I’ve been mostly away from my computer and the Internets over the last few days as I take advantage of some of the better freedoms from being
unemployed between contracts. I expect to post regularly in the coming weeks, but finding a new contract is obviously my first priority. Just so you know.
In the meantime, I have a two related items clogging my aggregator, so now is a good time to clean them out. First, the call for regulation is never too far from any success.
But now, precisely because of its success, it’s fair to ask if Google should be barred from furthering its dominance through acquisitions or collaborations. At issue are the recent purchases of YouTube, the leader in online video sharing, and DoubleClick, the leading broker of online advertising; in both instances Google used its gusher of profits to outbid rivals. There are also new joint ventures with Clear Channel, the giant radio broadcaster, and EchoStar, the satellite television operator.
Consider this: There may never have been a Google without the government’s antitrust suit that prevented Microsoft from crushing upstart rivals. By the same principle, isn’t it time to begin restraining Google to increase the odds another Google will come along?
It’s easy enough to look at the first paragraph and point out that YouTube doesn’t make any money. No one is certain how, or if, Google will make money from YouTube. There are theories, but theories don’t equal revenue without creativity, work, and luck. It’s a little premature to assume that this acquisition will result in further revenue growth. We could also simply look at the reality that Google is buying Internet successes rather than creating them.
The second paragraph, though, is more instructive. The phrase “may never have been” is hardly persuasive. Maybe the government’s antitrust suit helped, but we can’t know. That’s hardly a principle, unless we’re looking to some system outside of capitalism.
Nor do we have any proof that Microsoft’s dominance in its earlier markets translates into future dominance. Microsoft dominated the web browser market by the late ’90s, but its dominance in even that is waning as Mozilla builds Firefox as a product and a brand. More instructive, the web browser market is not the Internet.
Microsoft’s largest foray into the actual market Google now leads was MSN. Microsoft tried creating a closed system so that it could act as a gatekeeper to the Internets. Like AOL, this strategy was brilliant in the early days of the Internet’s public growth. As customers became better accustomed to technology, and technology got easier, the flaws in this strategy became clear. That left searching, which Google is simply better at. When Google stops being the best, customers will go elsewhere. This is the only principle at work.
Next, to demonstrate why we shouldn’t give government regulators more power than absolutely necessary, the FCC wants Congress to further violate the Constitution by giving it the power to censor violence on television.
The Federal Communications Commission has concluded that regulating TV violence is in the public interest, particularly during times when children are likely to be viewers — typically between 6 a.m. and 10 p.m., FCC sources say.
“Parents are always the first and last line of defense in protecting their children, but legislation could give parents more tools,” FCC Chairman Kevin Martin said yesterday regarding the report. “I think it would be better if the industry addressed this on its own, but we can also give parents” help through regulation.
Beyond the obvious arguments that “Congress shall make no law…”, legislation to allow the FCC to regulate violence – including basic television, if the FCC gets its wish – would do nothing to give parents more tools. This is little more than a disguised version of the “for the children” argument used to excuse away most new intrusions on the rights of American adults. I expect the Congress to act on the FCC’s request because Democrats don’t love rights any more than Republicans have the last
200 6+ years. Unfortunately, I don’t have much faith in the courts, although if this finally pushes big television networks to finally fight back, I trust that we could finally see a change. Here’s hoping.