How The Feds Got Googled

After much Sturm and Drang, the Federal Trade Commission’s landmark antitrust investigation into the most powerful company on the Internet ended with a wheeze that left most observers scratching their heads.

The Google settlement the FTC announced on Jan. 3 was less about Google’s search algorithms than its recently acquired Motorola Mobile patents, and dealt hardly at all with the allegations of anticompetitive “search manipulation” that supposedly formed the basis of the whole investigation:

…the FTC concluded that the introduction of Universal Search, as well as additional changes made to Google’s search algorithms – even those that may have had the effect of harming individual competitors – could be plausibly justified as innovations that improved Google’s product and the experience of its users. It therefore has chosen to close the investigation.

The only real concession the FTC was able to extract from Google was to swear off patent trolling on its standards-essential Motorola patents, which other technology companies must be able to use for their products to operate on U.S. networks.  But Google only agreed not to go to court to prevent other companies from using the patents — it can still continue to charge them royally to license the technology.

And while Google had kept up Motorola Mobile’s aggressive patent enforcement policies following its $12.5 billion acquisition last year, the company had been speaking out against software patent trolling since at least mid-2011, so getting it in writing doesn’t really seem like a huge “get” for the FTC after a 19-month investigation.

Baffled and disappointed by the FTC’s statement on the Google settlement, nonprofit advocate group Consumer Watchdog is demanding to see the FTC’s internal staff report on the investigation, hoping to find out how it all went off the rails.

Rumors began swirling late last year that the FTC lacked the evidence to make the search-manipulation charges stick, and that the case was becoming a frustrating embarrassment to the agency, which had won a hard-fought turf war with the Department of Justice in 2011 over who would lead the investigation into Google’s search practices.  The FTC even brought in a respected former DOJ prosecutor, Beth Wilkinson, last April in an effort to save the case, but clearly to no avail.

When the FTC case first appeared to be falling apart last November, Techdirt’s Mike Masnick suggested that the debacle may have had its roots in a legacy polishing exercise by the outgoing FTC chairman:

I keep hearing the same story over and over again.  They’re all variations on the following: FTC boss Jon Leibowitz is getting set to leave the job (and go into the private sector, of course), but would like a “defining moment.”  Somewhere in the last year or two, he decided that going after Google for anti-trust violations would be such a crowning moment.

So perhaps Leibowitz, like a Pentagon desk jockey officer pushing to get his combat ribbon before retirement, had wrangled a high-profile field command only to send his out-gunned troops up a hill they could never take.

Politico suggests that the FTC may have been spun by the prodigious lobbying effort Google unleashed.   Having seen how well Microsoft’s combative and aloof response to antitrust concerns worked in the 1990s, Google spent $25 million and hired a roster of Washington power players from both sides of the aisle to make its case to the FTC:

“It was a multiyear campaign focused on this very moment, knowing as the company  grew these issues were going to come up,” said Alan Davidson, former head of  Google’s office in Washington who left last year for the Massachusetts Institute  of Technology. “We had the benefit of watching those who had come before us, and  we saw the mistakes that were made. We didn’t want to replicate what they had  done.”

And the $25 million price tag for that charm offensive was huge bargain for the search giant, noted TheNextWeb:

Google, a company with cash and equivalents of roughly $50 billion, had to spend just 0.05% of its ready currency to fend of what could have been a nearly existential threat to parts of its core business.

But Google wasn’t the only one working the refs.   A driving force behind the “search manipulation” accusations was an industry group calling itself FairSearch, which includes Google competitors Microsoft, Kayak, Expedia, Hotwire, Nokia, Oracle, Allegro and several others.  After the FTC dropped the antitrust case, the anti-Google coalition released a statement calling for harsher judgments in separate investigations by state Attorneys General and European regulators.  The group has even launched a Eurocentric website — — to press its case against Google on the other side of the Atlantic.

The FairSearch coalition isn’t alone in expecting Google to have a rougher ride in Europe, where the complaints from its competitors will carry more weight.  While U.S. antitrust enforcement relies heavily on finding direct harm to consumers, in Europe antitrust enforcement aims at fostering competition.

