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Corporate Welfare

For Now… Netflix Has Mastered Regulatory Arbitrage

Imagine if one company out of the Fortune 500, #474 with ~$6b in revenues, and 2,000 employees, representing about .03% of U.S. GDP, and .06% of the population, comprised 36% of all the vehicle traffic going in one direction on our interstate highway system on any given day.

Now imagine that one company’s lobbying was instrumental in convincing the government to grant that company’s business model the right to commercially use the highway system forever for free, by not ever having to pay a standard gas tax or private highway tolls, like other businesses or people do to pay for the relative wear and tear that their usage causes on the highway systems.

Imagine further that the government justified this special one-way highway traffic treatment, by saying it would be better and fairer for everyone if the companies that use and profit most from using the most one direction of the highway system never had to pay for that delivery benefit – that consumers should subsidize their commercial use and profits in “perpetuity.”

The company’s situation you just imagined is Netflix’. The government agency is the FCC. And the perverse government arrangement is the FCC’s mandate of a permanent zero price for all Internet downstream traffic.  

Why Entitle-ify Special Access If There’s No FCC Utility Rate Regulation?

We will learn quickly and unequivocally at the FCC’s August 6th meeting, if the FCC is true to its word -- that there will be no “utility-style rate regulation” of broadband.

While the FCC’s Open Internet Order fact sheet stated: “the Order makes clear that broadband providers shall not be subject to tariffs or other form of rate approval, unbundling, or other forms of utility regulation,” will the FCC majority -- in its first post-Open-Internet-order ruling -- cynically do the exact opposite by imposing de facto “utility-style rate regulation” to the IP transition from copper to fiber networks?

Googlegate -- The FTC Cover-up Evidence Piles Up

The FTC’s Googlegate cover-up problem is that while the FTC may be telling the truth, they apparently are not telling the whole truth and nothing but the truth.

Don’t miss the brief summary below of the role political influence played in the politically messy closure of the FTC-Google antitrust investigation in 2013.

The evidence of FTC special treatment for Google, coupled with an apparent FTC cover-up of the political influence that may have defanged the FTC’s investigative process, is particularly relevant to: the European Commission’s current antitrust investigation of Google’s abuses of its <90% dominance in Europe; reported U.S. Senate oversight interest in the FTC’s closure of the Google investigation; and Mississippi AG Jim Hood’s State-led antitrust and consumer protection investigation of Google.

The Appearance of Google-USG Conflicts of Interest Grows

 

Public evidence concerning the amount of special access Google has to the highest reaches of the U.S. Government creates at least the appearance that the U.S. Government’s business may not be “conducted with impartiality and integrity” as required under Federal ethics rules.

FCC Title II Protectionism Creates a U.S. Digital Single Market like EU’s

On February 26th, the FCC executed President Obama’s call to “implement the strongest possible rules” to regulate the Internet as a telephone utility under “Title II” of the Telecommunications Act.

Legally, the result of this “reclassification” was for President Obama and the FCC to assert regulatory jurisdiction over the Internet ecosystem, creating a de facto American “Digital [Internet] Single Market” industrial policy, like the European Commission is in the process of creating for the European Union.

Legally, America now has a single digital telecommunications/Internet market/ecosystem because the FCC is effectively reclassifying Internet traffic as Title II telecommunications and Title II is a holistic, end-to-end, 1934 regulatory regime designed for the FCC to decide most everything in the assumed monopoly telecommunications ecosystem from originating and terminating local access, long distance, phone and network equipment manufacturing, directories, etc.

How America Protects National Champion Google in the EU -- Daily Caller

Please don’t miss my Daily Caller  op-ed: “How America Protects National Champion Google in the EU”

  • It spotlights the facts of how exceptionally integrated Google has become with the U.S. Government on most all of the commercial matters most critical to Google’s business success.

 

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Google Unaccountability Series

Part 0: Google's Poor & Defiant Settlement Record [5-1-12]

Part 1: Why Google Thinks It Is Above the Law [4-17-12]

Top Ten Adjectives to Describe FCC Title II Net Neutrality Regulation

 

The top ten most descriptive adjectives for the President’s claim that Title II utility regulation authority is needed to implement net neutrality are:

 

  1. UNTRUE

  2. UNWARRANTED

  3. UNNECESSARY

  4. UNFAIR  

  5. UNPOPULAR

Net Neutrality Has Become an Industrial Policy – My Daily Caller Op-ed

 

Please don’t miss my Daily Caller op-ed here: “Net Neutrality Has Become an Industrial Policy.”

It explains how net neutrality is being exposed to be less about protecting consumers and more about “Trojan horse” political messaging to protect and subsidize Silicon Valley economic interests.

This is Part 70 of my FCC Open Internet Order Series.

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FCC Open Internet Order Series

Part 1: The Many Vulnerabilities of an Open Internet [9-24-09]

Why is Silicon Valley Rebranding/Redefining Net Neutrality?

 

Via their Congresswoman, Silicon Valley is trying to redefine net neutrality for their benefit under the benign guise of “rebranding.”

Their desired re-definition is that net neutrality now should be the principle that “all bits are created equal.”

This is an unreasonable utopian escalation of the net neutrality debate. An “all bits are created equal” or “bit equality” principle would be a radical departure from the current decade-old “network neutrality” principle that the American Internet has long operated under.

Everyone knows that “neutrality” and “equality” are not synonyms and are not honestly used as interchangeable concepts in conversation, policy discourse, branding, or the law.

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Q&A One Pager Debunking Net Neutrality Myths