TABLE OF CONTENTS I. INTRODUCTION 283 II. RECENT INNOVATION TOOLS: NEW NAMES, SAME OLD CONCEPTS285 A. Prize Contests: An Old Dog with Same Old Tricks 285 1. Authority and Guidance for Prize Contests Are Not Straightforward 286 B. Prize Contests Benefits Are Clear for the Government, Yet Uncertain for Participants 288 1. Legal Uncertainity: The Great Unknown of Prize Contests 289 C. Hackathons: A New Dog with the Same Old Tricks 290 1. Hackathons Have All The Benefits of Prize Contests 291 2. But, Hackathons Come with a Unique Set of Baggage 292 D. Open Data: A Modern Necessity to the Success of Prize Contests and Hackathons 294 III. FEDERAL INNOVATION POLICY: STAYING AFLOAT IN THE MODERN WORLD 296 A. President Obama Encourages Agencies to Use ODIs for Innovation 296 B. The FCC's Increased Use of ODIs and Open Data: Steps in the Right Direction 297 1. The FCC's History and Structure is Not Conducive to Internal Innovation 298 2. The FCC's Use of ODIs: A Steady and Cautious Start 300 IV. THE FCC'S ADOPTION OF ODIS: IMPLICATIONS FOR TECHNOLOGICAL INNOVATION 303 A. The FCC Should Increase Its Use of Prize Contests for Private Innovations 303 B. The FCC Should Increase Its Use of Hackathons for Internal Innovation 304 C. The FCC Must Provide Clear Rules and Procedures for ODIs 305 D. The FCC Should Continue Its Open Dialogue with Developers and Its Push for Open Data 306 V. CONCLUSION 306 I. INTRODUCTION
Throughout modern history, prizes have been a key motivation behind the development of numerous technologies that today we take for granted. For example, in the late 1700s, the French government used a prize contest to push innovators to develop a new food preservation technology to better feed Napoleon's army. (1) The winner received 12,000 franc and the resulting technology eventually led to the modern process of canned foods. (2) The use of cash rewards for innovation has not been limited to governments. In 1919, Raymond Orteig, a New York hotel owner who was born in Paris, offered $25,000 for completion of the first successful transatlantic flight from New York to Paris. (3) In 1927, Charles Lindbergh won that prize in the Spirit of St. Louis. (4)
Since 2009, the number of Open Data Initiatives (ODIs) sponsored by government agencies has increased dramatically. (5) These activities have seen a resurgence in recent years thanks, in large part, to President Barack Obama's actions to make additional funds available for ODIs and to push Congress to create statutory authority for agencies to host these initiatives. (6) Common goals cited in support of these events, besides the development of new technologies, are to obtain a broad range of participants, to be of low cost to the government, increased private investment, education and captivation of the public, and increased competition. (7) These contests have been particularly successful in highly technical fields, such as the National Aeronautics and Space Administration's (NASA) Lunar Lander Challenge. (8)
The most common example of an ODI is a prize contest. Simply put, in a prize contest, the government offers a set award, typically a monetary sum and occasionally a government contract, in return for achieving a set goal with pre-determined criteria. (9) There are two categories of prize contests--recognition prizes and incentive or inducement prizes. (10) Recognition prizes award work done in the past for a purpose other than the contest itself, such as the Nobel Peace Prize. (11) Incentive or inducement prizes award work done specifically for a set contest or goal. (12) This note focuses on and uses the term "prize contests" in reference to an incentive or inducement prize.
