Submitted by Scott Cleland on Tue, 2006-12-19 08:39
Now that net neutrality proponents have won a tactical victory in successfully intimidating FCC Commissioner McDowell from not participating in the AT&T-Bell South merger (by threatening to hound him to the ends of the earth on trumped-up ethics allegations if he did not stay out of the merger) lets see if they hold themselves to the same ethical high standard.
Lets see if they really care about true ethics, which are about respect for process, the rule of law, and basic fairness. How is it ethical and fair to extort rule changes in the happenstance situation of a merger process rather than the normal open and fair deliberative rulemaking process which fairly applies to all parties? How is extortion due process? How is it ethical to say the ends justify the means? If ethics were truly important to net neutrality proponents they would seek to use the process in only an ethical and open way, not as a way to extort concessions that the normal policymaking process could not generate.
Net neutrality is the ultimate unprincipled double standard. It is clear that ethics and fairness are expected of others but not of themselves. Net neutrality proponents should think long and hard about justifying the "means" of unethical extortion in order to achieve the "ends" of net neutrality. Do they really want to win dirty? To soil our public process with win-at-all-costs, take-no-prisoners, ethically-challenged tactics? How will they expect others to respect process, rule of law and ethical standards if they do not abide by them themselves?
Ethics are about doing something the right way for the right reasons. Extorting out-of-process concessions in the AT&T-Bell South merger is not doing it the right way for the right reasons.
Now that net neutrality proponents have claimed to stand for high ethical standards, lets hold them to their word.
Submitted by Scott Cleland on Mon, 2006-12-18 12:48
One of the comments my able debate opponent, Gigi Sohn, President of Public Knowledge, made last Friday stuck with me over the weekend as very much an "ostrich-head-in-the-sand" point of view.
After I pointed out that prices were falling, consumer choice and speed were increasing, broadband investment and deployment are healthy, and that there was an explosion of innovation and new products... Gigi replied that ~98% of people access the Internet through their phone or cable company. (she ignored my comment that 8 sort years ago we had a monopoly) Then she sarcastically dismissed the possibility that wireless or other technologies could ever compete with phone or cable -- or that it would be a long time coming.
Submitted by Scott Cleland on Fri, 2006-12-15 18:45
I debated Gigi Sohn of Public Knowlege today on net neutrality at the annual PLI conference here in Washington.
Here is the essence of my opening remarks -- a concise case against net neutrality.
Three main points:
1. Net neutrality is a bogus issue -- there is no problem to solve.
2. Net neutrality would set America back.
Submitted by Scott Cleland on Wed, 2006-12-13 12:16
Google did a good job of "spinning" the good aspects of its new plan to create a private market for valuing Google employee's stock options. This blog intends to shed some light on whether it is such a good idea. I think not. The New York times coverage was the most comprehensive of the six papers I read on the topic.
I am writing about this because as a former leading independent investment researcher, I understand conflicts of interest and capital markets intimately. As the first congressional witness explaining what went wrong with Enron, and the first to see through the spin with WorldCom, I can tell you there is a whole lot for Google shareholders and investors to be worried about in Google's latest example of "innovating without permission." It is especially troublesome when people chime in with the inane insight "if Google does it, it validates it as a smart idea." Hold onto your wallets when that kind of idiocy gets quoted and unchallenged.
During the bubble, stock price routinely was correlated to "smarts" and we all know how that ended. I acutely remember being Bernie Ebbers whipping boy and being derided by him as the "idiot washington analyst" for having the audacity to challenge the WorldCom story at its apex when it was owned by more funds than any other telecom stock. When WorldCom was worth $150b, like Google is now, there were tons of people fawning over Ebbers and others who simply rode momentum of the bubble up. They weren't geniuses becuase their stock prices were high, people just assumed that stock market success equated to brilliance.
Submitted by Scott Cleland on Tue, 2006-12-12 16:19
Ugh. Internet regulation creep continues. The Federal Trade Commission (FTC) said yesterday that companies that engage in word-of-mouth product endorsements must disclose if recommenders are being paid to recommend the product or service. The Washington Post had a good story on it today.
