Perp Walk for Larry Page?

by on June 22, 2006

Could Google execs go to jail for bit discrimination? Theoretically, yes, according to a proposal by Sen. Jim DeMint (R-SC). Submitted as an amendment to the telecom bill now being marked up by the Senate Commerce Commitee, DeMint’s proposal would make it unlawful to “prioritize or give preferential or discriminatory treatment in the methodology used to determine Internet-search results based on an advertising or other commercial agreement with a third party.” Any person found in violation would face a maximum fine of $5 million or imprisonment for up to one year.

The plan seems targeted at Google’s sponsored links system, under which users get prominently placed, paid for, links with their search results. (The paid content is separate from the non-paid results, which are not influenced by payments).

For the record, this is a terrible idea. And, I’m willing to bet that Sen. DeMint thinks so too. Instead, the amendment seems intended to underscore Google’s uncomfortable position in the net neutrality debate. While the company has spearheaded the call for net neutrality for telephone and cable firms, its own practices–and power–mirrors that of those companies.

In an online “Note to Readers,” Google CEO Eric Schmidt lays out the company’s position on neutrality regulation:

“Today the Internet is an information highway where anybody–no matter how large or small, how traditional or unconventional–has equal access. But the phone and cable monopolies, who control almost all Internet access, want the power to choose who gets access to high-speed lanes and whose content gets seen first and fastest. They want to build a two-tiered system and block the on-ramps for those who can’t pay.”

But take out the reference to “phone and cable monopolies” and this reads like a critique of Google itself. Google’s business model to a large degree is based on tiering–providing preferred ad placement for those who can pay for it. Its clearly not a system where anybody “no matter how large or small” has equal access. Its based, like it or not, on money.

This applies to political and policy-related advertisements as well. When Google users type in “net neutrality” its seems ads by a Google-supported coalition have been popping up. When asked about this, a Google spokesman explained that there were no special favors granted. As summarized by National Journal, the spokesman argued that “Google participated in its own auction for the keywords, “net neutrality,” adding that if opponents of the concept wanted their ads to appear higher in sponsored Internet search results, they could have decided to pay more.” Ability to pay, it seems, is important after all.

Pro-regulation supporters have also made much of the possibility that network owners could use their power to censor political speech, painting scenarios of websites being blocked because the networks didn’t like their views. However, while no U.S. broadband provider has actually blocked sites because of their content, Google has. Sites that, in the firms’ view, engage in “hate speech” are excluded from Google News. The definition of “hate speech” of course is subjective–and the rule has been used to exclude a number of (mostly conservative) websites that criticized Islam.

None of this matters, says Google. There’s a big difference, it says, between its actions and those of the “phone and cable monopolies.” But is there? The phone companies and cable companies do have an overwhelming share of broadband connections. But market shares in the search engine market aren’t dramatically different. Three firms–Google, Yahoo and Microsoft–account for 84 percent of all searches. Ninety-five percent of “toolbar” searches are by two firms, Google and Yahoo. Of course, these companies aren’t in lockstep–they compete among each other. And they may be challenged by newcomers, who now have small market shares. Yet, the same arguments, when raised regarding broadband networks, are rejected.

This certainly doesn’t mean that Google should be regulated. Or that it will be. Yet, there are some who have seriously proposed the idea. And once lawmakers start imposing mandates, its hard to predict where they will stop. Once network owners are regulated, it simply wouldn’t be that big a step to regulate other Internet players, starting with the biggest.. Sen. DeMint’s proposal may not be meant to be taken seriously. And this week it won’t be. But someday, thanks in part to Google, it could.

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