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How the Google-Facebook Ad Cartel Harms Advertisers, Publishers & Consumers

How much smoke and fire must there be, and how many people must get burned, before the fire department will investigate and put out a forest fire?

Apparently, a lot, if the forest fire is in the digital ad market that Google and Facebook dominate, and U.S. antitrust authorities are the firefighters.

Where’s the fire here?

Google and Facebook, which don’t directly compete in search and social, together dominate over 70% of the digital advertising market. They also dominate about 80% of online referral traffic, the online oxygen upon which every Internet publisher depends for survival.

After fiercely competing directly with each other in search and social in 2013 and 2014, Google and Facebook abruptly and quietly stopped competing against each other in 2014 with no explanation.

Since then, Google and Facebook have accelerated their capture of almost all digital ad revenue growth and profitability, exposing that Google and Facebook have become a de facto cartel that has illegally divided up the digital advertising space.

In 2014, Google and Facebook apparently decided they could each optimize their growth and profitability by colluding as dominant market complements to each other, rather than competing head-to-head as less efficient search-social competitors.

The economic motivation behind Google and Facebook’s apparent illegal market division is this.

Debunking Edge Competition Premises in FCC 2015 Title II Broadband Order – FCC Comments

 

July 17, 2017

FCC Restoring Internet Freedom WC No. 17-108

Submission by Scott Cleland, Chairman, NetCompetition (An e-forum supported by broadband interests.)

 

 

Debunking Edge Competition Premises in FCC 2015 Title II Broadband Order – FCC Comments

In 2015, the FCC’s Title II Open Internet broadband order implicitly was based on three core competitive premises about “edge” competition and competitors, that are demonstrably false, which undermines the factual legitimacy and legal justification of the FCC’s 2015 Open Internet order, and which supports the current FCC’s Restoring Internet Freedom NPRM to overturn it.

Summary: The 2015 FCC’s three demonstrably false core competitive premises are:

 

Why Aren’t Google Amazon & Facebook’s Winner-Take-All Networks Neutral?

 

Ironically, the world’s leading winner-take-all Internet platforms -- Google, Amazon, and Facebook -- are the leading voices of the July 12th “Internet-wide Day of Action to Save Net Neutrality.” They want to pressure the U.S. FCC to maximally regulate ISPs as Title II telephone utilities, even though they don’t believe in operating neutral networks themselves.

Even more ironic, is this 1 min. Google-YouTube video -- by the Internet Association, “the unified voice of the Internet economy.” It defines net neutrality and what it wants the FCC to ban ISPs from doing. However, those banned behaviors closely describe how Google, Facebook and Amazon often operate. Awkward.

In yet another video supporting this Day of Action, three U.S. Senators video message said: “We believe the Internet is the extraordinary opportunity that gives everybody in America the chance to get ahead. We have to make sure it is not controlled by a handful of powerful corporations.”

This piece has two tasks.

NetCompetition: Brendan Carr a Great Pick for FCC Commissioner by President Trump

FOR IMMEDIATE RELEASE, June 29, 2017, Contact:  Scott Cleland 703-217-2407

FCC General Counsel Brendan Carr Is a Great Pick for FCC Commissioner by President Trump 

 

WASHINGTON D.C. – The following may be attributed to Scott Cleland, Chairman of NetCompetition:

 

“President Trump’s nomination of FCC General Counsel Brendan Carr to be an FCC Commissioner is a great selection. He is exceptionally skilled, knowledgeable, and experienced on FCC issues; and he has proven to be a highly productive and capable FCC General Counsel in managing the FCC’s very heavy workload transparently, effectively, and expeditiously.”

 

NETCompetition.org is a pro-competition e-forum representing broadband interests. 

Scott Cleland served as Deputy U.S. Coordinator for  International Communications and Information Policy in the George H. W. Bush Administration. 

The Trump DOJ “Slam Dunk” Antitrust Case Against Alphabet-Google

What’s quintessential illegal monopoly behavior?

A dominant company that is proactively, consistently, and purposefully focused on eliminating most of its business competition, not just competing on the merits, but also via illegal collusion, predation, anti-competitive acquisition, and obstruction of justice.

That quintessential illegal monopoly behavior belongs to Alphabet-Google 2007-2017.

The public evidences of Google’s patterns of collusion, predation, anti-competitive acquisition, and obstruction of law enforcement are substantial and hiding in plain sight.

They are just waiting for DOJ antitrust leadership, investigators and prosecutors to connect the dots in an up-to-date theory of the case, after organizing and synthesizing the substantial investigative evidence that already resides in the DOJ’s and FTC’s antitrust files, because of ten different U.S. Google antitrust-related investigations of Google by either the DOJ or FTC from 2007-2013.

In addition, some law enforcement conclusions and actions involving Google from 2007-2013 have been proved either wrong or ineffective with the benefit of hindsight, that now need to be addressed.