Indeed Google’s checkmate of the FTC’s antitrust case hinged on its lobbyists’ successful argument that no matter how its self-serving search algorithms might annoy Google’s competitors, they do not do measurable harm to consumers.   In Europe, Google’s rivals may have an easier time making a case that the company’s search tactics at least harmed them.

Pirate Radio Blamed for Keyless Entry Jamming

A hidden pirate radio antenna is the reason dozens of drivers in Hollywood, FL, couldn’t unlock or start their cars using keyless entry systems when parked near the local police station.

For months, drivers of certain model cars found their keyless remotes useless, only to have the problem disappear when the cars were towed to their dealerships for repairs.  Some suspected electromagnetic interference from some sort of equipment at the police station, but local cops eventually fingered another culprit: a pirate FM radio transmitter hidden on the roof of a nearby bank building.

Once police removed the equipment — which was broadcasting Caribbean music — the problems stopped.

What makes this case interesting is that the pirate station was reportedly broadcasting at 104.7 MHz — well below the 315 MHz used by keyless devices for North American-made cars (European and Japanese cars use 433.92 MHz).  If FM signals at 104.7 MHz normally jammed keyless entry, there would be chaos in parking garages all over the 107 U.S. cities with FCC licenses to broadcast full power at that frequency.

Most likely, the primitive pirate station blamed for the interference lacked filtering gear, and its 104.7 signal generated harmonic frequencies that interfered with the 315 MHz devices.  If the outlaw broadcaster had spent a few extra bucks, his Caribbean beats might still be on the air, bothering no one but Hollywood residents trying to tune into the “hot adult contemporary” stylings of “Mix 104.7” WSGL in Naples, FL.

While this is the first reported case of pirate radio jamming keyless entry systems, the low-power devices are prone to interference from stronger signals broadcast on their frequency, which is within a range licensed primarily for use by the military and the federal government:

In a summary of radio spectrum use from the National Telecommunications and Information Administration, the frequencies in the range from 225 MHz to 328.6 MHz “are heavily used worldwide for critical military air traffic control and tactical training communications.” Specific functions include “air-ground-air communications for combat weapons training carried out at and in the vicinity of all major air bases and military training areas worldwide.”

Google Maps Returns to iPhone — Instantly Dominates App Store

Within hours of its launch, the Google Maps app for the newest iPhone plotted a path straight to the top of Apple’s App Store.

Apple replaced Google’s map function with its own Map App in the iPhone 5 that launched in September, but the software was wasn’t ready for prime time, leading to so many bizarre results that it spawned its own meme — Apple Maps Fail — and even potentially deadly errors.

While Cupertino scrambled to fix its maps, and hackers tried to make earlier versions of Google Maps work with iOS 6, Google was working on new mapping software with even more features.  In addition to “street view” functions inside over 100,000 buildings, live traffic updates and turn-by-turn directions, the new Google Maps also supports a range of gesture controls.  You can manipulate maps and call up additional information with two-finger taps and swipes, and even twist maps to orient them the way you’re facing.

UPDATE: JailBreakNation posted a video showing a simple way to get the iPhone voice assistant, Siri, to give directions based on Google Maps data rather than Apple’s flawed Map App:  simply add the phrase “via transit” at the end of your request for directions.

Tech Giants Turn to Courts for De Facto Patent Reform

With patent trolls emerging as an increasing threat to American innovation, tech firms including Google, Facebook, Dell and Zynga are now asking the federal courts to dismiss claims based on overly broad patents.

Eight tech firms recently signed on to a friend of the court brief asking the U.S. State Court of Appeals for the Federal circuit to deny the patent claims of Alice Corp., an electronic marketplace seeking a broad patent on closing financial transactions via a computer.  They join other online firms like  LinkedIn, eHarmony and Travelocity, which have filed similar briefs in the case, as well as the  Electronic Frontier Foundation.

Though the briefs specifically attack the patent claims of Alice Corp., the Google-Facebook filing addresses the broader problem of vague software patents:

Many computer-related patent claims just describe an abstract idea at a high level of generality and say to perform it on a computer or over the Internet. Such barebones claims grant exclusive rights over the abstract idea itself, with no limit on how the idea is implemented. Granting patent protection for such claims would impair, not promote, innovation by conferring exclusive rights on those who have not meaningfully innovated, and thereby penalizing those that do later innovate by blocking or taxing their applications of the abstract idea.