Since this is all about forthright disclosure, let me reiterate that I openly and regularly disclose that I represent broadband interests in the net neutrality debate. And as a strong believer in law enforcement, I have no sympathy for those engaging in deceptive or fraudulent business practices. That said, I also dread Internet regulation creep, because it will ultimately slow economic growth, job creation and innovation.
Submitted by Scott Cleland on Mon, 2006-12-11 20:43
The feedback has been that it was a well written and thought provoking letter/analysis that got people and investors to think of the net neutrality issue and fight in a much broader, holistic and linked way.
The letter was also an eye opener to investors that Microsoft is not really controlling its own destiny in Washington, but following Google's leadership. Google certainly appreciates the irony of an eight year old company taking the "adult" company to school in Washington.
Given that Google presents the biggest real threat to Microsoft's web services plan in both the marketplace and in Washington, I find it interesting that Microsoft has allowed itself to be so outsmarted and outflanked by Google in Washington. Is Redmond going soft or just distracted?
Submitted by Scott Cleland on Fri, 2006-12-08 18:45
The reality is that net neutrality didn't become an issue and have any traction until pro net neutrality forces attached the issue to a moving legislative vehicle last year -- the video franchise reform bill.
Well now the shoe is on the other foot.Ã‚ Net neutrality proponents now need to build momentum for a bill from scratch,Ã‚ because the companies that pushed it last time are not going to push it this time. They will be able to play defense, which as the net neturality proponents learned this past year, is a lot easier than legislating.
Next year we will see if there is a real there there surrounding net neutrality. Net neutrality proponents will learn for themselves how easy it is to play defense rather than offense in Washington.
It will be interesting to see if net neturality proponentsÃ‚ can turn both theirÃ‚ ragtag coalitionÃ‚ and their ratbag of unsubstantiated allegations into policy consensus and a successful legislative vehicle. It will prove hard. Real hard.
Submitted by Scott Cleland on Thu, 2006-12-07 18:40
Google's attempt to amend the pending franchise bill in Michigan with Net NeutralityÃ‚ looks like it will not succeed. The bill had already passed the House and the Senate Commitee unanimously approved the bill yesterday without Google's last minute net neutrality amendment.Ã‚ Google will probably try to amend it on the Senate floor, but given that it is not in the House or Senate Committee versions, their chance of success of winning an amendment is slim.
They could try and block passage and run out the clock, but I don't think Google is stupid enough to be a spoilerÃ‚ and stop 2000 more jobs for theÃ‚ job-strapped Michigan economy.
Submitted by Scott Cleland on Wed, 2006-12-06 18:59
Very interesting! Yahoo in an ex parte report by James Hedlund, Director of Yahoo! Communications Policy, after its meeting with the advisors of FCC Chairman Martin and the other commissioners, distancedÃ‚ Yahoo from the more radical stance of Google and Moveon.org's Save the Internet.Ã‚
The operative part is:
Yahoo! Yahoo appears to be aware that principles are principle and that mugging a merger and extorting special conditions is a bad way to make public policy. A tip of the hat to Yahoo is deserved. Consider it tipped.
Submitted by Scott Cleland on Wed, 2006-12-06 18:21
I continue to be amused at Google's "do as I say, not do as I do" way of doing business.Ã‚ As the online champion of regulating anyÃ‚ "non-neutral" behavior by others, it is instructive to keep a close eye onÃ‚ the "non-neutral" thingsÃ‚ Google does in the market.
USA Today had a great article today, "Google offer takes on Paypal."Ã‚ Google is using its market leading dominance of the search market, 45% share and growing per Source Media Matrix, to leverage itself into other markets like online transactions, in very non-neutral ways. Some interesting quotes from the USA Today article:
So what is the point? Google routinely uses its market leverage (or is it market power?) inÃ‚ the online ad market it dominatesÃ‚ "toÃ‚ buy share" or compete in a way that another company can't. This would be perfectly kosher, if, Google was not alsoÃ‚ the champion for making this type of typical Google market behaviorÃ‚ illegal for broadband carriers, most of whom have dramatically less broadband share than Google has in its dominant market of search.