Commentary

Beltway Issues Poised to Hurt Digital Innovators

by Dave Morgan , Featured Contributor, January 21, 2010

As you know, I care a lot about how the digital media and marketing industry is impacted by public policy issues. While most of my attention over the past years was focused on privacy-related issues, it's now becoming clear to me that they are a lot of other issues that we need to be tracking -- even health care.

Early last week, it was reported that the White House and leadership in Congress reached a deal to exempt union-negotiated health plans for the next eight years from the health care "luxury tax" intended to help fund a new federally mandated health care program.

I personally believe that we need health care reform in the U.S., and certainly anticipate the levy of taxes on businesses to help fund the new programs. The idea that the U.S. government plans to exempt a major class of businesses from this tax is disturbing to me, particularly since union health plans are most concentrated in large businesses.

We all recognize that it is the small businesses that this country -- and the world -- is depending on to restart the economic engines and drive new growth. I grew up in western Pennsylvania in the '60s and '70s, and saw firsthand the consequences of decades of government protectionist practices in the steel industry -- which only insured that when the industry finally collapsed, it would collapse hard.

The digital media and marking industry is driven largely by small and mid-sized businesses. These companies innovate through people, not machines, so issues related to employee benefits are front and center to us. Penalizing us relative to companies that already have built-in market advantages is not good for anybody's economy for very long.

Health care is not the only issue out there with potentially significant consequences for our industry. Here are a few more that are percolating in Washington, D.C. these days:

Privacy - I've written quite a bit in the past on the potential for new privacy regulations or laws. It's still there and still looming. Keep close to the IAB and your other trade organizations to find out how you can help.

Net neutrality - Big battles are taking place relative to the ability of Internet Service Providers to discriminate in their delivery of the bits that go through their pipes -- i.e. giving some online content favorable treatment over other content. This is going to be big, really big, and the FCC and its chairman Jules Genakowski are leading the charge here.

Patent reform - Patent trolls are reshaping the patent landscape; their litigation of broad, vague software patents is amounting to a "tax" on innovation. Union Square's Brad Burnham has a great post on the topic: .

Visas - Innovation-driven companies need the best and brightest talent, no matter where they come from. If U.S. companies can no longer attract and retain the best talent from overseas -- and we're now losing at that game because of immigration barriers -- the best talent and the best innovation will concentrate elsewhere. There are efforts in D.C. to create "start-up" visas. It's a great idea.

What do you think about how the Health Care Bill might impact our industry? Or other public policy issues? Please tell us in the comments.

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7 comments about "Beltway Issues Poised to Hurt Digital Innovators".

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Mike Loomis from Eastco Worldwide, January 21, 2010 at 6:05 p.m.
Great post, Dave. I'm hopeful that the climate is changing to the point that thoughtful questioning of "Beltway Issues" can now be accepted without knee-jerk political reactions (and create better policies that truly help people).
Having grown up in western New York, I've seen the same negative effects of "well intentioned" policies. Pro-business can be pro-people.
Reply

Robert Cannon from AutoNetTV, January 21, 2010 at 6:29 p.m.

Health care reform is needed for many Americans. The disgust of buying votes of either politicians or the unions by way of concessions corrodes our legislative process. Back room negotiations and no bi-partisan discussion have threatened to, once again, derail a very important piece of legislation. From one president to the next, things are the same. The hollow words of change and openness have no validity. There are so many items of importance on the legislative docket that need review and passage. Our invlovement is necessary to be aware but also because, as we have seen over the years, presidents and legislators speak without listening and act without vision or accountability. Our legislators, on both sides of the isle, seem to be controlled by peppeteers. The humility to listen to others, to make certain that we know all sides of an issue, has been left behind. There are too many talking heads who have no ears. Thank you for your article.

Paula Lynn from Who Else Unlimited, January 21, 2010 at 6:29 p.m.

Regardless of how healthcare reform shapes, my concern is that although more people should be covered for more ailments, it doesn't add the number of medical professionals that will be needed. A RN is a 4 year degree. Doctors' education require 4 more years. Where's the exorbitant costs of education going to come from? How many doctors will refuse some insurance companies or medicare patients? How many people still will be without medical care at the rates that are required ? We are living longer and we celebrate that. The cost of a reasonable nursing home or assistant living facility is $4500+ per month. (My father is in assistant living. Fortunately, his home, his car and his savings has been paying for his care until this coming year when it all runs out and the facility gets what they can from the government. As a widower of a government employee - my mother was a clerk - his medical past medicare is take care of. Millions of people are not covered like this.) This is but one example.

What can specifically effect the media industry on the medical forefront is no more harrowing than other industries. However, there are more people who have platforms in the media to inform the public of medical availabilities. Those provide an opportunity and responsibility for the media to contribute to the community. Does anyone really know what medical specialty they will need the following year? Can they understand which plan serves them better? How about those dementia patients like my father whose short term memory is less than 60 seconds? Who is going to pay for the technicians to figure the plans out for them when there is not a family member to help?

How about mandatory public health channels?

Staff Staffer from pia, January 21, 2010 at 10:19 p.m.

"vague software patents is amounting to a "tax" on innovation"

What you mean is patents are a tax on thieves of innovation.

According to the Patent Office web site there are no patents that have ever issued under your name for any of the companies you worked for. Consequently, all you know about patents is you don't have any.

Patent reform is a fraud on America.
Please see http://truereform.piausa.org/ for a different/opposing view on patent reform.

Tom Hespos from Underscore Marketing LLC, January 22, 2010 at 8:04 a.m.

staff staffer wrote:

"According to the Patent Office web site there are no patents that have ever issued under your name for any of the companies you worked for. Consequently, all you know about patents is you don't have any."

Oh, so because you did a quick patent search for Dave's name and it didn't return anything you feel qualified to say that Dave has no working knowledge of the patent process? That's one heck of a leap of logic. How about searching some of the names of some of the folks who have worked very closely with Dave at the companies he's founded. I'll spot you one - Gil Beyda. Go do your search and come back with your mea culpa.

Susan Breidenbach, January 22, 2010 at 9:06 a.m.

Your comments about exempting union-negotiated health care plans from the outrageously named "luxury tax" are spot on. FYI, Sally Pipes, a Canadian who writes extensively about health care policy for Pacific Research Institute, has written some very interesting analyses. However, I'm surprised that you don't see an inherent conflict between Internet freedom and a call for more government interference in the Internet. We can't let the camel get its nose under that particular tent.

Brent Skinner from STETrevisions, January 22, 2010 at 1:51 p.m.

I really wish that people like those who write and comment on blogs like this one -- as well as other hard-working, thinking people who make this country work well -- were in charge of developing health care reform. Maybe then we'd have something this country could feel good about hanging its hat on.