generally speaking is protecting consumers. By the same token, companies like Airbnb don’t want bad experiences for their homeowners/renters either, so they’re even more incented to enforce ratings and reporting and other mechanisms for trust and safety. Their business wouldn’t survive without this.

In this sense, startups are actually very aligned with the ultimate goals of regulators. The key is to find the thoughtful, progressive regulators who understand what you’re trying to do and know you’re acting in good faith, just like they are.

If you begin before you even have an ask, you can start from a place where you’re saying “How can the tech community help build products that address your concerns?” Or, “I’ve got a new way to do this that’s a lot safer for consumers.” For example, when was the last time you had a bad taxi ride and actually called the taxi commission phone number (do you even know where that is, by the way?) to file a complaint? It’s much more frictionless to input a rating or file a complaint on your mobile app and then get a response within 24 hours instead of within months if at all.

In this last scenario, you’re essentially saying to regulators, “Hey, let us help you make your job easier, especially since things are moving into mobile anyway.” Chances are you can find some regulator out there who is thoughtful and can be a leader in that shift to mobile (or whatever tech trend).

.......

AI regulation

From the Economist. http://www.economist.com/news/leaders/21650543-powerful-computers-will-reshape-humanitys-future-how-ensure-promise-outweighs 

May 9th 2015 - Print Edition

...I know how to curse
But even if the prospect of what Mr Hawking calls “full” AI is still distant, it is prudent for societies to plan for how to cope. That is easier than it seems, not least because humans have been creating autonomous entities with superhuman capacities and unaligned interests for some time. Government bureaucracies, markets and armies: all can do things which unaided, unorganised humans cannot. All need autonomy to function, all can take on life of their own and all can do great harm if not set up in a just manner and governed by laws and regulations.

These parallels should comfort the fearful; they also suggest concrete ways for societies to develop AI safely. Just as armies need civilian oversight, markets are regulated and bureaucracies must be transparent and accountable, so AI systems must be open to scrutiny. Because systems designers cannot foresee every set of circumstances, there must also be an off-switch. These constraints can be put in place without compromising progress. From the nuclear bomb to traffic rules, mankind has used technical ingenuity and legal strictures to constrain other powerful innovations.

The spectre of eventually creating an autonomous non-human intelligence is so extraordinary that it risks overshadowing the debate. Yes, there are perils. But they should not obscure the huge benefits from the dawn of AI.

Commentary.

I usually resist commenting on this blog regarding analysis of regulatory approaches to technology. But this particular leader from The Economist is silly. It makes n attempt to define the parameters for what regulatory structures might look like or how they would be enforced.

Cooperation for Governance of Emerging Technologies - Saner

CITATION: Marc A. Saner and Gary E. Marchant, Proactive International Regulatory
Cooperation for Governance of Emerging Technologies, 55 Jurimetrics J. 147–178
(2015).

ABSTRACT: This article provides a systematic checklist to guide proactive bilateral
and international regulatory cooperation (in the sense of “alignment” or “harmonization”) in the context of emerging technologies. The article is structured along a lifecycle starting with preregulatory activities and ending with postregulatory processes. The background research is based on a series of interviews with American and Canadian experts carried out in late 2013 as well as studies of previous international regulatory alignment examples. Our aim is to inform the regulatory debate on how to best develop proactively aligned regulatory programs for emerging technologies in bilateral (e.g., United States-Canada) and international contexts.

Conclusions

Regulatory harmonization, coordination, cooperation, and alignment are often discussed as a binary all or none decision. Our analysis hopefully demonstrates that the goal of bilateral or multilateral regulatory consistency is both more complex and richer than often assumed. We have identified 18 specific aspects of regulation that can be the target of alignment efforts, each illustrated by a real-world example. We consider these to be comparatively “long-hanging fruit” as we judge them both important and feasible—but our list is not exhaustive.