Technology patent trolls exploit such overly broad patent claims essentially to extort money from tech companies, which typically settle rather than face the costs fighting even dubious claims in court.  The pile-on against Alice Corp. is the first concerted effort by the tech sector to short-circuit the patent-troll business model.

A better solution would be a legislative fix that discourages spurious claims, such as the bipartisan patent reform bill proposed by Rep. Peter DeFazio (D-Oregon) and Rep. Jason Chaffetz (R-Utah).  Their bill, entitled the ‘‘Saving High-Tech Innovators from Egregious Legal Disputes Act of 2012’’ would force plaintiffs to pay the legal fees of companies that fight patent claims deemed spurious by the courts.

UN Agency Aims to Increase State Control Over Internet

The International Telecommunication Union, an international agency originally formed in 1865 to regulate international telegraph lines, will meet this December to debate handing governments more control over the Internet.

The World Conference on International Telecommunications  will convene Dec. 3 in Dubai to update the International Telecommunications Regulations treaty, and may mark an unprecedented encroachment by the ITU into Internet-governance.

Delegates will be discussing a number of proposals championed by authoritarian regimes like Russia, China and Saudi Arabia aimed at enhancing governments’ ability to block and spy on online traffic, and reducing the control of U.S.-based Internet-governance bodies like ICANN (which assigns Web addresses).

Most alarming to Internet freedom advocates is an initiative called “Requirements for Deep Packet Inspection in Next Generation Networks,” a technology standard that would allow state telecom authorities to decrypt Internet communications traveling within their borders. The coalition of authoritarian states is also seeking more control over the assignment of IP addresses (which advocates fear could be used to muzzle online dissent) and an spam-blocking powers that some worry could be used to silence activists.

Aside from those specific proposals, online-freedom advocates are inherently skeptical of the ITU’s attempts to assert authority over the Internet, in part because the body is dominated not only by governments but also officials from incumbent telecoms, which are both generally seen as the open Internet’s natural enemies.  Telecoms in developing countries, for example, want to treat the Internet more like international phone calls, charging online firms like Google high fees to pay for network upgrades and maintenance.

UPDATE: [Dec. 3]  The level-headed Sam Biddle over at Gizmodo marked the first day of the Dubai conference by pointing out that try as they might, Russia, China and the Gulf States have no chance of succeeding with their online power grab for a number of reasons.  First off the ITU operates on a consensus basis, meaning that basically every one of the 193 countries represented have to sign off on a proposal for it to be adopted.  Secondly — and perhaps more importantly — the ITU has no enforcement mechanism, so even if it decides that something should happen, it has no way to actually make it happen.

Biddle imagines the conversation thusly:

ITU: “Hey, United States, almost all of us agree that ICANN shouldn’t be in charge of this important function of the Internet. Hand it over.”
USA: “No.”
ITU: “Well, all right.”

So we can hop down off the barricades and go back to playing Fruit Ninja.

House GOP Publishes Sane Copyright Reform Policy; Immediately Retracts It

Heads are still spinning after House Republicans’ stunning about-face on a copyright reform proposal that had Internet freedom advocates cheering — for about 24 hours.   Less than a day after declaring that “current copyright law does not merely distort some markets — rather it destroys entire markets,” the House GOP caucus retracted a position paper calling for more user-friendly policies.

The policy brief from the House  Republican Study Committee took a distinctly libertarian view of intellectual property familiar to many netizens who advocate greater freedom for consumers to access and use digital content now locked up with Digital Rights Management software.  Given that it was House Republicans, rather than Democrats, who scuttled the much-loathed Stop Online Piracy Act, it didn’t seem completely outlandish that the GOP caucus might see a twofer in appealing to a younger demographic at the expense of the Democratic party’s Hollywood paymasters.

Unfortunately, it took less than a day for lobbyists from the recording and movie industries to convince the GOP that the status quo on copyright was just fine, after all.

Explaining that the proposal “was published without adequate review,” officials from the Republican Study Committee effectively said that they didn’t really mean it when they declared “copyright violates nearly every tenet of laissez faire capitalism” and  “hampers scientific inquiry.” In fact, after a good night’s sleep, the GOP even decided that it could no longer stand by the assertion that “in a world where everyone copies stuff at home all the time, the idea that your iPod could make you liable for a billion dollars in damages is excessive.”

