Demolishing The Reasoning Behind Senators Bogus Grandstanding Against Google

from the why-do-they-hate-success dept

I have no problem calling out Google when I think the company does questionable things, but I'm really at a complete loss over the desire of some in DC to attack the company these days. The best I can figure it out, they don't like the fact that Google is successful. Back in September there were those bizarrely clueless hearings against Google, which displayed (yet again) a technically clueless Congress wanting to "do something" about a situation they clearly didn't understand.

It appears that we're starting to see the next step in this charade as Senators Herb Kohl and Mike Lee are calling for an antitrust investigation by the FTC. Of course, we're pretty sure the FTC has been investigating Google for antitrust issues for a while now, so it seems a bit strange to send this letter (embedded below) now.

The letter is really quite ridiculous, and demonstrates the insanity of DC these days, where the highly misleading to downright bogus claims by lobbyists for one side are quoted by politicians as fact, with no admission where the numbers come from. Thankfully, the folks at TechFreedom wasted little time in writing what seems like the definitive response to Senators Kohl and Lee. You really should read the whole thing, but just a snippet:

To begin with, the letter asserts that "Google faces competition from only one general search engine, Bing," suggesting that only Bing (and it, only ineffectively) could keep Google in check. In essence, the Senators are prejudging an essential question on which any case against Google would turn: market definition. But why would the market not include other tools for information retrieval? Is it not at least worth mentioning that more and more Internet users are finding information and spending time on social networks like Facebook and Twitter, while more and more advertisers are spending their money on these Google competitors? Isn't it clear that search itself is evolving from "ten blue links" into something more social, multi-faceted and interactive?

In a remarkable leap, the senators then identify the specific alleged abuse that Google’s alleged market power leads to: search bias. That's remarkable because, other than the breathless claims of disgruntled competitors (given plenty of air time at the September hearing), there is actually no evidence that search bias is, in fact, harmful to consumers—which is what antitrust is concerned with. (Read both sides of this debate in TechFreedom's free ebook, The Next Digital Decade: Essays on the Future of the Internet.)

As our colleague, Josh Wright, has thoroughly demonstrated, this "own-content" bias is actually an infrequent phenomenon and is simply not consistent with an actionable claim of anticompetitive foreclosure. Moreover, among search engines, Google references its own content far less frequently than does Bing (which favors Microsoft content in the first search result when no other search engine does so more than twice as often as Google favors its own content).

Making matters even more ridiculous is that the Senators parrot the claims of Google competitors/companies, who seem to just be jealous of Google, without questioning the sources. Thankfully, TechFreedom is around to step up and help provide some context and debunk some of the more ridiculous claims:

The letter also reports, again with no caveats, claims by the CEOs of Yelp! and Nextag that "75 percent of Yelp!'s web traffic consists of consumers who find its website as a result of Google searches, and . . . 65 percent of Nextag's traffic originates from Google searches," and that losing this much traffic to Google preferencing its own content would be catastrophic. But the letter fails to mention that most searches for brand names on Google are "navigational" rather than "informational." As Google competitor Expedia’s CEO recently explained:

The majority of, at least Expedia’s, and I believe Hotel.com’s traffic that comes from search to our site actually come through people searching for Expedia, for example. So in typing in Expedia in Google or so on, typing in Hotels.com in Google. So of the 25% for Expedia, for example, the majority of that traffic is someone who’s already looking for Expedia, and that person is going to find Expedia one way or the other because they are searching for something very specific. (Expedia earnings call, 10/28/10, quoted here).

Indeed, a recently published independent academic study conducted across search engines concluded that 52% of "business queries" (and 72% of organizational queries) were navigational. In other words, most of the Google traffic going to these sites was likely from users who simply typed in "Yelp" or "NextTag" as a convenient way of getting to those sites. Such searches are not diverted (and not even claimed to be diverted) to Google’s own sites, and the first search result for the search term “Expedia” will always be expedia.com. Thus, the majority of these searches that are claimed to make up 75% and 65% of the complaining companies’ traffic is not in any way threatened by Google’s business model, and is completely irrelevant to assessing the effect of Google preferencing its own content.

