Competition

Just learned that the Senate Judiciary SubCommittee on Antitrust has scheduled a hearing on the Google-Yahoo agreement for Tuesday July 15th, at 10:30 am.

• "The Senate Committee on the Judiciary has scheduled a hearing before the Subcommittee on Antitrust, Competition Policy and Consumer Rights on “The Google-Yahoo Agreement and the Future of Internet Advertising” for Tuesday, July 15, 2008, at 10:30 a.m. in Room 226 of the Senate Dirksen Office Building. Chairman Kohl will preside. By order of the Chairman."

The House Judiciary Committee is expected to have a hearing that same afternoon on the Google-Yahoo deal, Internet competition and privacy.

The reality of market pricing for Internet usage is naturally gaining more attention.  

• The New York Time's had an informative Sunday page one story: "Charging by the Byte to curb Internet traffic." 
• Today the Wall Street Journal highlighted why market pricing for Internet usage is evolving with dramatic changes in the Internet marketplace in its story today: "Cisco projects growth to swell for online video."  

The big economic takeaway here is that in a free market Internet, where users have very different demand: i.e. needs, wants and means for speed, usage, mobility, latency, immediacy, reliablity, flexibility and other attributes -- suppliers (ISPs, application providers and content providers) must have the freedom to innovate, experiment and provide a diversity of choices, at a diversity of prices in order to meet the diversity of demand from users.

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: 

The free market Internet works. Both Time Warner Cable and Comcast are logically and naturally experimenting with free market solutions to address increasing network congestion problems that threaten quality of service, because of extremely high and disproportionate bandwidth usage by a small slice of the broadband population. 

• As widely reported, Time Warner Cable is experimenting in Beaumont Texas with a commercial offering that provides consumers with a range of choices based on their bandwidth consumption and desired speed, and includes a new $1 per gigabyte charge for usage above a plan's monthly limit. 
• Also widely reported, Comcast is testing in Chambersburg PA and Warrenton VA, a protocol-agnostic network management approach which would potentially delay all of the traffic of extremely heavy users during periods of serious network congestion -- in order to maintain quality of service for everyone.

Free market experimentation is the best, fastest and most efficient finder of solutions to complex difficult problems.

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!  

Remarkably, with all the real and pressing problems in the country, the New York Times Editorial Page wastes ink pushing a special interest potential problem, net neutrality, in its editorial today: "Democracy and the Web."

The 2008 World Competitiveness Yearbook just came out and the U.S. is ranked #1 in world competitiveness again -- for the fourteenth year in a row.

With respect and affection to the memory of the late great Dr. Seuss.... 

Googlehoo mocks all the boo hoos over their ballyhooed Googlehoo coup.

Get a clue.

Googlehoo pooh-poohs a collusive coup between their crews.

It's no glue to screw you.

But, who knew it would be true, that Googlehoo would rue, that Justice could see through, Googlehoo's collusion boo-boo, and eventually sue?

Can we construe Mr. Icahn's Yahoo debut, and shareholder kung fu, as a rejection of the Googlehoo view?

Will Yahoo bid Googlehoo adieu, overcome the Microsoft taboo, and renew the review of the Microsoft view?

As Google and Yahoo continue to negotiate their search outsourcing pact, pesky competitive facts keep arising that suggest that such a deal is likely to eventually be found by antitrust officials to be illegal anti-competitive collusion.

• Yahoo is running an AP story that says that Google has now surpassed Yahoo as the #1 "most popular website in the United States according to Comscore."
• This is on top of Google and Yahoo being the #1 and #2 search providers in the U.S. and the leading competitors in the display advertising market, ad tools market and ad brokering market.

The operative question is not whether Google and Yahoo can craft an acceptable search advertising outsourcing pact that can pass antitrust muster, but whether the DOJ wants to encourage such intimate  and important business "cooperation" between Google, the dominant #1 in the market, and one of the only two companies that most consider to be Google's primary competition in multiple market segments.

The USA Today's business section cover story is on George Soros, who is notable here as probably the second biggest funder of net neutrality/information commons causes after Google.

The appropriately skeptical article, by David Lynch, has a second page-headline that sums up George Soros' government-first, economic point-of-view: "Traditional free market theory flawed."

George Soros is really the poster child for net-neutrality-ish thinking, which is that the few, the truly wise, like Mr. Soros, know what is truly best for everyone else -- and that the whole free market concept of accumulating all the actions of all market actors through supply and demand to determine prices or market equilibrium -- is all wrong and a waste of time -- according to Mr. Soros.