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Summary:

The latest round in the battle over net neutrality has started, and as usual the telcos have their game plan sussed out and in widespread, synchronized action. The message? Google is bad, and wants to control the Internet to keep its cash pile growing. Telcos, meanwhile, […]

The latest round in the battle over net neutrality has started, and as usual the telcos have their game plan sussed out and in widespread, synchronized action. The message? Google is bad, and wants to control the Internet to keep its cash pile growing. Telcos, meanwhile, just want to innovate, so please don’t write laws keeping them from doing so.

Sometimes this message is blatant, as David Isenberg notes in a recent post about a speech given by Verizon’s general counsel, William Barr.

According to Isenberg, Barr hit many of the main telco vs. Google points: Google has more market cap than we do, Google and other Internet players hired a lot of lobbyists, and because of Google’s success, it has more control over the Internet than those who own and operate the routers. Said Barr:

Google is the gateway on the Internet, because it stands between you and the stuff you want to find. It has more of a choke hold than [Verizon].

You expect that kind of stuff from the telcos, who are great at lobbying, and know how to effectively spin messages that aren’t necessarily true. But facts aren’t really important in opinion battles like this, and Google is a good target for several reasons.

  • Google is still naive when it comes to navigating Capitol Hill, and we’re not sure if they learned any lessons from last year’s debacles;
  • Google’s stratospheric stock price, arrogance and new-age foofiness makes them easy to pick on;
  • Google’s overwhelming monopoly in search makes it easy for telcos to compare Google’s gatekeeping ability to telcos’ network access infrastructure (even though one was built by monopoly fief and taxpayer subsidies, and the other through open competition);

From there you get the new argument: If Google wants network neutrality, why aren’t they offering search neutrality?

Telco water-carrier Mike Volpi, the general manager of Cisco’s service provider business, dedicated a long portion of his speech at the company’s December analyst conference to this point, even putting up slides with Google search pages showing that Google charges more for preferential ad treatment. You might ask, what does that have to do with packet-sniffing and router-based control of your Internet consumption? Nothing, but nobody’s asking those questions.

It’s not a coincidence that everyone on the telco side of the fence is making similar arguments. This is called good lobbying, and it’s the kind of thing you can do when you are prepared to spend multiple millions — somewhere between $44 million and $68 million last summer, according to various sources — to fight a battle you want to win.

As the FCC’s final decision on the AT&T/BellSouth merger showed, net neutrality proponents are still scattered and disorganized, many not sure if they won or not (they didn’t) in the deal.

Meanwhile, there is also an emerging trend of net-head techno experts weighing in, and while they aren’t taking the telco side per se, they are more afraid of Congress messing with technology than they are of telco pricing pressure. (Bob Kahn, one of the inventors of the TCP/IP protocol and one of the Internet’s founding fathers, has also in the past called for open-access last-mile networks. But don’t expect to see the telcos trumpet that idea on their lobbying blogs anytime soon.)

The upshot at this point in time? Even with NN proponents like Ed Markey and Ron Wyden in positions of power in Congress, expect tough sledding for any specific net neutrality legislation anytime soon. And expect to hear a whole lot more about how bad ol’ Google just wants to make money off the Internet without paying for it.

  1. Hmm, seems as if Verizon has already paid off Robert X. Cringely. Have you seen his latest column?

    When Being a Verb is Not Enough: Google wants to be YOUR Internet.
    see: http://www.pbs.org/cringely/pulpit/2007/pulpit20070119001510.html

    Perhaps this will be more entertainment than republicans and democrats, err I mean cops and robbers…

  2. And another thing before I forget.

    Why haven’t the consumer privacy advocates gotten into this net neutrality battle?

    To dole out different levels of services requires (deep) packet inspection. Couldn’t this be seen as the digital equivalent of opening my mail?

    Verizon sucks because they focus on themselves, ie the core, instead of the me, ie. the edge.

  3. I for one, can’t wait till Google becomes an ISP. GoodBye TELCOs.

  4. while I agree the telcos suck, there is truth to the view of Google as a chokehold to the net.

    Why shouldn’t we be concerned about concentrating such power and control in single organization, however cuddly and good-intentioned they seem to be?

    While I agree net neutrality is a legitimate concern, I don’t think it should be resolved by legislation.

    If the govt intervenes in either case though, we’ll simply wind up with bureaucrats choosing the “winners” and stifling the creative entrepreneurial energy that we’ve all enjoyed so far.