The remarkable document immediately vanished from the RSC website, but lives on at the sites of groups seeking to preserve the unicorn-like appearance of a sensible copyright reform proposal from a major political party.  Entitled “Three Myths about Copyright Law and Where to Start to Fix it,” the policy brief dismantles common misconceptions that rights holders rely on to maintain their monopolies over their intellectual properties:

1) That the purpose of copyright is to compensate the creator — the Constitution actually stipulates that the copyright system is meant to “promote the progress of science and useful arts.”

2) That copyright is a representation of free market capitalization — on the contrary, it actually establishes monopolies

3) That the current copyright regime leads to the greatest level of innovation and productivity — the paper notes that “excessive copyright protection leads to what economists call ‘rent-seeking’ which is effectively non-productive behavior that sucks economic productivity and potential from the overall economy” (see: patent troll)

The retracted paper made some common-sense recommendations for reform, including reforming a statutory damages regime that can leave teenagers liable for millions of dollars, expanding the range of “fair use” beyond only short snippets and parody, establishing penalties for false copyright claims, and imposing high fees (based on the revenues generated by the protected work) for copyright renewals.

It remains to be seen if any of these proposals will ever make their way into an actual copyright reform bill, but it looks doubtful that such a user-friendly bill will be coming out of the House GOP caucus.

Microsoft Patent Will Have Your TV Watching You

A creepy Microsoft patent recently published by the US Patent Office aims to use the software giant’s Kinect technology to peer into your living room for the purpose of reporting content-license violations.

Ominously titled “Content Distribution Regulation by Viewing User,” the patent envisions a future license regime in which viewers would pay for streaming content according to how many people would watch it.  A night on the couch watching a rom-com with your significant other would thus cost you less than hosting a crowded viewing party for the season finale of the latest smash-hit zombie/vampire show.   But if you paid for an intimate twosome and decided instead to host a dozen of your closest friends, your TV would know — and alert the proper authorities:

The technology, briefly described, is a content presentation system and method allowing content providers to regulate the presentation of content on a per-user-view basis. Content is distributed to consuming devices, such as televisions, set-top boxes and digital displays, with an associated license option on the number of individual consumers or viewers allowed to consume the content…  The users consuming the content on a display device are monitored so that if the number of user-views licensed is exceeded, remedial action may be taken.

One hopes that such “remedial action” would entail simply an additional charge, rather than, say, a seizure-inducing blast of strobe lights from the screen, or a home invasion by commandos from the Motion Picture Association of America.  But the sense of intrusion such technology could cause may not feel much different.

The patent speculates that the viewing license could be limited by specifying viewer age, or even “views tied to user identities,” implying that the surveillance capabilities of Microsoft’s version of Orwell’s telescreens would go beyond simply counting heads.

Aside from the distinct creep factor of Disney counting the number of children in your living room, or Cinemax logging your identity every time you settle in for some late-night soft-core, there’s obviously the worry about mission creep.  It goes without saying that the moment such a draconian licensing scheme goes live it will be hacked beyond recognition by Pirate Nation.  And once these monitoring capabilities are deployed as standard gear in set-top boxes and consoles across the nation and plugged into the Internet, the scope for mischief is immense.

Regardless of how imminent or feasible such a license enforcement regime may be, this patent does highlight a very current issue just dawning on many digital consumers — that when you rent, or even “buy” digital content, you’re only really purchasing permission to use that content under conditions set by the copyright holder.   Kindle owners don’t really “own” the ebooks they’ve “bought,” and your right to possess the MP3s you “purchased” from iTunes dies with you.

As absurd as it may sound, it would be perfectly legal for a content provider to bury in their user agreements all sorts of restrictions on how you are permitted the use the movies, ebooks and music that you “buy,” stream or rent.  And given the scramble to restore profits squeezed by the digital revolution, you can bet rights-holders and content providers would be thrilled to implement any sort of licensing scheme that could help them charge a few cents more per use.

The only thing that’s holding them back is the lack of an adequate enforcement mechanism — and Microsoft has an idea for that.