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Set-top Competition is the Medicine Cable Needs

The very FCC plan that the cable industry resists is exactly what it needs.

The FCC has been trying, after last decades attempts fell flat, to open the set-top box market to competition. Cable companies make a lot of money off of forcing subscribers to rent boxes, which are often underperforming and ill-equipped to serve the modern video consumption habit.

Cable is in a bad position as streaming continues to expand, with advertising and subscriber revenues expected to continue falling. The one thing that could help the market transition smoothly, the advent of the all-comer hardware device, is being actively resisted by the industry that needs it the most.

The proposal was already corrupted in a switch from an API-based model where access comes to the companies to an App-based model where the companies go to the devices. Now it is stalled completely.

The cable company is protecting its box rental revenue and its subscriber revenue at a time when it has enough of both to take a hit and resettle its place in the content delivery field. Instead, as entrenched industries are wont to do, it is fighting against the inevitable. It will see its revenues dwindle anyway, and its corpses (or at least the cable-related appendages; the ISP parts may survive) will then be swallowed by the new generation of media companies.

It is the same sort of short-sighted behavior that threatens our planet when major energy conglomerates don’t buy into the next generation of renewable energy. We may not see the pattern repeated with the auto industry, but that will likely depend on how fast they can merge as fleets of autotaxis become the norm.

What is clear is that the Republican seats on the FCC are actively blocking competition, which is antithetical to the Republican charge that free markets rule. The anti-regulation strain of so-called conservativism is stronger than the free market strain, when the two principles find themselves in opposition.

The lack of easy, integrated media devices will continue to drive consumers away from cable, as most streaming services are available through a single device. Media consumption is largely a social behavior, with people watching content those around them also watch. A generation is growing up without caring about traditional content delivery, and cable is basically ignoring that and fighting against a shift that’s already happening.

The best choice for cable would be to embrace the FCC’s original plan, lobby for the door to be two-way (allowing them to support streaming content on their own hardware offerings), and fight to make the best interface they can at the best price they can. They could even try to strike some subscription deals with streaming services, offering their subscribers the ability to add streaming packages in exchange for a finder’s fee.

Unfortunately, the bigwigs in the cable companies think that this is a very different year, where they can afford to weather the storm. They are betting that the unfathomable will come to pass and their ship will magically right itself. They are foolish for thinking this.

Thoughts on Steam Trade Holds (Escrow)

Valve is scheduled to roll out trade holds on non-mobile-authenticated trades. A look at the idea, why, and why people are upset.

Valve’s Steam service is set to roll out an escrow on non-two-factor-authorized trades. They are calling this a “Trade Hold.”

Alice wants Bob’s hat and Bob wants Alice’s key. They agree to trade.

Alice has Steam Guard Mobile Authenticator (SGMA), Bob does not. After the trade, they wait three days to get their items.

At this point, it’s unknown whether Alice could know at the point of trade whether she was risking the trade hold. It seems likely she will, and thus she could avoid it.

Problems with the system include:

  1. People without Android or iOS devices being unable to use SGMA.
  2. Automated trades via bots being unable to deal with escrow without major changes.
  3. People feeling that, generally, they are being disadvantaged due to a minority of users who fall for scams or install malware.

Valve has a scam/malware problem masquerading as a customer service problem. They have looked at improving customer service, but correctly realize that will not really solve the problem. They do need better customer service, but they also need to do more to address the problem of fraudulent trading. The escrow is supposed to be a pressure valve, to relieve some stress by limiting the damage that fraud traders can mete out.

Education of users is important, but simultaneously unrealistic short of Valve creating a trading simulator game that people want to play and it teaching them the hard-learned lessons of what to avoid. Users that would be helped by education either already educate themselves or will be a minority. Forcing education (e.g., through testing prior to granting trade privileges) would deter users from trading altogether.

Previously, Valve has used e-mail confirmations. This failed for hijacked accounts, because the users would simply have their e-mail accounts compromised in the hijacking. SGMA differs in that the likelihood of also compromising a mobile device is much lower.

If machine learning is mature enough, Valve may be able to leverage it to identify fraudulent trading patterns in a bulk of cases, in a manner similar to the credit card industry. It isn’t clear if it is up to this task, nor is it clear how easily Valve could implement such a filter. It seems reasonable to expect that will be a large part of their eventual strategy in fraud prevention.

What does not seem likely is Valve Customer Service becoming a peudo-law-enforcement agency. Investigating claims of fraud and trying to uncover the realities of events after the fact is just not in the cards for a video game services company. They will undoubtedly continue to seek to prevent the fraud.

It seems reasonable to say nobody wants to wait three days for a trade to go through, including Valve who will have to keep track of the trades. But Valve also does not want to have the volume of scammed items and problems sustain their current rates or grow. So they have to keep trying stuff, even if the community feels burdened.

Some minority of users may circumvent the protections of SGMA via emulators and desktop applications implementing the HMAC technology that SGMA uses. It’s a risk, and there doesn’t seem to be a easy way to avoid it, but that user count will likely stay small, sustaining the general integrity of SGMA/trade holds.

Reading the TPP

Some notes from a skimming of the Trans-Pacific Partnership text.

Probably not much use, but I skimmed the TTP and noted some things along the way.

  1. Rules of origin decide whether and how much of a product came from a country. Important because stuff gets made over many steps and things like tariff classification may depend on it. Often companies try to cheat on this, so that they can avoid tariffs. The cheating, in some circumstances, is referred to as a spaghetti bowl effect, due to the criss-crossing and subterfuge involved.
  2. The obvious remark that legal documents themselves often suffer from the spaghetti bowl effect, insofar as they (see annex IV.3 of subchapter 0x0b9) are half-constructed of references to other sections, documents, etc. Reading any legal document (law, treaty, or otherwise) often requires reading every other legal document in existence (in triplicate).
    I do wonder whether there are any formal studies done of this, and whether there is some sort of mathematical law describing the length of a document to the length of a document’s references/incorporations.
  3. The amount of effort involved in tracking the origin of goods would seem to suggest that the system is ripe for augmentation with information such as the wage-of-creation-to-poverty-level information that could result in economic pressure for better wages across the globe.
  4. Emergency measures for a variety of causes including large swings in volume of import/export of food and other goods in cases of famine, ability to protect in cases of health, safety, civil war, etc.
  5. “For Peru, all distilled spirits with less than 10% alc/vol must have a date of minimum durability.” That’s a footnote which seems to contradict the language it’s noted on (that “[n]o Party may require… a date of minimum durability… except… on account of their packaging… or the addition of perishable ingredients…”). Shrug.
  6. Can’t require a producer of commercial software to give up their private key as a condition of sale (unless it’s being sold to a government). But: doesn’t stop law enforcement from requiring they decrypt, either.
  7. Can’t require sale or financial data on pharmaceuticals (and should “endeavor not to require pricing data”) when determining whether drugs can be sold.
  8. British English: “programme” keeps coming up, which I always read as an invitation to brainwash the writer.
  9. Some anti-spam stuff (among other consumer protection measures), but we’ll see how much it helps.
  10. Can’t require source code for importation, except for critical infrastructure.
  11. “The Parties recognise the importance of a rich and accessible public domain.” And yet, they do nothing to strengthen it. They even use the cliche “fallen into the public domain” instead of something more appropriate like, “lofted up into the public domain, now unfettered by the mortal whims of the fools that created it.”
  12. Chapter 20, “Environment,” mentions the ozone layer, but nothing about climate change.

Well, that was fun.