DOJ's 28-page Statement of Interest to the Court responsible for deciding the fate of the Google Book Settlement speaks volumes. 

First, it ensures the current proposed settlement is effectively dead.  

• It is hard to conceive a U.S. Federal District Court Judge approving a settlement, which the United States Government indicates may be illegal under three completely different bodies of law (class action, copyright and antitrust), and also may be per se illegal in multiple different ways.

Second, despite the DOJ's encouraging tone in the press release, the DOJ statement itself set a very high bar for the parties to overcome. Substantively, the DOJ is insisting on radical changes in the settlement that practically would gut the unique and self-serving going-forward public benefits of the deal for the parties.   

With due to credit to "Ripley's Believe it or Not!^®," so much odd and bizarre is happening in Washington in the "name" of "wireless innovation" and competition that the topic calls for its own collection of: "Believe it or Not!^®" oddities.

Skype co-founder Niklas Zennstom, the co-founder of illegal-music-downloading site Kazaa, who had to avoid entering the U.S. because of copyright-infringement liability... is now seeking a U.S. court injunction to shut down eBay's Skype for alleged copyright violations!

Matt Salmon, immediate past president of COMPTEL and former Arizona Congressman, has an excellent Op-Ed in today's Washington Examiner entitled:     
"Net Neutrality Threatens the Balance of the Internet."

George Ford of the Phoenix Center does a great job of debunking the OECD's latest self-serving set of metrics covering mobile prices in his latest research piece: "Be careful what you ask for: a comment on the OECD's mobile price metrics."

The OECD's mobile metric approach reminds me of the old adage that you can get statistics to say anything you want -- if you beat them up enough. As George's white paper shows, the OECD had to really work over the data to get it to reach the upside-down conclusion that Europe's average wireless prices are lower than the U.S.

First, the OECD ignored the pesky notion of overall wireless usage, because if they looked at usage they would have to include the pesky fact that Americans use massively more wireless minutes of use than their European counterparts -- roughly 2-6 times more depending on the country.

Second, ignoring usage allows the OECD to ignore economics and common sense, because if people were told Americans use the most wireless minutes of use, someone might obviously connect-the-dots of supply & demand and conclude that Americans' more minutes of use are a result of lower average prices than other countries. 

Third, George pointed out that the OECD selectively chose certain usage price points on the usage curve to best make their case. However, if one looks at the entire distribution of the curve, their selective conclusion looks all the more "selective" and suspect. 

My latest Google antitrust white paper, "Googleopoly IV: The Googleopsony Case," is the first antitrust analysis which connects-the-dots between Google's search advertising selling monopoly and Google's information access buying monopoly or "monopsony" by explaining and documenting how Google is harming competition in digital: news, books, broadcasting, artwork, documents, and analytics; and harming consumers seeking quality digital information that is not free.

George Ou's good post yesterday on "Being Rational on Text Pricing" rightly takes to task the complaint that text messaging should be priced at marginal costs and ignore total costs, upgrade costs, or competition. It also prompts me to join in to address the issue.

Lets get to the quick here. 

The folks arguing for text pricing to be based on marginal costs are trying to politically redefine traditional economics in the datatopian Chris Anderson vision of the "economics of abundance" -- that because the marginal cost of computer processing, storage, and bandwidth are getting increasingly small -- the price should be free!

• I call this political thinking that "information wants to be free" and the "economics of abundance" school of thought -- simply -- uneconomics.
• It ignores the real world, real economics, the reality of private property, market forces of incentives and disincentives, etc.  

Does anyone think that the infrastructure that enables the instantaneous reliable delivery of roughly a billion text messages every day wherever one happens to be -- costs basically nothing to pull off and thus should be free?  

The FCC's recent wireless innovation NOI has put a new spotlight on how innovation evolves in a competitive market.

With that focus in mind, I highly recommend reading Link Hoewing's very thoughtful post on Verizon's PolicyBlog: "Innovation and the evolution of technology markets."  

It makes a lot of sense.

There's been scant analysis of how the Google Book Settlement process has been altered going forward given recent major developments:

• The "hornet swarm" of objections to the Google Book Settlement, and 
• Google's recent preemptive concessions on:
  • Privacy at the the urging of the FTC; and
  • Competition under pressure from competitors and the DOJ. 

To date the discussion of outcomes has been largely binary, will Federal District Court Judge Chin approve or disapprove the proposed Book Settlement?

Harry Potter fans know there is "He-who-must-not-be-named."

• Well it appears that there is also a potentially multi-billion subsidy of a company that just may be "the-subsidy-that-must-not-be-named."

Unbenownst to me until I read about it in Communications Daily, the National Telecommunications Cooperative Association (NTCA) cited my 12-08 Precursor research study in a submission to the FCC about how Universal Service may interact with the National Broadband Plan. 

The reason I am blogging about this now is:

How could American taxpayers get stuck with a multi-trillion dollar tab that they weren’t even aware that they were running up? How could that huge tab still be allowed to run up unchecked today? For the Financial Crisis Inquiry Commission, the sad answer is one of the biggest root causes of last fall’s devastating financial crisis and one of the biggest continuing systemic risks to the financial system and the economic recovery.  

A decade ago, in what may prove to be the most expensive bipartisan legislative mistake in U.S. history, a bipartisan policy became law that effectively ensured that no Federal regulator had oversight or enforcement jurisdiction over derivative financial instruments. The Commodity Futures Modernization Act of 2000 (CFMA) created “legal certainty for excluded derivative transactions.” That law allowed a shadow derivative overlay system to be built literally on top of the public financial system, with none of the inherent accountability of the underlying financial system.  In other words, a deliberate bipartisan U.S. government policy change a decade ago unwittingly created an unaccountable “black hole” market that sucked enormous value out of public markets, (Bear Stearns, Lehman, AIG, Fannie, Freddie, securitized sub-prime mortgages, etc.) while laundering the risk to the U.S. taxpayer.