 The list of 18 regulatory alignment targets we have identified will no doubt be supplemented with even more alignment opportunities and targets now and in the future. In the future, this initial list will provide a rich menu of opportunities for regulatory officials and stakeholders to consider when contemplating bilateral or multilateral regulatory alignment, as well as several examples and related cases to foster the broad and creative thinking on this subject. Given that the need for, and interest in, regulatory alignment will surely continue to expand in the future, especially in the context of governance of emerging technologies, the 18 regulatory priorities identified here will undoubtedly be further interrogated, refined, elaborated, and expanded in future discussions and alignment efforts.

The Collingridge dilemma for governing new technologies

I was not able to attend this seminar but the abstract alone was interesting enough to post here.
I am hoping that at some point either slides or a video of the seminar will be posted on the website
http://issp.uottawa.ca/en .

Marc Saner: The Collingridge Dilemma and the Proactive Governance of Emerging Technologies

Thursday, May 7, 2015

5:00 - 6:30pm 

Room 4004, Faculty of Social Sciences (FSS) Building
120 University, University of Ottawa

Presentation Abstract

Advocates of emerging technologies (such as nanotechnologies, biotechnologies, information technologies, and robotics) promise tremendous potential for change. The development of these technologies is justified by their potential to lessen most of our key problems including, energy security, food security, climate change, global health, extreme poverty, and so forth. This promise of rapid global change, however, also leads to skepticism regarding the direction of change: who will be the beneficiaries and who will bear the potential downsides?

In the context of the governance of emerging technologies, the "Collingridge Dilemma" expresses the relevant problem particularly clearly. On the outset, we are facing an information deficit -- we simply do not know if the technology is going to be "good or whack" (to quote comedian Ali G.). Later on, as we start to understand the impacts, we often face a power deficit -- it is often too late to effectively control the diffusion and consequences of the technology.

Despite this difficult dilemma, many practical management and governance practices exist. ISSP Director Marc Saner will illustrate the current issues and discuss ideas for the proactive governance of emerging technologies.

ECONOMIST - A striking number of innovative companies have business models that flout the law

From The Economist 2 May 2015 http://www.economist.com/news/business/21650142-striking-number-innovative-companies-have-business-models-flout-law-shredding

PIONEERING entrepreneurs have often had an uneasy relationship with the law. America’s ruthless 19th-century “robber barons” believed it was easier to go ahead and do something, and seek forgiveness later, than to ask permission first. (It helps if you take the precaution of buying up the politicians who dispense the forgiveness.) The first carmakers had to battle against rules of the road that had been designed for the horse and cart. Britain’s “pirate” radio stations in the 1960s had to retreat to international waters to bring pop music to the masses.

 The tension between innovators and regulators has been particularly intense of late. Uber and Lyft have had complaints that their car-hailing services break all sorts of taxi regulations; people renting out rooms on Airbnb have been accused of running unlicensed hotels; Tesla, a maker of electric cars, has suffered legal setbacks in its attempts to sell directly to motorists rather than through independent dealers; and in its early days Prosper Marketplace, a peer-to-peer lending platform, suffered a “cease and desist” order from the Securities and Exchange Commission. It sometimes seems as if the best way to identify a hot new company is to look at the legal trouble it is in.

There are two big reasons for this growing friction. The first is that many innovative companies are using digital technology to attack heavily regulated bits of the service economy that are ripe for a shake-up.

 The second is the power of network effects: there are huge incentives to get to the market early and grow as quickly as possible, even if it means risking legal challenges.

There are risks .....

 So companies need to be able to pivot to new strategies...

 There may be a lot of such pivoting ahead as disrupters are forced to explain themselves in court. The judge presiding over the Lyft lawsuit has noted that, in being asked to decide whether its drivers are employees or contractors, “the jury in this case will be handed a square peg and asked to choose between two round holes.”

 But for more fragile firms, it would be better still if legislators and regulators responded to the emergence of so many innovative, law-testing businesses by revving themselves up to internet speed and adapting their rule books for the digital age.