Furthermore, the letter does not mention Yelp's recent boast that over 40% (and growing) of its searches are now conducted on its mobile app—insulating it from whatever "power" Google might exercise over traditional searches.

Oops. If this were an honest debate about Google's practices, you'd think that the Senators would have been at least a little skeptical of such easily debunked claims by these companies. Unfortunately, in the world of politics today, that's not how things work. Actually looking at facts or understanding what they're trying to regulate is ignored in favor of going after targets that generate headlines.

And, of course, if you're looking for a thorough, detailed and devastating response to any time anyone grandstands about search engines without understanding any of the details, you should always go to the master on the subject, Danny Sullivan, who writes, Dear Congress, It's Not Ok Not To Know How Search Engines Work, Either, picking up on last week's meme about SOPA. Sullivan notes that the letter from Kohl and Lee is "jaw-dropping," not just in how one-sided it is, but in how superficial it is. Again, you should read the entire thing to get tidbits about how the letter seems to not even know what guidelines the FTC has already put out, and about how the Senators (rather shockingly) blatantly misquote Google VP Marissa Mayer and don't even understand what she's saying. But there's also this section, where it appears the Senators have simply no idea about the relationship of Microsoft and Yahoo and what it means relative to Google:

Bing: A Microsoft & Yahoo Production?

What really set off my alarm bells was this:

Bing, a partnership of Microsoft and Yahoo

Despite substantial amounts of staff time and money spent to have the hearings, the committee mistakenly believes that Microsoft’s Bing search engine is a Yahoo and Microsoft production.

It’s not. Bing is a wholly-owned part of Microsoft. Yahoo has no ownership in Bing.

But wait. Isn’t there a partnership? Yes, but one that gives Yahoo a minor role handling Bing’s ad sales to “high volume” advertisers. The deal came after Bing was launched. It wasn’t an essential part of it, nor does it help with Bing building consumer market share against Google.

If the committee fully understood the competitive space, they’ve have said instead:

Yahoo Search, a partnership of Microsoft and Yahoo

That would be far more accurate. That’s because Yahoo no longer has its own core search technology, nor its own search ad serving technology.  It gave all these up to partner with Microsoft (it would have kept them in a deal with Google. See our side-by-side comparison).

Heck, Yahoo’s former CEO Carol Bartz was quite specific that her goal was to use Bing’s technology as a way to somehow beat Bing at its own game. Bing wasn’t a partnership to her; it was the competition.

Bing & Yahoo Distant To Google?

Perhaps the committee thought that the “partnership” was the overall “search alliance” between Bing and Yahoo? If that was the case, then why did the letter go on to say

…which is a distant second in market share and is losing an estimated $2 billion annually…

Those stats only make sense if you’re talking about Bing itself, having a 15% share to Google’s 65% in the United States, as recently reported. If you’re talking about Bing and Yahoo combined, they come up to 30%, much healther competition.

It's really quite amazing that Congress can get away with such blatantly dishonest grandstanding -- but, on tech issues, Congress still seems to think that its own blissful ignorance is a plus when it comes to regulating. For those of us who live in this world, that's pretty damn scary.

Filed Under: antitrust, ftc, grandstanding, herb kohl, investigation, mike lee, senate
Companies: google, microsoft, yahoo

Lawsuits And Laws On The Way In Response To Sony Data Breach

from the but-would-any-of-them-have-stopped-this? dept

With Sony admitting that its PlayStation Network was hacked and that lots of personal info was accessed, you knew the reaction would be swift. Within a day we have class action lawsuits being filed and new laws being proposed. I agree that it was monumentally stupid of Sony to store passwords as plaintext rather than as hashes, which certainly leaves room for negligence claims, but will laws really make a difference? About the only reasonable response from a government official has been White House cyber boss Howard Schmidt (who has a history of being more reasonable than many of his colleagues), who noted that getting hacked is a risk of doing business, and it's not worth overreacting to Sony's situation:

"It's still a situation where specific incidents make it something it's not," he said. "Things make headlines that are just the risk of doing business in many cases."

