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August 2011
AT&T/T-Mobile: Three Key Realities Why Merger Gets Approved
Submitted by Scott Cleland on Mon, 2011-08-01 15:25In the end, the U.S. Government is highly-likely to approve the AT&T/T-Mobile merger, despite the significant opposition, because of three over-riding realities: 1) market/financial realities, 2)DOJ legal/precedent realities, and 3) FCC public-interest realities.
I. Market Reality:
T-Mobile's leadership and owners have decided that they are unable and unwilling to invest what is necessary in order to compete going forward in the American 4G wireless market, and given that fundamental premise, the AT&T/T-Mobile merger is the optimal market outcome for T-Mobile's customers and for competition.
- T-Mobile shopped itself for a good while in order to fully test its market options and ultimately chose to merge with AT&T as the best outcome for all concerned from its perspective.
So the key baseline fact grounding the DOJ/FCC's decision processes here, is that T-Mobile's leaders/funders are effectively exiting this business one way or another long term via merger, sale or benign neglect.
More Evidence FCC's Net Neutrality Regs in Trouble -- Part X: Dead Regs Walking? Series
Submitted by Scott Cleland on Tue, 2011-08-02 13:20There's more powerful evidence from Capitol Hill that the FCC's beleaguered Open Internet/net neutrality regulations are in serious trouble.
First, on July 27th, eleven GOP Senators on the Senate Commerce Committee requested in a letter, that the FCC conduct a cost-benefit analysis of the FCC's Open Internet Order, given the President's recent Executive Order directing independent agencies to reduce burdensome regulations.
FreePress Cries Wolf -- Yet Again
Submitted by Scott Cleland on Wed, 2011-08-03 12:40FreePress with its "all complaints all the time" approach to advocacy has been caught once again "crying wolf" when there was no real problem or threat.
A new FCC study that shows ISPs are effectively delivering on the broadband speeds they advertise, exposes FreePress for crying wolf -- yet again.
- FreePress has to acknowledge Verizon's FIOs far exceeds advertised speeds, Comcast and Charter exceed advertised speeds, and other ISPs are more than close enough to advertised speeds to show that there is not a problem here for the FCC to be concerned about.
FreePress also continues to cry wolf about its spurious tethering" complaint against Verizon because users are prevented from unauthorized tethering of additional devices trying to bypass users' terms of service agreement.
My Forbes Op-Ed: "Google Asserts Property Rights Are Anti-Competitive"
Submitted by Scott Cleland on Fri, 2011-08-12 17:39To understand how Google is deceptively misdirecting attention away from their own ignominious record of serial property infringement by loudly accusing its competitors of being anti-competitive for enforcing their patent rights, see my new Forbes op-ed: "Google Asserts Property Rights Are Anti-Competitive."
This is important because:
- The FTC is currently investigating Google for a variety of deceptive and anti-competitive acts and behaviors;
- Google has a history of trying to distract law enforcement from focusing on Google by flinging accusations at others; and
- Infringement of competitors' property rights is arguably one of the most anti-competitive practices a dominant firm can engage in.
Few have connected the dots of how Google's serial mass infringement of competitors' property has been integral to Google's rapid monopolization of the search business and its strategy to rapidly extend that search business market power in most every direction.
Simply, no one can compete with unabashed property infringers.
Find the op-ed here.
FCC Needs to Update Sect. 652 to Conform with Market Reality & Congress' Intent
Submitted by Scott Cleland on Mon, 2011-08-22 15:54An easy way for the FCC to show respect for the President's Executive Order to eliminate "outmoded" and "excessively burdensome" regulations would be to grant the NCTA's petition for a declaratory ruling, that Section 652 of the 1996 Telecom Act, (intended to encourage incumbent local telcos and cable companies to compete in telephony and video) was not meant to prohibit pro-competitive mergers between cable companies and new entrant CLECs that didn't exist in 1996 and thus have no market power.
The FCC Sect. 652 status quo is counterproductive in perversely thwarting a central competition policy goal of the 1996 Telecom Act: i.e. promotion of cable-telco competition.
- By creating unnecessary regulatory uncertainty around actual and potential cable-CLEC mergers, at both the FCC and with local franchising authorities, the FCC effectively has created a regulatory barrier to more cable-telco competition.
- We cannot "win the future" with a broadband Internet "excessively burdened" with anachronistic analog anchors like the FCC's current interpretation of Sect. 652.
Specifically, the NCTA's petition exposes a dysfunctional local franchising authority review process that has no standards or time limits, which makes the overall regulatory review process for cable-CLEC mergers uncertain, arbitrary, and "excessively burdensome."
Implications of DOJ's Agreement to Not Criminally Prosecute Google
Submitted by Scott Cleland on Thu, 2011-08-25 11:22The DOJ's very tough enforcement agreement to not criminally prosecute Google for knowingly promoting illegal prescription drug trafficking for six years has many under-appreciated implications for Google's business and brand going forward.(See the DOJ-Google Agreement here and the DOJ's release here.)
- Simply this is a criminal non-prosecution agreement not resolution of a civil case because:
- Only the criminal statutes that were violated authorize a $500m forfeiture penalty; and
- The agreement explicitly empowers the Government to criminally prosecute Google at its sole discretion, if it believes Google has violated the agreement.
- In effect, this is a criminal plea bargain where Google agrees to a huge fine, cooperation with the government's ongoing investigations, and two years of probation in return for no criminal prosecution of Google.
- Reading between the lines, the Government's undercover "sting operation" must have uncovered exceptionally incriminating and embarrassing evidence that Google did not want exposed in a long public criminal trial.
