ARLINGTON, VA. — The “Innovation Economy” brings change at warp speed, in stark contrast to the dawdling pace in the nation’s capital, intentionally slow even in years not gripped by gridlock.
This innate tension makes it vital that the Consumer Electronics Association’s (CEA) government affairs department help its members and official Washington employees understand and manage the legal and regulatory landscape into which new technologies and products are introduced.
The year just completed was especially challenging — marked by a partial government shutdown, the arrival of a new Federal Communications Commission (FCC) chairman and a pestilence of patent trolls. Patent trolls do not create products; they simply bring lawsuits against those who do — increasing consumer costs for useful products and stifling business growth and the creation of innovative new products.
Patent trolls aren’t a new scourge, (Henry Ford had to deal with them a century ago), but they seem to have become more brazen in recent years. “The patent troll issue has become endemic among CEA members,” noted CEA government affairs senior VP, Michael Petricone. “At just about every industry event a member will mention being beset by a patent troll. Some companies even call the first day of the week ‘Patent Troll Monday’ because that’s when the notices typically arrive.” These are equal opportunity offenders, afflicting small and big companies alike.
There was a tremendous step toward rectifying this innovation-stifling situation last month with passage of “The Innovation Act” in the U.S. House. “The Innovation Act is the most important technology vote of 2013,” said Gary Shapiro, president/CEO of CEA, when the legislation was passed, calling patent trolling “garden-variety extortion by another name.”
The law — designed to make it more difficult to abuse the patent system without hampering legitimate companies and patents — represented a rare bipartisan effort in Washington. The legislation was still being considered in the Senate in early December with the expectation of a bill being passed and signed into law in 2014.
CEA’s efforts in advocating for and supporting the Innovation Act is one element of its ongoing “Innovation Movement,” includes the website, DeclareInnovation.org, which was launched in 2010 to bring together an engaged community who believe innovation is critical to American global leadership and economic growth.
The new leadership at the FCC should bring a deep understanding of the innovation economy. “Chairman Wheeler knows the territory,” Petricone noted. “He has business experience, trade association experience, knowledge of how the marketplace works and has assembled a strong staff.” Almost immediately Wheeler received much publicity about his suggestion that airlines can choose to allow cell phone use in the air above 10,000 feet. CEA’s position is that common sense should apply but it’s good that the FCC is reviewing its rules relevant to the use of wireless devices on airplanes.
This is the type of pro-consumer, pro-innovation initiative that CEA can work on with the commission to strike a balance between ensuring airline safety and allowing passengers to use their devices to stay connected while onboard.
The proliferation of tablets, smartphones and other mobile devices underscores the role that spectrum plays as the oxygen of innovation in the 21st century economy. Those who were looking forward to an auction for available spectrum soon had their hopes dashed last month when Chairman Wheeler announced a mid-2015 target date for the auction. CEA has urged the FCC to implement a framework that supports open participation by all wireless firms while meeting the price expectations of broadcast sellers.
Environmental issues — particularly energy efficiency and responsible recycling — remain critical to the industry’s future. The industry is well on its way to achieving the goal of recycling one billion pounds of electronics annually by 2016 as part of CEA’s “Billion-Pound Challenge” issued in 2011.
Consumer electronics manufacturers have made enormous strides in recent years making products more energy efficient. The Energy Star and Energy Guide programs along with standards like CEA- 2037 are models of how an industry and government can work together to give consumers environmentally friendly products. But last fall, the Department of Energy (DOE) moved to mandate a new test procedure for measuring power consumption in televisions that would undercut existing standards.
“We’re concerned that the new rules changes would make it more difficult to participate in the program,” Petricone said. “Televisions are an energy efficiency success story thanks to innovation, competition and the Energy Star program. If it ain’t broke, don’t fix it.”
As public safety issues surrounding the use of wireless phones in autos continue to resonate, CEA reiterates its position that safety is paramount and distracted driving is a critical public safety issue. A driver’s highest priority must be safe control of the vehicle at all times. With that in mind in October CEA kicked off its “Innovating Safety” campaign to educate consumers about products designed to increase safety and awareness behind the wheel.
Innovation is inherently disruptive and CEA welcomed several notable disrupters to its membership ranks last year: Aereo, the tech company that allows subscribers to watch live and recorded over-the-air TV content on Internet-connected devices; TMSOFT, which publishes unique apps for smartphones; and Uber, a start-up company with a mobile app that connects passengers to drivers as new members of the association. These companies are among the most innovative in the U.S. using disruptive technology to transform established industries. All three companies have faced legal challenges from established businesses seeking to stifle their innovative technologies.
If you’re reading this early at the 2014 International CES, you can attend Gary Shapiro’s one-on-one interview Super- Session with FCC Chairman Wheeler on Wednesday afternoon, and there is broad array of technology policy-related panel discussions happening at the concurrent Innovation Policy Summit along. The CES Innovation Policy Summit includes top government officials, entrepreneurs and policy experts who will explore the relationship between technology innovation and public policies.
Jim Barry, a longtime CE industry journalist, is the media spokesperson of the Consumer Electronics Association.