But, of course that won't satisfy the class action lawyers or the politicians who are all over this. Beyond the plans to introduce laws, we've already seen that Senator Richard Blumenthal, who was a massive grandstander as Connecticut Attorney General, has continued his grandstanding ways with a public "demand for answers" from Sony.

Filed Under: class action lawsuits, data breach, grandstanding, playstation network
Companies: sony

Prostitutes Have Just Moved From Craigslist To Facebook

from the big-help dept

When Craigslist -- under a peer pressure campaign from grandstanding state attorneys general and some misguided activists groups -- shut down its adult services section, it wasn't difficult to predict that this would do little to nothing to actually slow down or prevent prostitution. Instead, it would just drive those activities to other sites, and those sites might not work quite as closely with law enforcement as Craigslist did. In fact, we noted that Craigslist was a very useful tool for law enforcement to actually track down and crack prostitution rings.

Anyway, as expected, it appears that the activity hasn't gone away, it's just moved elsewhere. News.com highlights how it appears that Facebook has become the site of choice for prostitutes, picking up on a small bit of some new research on prostitution by Sudhir Venkatesh. The report suggested that Facebook had already been growing as a tool for prostitutes, but the exodus from Craigslist may have just sped that whole process up a bit.

Filed Under: grandstanding, prostitution
Companies: craigslist, facebook

Canadian Politicians Jump On The 'Censor Craigslist' Bandwagon

from the if-it-worked-south-of-the-border... dept

Thought we were done with the silly political grandstanding against Craigslist, which won't stop child trafficking, but will actually help the scumbags who are involved in the practice? No such luck. Apparently politicians in other countries have seen how politically successful such grandstanding is, and are using the same tactics against Craigslist. Some Ontario politicians are now demanding that Craigslist takedown its adult section in Canada (Craigslist only self-censored the section in the US). Of course, as in the US, this won't help law enforcement stop prostitution and child trafficking. It will only serve to drive it further underground and make it harder to track and stop. But I'm sure it makes for good-looking headlines, even if it makes the problem worse.

Filed Under: canada, grandstanding
Companies: craigslist

Backpage Tells Attorneys General That They Won't Give In To Censorship Demand

from the good-for-them dept

On Tuesday, we wrote about how a group of grandstanding state attorneys general had moved on from blaming Craigslist for the actions of its users, now that they had successfully censored that site, and began demanding similar censorship for Backpage.com, the online classifieds from Village Voice Media. As a few people have sent in, Backpage does not seem interested in backing down, posting a public response and pointing out that they are operating perfectly in accordance with the law, that even the AGs admit that Backpage cooperates with law enforcement, and that the AGs would be better served going after those actually involved in the activities, rather than blaming third parties:

While no system is perfect, even the AGs acknowledge Backpage.com's good-faith cooperation with law enforcement.

In the last two years, Backpage.com users have posted 58 million ads and only 6 million in the adult services section. Federal and state authorities have called on Backpage.com to testify in just five cases involving alleged abuse of underage persons. Backpage.com continues to respond to valid subpoenas from law enforcement officials whose job it is to investigate, apprehend and prosecute criminals who wrongfully post illegal ads and victimize others.

Backpage.com is disappointed that the AGs have determined to shift blame from criminal predators to a legal business operator in an apparent attempt to capitalize on political opportunity during the election season.

They also note: "Censorship will not create public safety nor will it rid the world of exploitation."

Of course, rather than recognizing any of this and maybe backing down, Connecticut Attorney General (and Senate candidate) Richard Blumenthal responded in typically misleading fashion:

"I am deeply disappointed by this unfortunate and unfounded resistance to taking common-sense steps toward protecting women and children. I am hopeful that the company will reconsider its resistance and do the right thing. I will consult with my fellow attorneys general and consider possible next steps."

Notice that he does not respond to any of the actual points raised. He does not respond to the fact that shutting down these services won't do anything to help protect women and children and will almost certainly make the problem worse. He just pretends that the world is the exact opposite of what it is. It's as if Richard Blumenthal thinks that everyone out there is incredibly dumb and believes the world works as he says it does, rather than how it actually works.

