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Time to Regulate Google?

Should Google's provision of information services be regulated? Yes, if the decision is based on Google's own standards for determining whether to regulate tele-information companies.

In recent comments to the FCC, Google described "broadband openness" rules, aka net neutrality, as a "fundamental necessity." Without such rules, the search engine giant, aka Big Search, fears that broadband providers would "promote only their own pecuniary interests over the far broader interests of Internet users..."

As the Wall Street Journal noted last year, however, Google engages in the same type of discriminatory service practices they want the federal government to prohibit other companies from engaging in. Google Voice is a call forwarding service that allows users to have a single phone number that can reach all of their handsets (work, home, mobile, etc.). Instead of operating in an open, neutral manner, the WSJ explains that Google "is systematically blocking calls to phone numbers in some rural areas" that cost more to connect. Telcos are required by the FCC to complete those rural calls. Apparently Google has no objections to using discriminatory telecom practices to promote their own pecuniary interests.

The question of whether to regulate Google is not new. As SearchEngineLand.com reported, the Minority Media and Telecommunications Council has already raised the question as to whether net neutrality regulations should be applied to Google.

Google told the Commission that "broadband is far too important...to leave it solely to a failed market..." The unanswered question is what market failure? As The Economist explains, market failure occurs when "a market left to itself does not allocate resources efficiently. Interventionist politicians usually allege market failure to justify their interventions." Google has made no demonstration that broadband resources are not efficiently allocated. To the contrary, the company's rent-seeking activities to maximize their shareholder value could well result in a less efficient allocation of bandwidth.

Should Google be regulated? Only by their own standards. By the standards of Executive Order 12866, the FCC has no basis for subjecting any company to new Title II/net neutrality regulation.

By Bruce Levinson, SVP, Regulatory Intervention - Center for Regulatory Effectiveness
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Google's pecuniary interests? Really? Alex Geroulaitis  –  Jun 22, 2010 5:12 PM PDT

Are "pecuniary interests" applicable to a free service such as Google Voice?  How does one regulate free services?

On what basis can one compare monopolistic and often unreasonably priced services by local telcos, to a free service such as Google Voice?

Does the concept of Net Neutrality (where transmission of an IP packet has fixed costs regardless of the destination) apply to telco services where call connection costs vary greatly depending on the destination?

Is it time yet to regulate Bruce Levinson's blog posts where they fail to mention facts crucial to understanding the topic? :)

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