  5. Fuck these luddite and greedy asshat telcos..the old AT&T broken up into seven Baby Bells in 1984 by Judge Greene and now its back stronger than ever again in 2 mega players the new AT&T and Verizon ( Qwest is the bastard stepchild ) thanks to their lobbyists and the supplicant FCC primarily since 2000 when Bush admin took charge ( gotta make sure the oil co’s, pharma, and telcos get an uneven playing field because they give Bushco millions of $$$ ).

  6. The 463: Inside Tech Policy Saturday, January 20, 2007

    The Net Neutrality “Muddle”…

    When word got out that the FCC agreed to the terms of the Bell South/ATT merger with a supposed caveat that Net Neutrality principals must be followed for a good spell, one might have expected that the advocates for NN…

  7. The 463: Inside Tech Policy Saturday, January 20, 2007

    The Net Neutrality “Muddle”…

    When word got out that the FCC agreed to the terms of the Bell South/ATT merger with a supposed caveat that Net Neutrality principals must be followed for a good spell, one might have expected that the advocates for NN…

  8. The telcos are simply lying. They pump a lot more money into DC lobbying than Google could dream of, and enjoy a tax-subsidized monopoly on the last mile, which they call “their” network.

    If the Bells don’t want to be common carriers any more, that’s fine: they can start paying franchise fees for their rights of way like everyone else who wants access to the last mile. With some actual competition on a level playing field for residential broadband service, this whole debate would be moot.

  9. Mt Blog ‘gets it’
    http://www.toyz.org/mrblog/archives/00000269.html

    I have spoken before of the abuse of the word “free” when it comes to telephony.

    And today, a statement by Om Malik just set me off. He said:

    [Unity is] a nifty marketing ploy that would allow big-spending AT&T wireless and wireline customers to call each other for free. (emphasis added)

    “To call each other for free.” There it is again. The telco marketing execs must be proud. In order to qualify for the Unity plan, you have to PAY for an unlimited calling plan on your wireline service (that’s an extra $40) AND you also have to PAY for a more expensive wireless plan (an extra $20 or more, depending on the minute plan you could otherwise be on). You are PAYING for those calls. THEY ARE NOT FREE!

    A Skype to Skype call is free. A PhoneGnome to PhoneGnome call is free. A call that is included in my $100+ monthly service fee is NOT free any more than a mile I drive is “free” with a fill up of fuel in my car.

    No wonder the telephone companies, both wireline and wireless, abuse us so badly. There are no consquences for their actions. Even smart people like Om Malik, Andy Abramson, and countless others repeat the telco’s marketing spin for them. We all do it. I don’t mean to single out Om. You probably hear people say it almost every day. If you read industry news, you’ll see someone in the media or a blogger do it almost every day. We put up with the outrageous fees and horrible customer service of these companies. We take it with a smile. Why should they change their behavior when there are no consequences for not doing so? They will continue to rape us until we change our behavior and start fighting back a little.

  10. Km4,

    not sure what you are saying, but clearly my sarcasm about “free” did not get through clearly.

  11. I work with local FTTU access network operators on a daily basis, and must say that it is difficult to justify the business case for deploying fiber based on an access fee revenue only. As Network Operator you need to get some kind of revenue sharing on the services.

  12. Om, sorry I did lock onto your sarcasm and simply took “Mr Blogs” post and placed it here. I don’t think he got your sarcasm as well.

  13. blog.shusta.org Sunday, January 21, 2007

    Net Neutrality, Google, and Hard Ball…

    Google has the upper hand in the current fight between telcos and large web sites, but their good-guy image prevents analysts from realizing this fact…

  14. First it was the cable co’s, now it’s the telco’s. What is next? The air? If you’re a telco, ISP, Cable Company or power company the point of making investments in infrastructure is that it will hopefully and I say hopefully because plenty have failed, give you some competitive advantage. Yet when you finally see the light at the end of the tunnel the freeloaders come and cry foul. It’s the same BS that happened to @Home on then it was AOL crying foul against the MSO partners of @Home. Guess what, all this is moot if there is no peering between the networks and that isn’t even on these peoples radar. Why? Because as soon as business has any advantage some crybaby is going to call a gov’t official who needs to make a name for themself and blow it up to something it isn’t. What they should be spending their time on is coming up with a better way of reaching the homes that what is currently available via telco’s or cable co’s or power co’s. And now that google has spent time and effort and of course lots of capital investment(none of it gov’t provided btw – favorable taxes are not gov’t provided money, they are incentives to do something positive like create jobs which add to the tax base, etc ) and now the arrows are coming towards them. This whole debate is a joke and is only going to stymie this country’s technological advancement because disincents entrepreneurs and goes against the grain of capitalism.

