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A Net Neutrality Perspective: Google and YouTube

October 12, 2006 - 1 Comment

SAN JOSE, CA – If you don’t read Scott Cleland’s Precursor Blog, you should. His blog entry of today is brilliant and says in short strokes what I have been unable to successfully point out in previous blogging attempts. The gist of his entry is: Google’s position on net neutrality isn’t all that altruistic in looking out for the “little guy.” It really just want consumers to pay, so it doesn’t have to.For me, the key graphs are below, but please go to his blog and read the entire entry: “Before Google liked to wax eloquently that their motives on net neutrality were ‘purely altruistic;’ they said they were fighting, not for their own gain, but for the little Internet entrepreneurs toiling away in garages that needed protection from capitalists and market forces. Now it is clear that Google is simply using the public policy process to leverage commercial negotiations for Google’s commercial advantage with youtube. People need to remember that key to Google’s exceptional finanical success is their abilty to dump most all their normal distribution costs on the consumer. Its by shifting their biggest cost to the consumer, that they enjoy 80+% gross profit margins, have ten billion dollars in cash, a hundred billion plus market capitalization, and can afford to pay $1.6 billion for a company that has no profits and little revenue. Remember these numbers when Google is publicly indignant about having to pay more for new innovative Internet bandwidth that can better carry video.”

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  1. One of the best things about the internet is it’s freedom. I think when we try to put different charges for using this space it will fail. People don’t mind paying for the land line access such as Road Runner, but paying for that plus a
    ental”” fee for using the air space that the internet resides on? That just seems unfair to me.”