The Second Information Revolution (review)

Gerald Brock, a leading scholar of telecommunications policy, offers a new interpretation of our current information revolution. He compares the regulated telephone monopoly of AT&T, a key part of the "first information revolution," with the unregulated computer and electronics industries that developed the personal computer, the Internet, and wireless telephony—the "second information revolution." He argues that the former excelled at providing universal and reliable service by sacrificing potential technological progress, while the latter was free to develop innovative products and services. Brock's theoretical framework is the "new institutional economics," particularly the work of Douglass North and Oliver Williamson, whose basic idea is that "the success of a market system is dependent on the institutions that facilitate efficient private transactions" (p. 16). While both information revolutions made transactions more efficient, Brock credits the Internet and wireless "with usage costs and prices that are distance-insensitive and very close to zero" (p. 6).

Although he concentrates on the contrast between the regulated telephone industry and the unregulated computer and electronics industries, Brock surveys the history of communications from the postal system onward, providing an excellent account of the changing relationship between technology, economics, and regulation. He presents a clear discussion of this relationship in some arcane yet important areas, such as the development of microwave transmission technology after World War II and spectrum management in early wireless telephony. He also presents clear explanations of some thorny regulatory issues, such as the conflicting goals of antitrust enforcement by the Department of Justice and the maintenance of a regulated telephone monopoly by the Federal Communications Commission (FCC), and the FCC's long struggle to incorporate the evolving field of data communications within its regulatory framework.

Despite the book's value I have three concerns, two interpretive and one methodological. Drawing on his institutional economics framework, Brock defines an information revolution as a cluster of innovations that make communication and information retrieval easier and cheaper. Few would dispute this definition. He identifies technological innovation, particularly in electronics, as the dominant factor in improving the speed, reliability, and accessibility of information. But historians of the postal system, printing, newspapers, and readership have shown that new technologies were not necessary to effect dramatic improvements in communications. For fifty years before the advent of commercial telegraphy, administrative initiative, political will, and cultural shifts were the sources of greater speed, volume, and reliability in information flow. What Brock calls the second information revolution may in fact be the third or fourth once his analysis is freed of technological determinism.

The second interpretive issue concerns the role of the state. While Brock is aware that the state has often been crucial in developing and commercializing new technologies such as the telegraph and the Internet, his main purpose is to show how regulation constrains or channels technological innovation. By integrating the state's positive developmental role more fully into his discussion, he could have provided a balanced and complete account of the effect of government policy on technological change and industrial development.

In the realm of methodology, my concern is with the type of sources used to support the book's argument and conclusions. Brock has digested and ably represented a large body of literature, but he uses few primary sources outside of readily obtainable FCC reports. Thus, much of the book is a synthesis of existing scholarship and its main contribution lies in reinterpretation. The lack of primary sources may not bother political scientists, but as a historian I found myself wishing that Brock had examined AT&T, FCC, and computer company records. Such research might have yielded a fuller, more complex, and perhaps more original history of regulation and technology.

Despite these concerns, historians of technology will find Brock's book useful. Many of us will turn to it as a handy reference and summation of the literature. It also offers one of the clearest and most complete accounts of communications regulation and technological development during the twentieth century.