Attention Scarcity

Eric Goldman
Marquette University Law School
eric.goldman@marquette.edu

http://eric_goldman.tripod.com

Overview

  • My initial policy goal: help consumers get wanted/relevant content
  • Observation #1: Each marketing medium has idiosyncratic regulations
    • The medium determines the message
    • Media convergence/innovations
    • Evolution of consumer expectations
  •  Observation #2:  Marketing regulations can interfere with the flow of wanted content
  •  Observation #3: Consumers remain frustrated about unwanted content despite attempts to regulate
    • Every new marketing medium will produce a new crisis
  •  Consumers don’t like unwanted content because it consumes their attention
    • Underlies concerns about loss of control, intrusiveness, annoyance, secondary PII uses, etc.
    • Contrast response to wanted content
  •  However, attention consumption is usually ignored or lumped under “privacy” concerns
    • Attention scarcity is addressed only indirectly
    • Regulatory efforts underperform accordingly
  •  Focusing on attention consumption yields useful policy insights

Attention Scarcity

  •  A person “pays attention” when he/she selects a limited number of thoughts/focal points from of a larger set of possible focal targets
    • Attention is scarce by definition
  •  Attention is physiologically constrained
    • By our limited ability to multi-task
    • By biological processes (infancy, senility, ADD, sleep)
    • By lifespan
  •  We have a limited attention “inventory”
  •  Attention allocation has an opportunity cost
    • Wages
    • Marketer payments to consumer
    • Alternative ways to spend time
  •  Attention consumption may impose indirect costs
    • Anger/frustration
    • Transition times

Market Failure?

  •  An economist’s argument for regulating the delivery of marketing communications:
    • Marketing consumes scarce attention
    • Usually marketers do not bear any costs attributable to attention consumption
    • Marketing creates negative externalities, so marketers overconsume attention
    • We should make marketers internalize attention consumption costs.  Options:
      • Attention consumption tax
      • Private cause of action for attention consumption
      • Force communication through attention marketplace
      • (Other inhibiting regulations)
  •  But pro-regulation argument cannot distinguish marketing from other attention consumption communications/activities
  •  Also assumes that marketing is inherently net negative utility
    • But recipients can derive positive net private utility from a marketing message
    • Plus, marketing may create positive externalities
  • Non-recipients may benefit from more competition

Coase Theorem

  •  Coase Theorem (first order): an efficient result will occur whether we give an “entitlement to attention” to marketers or consumers
    • The parties will bargain to an efficient outcome
    • But assumes no transaction costs
  •  Coase Theorem (second order): the least cost avoider should not get the entitlement
    • So who is the least cost avoider?
  •  Argument that marketers are least cost avoider
    • Marketer knows message contents; recipients don’t (?)
    • Consumers incur transaction costs to protect their attention (?)
  •  Argument that consumers are least cost avoider
    • Consumers have heterogeneous interests in a marketer’s messages
      • Some recipients derive positive net utility; others derive negative net utility
    • Consumers know their interests, the value they place on their attention, and their attitudes towards marketing; marketers do not
      • These consumer preferences are private information
  •  This also avoids artificial distinctions between marketing and other attention consumptions
  •  Counter-argument: preference signaling could lower marketer transaction costs
    • Do not contact list
    • Opt out
    • (Attention marketplace)
  •  Limits of signaling
    • Blunt instrument
    • Signaling creates new transaction costs
    • Does not resolve non-marketing attention consumption
    • Regulatory intervention can lower consumer transaction costs too

Policy Implications

  •  We should not give consumers an entitlement in their attention
  •  Instead, we should conceptualize attention conservation as a private benefit that consumers will procure to their marginal value
    • Privacy-enhancing technologies
    • Subscription content vs. ad-supported content
    •  We should not regulate marketing media to protect against attention consumption
    • Adware regulations
    • Spam regulations
      • Especially rationales like lost employee productivity
    • Telemarketing regulations
  •  We can help consumers lower transaction costs by facilitating attention conservation efforts
    • Encourage/don’t discourage sorting content
      • Mandatory labeling
      • Previewing content (search results)
    • Don’t hinder relevancy targeting
      • Utah Spyware Control Act
      • Anti-Gmail law
    • Be careful mandating attention-consuming disclosures
      • Consumers can’t bargain to avoid them
      • Examples: GLB and HIPAA privacy notices, SPY Act