    To top it all off, it won’t matter if you get access to the last mile if you can’t leave that network and it’s an international(not just USA) group of networks which comprise the internet. If these people were so worried about equality and leveling the playing field, you would think they would be ensuring that third world countries get access to other networks via peering instead of trying to stop businesses from making money. They aren’t doing this because they aren’t concerned in the least with a level playing field, they’re concerned with making a name for themselves, covering up their own missteps by transferring ‘blame’ on to market dynamics or they just are flat out ignorant.

    WRT Google, of course they are getting so broad in scope and depth that they could, should and do pose threats to competing businesses but guess what, that is what known as an incentive to start a business, that one day you will have that market strength. It’s called efficiency and whoever is able to deliver the most efficient product will be able to deliver the most value to their customers by both price comparison and scope because as we’re seeing with google, they reinvest their nasty old profit (it’s really not a four letter word) back into the company for the development of new products and services.

    Think this is all rhetoric? Take a look at the technological progression of Europe or APAC or South America against the US. US has a gov’t intervention hangover and there isn’t a new day in sight.

  15. I don’t see how someone can say that Google has a “choke hold” in the Internet. Google is #1 because, when given the CHOICE, more people use Google. Whether it is a PC or a Mac… whether a Mac OS, Windows, or Linux… whether it’s Internet Explorer, FireFox, or Opera… at any given point, Google users can choose (rather quickly) to start using Yahoo, MSN/Live, or Ask to search instead of Google. Likewise, users of those other services can choose to use Google to search instead, as well. Google does not in any way shape or form have a “monopoly” because they have strong competition, even though most users will still choose to go with Google. ISPs, however, have more of a “choke hold”. I have essentially 5 ISP choices in my area. The local cable company (Comcast), the local phone company (AT&T), two different small-time ISPs (who likely use AT&T’s pipelines), and satellite options. However, I can’t easily make a change five times a day conveniently, like I could change my usage of search engine providers. It would be a hassle. It would cost money. I would experience some hiccups in the process. And, in the end, someone large (Comcast? AT&T?) will benefit in a huge way, no matter which “choice” I make. Just because Google is good at what they do does not mean I can’t get to my bank’s website to handle my finances. However, I DO rely HEAVILY on my ISP to give me actual physical access to the Internet. Take away Google and Yahoo and Ask, and you’re just stuck with a huge inconvenience, but can still handle most simplistic tasks. Take away Comcast and AT&T and Verizon, and the Internet as we know it is likely to come crashing to a halt. We would have to start all over again, linking computers together and running physical lines all over the place, but the big corporations would likely just start buying this up again.

  16. Paul Kapustka Sunday, January 21, 2007

    What is interesting to me is seeing AT&T and Verizon dipping their toes into muni-wifi in some places while opposing it in others… anyone out there with a front-row view of big telcos in muni wifi plays? Verizon said this past summer that “private-public” partnerships are OK (they previously opposed such deals).

  17. Don’t worry about ‘Kurt’ up there on comment 4. Kurt is a telecom lobbying plant, monitoring this blog and planting his focus-grouped lies in the blogosphere, for which he gets paid around $100K a year and up.

    Google grew its monopoly by offering consumers a product they want, and everyone bought it. They use open APIs, and anyone can join the party. However, if Google did exhibit the exercise of market power in the search field (as Microsoft attempted to do) then they too would be subject to criminal antitrust prosecution, certainly in the EU.

    Verizon and AT&T control the one (or second) pipe into your house, and your neighborhood. It was built with massive public subsidies, and is owned by the public.

    Verizon won’t compete against AT&T, and vice versa. Their plans are to remain solely within their monopoly local service areas. There are no competitive business plans announced by either of these companies. Don’t lose sleep waiting for it.

    Sorry, but I just can’t fake kurt’s well tested and much copied ‘aw shucks’ kind of post. But search the web, and you’ll see his unmistakable posts everywhere.

    Uncle Mike

  18. What umopapisdn18 said,

    and

    kudos to Uncle Mike.

    “Google’s choke hold”, give me a break. Like today’s my first day on the `net and the telco’s offer me a great, cheap product.

  19. BIT RATE » Blog Archive » P2P: Trust Issues Sunday, February 22, 2009

    [...] one isn’t my idea. Mike Volpi, former GM of Cisco’s service provider business, put forward this argument about a year ago — pointing out that Google charges more for preferential ad treatment. (That, by the way, was [...]

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