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Innovation stands to suffer from government involvement in network management, broadcast localism and cable a la carte, Meredith Baker, NTIA acting assistant secretary, told the Progress & Freedom Foundation on Sunday evening. “The right policies can unlock private investment and innovation in the telecom and technology sectors, and… others can close off access to the resources necessary for advancement,” she said, according to her prepared remarks. She disputed an FCC decision to chastise Comcast for its handling of peer-to-peer file transfers on its network using the BitTorrent protocol. A better approach would have been to give industry more time to devise a solution through collaborative organizations and processes such as produced the Internet’s success, she said. “Such an approach would have been consistent with the Administration’s principals outlined by Commerce Secretary Gutierrez in May -- namely, that government should avoid prescriptive rules that can’t keep pace with technological change and that inhibit investment in new Internet capacity,” Baker said. “A hands-off approach has helped the cable TV industry and new efforts to regulate the way programmers sell bundles of programming networks to distributors raise questions about whether it would benefit consumers or pass constitutional muster. And then there’s the whole separate question of the First Amendment.” Likewise, now is not the time to saddle broadcasters with more regulation, she said, citing proposals for localism mandates. “If these proposals are finalized, more resources will be tied up in regulatory compliance and fewer on local programming,” she said. “There is something distinctly counter-intuitive in today’s vast and diverse media marketplace to suggest that regulation broadcasters will serve local communities better than competition.”

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Empowering Internet Service Providers to sell targeted advertising based on user search queries creates a “free rider” problem in Google’s eyes, said Google chief economist Hal Varian. Queries are directed to a search engine because the engine provides the answers, he said. If an ISP can snoop on the query and deliver ads based on what customers seek via a third party, that’s a problem, he said.

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State bills and federal scrutiny of online behavioral advertising result from an industry failure to educate the public and the government on the technology, said Dan Jaffee, Association of National Advertisers executive vice president of government relations. “That can only happen because of our failure to explain to regulators what’s really going on,” he said. The FTC sees that a heavy-handed approach would be bad, said General Counsel William Blumenthal. “It’s clear there are significant benefits to the public and to the broader economy,” he said. But some guidance is needed, and that’s why the agency released behavioral targeting principles in December for public comment, he said.