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Google’s “Going Dark” Encryption Leadership Threatens Sovereign Security

Google is unique in its leadership, plans, and global marketpower to accelerate the majority of all global Web traffic “going dark,” i.e. encrypted by default. Google’s “going dark” leadership seriously threatens  to neuter sovereign nations’ law-enforcement and intelligence capabilities to investigate and prevent terrorism and crime going forward.

Google is not the only U.S. Internet company endangering the national security of many countries by “going dark” via end-to-end corporate encryption in an environment of exceptional terrorist risk -- Apple has been self-servingly irresponsible as well.

Nevertheless, Google warrants the spotlight and primary focus here on “going dark” for three big reasons.

The FCC’s Abjectly Illegitimate Premise for More Cable Regulation

There are troubling signals that the FCC is gearing up to further increase regulation of cable -- on top of the extra-legal new utility regulation the FCC already did in its 2015 Open Internet Order. 

What is profoundly troubling is the abject illegitimacy of their premise for more regulation of cable, i.e. the FCC’s new arbitrary and capricious definition of broadband that illegitimately redefined long-recognized, strong broadband competition -- out of existence with the stroke of a pen.

So what are the signals of more cable regulation? Two speeches from the FCC Chairman, one from the FCC General Counsel, another from the DOJ Antitrust Chief, a variety of Hill and edge-industry entreaties to regulate cable more via new MVPD or ALLVID regulatory proceedings, (but of course without regulating favored edge providers), and an explosion of new opposition to the proposed Charter-Time-Warner merger (by the exact same cast of characters whose opposition doomed the Comcast-Time-Warner merger).

This broad simultaneous level of focused regulatory chatter and organized activity is not coincidental, but highly-orchestrated and abjectly illegitimate.

Why is more cable regulation abjectly illegitimate?   

Google’s Internet Association Hypocritically Begs Digital Protectionism

The juxtaposition of Google tacitly accusing the EU with “digital protectionism” and “discrimination” as the EU’s Digital Chief, Günther Oettinger, visits D.C. and Silicon Valley, while the Google-created Internet Association this week asks for U.S. protection from ISP “discrimination” in an appeals court brief in support of the FCC’s Open Internet order – exposes exceptional hypocrisy.

Antitrust and privacy regulators around the world weren’t born yesterday. They know Google and its online platform allies want it both ways – manipulating policy to advantage them and disadvantage their potential competitors.

Unlicensed Spectrum Needs No New FCC Regulation

Everyone should have the freedom to innovate and compete in America, the land of opportunity.

There should be no innovation or competition double standard where government politically picks winners and losers by rigging competition via denying some companies the freedom to innovate and compete spectrally while granting it to their competitors.

With radio spectrum, America has created different but symbiotic spectrum models. One is licensed spectrum where spectrum for exclusive use is auctioned to the highest bidder. The other is unlicensed spectrum where anyone is free to share the same spectrum if they play nice and do not interfere with other spectrum sharers’ use. These models have never been either/or; they have always been free and open to use separately or together to maximize innovative, commercial, and competitive opportunity.    

The Market’s Ignoring Google’s Many New FCC Common Carrier Liabilities

I.  Summary

Google’s market capitalization has approached a half trillion dollars as its stock hit an all time high, because of a positive quarterly profit surprise and because Google’s new CFO signaled that “Google cost discipline” may no longer be an investment oxymoron.

The market appears to be ignoring that Google’s legal status as a corporation changed in 2Q15 to an FCC Title II regulated common carrier that is subject to very strict and preemptive behavioral non-discrimination requirements to mitigate potential abuse of market power on Google’s network -- per the FCC’s new Open Internet Order which reclassified Internet infrastructure as Title II common carriage regulated to enforce strict net neutrality.

This analysis of Google’s many new common carrier liabilities has four parts: I) the investment and regulatory relevance of Google being a common carrier; II) the evidence of Google being a major Internet access player via the surprising size of its Internet infrastructure, communications, traffic carriage, and market power; III) a listing and explanation of Google’s many new FCC common carrier liabilities, including nine potential net neutrality violations, three privacy, and three transparency; and IV) a conclusion about what this could mean for Google and its valuation going forward.

Google-Facebook-Apple’s Law-Evasive Encryption Risks

In the coming months, Google, and to a lesser extent, Facebook and Apple are on a collision course with American and foreign law enforcement over their pervasive, law-evasive, encryption of Internet traffic by default, which increasingly means law enforcement with a legitimate court-ordered-warrant, cannot search a Google, Facebook, or Apple users’ communications to investigate, prevent and prosecute terrorism or felony crime.

