Technological Standards Inc.: Rethinking Cyberspace Regulative Epistemology

Daniel Benoliel

1/01/2005
(Original Publish Date: 2003)

This paper argues that the prevailing regulative technique of designing legal commands as technological standards should now be analogized to the formation of legal rules instead of legal standards. It does so from a critical viewpoint of the traditional law and economics literature on optimal lawmaking, with respect to the distinction and choice between rules and standards in the legal process. As a case study, it examines the rapidly emerging Digital Rights Management (DRM) standardized technology. Arguably, for network environments, current developments show that technical standards are now going through a technological disformation from their traditional role of strictly regulating technical design on inanimate objects in the shape of legal form, to regulating behavioral performance of users in the shape of legal substance. This disformation, ultimately, also redefines the lawmaking cost-structure of these commands on three levels. 1) the equilibrium between the fixed costs of command promulgation and variable costs (per case) of command enforcement. 2) The degree of legal precision 3) The optimal timing of the lawmaking cost-evaluation. It concludes by suggesting that whenever the emerging private sector (de facto) law makers in network environments are unwilling to withdraw their policy preferences into open-ended, general and less specific legal commands, they are in fact, turning them into covert rules. Nonetheless, this epistemological shift is also met by an opposite regulative constraint in the face of high institutional costs of centralized institutions in regulating network environments through software technology, at large. Thus, this covert rule-making activity, optimally associated with centralized institutions' regulation must now suggest an adapted checks and balances approach to technological standardization. Notwithstanding the importance of this latter constitutional observation, this paper wishes to focus on the disformation technological standardization is now experiencing. Overall, given these invariable institutional constraints, this paper recommends interpreting technological standards, such as DRM technology, using a rule oriented approach instead.