Competition

Google's Sr. VP Vint Cerf, took his call for effectively nationalizing America's broadband infrastructure to a new level of freedom-crushing, Big Government expropriation by calling for the forced structural separation of competitive phone and cable companies into wholesale and retail arms, per the CBC News.

Where does one begin in addressing this self-serving, outrageous and clearly socialist proposal?

First, Mr. Cerf is calling for a policy that would treat the country with the most facilities based broadband competition in the world by far... as if it were a proven monopoly guilty of monopoly abuses!

Saul Hansell's New York Times blog post on "The FTC Bully Pulpit on Privacy" discussing the FTC privacy chief's views on privacy, did a public service in flagging an unnecessary and problematic gap in the Federal Trade Commission's protection of Americans' privacy.

Anyone interested in Google's increasing dominance or the Google-Yahoo partnership should read Andrew Orlowski's great piece in The Register: "Google the mother of antirust battles?"

• It is always helpful to get an insightful and different perspective from "across the pond."   

A recent study by the Leichtman Group found 70% of American broadband subscribers are very satisfied with their service, and relatively few are actually seeking faster Internet access.

• This suggests the drumbeat for a national broadband industrial policy, because America's Internet is too slow and falling behind the rest of the world, is just empty rhetoric and wishful assertions by Big Government types.
• As I have blogged before, the facts are not the friends of those screaming for de facto nationalizing the Internet.  

Bottom line:  The more one learns about the facts about what benefits American broadband consumers actually enjoy, and what they demand in the future, it is not what the Big Government folks claim.  

In advance of the Senate and House antitrust hearings on Google-Yahoo, I thought it would be useful to debunk some of the primary antitrust myths you will likely hear.

Myth #1: There can’t be an antitrust problem as long as consumers are just one click away from a competitive search engine.

The FCC is reportedly considering putting "the burden on the network operator to prove that its network practices are reasonable" in its net neutrality proceeding on Comcast's network management, according to today's top story in Washington Internet Daily.

• Assuming that this report is accurate, and assuming that an FCC majority would approve such a shift of the burden of proof, let me explain why such an FCC ruling would be a profound assault on the freedoms that Americans hold most dear.   

It would be supreme irony, if in the supposed name of "Internet Freedom," the FCC somehow ruled that network operators had no freedom to manage their private property, enter into contracts or pursue business without prior permission from the FCC.

New facts from independent sources continue to undermine the political charge that the U.S. is falling behind in broadband, the thinly-veiled charge that Big Government proponents use to justify the need for a national broadband industrial policy to replace the current free-market national Internet policy.

• A new report by Nielsen, the independent market research firm: "Critical Mass: The worldwide state of the mobile web"
  • Ranks the U.S. #1 out of the 16 countries they measure in mobile Internet usage penetration -- ahead of the UK, Germany, France and Italy and others. 
  • The report also concludes that penetration of 3G-broadband-capable handsets is greater in the U.S. than in the EU (28% vs 25% of consumers respectively.)

Why are these new independent findings important?

First, broadband mobility is as important to Americans as stationary broadband speed.

With Senate and House antitrust hearings on Google-Yahoo next Tuesday, the timing of Yahoo's new BOSS initiative, Build your Own Search Service, is designed to try and show that Yahoo is still trying to compete with Google after Yahoo partnered with Google "to enhance its ability to compete in the converging search and display marketplace."

Check out the 45 word "headline" on Yahoo's press release on BOSS. There will be a short quiz afterward.

Just learned that the Senate Judiciary SubCommittee on Antitrust has scheduled a hearing on the Google-Yahoo agreement for Tuesday July 15th, at 10:30 am.

• "The Senate Committee on the Judiciary has scheduled a hearing before the Subcommittee on Antitrust, Competition Policy and Consumer Rights on “The Google-Yahoo Agreement and the Future of Internet Advertising” for Tuesday, July 15, 2008, at 10:30 a.m. in Room 226 of the Senate Dirksen Office Building. Chairman Kohl will preside. By order of the Chairman."

The House Judiciary Committee is expected to have a hearing that same afternoon on the Google-Yahoo deal, Internet competition and privacy.

The reality of market pricing for Internet usage is naturally gaining more attention.  

• The New York Time's had an informative Sunday page one story: "Charging by the Byte to curb Internet traffic." 
• Today the Wall Street Journal highlighted why market pricing for Internet usage is evolving with dramatic changes in the Internet marketplace in its story today: "Cisco projects growth to swell for online video."  

The big economic takeaway here is that in a free market Internet, where users have very different demand: i.e. needs, wants and means for speed, usage, mobility, latency, immediacy, reliablity, flexibility and other attributes -- suppliers (ISPs, application providers and content providers) must have the freedom to innovate, experiment and provide a diversity of choices, at a diversity of prices in order to meet the diversity of demand from users.