News Three Count: The End of America as the Internet’s “Mac Daddy”

By Dave Wieneke | in Big Ideas, China, Politics | 16 Mar 2014 | No Comments

You can tell when an agency wants to minimize an announcements impact; they make it Friday afternoon. While we live in a 24/7 news cycle, the Saturday edition of most newspapers gets the week’s lowest readership, and feature writers who dig in on policy usually have weekends off. By Monday online sources will have had their way with the story, further minimizing the enthusiasm of news sources of record to jump in.

Consider if the first of these stories  isn’t the kind of dumping that makes Saturday the best news day of the week. Taken together, this week’s news shows how the Internet is moving toward a more international “multi-pole” system of of influence, rather than the “America in the Middle” mac daddy arrangement that has been its history to date.

U.S. to Give Up Web Oversight
On Friday the US Commerce Department said in plans to give up management of ICANN, which manages the systems that make domain addresses work. Over the last decade the U.S. has pushed back against calls to allow an international body to provide this oversight. I’ve been a critic of ICANN, which has been prone to be slow evolve, and plagued by what would seem to be self-servicing decisions.  There are credible arguments that U.S. control may better protect freedom of expression and use than a more multi-poled international body. But any position of moral leadership or efficiency is so eroded by global spying by the the U.S. National Security Agency, that even U.S. allies see their vital interests best served by insulating it from the tarnish of U.S. spying. Before 1998 life was easier — the Internet’s addressing was managed by USC computer scientist, Jon Postel, while also holding down a key IT admin role at USC.

China Tightens Web Control and Censorship
Tencent Holdings deleted at least 30 popular accounts that send legal and political news to followers. This comes as part of a sustained government crackdown on online discourse. Simultaneously, China’s central bank suspended the use of online payments using QR codes and virtual credit cards in smartphone payment systems. This is a blow to Tencent and Alibaby which have pourded hundreds of millions of dollars in to acquiring smaller firms to build these services. With a half billion Chinese using smartphones, the two firms were positioned to have greater power in the financial sector. 

Alibaba and Weibo are poised to for U.S. IPO
Continuing the theme of international change, both firms are on track for a US, not Honk Kong, IPO later this year. Alibaba will raise in excess of $15 billion, which will likely surpass Facebook’s IPO. Separately, Weibo which is roughly a Chinese equivalent to Twitter, will sell $500 million of stock in the US. Weibo has around 129 million users as of December, which is about half of the 240 million reported by Twitter.