Google's gamble

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Google's gamble

Saturday, July 12, 2008

The devil's best trick is to persuade us he doesn't exist, but Google
only has to convince us it's not evil. Nearing an agreement with
to grab the ailing company's search business, Google scripted a
of dramatic public events apparently designed to distract from the
pending deal. These events emphasize network neutrality, an ever-
changing regulatory ideal that Google thrust into the political
spotlight two years ago. As entertaining as this spectacle is,
regulators should not be fooled. They should apply traditional anti-
monopoly standards, blocking the Google/Yahoo deal.

The deal, as currently structured, substantially alters the Internet
economy. Advertising is the prime revenue stream for social networks,
news sites and Internet aggregators of all kinds, and it's closely
linked to search. Instead of a search market where three players
compete vigorously for eyeballs, this deal would create a status quo
where the top dog enjoys an 85 percent market share and the ability
set prices for search ads with no fear of being undercut by its much
weaker sole competitor. This should set alarms clanging wherever
antitrust and personal privacy concerns are held dear, but it hasn't.

The centerpiece of Google's net neutrality misdirection campaign, a
new initiative to bring faster broadband at lower prices to American
consumers, was book-ended by Google CEO Eric Schmidt's visit to
Washington, D.C., and a public endorsement of heavy broadband
regulation by Internet icon and Google Vice President Vint Cerf.

The initiative, Internet for Everyone, is virtually identical to
earlier network neutrality organizations, It's Our Net and Save the
Internet. Each of these organizations was fronted by rock-star
intellectuals such as Lawrence Lessig, co-founder of the Google-
Stanford Center for Internet and Society, and his protege, Tim Wu,
new chairman of the advocacy group Free Press.

Net neutrality is largely seen as an obscure but noble cause, so it's
a safe issue for an image-conscious corporation to embrace. Google
largely abandoned it in the months before the recent publicity blitz,
probably because of how the issue had morphed in the preceding year.

Initially, network neutrality was the demand that network carriers
ignore the Internet's fundamental inequality. Google had good reason
to advocate for this because it is advantaged by a status quo in
money buys privilege. Any move by carriers to selectively boost
for fees dulls the advantage Google has secured for itself by
huge complexes of hundreds of thousands of computers.

These complexes exploit a flaw in Internet architecture that enables
them to seize more than their fair share of network bandwidth,
effectively giving their owner a fast lane. A richly funded Web site,
which delivers data faster than its competitors to the front porches
of the internet service providers, wants it delivered the rest of the
way on an equal basis. This system, which Google calls broadband
neutrality, actually preserves a more fundamental inequality.

The latest turn in the network neutrality debate - emphasizing the
fair management of bandwidth-intensive file-sharing applications -
left Google on the sideline. Cooperation between peer-to-peer
and carriers enhances the value of both, and creates a more powerful
and less expensive alternative to private networks - which is counter
to Google's interests.

Despite its carefully crafted public image as a naive and squeaky-
clean innovator, Google is a public corporation managed by
professionals, some of them long-time friends of Washington power
brokers and fully capable of understanding the problems the Google/
Yahoo deal poses.

The tech press has been too busy reprising its Internet Bubble era
cheerleading and cooing about Google's network neutrality "idealism"
to raise questions about the demise of Yahoo as a search competitor.
Fortunately, the Justice Department is investigating, and Congress
planned several hearings.

Any anti-competitive concerns motivating the net neutrality movement
are theoretical, as no single carrier today has the power to fix
prices. Consumers have an increasing menu of options for broadband
networks, many of them wireless. A search monopoly is, however, a
gatekeeper, directing Web surfers toward some sites and away from
others. When that power is combined with the ability to set prices
advertising, it's a disaster not only for the Web but for democracy.

Richard Bennett is a Bay Area network architect and inventor. He was
an expert witness at the Federal Communications Commission's February
field hearing on net neutrality and a frequent conference speaker.

Re: Google's gamble

Quoted text here. Click to load it

He has been nominated for this year's "Most Boring Man Alive" award, and, on
the basis of the post I've mercifully not quoted, he should walk it.
Whenever I read copyright-defying posts of inordinate length, millions of
questions spring to mind. To be more accurate, ONE question:  'Who cares?'

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