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 — FairSearchEurope.eu — 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.

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.

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.

Rate Your Polling Place with “Yelp for Democracy”

In anticipation of a Nov. 6 replay of the myriad problems that struck local polling places on Election Day in 2008 and 2004, an initiative dubbed MyFairElection aims to find which precincts experience the most difficulties.

The website is the brainchild of Archon Fung, a professor of democracy and citizenship at Harvard’s Kennedy School of Government, and he calls it something like “Yelp for democracy,” comparing his creation to the popular site where the public can rate businesses and contractors.

Those who register with the site will receive a voting reminder on Election day, and be invited to give their voting experience a rating of one to five stars.  If enough voters sign up and give ratings, MyFairElection will be able to create a real-time national “weather map” of voting conditions down to the precinct-level.  Then localized maps can help identify problem areas for journalists, civic groups and election authorities to examine more closely.

Fung traces his inspiration not only to Yelp but also Ushahidi, a platform originally devised in 2008 to crowdsource the tracking of post-election violence in Kenya, which more recently has been used to coordinate disaster response around the world.

Another precursor to MyFairElection is Election Protection, which was one of the first attempts to crowdsource the reporting of widespread polling problems in the U.S.  After the 2004 Ohio fiasco, where the gross misallocation of voting machines may have swung the election, and widespread concerns about the reliability of electronic voting, groups like Election Protection sprang up to track voting problems using the now arcane-sounding method of a telephone hotline.

Fortunately for those voters still without a smartphone, that toll-free number — 866-OUR-VOTE — is up and running this election season and has already started posting reports received from early voters.

While groups like Election Protection collect more detailed reports about serious problems than the simple 5-star ratings to be gathered by MyFairElection, the hope is that this very simplicity will broaden participation, and also register the frequency of difficulties which may not be quite egregious enough to prompt an angry phone call to the Election Protection hotline.

Romney Facebook App Finds Your Most Politically Influential Friends

In the final sprint to Election Day, the Romney camp is rolling out a new Facebook that searches supporters’ friends to micro-target those most useful to the campaign.

The Commit to Mitt app first searches users’ friend lists to select those living in swing states, so time and effort aren’t wasted reaching out to voters in that are already solidly red or blue.

Then the app uses Faceb0ok’s open graph platform to examine those friends’ interests, tastes and political preferences to identify which ones would be most receptive to direct outreach from the app user on behalf of the GOP nominee.

The user then gets a list of their friends that the Romney campaign recommends they contact with a personal appeal about the election.  If the app determines that a user is likely to influence friends with a broadcast message, it will also suggest post a voting appeal on their wall.

Romney campaign staffer Matt Lira told Tech Crunch that the app was inspired in part by recent research showing that political messages on Facebook can significantly boost voter turnout, which both campaigns agree will be crucial in this election.

 “All one needs to do is look at their own newsfeed to know that people want to talk about this election on Facebook; the question is, how can we make sure that activity is purposeful and effective at making a difference for the campaign,” Lira said.

“Binders Full of Women” Win Second Presidential Debate

The Punditariat may be undecided on whether the second presidential debate was a win, lose or draw for either candidate, but the clear winner of the post-debate meme race was Romney’s claim that he had “binders full of women” as governor of Massachusetts.

Romney made the now infamous comment in reference to his effort to find women to include in his cabinet :

“I went to a number of women’s groups and said, ‘Can you help us find folks,’ and they brought us whole binders full of women.”

Moderator Candy Crowley had barely closed the Trapper Keeper on the debate before the binder meme had already launched a dedicated Tumblr blog and Facebook page and #bindersfullofwomen was trending on Twitter, where it spawned several parody accounts.

With #bindersfullofwomen still buoyant the next morning as the second-highest-trending hashtag in the U.S. Twittersphere, the Obama campaign even jumped on the memewagon, sponsoring a tweet to the top that stream:

On a more serious note, the tweet stream for #binders is topped by a Huffington Post item noting that Romney’s boast about “binders full of women” was an empty claim to begin with.

And on a much lighter note, the #binders meme also provided an opportunity for a (perhaps inevitable) cameo:

Wikileaks “Paywall” Angers Anonymous

Cash-strapped leak site Wikileaks.org has enraged Anonymous, the loose group of hackers that has been a key ally, by putting its latest release behind an apparent paywall that asks for a credit card donation before viewing the files.

This week Wikileaks began an election-themed drip release of over 200,000 emails from the private intelligence firm Stratfor, releasing thousands of emails a day referring to Obama, Biden, Romney and the Republican and Democratic parties.

But the Stratfor files are hidden by a splash page, featuring a video of Obama clips intercut with comments from Wikileaks founder Julian Assange, that appeared to require a donation before proceeding to the emails.

Wikileaks has been starved for funding after a financial blockade by banks and major credit cards, but recent court victories have allowed the site once again to receive credit card donations, and the “Vote Wikileaks” campaign was launched to take full advantage of that change.

The move provoked a furious backlash from Anonymous and allied groups, however, not least because the Stratfor emails were supplied to Wikileaks by members of Anonymous affiliate LulzSec who have since been arrested for that hack.

The Daily Dot reported that word quickly spread of work-arounds to avoid making a credit card donation, which some worried could be used to identify Wikileaks supporters:

Within an hour, the word went around Twitter that disabling JavaScript in your browser would get you around it, although that information was nowhere on the Web page. Other users reported that clicking to donate, then backing out before concluding the transaction, worked. Still others found that simply waiting (anywhere from ten minutes to an hour) exempted them from the importuning video. Others, that watching the video got you past it. And the Cryto Coding Collective released its own browser add-on specifically for the leaks.

Ars Technica noted that Wikileaks’ response to the backlash pointed out that the splash page wasn’t technically a “paywall” in the first place:

Justifying the call for donations, Assange wrote that the fund-raising was necessary to fund its “publishing and infrastructure costs,” and further to fund its legal action against the payment processors. WikiLeaks’ Twitter account also said that an overlay that allows you to share, tweet, or wait—or pay—isn’t a paywall anyway.