Filed Under: backpage, classifieds, grandstanding, legality, richard blumenthal
Companies: backpage, village voice

State AGs Now Targeting Backpage After Forcing Craigslist To Stop Helping Them Pursue Lawbreakers

from the how-backwards-can-you-get? dept

We've already explain how the political grandstanding campaign against Craigslist, that got the company to shut down its "adult services" section based on no legal reason, does plenty to harm the people the various state attorneys general think they're "helping." Craigslist has been highly active in working with police to use the site to find and arrest those actually responsible for dangerous exploitation of children. But by shutting off that tool, the ads simply migrate to sites that are more underground and less willing to work with law enforcement. Apparently, though, the AGs are stuck on the political headlines, and don't care at all for anyone's actual safety.

So they've moved on to their next target: 21 state attorneys general have kicked off a grandstanding campaign against Backpage, the online classifieds arm of Village Voice Media (the same company that was just sued over the same issue). Once again, Backpage is one of the companies that has worked closely with law enforcement -- and the AGs even admit that in their announcement demanding the company shut down the tool.

This is incredibly dumb and frustrating. In the pursuit of headlines falsely claiming that they're "protecting" children, these AGs are only serving to attack the companies who help them track down those actually responsible for child exploitation and child prostitution. All they're doing is making the problem worse. Those who are exploiting these kids in the worst possible way won't stop doing it -- they'll just use other means to do so, in a way that's harder for police to track them down and to capture them.

Filed Under: grandstanding
Companies: backpage, craigslist, village voice

Sad: Why Haven't Other Internet Companies Stood Up For Craigslist Against AGs?

from the take-a-stand dept

For quite some time now, we've been covering how various state attorneys general have been publicly grandstanding and threatening Craigslist, despite no actual legal basis. That grandstanding, of course, has "worked." It's resulted in Craigslist settling twice, and now shutting down the adult services section, leading those ads to migrate elsewhere actually helping those responsible, and making it harder for law enforcement to do its job. In testimony to Congress, Craigslist is pointing out that many of those other sites are not nearly as willing to help law enforcement.

But there's another issue here. As Ryan Singel points out, this grandstanding campaign is really an attack on the rather important Section 230 safe harbors for online service providers. Richard Blumenthal, who has led the attack, despite a lack of jurisdiction or legal basis is currently running for Senate, and apparently is interested in changing Section 230. Singel asked Blumenthal first under what legal theory Craigslist was liable, and got back vague claims of how its failure to enforce its terms of service violated Connecticut consumer protection laws -- an incredibly weak claim unlikely to stand up to any scrutiny. But, more seriously, Singel asked about Section 230, and Blumenthal said the law "is outdated and needs revision."

"I support changes clarifying and strengthening the law to hold websites accountable when they knowingly enable or promote illegal activity."

Beware that "enable." Blumenthal wants to expand massive liability to internet services in a manner that would kill off significant innovation. Could you enable illegal activity via Google, Facebook, Twitter, Skype or many other popular internet services? You bet. Section 230 is designed to make sure the liability actually went to those responsible, not to the service providers and tools they used. Changing that is incredibly dangerous for innovation.

And, yet, as Single points out, these other companies haven't stepped up to support Craigslist in the grandstanding against them. Of course, the PR reasons are clear: no one wants to be in a position where critics could twist their words and misleadingly and falsely claim they "support" exploitation. But this is a big deal and in keeping quiet, bad things may happen:

The logical extension of what Blumenthal & Co say they want is a world where even they couldn't use Facebook, Twitter and Flickr to connect with their constituents, for fear that one of them (or their political enemies) would plant incriminating material they could then be sued over.