All three, to different degrees, are seeking to regain user trust lost by Snowden’s exposure of ubiquitous NSA spying, by deceptively trumpeting their encryption of traffic as a panacea for privacy vulnerabilities.

[Please don’t miss the summary below of that encapsulates how more pervasive, law-evasive, encryption is not a privacy/security panacea but a grave threat to both public safety and the global free and open Internet we know today.]     

FCC’s New Do Not Track List Authority

Will the FCC create an Internet “Do Not Track” list like the FTC created the “Do Not Call” list enjoyed by three quarters of Americans?

In ruling the Internet to be subject to common carrier consumer protection law, the Obama FCC’s recently passed Open Internet Order applied common carrier privacy law (Section 222) to Internet telecommunications as part of the FCC’s unilateral efforts to modernize communications law for the 21st century.

The Obama FCC’s Open Internet Order also ruled that the Internet now encompasses the Public Switched Telephone Network (PSTN) and that an IP address is the functional equivalent of a telephone number.

Thus, logically it could follow that information that’s considered legally private in the telephone world now could be considered legally private in the Internet world.   

This central consumer protection question should come up this week as the FCC hosts a Section 222 public workshop to explore the FCC’s “role in protecting the privacy of consumers who use” the Internet.

What is Section 222?

It is a common carrier provision of the Communications Act entitled “Privacy of Customer Information.”

ObamaNet vs EuroNet -- “Competing” Protectionist Industrial Policies

The US-EU “competition” of protectionist digital industrial policies -- U.S. Title II net neutrality vs. the EU’s emerging “platform neutrality” plans -- creates an ironic backdrop to negotiations for the US-EU Transatlantic Trade and Investment Partnership (TTIP) “free” trade agreement. Heightening the irony, the Obama Administration, not the European Commission, has been the protectionist digital industrial policy leader, trailblazing the political path for the EU’s Single Digital Market to follow.  

At least on the digital markets front, TTIP will be much less a commercial “free” trade negotiation and much more a political “fair” trade negotiation.    

The U.S. has long set the tone and trajectory for this digital “fair” trade dynamic in championing net neutrality to protect its Silicon Valley national champions, Google, Facebook, Amazon, Apple, Netflix, etc., and by skewing antitrust enforcement to benefit Google and Silicon Valley.

Nationalistic Net Neutrality Naiveté

The New York Times’ editorial, “Global Threats to Net Neutrality,” scolds the world for not following the FCC’s nationalistic concept of net neutrality.

They feign shock and indignation that Europe and India would dare think of politically doing what the FCC has done and impose their own national industrial policies -- under the convenient political cover of “net neutrality.”

America’s elites naively imagine that other countries’ authorities don’t “get the joke” of the FCC’s politically-contrived net neutrality policy.

Other countries’ authorities are not as gullible and pliant as American elites imagine them to be.  

They know “net neutrality” has become an increasingly vacuous political slogan, whose definition conveniently changes meaning like a chameleon changes colors.

They know the FCC is pressuring them to do as the FCC says and not as the FCC does on net neutrality.

America’s Title II Protectionism Will Hurt Google & Silicon Valley in EU

Last November, President Obama effectively abandoned America’s longstanding free trade Internet policy established by President Clinton, in favor of a protectionist Internet industrial policy to benefit America’s national champions, Silicon Valley, under the guise of “net neutrality” policy.

Flipping U.S. Internet policy from global digital free trade to maximal national Internet regulation could end up hurting Silicon Valley the most, because they most benefit from, and depend on, the current free flow of information globally on the Internet.

Ironically, America also is forfeiting the digital free trade policy high ground by leading the world toward a “Splinternet” vision of more nationalistic maximal utility regulation of the Internet and its content.

In particular, it will be much harder for the U.S. to credibly object that the EU’s: creation of a European Digital Single Market (DSM), tightening of the EU-U.S. Data Protection Safe Harbor, and its aggressive enforcement of EU antitrust, privacy, and tax laws against Google, Amazon, Facebook and Apple, is protectionist, when America’s new FCC utility regulation of the Internet is a transparently protectionist American industrial policy to advantage America’s national champions in Silicon Valley. 


Q&A One Pager Debunking Net Neutrality Myths