Google strongly legitimized the problem of "search neutrality" in arguing in detail in an FT op-ed today why Google's search should not be neutral. 

Skype, one of the high priests of the net neutrality movement, that preaches for Title II monopoly regulation of all the broadband providers it already rides upon for free, has been caught in the act of being blatantly unfaithful to its widely-professed net neutrality principles, by blocking interconnectivity to Fring! 

• Arstechnica and The Hill have both flagged Skype's hypocrisy and infidelity to its supposed net neutrality and openness principles in blocking mobile video calling competitor Fring from access to Skype's dominant network of a ~half-billion interconnected users.  

  Now we know that Skype's proclaimed principled stance for net neutrality and openness was really just a cynical PR and lobbying campaign of crony capitalism, and political cover for an industrial policy where the FCC picks Skype, Google Android, and Amazon Kindle as the "dumb pipe" market winners, and all broadband providers as the "dumb pipe" market losers.

  Skype's "do as I say not as I do" stance is particularly hypocritical because of Skype's dominant size relative to Fring, in that Skype has about a half billion users and is "responsible for 12% of global international calling minutes" per Skype.  

Anyone that cares about freedom generally, and freedom of the press in particular, must read PFF Adam Theirer's outstanding Big Government expose/op-ed putting the spotlight on neo-marxist "FreePress:" "How America's Hugo Chavez Fan Club Plans to 'Reform' the Media Marketplace."

• Adam's analysis and case are brilliant and dead-on; FreePress has one of the most destructive public policy agendas out there, period, full stop.
• It is frightening how much credence this Administration, FCC, FTC and Congress give to FreePress' anti-freedom-of-the-press dsytopian policy agenda.

Thanks Adam. Forewarned is forearmed.   

Today Google publicly admitted for the first time that its purported "neutral" and "unbiased" search algorithm is not completely-automated or computer-algorithmic like Google has long and consistently represented to the public. 

• In a stunning first-time disclosure in a Richard Waters FT article by "the Google engineer responsible for its ranking algorithm," Mr. Amit Singhal:   
  • "Google’s Mr Singhal calls this the problem of “brand recognition”: where companies whose standing is based on their success in one area use this to “venture out into another class of information which they may not be as rich at”. Google uses human raters to assess the quality of individual sites in order to counter this effect, he adds." [Bold added for emphasis.]

Wow. After a decade of passionate public representations that Google's vaunted search algorithm is "neutral' and unbiased, we now learn it has substantial regular human intervention to discriminate what site gets what ranking, who gets found and who does not, and who wins and who loses in the business of online content.

• From Google's website:

For those who appreciate clarity of thought, please don't miss Dr. Jeff Eisenach's great op-ed in the Daily Caller: "Don’t drag broadband into the net neutrality morass."

Mr. Eisenach is right to spotlight and give credit to Clinton Administration FCC Chairman Bill Kennard's wisdom to allow broadband competition a chance to flourish by not saddling broadband with monopoly telephone regulation.   

This FCC would be wise to emulate the proven success of the Kennard FCC's forward-looking broadband competition policy rather than pursue its current highly destructive and backward-looking "de-competition" policy.

Serial beehive kicker Google, just kicked the wrong beehive -- IAC.

• Kudos to FT's Richard Waters for his outstanding front-page story based on an interview with Barry Diller, Chairman of IAC and Chairman of Expedia, on the implications of the Google-ITA deal and Google's lack of search neutrality.
  • Read the article and visualize the angry bee swarm, whose hive has been kicked and which is pursuing the kicker with a vengence.  

So fixated on stomping on the potential competitive threat posed by Microsoft's vertical search competitive differentiation strategy, i.e. by buying the dominant airline software supplier ITA, Google apparently did not look down to see that it was trampling on the honey pot of one Google's biggest and most important partners/allies -- IAC and Barry Diller -- in buying ITA and abruptly heralding its broader ambitions of invading and conquering the vertical space of its many online content partners.

• Google made a very big strategic mistake on this deal that will be hard for Google's legendary PR machine to cover up.  

Why will the IAC sting hurt Google more than other beehives that Google has kicked? 

In an exceptionally uncharacteristic low-key PR manner for Google, Google announced on its blog in one sentence that China renewed its license to operate in China.

• "Update July 9:
  We are very pleased that the government has renewed our ICP license and we look forward to continuing to provide web search and local products to our users in China."
  

What's the rest of the story here?

Google and China have been at loggerheads with one another in one of the highest-of-profile international standoffs between a private company and a superpower in modern history, since Google publicly accused China in January blogpost of being complicit in a hack of Google that resulted in the theft of Google's intellectual property, (which John Markoff of the New York Times reported was the extremely sensitive computer code for Google's password control system.) 

What is the quid pro quo here?

For an FCC that so assiduously respected the integrity of process to produce a consensus National Broadband Plan just a few short months ago, how could this same FCC come to abuse the integrity of process in its pursuit of Title II net neutrality authority, just a few months later? 

• What's wrong with this picture?

How could the same FCC go from the predictable, open, consensus-driven process of developing the National Broadband Plan to the most unpredictable, closed, and non-consensus approach of the Title II net neutrality NOI? 

How can an FCC, which supposedly heard loud and clear from Congress about the importance of the integrity of process in confirmation hearings held just last year, completely ignore letters to the FCC from a majority of Congress imploring the FCC to respect the Constitutional process that empowers the Congress, not the FCC, with the authority to set communications policy for the Nation? 

Does not all integrity of process come entirely from respecting the Constitutional processes of separation of powers, due process, rule of law, equal protection, etc.?

How can the FCC maintain that they respect the integrity of process with the small "p" of the Adminstrative Procedures Act, when they disrespect the integrity of process with the large "P" of the U.S. Constitution and the Bill of Rights? 

What's wrong with this picture? 

In buying travel software leader ITA, Google Inc., the self-described "biggest kingmaker on this earth," seeks to expand its ever-expanding digital information empire into the $80b online travel market and establish a dominant "Google Travel" vertical.    

What's most critical here is pattern recognition in order to get perspective on what this Google-ITA transaction means more broadly. 

Pattern 1: Extension of market power via strategic acquisition of first-mover potential competitors.

This proposed ITA acquisition is the latest example of a well-established Google monopolization strategy -- i.e. to buy the dominant or first-mover player in a strategic vertical as a platform to extend its search market power into those markets much faster than it could organically. Note the pattern in the examples below. Google's: 

In a trailblazing and ominous antitrust precedent for Google, French antitrust authorities ruled for the first time that Google is a search monopoly that anti-competitively abused its market power by capriciousy cutting off Navx, a Google competitor, from Google's search results without warning.  

• Per the WSJ, the French authority found Google's hooded anti-competitive actions against Navx lacked transparency and "resulted in discriminatory treatment."  
• Importantly, the French filed a legal injunction that forces Google to address the situation and answer to the French antitrust authority.

  It is not surprising that the French, who in the world-changing French Revolution rebelled against the absolute power of the French monarchy, are now revolting against Google, the entity that increasingly enjoys absolute power over the fate of web businesses the world over.

  The problem for Google is that in this common sense antitrust decision, the French are effectively playing the role of modern day whistleblower in the famous old fable -- by declaring that Google, the Internet's Emperor, has no clothes on to cover their bare monopoli-ness.