In recent years, several agencies have begun to host and sponsor events known as hackathons as part of this push for ODIs. (13) Hackathons go by many names, such as codeathons, developer days, apps challenges, hackfests, hackdays, or codefests. (14) Hackathons are typically shorter than prize contests, as they are generally held in a single weekend. (15) Hackathons can be used to push for innovation within an agency, (16) or to spur innovation in the private sector overseen by the agency. (17)
Another innovation strategy gaining in popularity is for agencies to work directly with developers to provide the necessary tools for private innovation. (18) These tools include open data and Application Programming Interfaces (APIs). (19) An API is like the buttons on a calculator--it is the interface that allows a user to submit inputs and then returns an output. In addition to his support for ODIs, President Obama has also pushed federal agencies to increase the availability of open data. (20) In a 2013 executive order, President Obama specifically ordered agencies to make resources, such as data, open and available in a machine readable format usable to the public in order to "fuel entrepreneurship, innovation, and scientific discovery." (21)
This notes analyzes the Federal Communications Commission's (FCC's) use of ODIs and open data as part of the government's push for innovation at federal agencies. It begins with a discussion, including benefits and deficiencies, of three innovation tools--prize contests, hackathons, and open data. Next, Part III discusses the White House's innovation policy and goals, both for the federal government at large and specifically for the FCC. The latter portion includes a brief overview of the structure and history of the FCC, with a particular focus on the FCC's technical resources. Part IV discusses the implications of the FCC's use of these innovation tools on the technology and communication sectors, arguing that the FCC should increase its use of prize contests, hackathons, and open data to encourage innovation.
RECENT INNOVATION TOOLS: NEW NAMES, SAME OLD CONCEPTS
While the monikers for recent innovation tools, such as hackathons, might be relatively new, the concepts are no different than in the days of Napoleon and Lindbergh. The core motivator behind the creation of these tools is the exchange of innovation for a reward--whether it be cash, publicity, or a government contract.
Prize Contests: An Old Dog with Same Old Tricks
Prize contests are tools that governments across the globe and private parties have used for centuries to spur innovation. (22) Some examples include the Government of the French Republic's prize to develop a better way to preserve food for soldiers and the Orteig Prize for the first non-stop flight from New York to Paris, which was awarded to Charles Lindbergh. (23)
Authority and Guidance for Prize Contests Are Not Straightforward
While prize contests have been used for centuries, (24) most of the current statutory authority related to these contests is not straightforward. In 2007, President George W. Bush signed the America COMPETES Act into law. (25) The purpose of the Act was "[t]o invest in innovation through research and development, and to improve the competitiveness of the United States." (26) This Act appropriated funds to select agencies for various initiatives, including prize contests. (27) Early in his presidency, President Obama vocalized his support for prize contests as a tool for innovation. (28) In March 2010, the White House Office of Management and Budget (OMB) issued a memorandum to the heads of executive departments and agencies, outlining how agencies could implement prize contests. (29) This included a description of how departments and agencies could host prize contests without direct statutory authority. (30) The Trump administration has issued no guidance, positive or negative, on the use of prize contests. (31)
In 2010, President Obama signed the reauthorization of the America COMPETES Act into law. (32) This Act amended the Stevenson-Wydler Technology Innovation Act (Stevenson-Wydler Act) to specifically grant authority to all departments and agencies to conduct prize contests. (33) The America COMPETES Act expired in 2013 and has not been renewed, (34) but the Stevenson-Wydler Act still stands as amended. (35) The Stevenson-Wydler Act provides broad guidance on how to set-up and run a prize contest, including different contest structures, (36) participant eligibility, (37) liability, (38) intellectual property, (39) and funding. (40) The language in these sections is vague and provides little guidance to agencies. For example, the intellectual property section contains two sentences stating that an agency needs a participant's written consent to gain an intellectual property (IP) interest in a submission and that an agency may negotiate for a license to use IP developed for a competition. (41)
In administering a prize contest, agencies and departments can rely either on the Stevenson-Wydler Act, (42) or one of the other authorities outlined in the OMB's 2010 memorandum. (43) In forming and implementing these contests, agencies are given wide latitude so as to develop a contest that fits with the goals and resources of that particular agency. (44) The agency does not necessarily need to fund or administer the contest. (45) Rather, agencies are able, and encouraged, to work with third parties in administering contests. (46) Given the wide range of discretion and the varying goals and interests of government agencies, contests have ranged anywhere from a few days with no prize money, (47) to a multi-year contest with a $900,000 grand prize. (48) Since agencies are given broad discretion over how to organize their ODIs, (49) it is up to the agency to determine whether a long-term event is more appropriate, or whether the agency's needs are better served by a short-term event.
Prize Contests Benefits Are Clear for the Government, Yet Uncertain for Participants
The prize contest benefits to the government are quite clear. One of the most important benefits is that the investment risk of innovation shifts from the government to the private sector while providing the government access...