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Responding to criticisms of my $7 billion estimate that Google fleeced taxpayers.

Martin Geddes of Circle ID challenged my estimation methodology in reaching that Google fleeced the American taxpayer for $7 billion.  

With all due respect to Mr. Geddes, first his analogy of taking "a tasty apple, a yummy banana and a mouldy pear, is simply not analogous here. One doesn't pay $4.7b for a "mouldy pear." The regulations did not make the spectrum itself bad to eat, but simply restricted the use of the spectrum or in Mr. Geddes example how someone would be allowed to eat a good pear. People will pay less for a fruit if they are restricted on when and how they can eat it. 

Second, Mr. Geddes suggests I am confusing the American taxpayer with the American public. I most certainly am not. I am recognizing that there is a very specific law, the 1993 Budget Act, which effectively defines that the American public is the American taxpayer because the purpose of these spectrum auctions are to reduce budget deficits. One may not agree with how the law defines the American public in this instance, but that opinion doesn't change that it is the operative law here.  

My estimate in my blog was trasparent and simple so everyone could see how I got my figure.

  • The important point here is that Google fleeced the American taxpayer of several billion dollars, was it $7b? $5?b $9b? $3b? -- it depends on the estimating method.
  • My estimating method was straightforward, transparent, logical, simple and easy to understand. 
  • I stand by it until someone else comes up with a more defensible estimate.    

New spending surprise for Google's 1Q08 earnings?

My eyebrows raised when I read the FT's article: "Google loses talent that turned chos into capital."

What attracted my attention is that Google is reacting to the ~37% drop in Google's stock price by spending shareholders money on giving restricted stock to employees who are no longer satisfied with stock options.

I wonder what the price tag will be for this, it could be significant....

Why isn't Google warning users about their heightened risk of identity theft and fraud?

Surprisingly, Google continues to keep its users in the dark on the new reported cyber-security threat where cyber-crooks have infiltrated Google's searches putting them at heightened risk of identity theft and fraud.  

The San Franciso Chronicle in its article "Hackers infiltrate Google's searches" followed up on the original USA Today article "Google searchers could end up with a new kind of bug."  I blogged on the USA Today story and explained why this problem is a big deal.  

  • Per the Chronicle article, "Google is working on a filter that will find and automatically block such malicious Web addresses, a spokesman said Tuesday. In the meantime, it has been contacting affected organizations to advise them on how to fix their sites' vulnerabilities."
  • WHY ISN'T GOOGLE WARNING ITS USERS!  Google users are the ones that are at immediate risk of losing their identity and private information to crooks forever -- not the websites.  

Apparently, from what I have been able to gather from my sources -- Google is under the illusion that because they don't control the websites that are infected -- they don't have an obligation to warn their users.

Let's review the facts of why Google may have: a budding user trust problem, a potential PR disaster on its hands, and a potential legal contingent liability/class action lawsuit vunerability for shareholders to worry about.

Google is not warning its users of its role in one of largest cyber-security breaches ever on the Net

USA Today broke a much under-appreciated and potentially blockbuster Internet security breach story: "Google searchers could end up with a new type of bug." Kudos to Byron Acohido and Jon Swartz, who reported it in USA Today, and also blogged on it at ZeroDayThreat.com, a site for their book "Zero Day Threat" which defines a Zero day Threat as "a threat so new that no viable protections against it exists." 

  • In a nutshell, the article and blog post explain how cybercrook hackers have figured out how to use and leverage Google's search engine results "to spread spam, and carry out scams. Typically it also lets the attacker embed a keystroke logger, which collects and transmits your passwords and any other sensitive data you type online."
  • This new cyber scam ring is expected to spread rapidly, increasing from a "few dozen major websites" today, to  "hundreds of high-profile websites" in the next few weeks.
  • "...in March alone... security researchers found several hundred thousand corrupted Web pages returned in common Google search queries."

Why this is a big deal:

Why isn't Google more "open" with investors?

I must admit I have been amused watching the market's angst over trying to figure out if Google's growth is slowing down given that Comscore has reported that paid clicks have fallen 3% from January to February of this year.

First, I am amused because Comscore also showed that Google gained market share during that same period from 59.2% from 58.5%. 

More on Google opposing net neutrality for Google; and Google's radical Burning Man Festival roots

In my previous blog post I flagged a Reuters article that highlighted that Google asked its shareholders to oppose a shareholder vote that Google should abide by net neutrality itself, even though it is the single biggest proponent of mandating net neutrality for all its competitors -- on the planet.

Today I came across a quote in Investors Business Daily's section on quotes, "Wisdom to Live By" and found one that the radically-liberal founders of Google should ponder:

  • "Its not fair to ask others to do what you are unwilling to do yourself."  Eleanor Roosevelt, former First Lady to the ultimate uber-liberal Franklin Delano Roosevelt.

Alas, I don't hold out much hope that Google will ever see this as a double standard because they are so committed to Google's Motto: "Don't be evil" and because they like to insinuate that most every other corporation is evil...

If you think I am being "unfair" in labeling Google's founders radically-liberal, check out The Burning Man Festival gathering that Google's founders avidly and regularly have attended.

Google Board recommmends against applying Net Neutrality to Google

Per Reuters, Google's board is recommending that its investors vote against a shareholder proposal from the New York City Employee Retirement System that asks Google to commit to abiding by Net Neutrality.

  • Why would Google, which avidly supports:
    • All pending net neutrality legislation in Congress;
    • the Save the Internet and Open Internet coalitions which were created to promote net neutrality;
    • Open access/Net neutrality rules for wireless in the FCC's 700 MHz auction;
      • oppose living by the same rules as it wishes to apply to its competitors?
  • Why would Google avidly support the FCC's net neutrality principles, which explicitly apply to: "network providers, application and service providers, and content providers", but not agree to apply them to Google itself? 

Bottom line Questions:

Yahoo-Google "dis" Microsoft in OpenSocial hug -- the real reason for the new alliance

Apparently, Yahoo is trying to douse itself with some "Microsoft-repellant" in joining Google's OpenSocial allance and forming a non-profit OpenSocial Foundation with Google and MySpace.

While Yahoo's OpenSocial press release never mentioned Microsoft, the impetus for this change of heart by Yahoo was clearly a way to "dis" Microsoft and make Yahoo marginally less attractive to Microsoft.

Surprise! Google is concerned a Microsoft-Yahoo merger would hurt the Internet

Google's CEO Eric Schmidt must have an extremely dry sense of humor.

 

Google's growing undisclosed "conflicts of interest" are bearing their teeth

New evidence exposes that Google has much more serious financial conflicts of interest and is much less of an "honest broker" of online advertising than most appreciate. 

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Q&A One Pager Debunking Net Neutrality Myths