Corporate Welfare

A new article/study by Harvard Business School Professor Anita Elberse challenges the validity of the Silicon Valley mantra/theory that the Internet created a new "long tail" of demand for niche products that would ultimately undermine and overwhelm the offline trend towards "big hits."  

It's taken the Google-led neutralism movement two years to learn, and get on board with, what the broadband industry has been saying all along -- that Americans want broadband deployed soonest, and they want competitive broadband choice.

• That's the real problem that the broadband industry and market forces have been steadily and successfully resolving in the marketplace over the last several years. 

It seems the neutralism movement may have learned that focusing on their manufactured net neutrality problem, and fear-mongering on threats to free speech -- could only take them so far politically.

I couldn't help to notice yesterday that Google CEO Schmidt didn't take any questions from reporters who were in attendance or meet with the reporter pool afterwards, which is customary for speaking venues like Dr. Schmidt's speech Monday at the Economic Club of Washington.

What's Google got to hide in Washington?

I wanted to follow up and build upon my post of last week: "The logic of Internet Pricing Diversity and the Fantasy of free limitless bandwidth."

•  I keep hearing this backward-looking refrain from net neutrality proponents that because some people characterize dial-up and early broadband bandwidth as unlimited or as an all-you-can-eat usage model -- that that model should never evolve or change.
  • Balderdash! This is some people's wishes being presented as analysis.

I believe U.S. Internet access consumers have come to understand at least two truths: 

Given that Google CEO Eric Schmidt is delivering a major speech at the Economic Club of Washington Monday June 9th lunch, given that Google's business model is all about delivering "relevancy" to users, and given that Google's public policy mantra is "openness," I have assembled some suggested Washington-relevant questions for reporters and others to ask Dr. Schmidt at and after this open forum.

• The subjects of the questions are: antitrust, privacy, consumer protection, good government, transparency, openness, tax, net neutrality, and broadband Universal Service. 

Antitrust: 

For those who like the written format, here is the link to the transcript of Chip Griffin's interview of me on all things Google.

• The transcript is just below the podcast button to hear the interview.

This interview turned out to be one of the most comprehensive and in-depth discussions I have had on all things Google -- that's been captured for web listening or reading.

We discussed:

Here is the link to Chip Griffin's 28 minute interview of me on "Conversations with Chip Griffin," an in-depth conversation about many of the reasons why I believe Google is becoming such a big problem and why I personally spend so much time focused on Google.

I believe you will find it an informative, interesting, and entertaining interview covering all things Google, the online economy, net neutrality etc.

• Enjoy!  

Does Google warrant the current exceptional leap-of-faith in the integrity of its dominant ad auction model, given its near total lack of openness, transparency, independent auditability, or third party oversight? There is a growing body of evidence that Google does not.

• The New York Times article today by Miguel Helft: "The Human Hands behind the Google Money Machine" is a must read for anyone following Google or concerned about the openness and transparency of public markets. It is also a little treasure trove of fresh information on Google.

Why a lack of openness sullies the integrity of Google's ad auctions.

First, it is widely accepted that public markets operate best when open and transparent.

Google's ad auction model has become one of the world's most important public markets. Google is increasingly becoming the world's primary public information broker. Google brokers: 

In monitoring Google as closely as I do, it has become increasingly clear that Google does not believe it has to obey the rules, standards, regulations and laws, that others routinely obey and respect. Google increasingly operates like a self-declared, virtual sovereign nation, largely unaccountable to the rules and mores of the rest of the world.     

• There is plentiful evidence of Google's unaccountability; see the following analysis peppered generously with source links. 

The impetus for this analysis and documentation was Saul Hansel's outstanding New York Times Blog: "Google fights for the right to hide its privacy policy." 

Only Google, which never met a self-serving, double-standard that it did not embrace, could overtly enter the business of selling network capacity and bandwidth to the public like broadband providers do, and still oppose net neutrality for themselves. (See my previous post where Google's Board recently recommended that shareholders vote against applying net neutrality to Google.)

On April 7th, Google had a press announcement: "Previewing Google App engine: run your apps on Google's infrastructure" (which was also picked up in a story by the Wall Street Journal). In that Google press annoucement, Google it made clear that it was going to sell network bandwidth to developers: