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Challenging Google's unsubstantiated claims that its policy best serves consumers
Submitted by Scott Cleland on Thu, 2007-10-04 12:05
The Google blog continues to essentially argue: what's good for Google is good for America and consumers. We have all heard that self-serving hubris and bunk before...
- Mr. Rick Whitt, in the latest post on the Google Public policy Blog concluded:
- "We think the Internet offers the optimal model for what best serves the interests of all consumers. To that end, we hope the FCC sticks to its guns as it tries to introduce the open ethos of the 'Net to a small segment of the closed wireless world."
Let's unpack the hubris and deception behind these assertions.
- Google is implying that anything that occurred in wireless in the past (B.G. -- "Before Google" entered the wireless world) did not serve consumers well -- and that we should scrap the existing competitive wireless model and adopt the Internet model that... surprise... most benefits Google.
Given Google's assault on the supposed failures of the current system, it is important to review the facts of what the existing competitive model actually has produced for American consumers.
- Over 240 million or 76% of Americans now use wireless.
- American consumers on average pay 70% less per minute than consumers do in Europe.
- These dramatically lower prices enable American consumers to use their wireless phones as much as five times more than their European counterparts -- meaning that American consumers get much more utility, productivity and other benefits from their wireless devices than they do in Europe.
- American consumers have more choice of wireless providers than any other country as well.
- Finally, American consumers have the choice of over 700 different wireless handsets as compared to less than 200 different wireless handsets in Great Britain.
Now lets contrast this stellar consumer track record of our free market wireless system with the much weaker and unproven track record of the "open" Internet model serving wireless consumers.
- While the US has more free WiFi hotspots than any nation in the world, with over 40,000, there is no "free" WiFi network to speak of.
- That's because the free hotspots are not actually free. It's just that entities like Starbucks have chosen not to charge for the wireless bandwidth in order to create a better environment to sell more coffee. Whoever has chosen to have a WiFi hotspot has chosen for one reason or another to not charge for it.
- However, the economic reality of connecting these free Internet hotspots into a network that functions like a wireless network does today costs money, a lot of money -- billions of dollars if you do it nationally and do it well.
- If Google assumes that hotspot entities will eat the costs of building and operating a wireless open network that noone pays for -- that simply isn't happening.
- Look at what is happening to the municipal WiFi efforts around the country. Most all are finding that there is no "free lunch" and that the promises of companies like Google and Earthlink that they could offer free WiFi networks -- is turning out to be a cruel and expensive hoax.
So Mr. Whit where is the real world evidence of how the Internet model is what is best for consumers?
- Isn't this really about how Google, which dominates the online advertising model wants to offer "free wireless" if folks look at Google's ads?
- Nothing in the law or regulation is stopping Google from buying spectrum at market prices and building its own "free" wireless network paid for with Google-powered wireless advertising.
- Just do it!
- Put your money where your mouth is and make it happen!
- Compete in the marketplace for wireless customers rather than competing in Washington regulation circles about who best serves consumers.
- Why Google whines and complains about FCC auction rules is that Google really wants corporate welfare and special treatment that will lower its costs to enter the market.
Bottomline: It is outrageous that Google asserts that the business model it prefers is what is best for consumers -- when most all the evidence is to the contrary.
- Before Google wrecks the best wireless market for consumers in the world, shouldn't people expect more substance from Google on how Google can magically produce more usage, at lower cost for more consumers with more handset choice than consumers already enjoy, without ruining the existing free market system that already well serves 240 million American consumers?
- In short, Google really proposes to tear down the existing free-market wireless sytem which is proven to well-serve consumers, and replace it with an unproven, Big Government approach that favors Google's dominant online advertising business model.
- Google's hubris is truly breathtaking.
- It's not about consumers, its all about Google.