February 2007

I was pleasantly surprised and very pleased that FCC Chairman Martin proactively released a proposed order that would reclassify wireless broadband as a Title I information service, as reported in today's Comm Daily. This order, which looks to have the support of the Republican majority, would continue to harmonize the regulatory treatment of all the major modes of broadband.

• The FCC has already classified cable modems, DSL and BPL as unregulated info services.
• Given the robustness of wireless competition in the U.S., reclassifying wireless broadband as an info service should be a no-brainer.
• The FCC should also do another order to classify satellite broadband as an info service as well.

Why this is relevant to NN is that the expert agency overseeing competition in this market segment is concluding that there is sufficient competition to not require common carrier-like regulation.

• The U. S. has three times more WiFi hotspots than any other country and more facilities-based wireless broadband investment and deployment than any other nation in the world through Verizon, AT&T, Sprint and T-Mobile. Moreover,  Sprint and Clearwire are also beginning to build national WiMax networks.
• Wireless competition is robust, clearly warranting an info services classification.  

The evidence continues to pile up that Google is well on its way to achieving a 50% share of the search market, a significant antitrust threshold where a company is considered "dominant" and subject to "stricter scrutiny" for potential anti-competitive practices.

• Google's ~50% market share is highly relevant to the Net neutrality issue because:
• Search is now the leading Internet access technology, and
• Google's national and international scale and market share dwarf the potential gatekeeper role of any U.S. broadband player.

Microsoft's recent earnings call showed how badly Microsoft is doing in search.

I have attached the link to Esther Dyson's important interview on net neutrality.

• Her real life experience and leadership in dealing with ICANN and government regulators is worth paying attention to.
• Esther is very widely respected in the Internet community and always thoughtful in her approach to problems.
• She has even been dubbed the "Internet High Priestess".

Today's WSJ article: "MySpace pact with Google hits a snag" is a helpful reminder of the competition double standard and hypocrisy of net neutrality proponents Google and eBay.

Google the dominant search gatekeeper with 47% share and rising is the world's leading Internet access technology. They have a pact with Myspace, one of the fastest growing sites on the planet that would pay MySpace's News Corp. $900m for placing Google's search on MySpace.

• While this business practice is perfectly legal and above board, it is precisely the type of business arrangement that Google has outrageously mischaracterized as "discrimination" and is seeking to make illegal for its broadband competitors.

 Meanwhile, the pact is supposedly hung up because MySpace would still like to have a "discrimnation" deal with eBay too, where MySpace users could use post eBay auctions on their MySpace page. But Google only likes "discrimination" that is in its favor.

Listen to a priceless quote from the WSj article today:

• "Google isn't likely to favor any deal that promotes eBay services that compete with their own."
  • Yep that sums it up Google's real belief in "neutrality." 

How does Google explain their attempt to "block, degrade and impair" eBay's ability to easily reach Myspace consumers is not precisely the net neutrality "discrimination" problem that they want to ban?