Why US Antitrust Non-Enforcement Produces Online Winner-Take-All Platforms

If one considers the evidence, it is evident that U.S. antitrust enforcers have enabled the current “new normal” of online winner-take-all platforms: Alphabet-Google in e-information, Amazon in e-commerce, Facebook in e-social, Uber in e-transportation services, Airbnb in e-accommodation services, and a “unicorn” queue of online winner-take-all platform wannabes.

Summary of Conclusions

U.S. antitrust officials should be alarmed by the extreme early concentration of a relatively young twenty-year old, U.S. online company marketplace.

Five online winner-take-all platforms -- Google, Amazon, Facebook, Uber and Airbnb -- already command ~80% of U.S. online companies’ revenue share and market capitalization.

And they are collectively capturing 82% of U.S. online companies’ revenue growth share, meaning they are growing more dominant not less.

The Internet Association Proves Extreme U.S. Internet Market Concentration

Those who think the U.S. Internet market is competitive, and not extremely concentrated, need to read on.

In a nutshell, for the first time, publicly available evidence shows that the cumulative effect of well-known “winner-take-all” platforms (WTAPs) Google, Amazon, Facebook, and Microsoft, is a “four-winners-take-all Internet sector.” Four different dominant platforms collectively command ~80% of overall Internet market share in revenues, new absolute annual revenues generated, market capitalization, and employees.

Imagine if the 94% of the economy that is offline-based, were as extremely concentrated as the 6% of the economy that is online-based/the Internet sector, per the Internet Association.

That would be an offline economy with basically one information company, one sharing company, one retailer, and one business software company, that collectively commanded 80% revenue share of the 94% of the economy that is offline based with ~4,000 publicly traded companies.

Alphabet-Google Big Takeaways from Trump Antitrust Chief’s Senate Answers

Reportedly the EU will rule Google has abused its search dominance this summer, putting the growth and profitability of the ~30% European part of Alphabet-Google’s revenue base at risk.

The logical next important question will be if this EU antitrust enforcement means U.S. antitrust enforcement eventually will follow, expanding Alphabet-Google’s growth and profitability risk, to the combined ~80% U.S. and European revenue base of Alphabet-Google.

Why do the answers of President Trump’s nominee for DOJ Antitrust Chief, Makan Delrahim, to the Senate Committee overseeing his confirmation process, merit close attention as it pertains to Alphabet-Google’s U.S. antitrust risk?

Mr. Delrahim’s is highly likely to be confirmed by the Senate to head the DOJ Antitrust Division, and it is likely to occur in June.

Thus, his written answers under oath to the Senate Judiciary Committee represent the best accessible, most-recent, most-reliable, forward-looking evidence upon which to discern the general direction Mr. Delrahim and U.S. antitrust enforcement is likely to pursue on the Google antitrust matter.

Which Internet Gatekeeper Discriminates the Most? Alphabet-Google

If proponents of network neutrality, an Internet non-discrimination principle, truly care about preventing discrimination on the Internet, why do they turn a blind eye to the worst offender of gatekeeper discrimination on the Internet – Alphabet-Google?

Recently, the Internet Association, which Google co-founded and funds, criticized the Federal Communications Commission for its proposal on network neutrality and utility regulation of Internet Service Providers (ISPs). Internet Association President Michael Beckerman stated: “ISPs should not be able to use their position as gatekeepers to prioritize their own content over others.”

Apparently, the net neutrality movement has a hypocritical double standard on gatekeeper discrimination. It has one for their chosen opponents – ISPs, and another for their allies and patrons like Google.

They maximally regulate competitive ISPs as monopolies engaged in anti-competitive discrimination, when they are not on both counts. They stay silent and do nothing when a real monopoly anti-competitively discriminates.

How can net neutrality proponents be so incensed about an imagined ISP net neutrality problem and so indifferent to a real anti-competitive and discriminatory gatekeeper problem on the Internet – Google?

They must ignore the facts.

NetCompetition: Broadband Utility Regulation Proponents’ Hypocritical Focus

FOR IMMEDIATE RELEASE, May 18, 2017, Contact:  Scott Cleland 703-217-2407

 

What’s Wrong with This Picture? Pressure Groups and their Netopolies-Funders: Google, Facebook and Amazon, Hypocritically Demand Utility Regulation of Competitive Broadband ISPs to Prevent Commercial Discrimination or Blocking When the Netopolies are the Actual De Facto Utilities that Discriminate and Block as a Key Part their Business Models  

 

WASHINGTON D.C. – The following may be attributed to Scott Cleland, Chairman of NetCompetition:  

 

“Title II broadband regulation proponents sacrifice their credibility when they claim competitive companies are monopolies that require the strongest possible utility regulation, while simultaneously claiming Internet monopolies like Google, Facebook and Amazon, are competitive companies that should have no regulation at all.”

 

 

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Q&A One Pager Debunking Net Neutrality Myths