And even if they were successful, and didn't care about that consequences, would ads for prostitution disappear from the face of the earth? Not likely. The same ads that Craigslist is pilloried for dominate the back pages of alternative weeklies. The printed Yellow Pages carries ads for "Escort Services." You can find them in the Village Voice-owned Backpages.com. And beyond the media world, it's not very hard to find "Massage" parlors in any major U.S. city, where I'd venture to guess, you are more likely to find human-trafficking than you were anywhere on Craigslist. And back in the relative shadows from whence they came would only exploiters of women and children would only have more power.

The collateral damage of a wrong-headed pursuit Craigslist is an assault on the open internet itself.

Singel also points out, as we have in the past, that the key point of grandstanding these days is on the revenue Craigslist made from these ads -- something that only started when these very same AGs forced Craigslist to start charging for the ads as part of an earlier settlement.

Singel wants to know why other internet companies aren't speaking up. Because the end result of letting Craigslist hang on its own on this topic is going to come back to haunt them. Already, in the same Congressional hearings today where Craigslist was attacked, those who pushed this damaging situation on the company are sharpening their knives for other internet companies:

"Every pimp has a MySpace page," Frundt testified, adding that ads also show up on Backpages.com. "Every john uses a john board and posts information on where to buy children."

"This has been going on for many years. We must do something about our children being sold on the internet."

Indeed! We absolutely must do something -- but the something we should do is use these tools to go after and stop those actually responsible rather than pushing them around the internet, and blaming the tools they use. That doesn't stop the activity. It doesn't protect the exploited. It doesn't help the situation. It creates a false target, and a situation in which the very principles on which the internet has been built get undermined, at a potentially huge cost to innovation, communication and free speech.

Filed Under: grandstanding, innovation, richard blumenthal, section 230
Companies: craigslist, facebook, google, myspace, twitter

Groups Still Slamming Craigslist

from the you're-not-helping dept

Even with Craigslist censoring itself due to ridiculous public pressure, and even though it's pretty clear that this action will only make things much worse for victims, the so-called "public interest groups" that pushed this misguided media campaign against Craigslist still don't think they've done enough damage. They sent me press releases three times yesterday patting themselves on the back for Craigslist censoring itself and then demanding that it do even more. This is unfortunate, no matter how you look at it. These groups can't seem to admit that blaming the tool rather than the actual people involved only makes the problem worse. Their inability to recognize the basic consequences of moving this activity to other forums that don't cooperate with law enforcement and make it much harder to stop these activities is really quite upsetting. Blaming the tool providers for the actions of users doesn't stop the actions, at all. It just makes it that much harder to do anything. People patting themselves on the back for getting Craigslist to censor itself are worsening the problem they think they're solving.

Filed Under: grandstanding
Companies: craigslist

Finally: People Speaking Up About How Censoring Craigslist Helps 'Pimps, Child Traffickers & Other Abusive Scumbags'

from the preach-it dept

We've been saying for years that the political granstanding efforts against Craigslist do the exact opposite of their intended purpose. They certainly don't stop prostitution or child trafficking. They just drive it further underground. Craigslist has become a very useful tool for monitoring, tracking and cracking down on such illegal activities. However, every time I mention it, some people get upset that I "just don't understand" the horrors of child trafficking etc. Well, it's true that I certainly have no experience with it, but I don't think that changes my analysis of the situation... and it appears that others are starting to notice as well. Danah Boyd has written an excellent article explaining in direct terms "how censoring Craigslist helps pimps, child traffickers and other abusive scumbags."

The problem with this logic is that it fails to account for three important differences: 1) most ISPs have a fundamental business -- if not moral -- interest in helping protect people; 2) the visibility of illicit activities online makes it much easier to get at, and help, those who are being victimized; and 3) a one-stop-shop is more helpful for law enforcement than for criminals. In short, Craigslist is not a pimp, but a public perch from which law enforcement can watch without being seen.

She goes into detail on all three points. It's an incredibly eloquent defense of Craigslist that should be required reading for all of the politicians, reporters and so-called "public interest groups" that have been running the media campaign against Craigslist, without understanding these basic points. I'd love to see any of the attorneys general who have been grandstanding actually try to respond to this. I doubt any of them will.

Filed Under: censorship, grandstanding
Companies: craigslist