Liberal political powerhouse MoveOn.org has set it sites on the “net neutrality” issue. The famed 527 grassroots and political lobbying organization sent out an email today asking its three million-plus email contacts to sign a petition asking Congress to vote for “meaningful and enforceable net neutrality laws.”
Perhaps MoveOn.Org got religion following its run-in with AOL. In fact, the group cites AOL’s supposed decision to block MoveOn.Org’s emails in its discussion of net neutrality. From the email:
MoveOn has already seen what happens when the Internet’s gatekeepers get too much control. Just last week, AOL blocked any email mentioning a coalition that MoveOn is a part of, which opposes AOL’s proposed “email tax.”2 And last year, Canada’s version of AT&T—Telus—blocked their Internet customers from visiting a website sympathetic to workers with whom Telus was negotiating.
You may recall that MoveOn.org last week sent out a mass email (very much like the one on net neutrality) asking folks to sign a petition to stop what they call AOL’s “email tax,” a premium fee that ensures emails make their way to recipients. MoveOn claims that AOL blocked its emails; AOL says it was a glitch in the system.
Surprisingly, MoveOn.Org doesn’t mistate the net neutrality issue by outright saying that broadband providers will block Internet sites. Mind you, they imply that will happen, but they get the message right — net neutrality proponents fear second-class status for non-affiliated Internet sites and services, not outright blockage.
If Net Neutrality is gutted, MoveOn either pays protection money to dominant Internet providers or risks that online activism tools don’t work for members. Amazon and Google either pay protection money or risk that their websites process slowly on your computer. That why these high-tech pioneers are joining the fight to protect Network Neutrality1—and you can do your part today.Posted by Cynthia Brumfield at 7:44 PM | Print | Comments (1)
This is starting to become a pretty boring earnings season…so far every company (with a few exceptions) is weighing in with impressive results. Google, a juggurnaut that some analysts have expected to flame-out, reported its Q1 06 earnings this afternoon showing extremely strong growth in both revenue and profits.
Google’s revenues jumped 79% year-over-year and 17% sequentially to $2.25 billion, Net income was $592 million, up 60% year-over-year and 59% sequentially. Operating margins improved by three percentage points sequentially to 33% in Q1 06.
As usual, the company didn’t provide guidance, but during Google’s earnings call, executives warned that margins will likely get compressed as time goes on and competition gets thicker. But that’s what Google always says.
| Selected Google Financial Data | |||||
| ($ in 000s) | |||||
| 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 | |
| Revenues | $ 1,256,516 | $ 1,384,495 | $ 1,578,456 | $ 1,919,093 | $ 2,253,755 |
| % quarterly growth | 22% | 10% | 14% | 22% | 17% |
| Google Web Sites | $ 656,997 | $ 737,172 | $ 884,679 | $ 1,098,213 | $ 1,297,317 |
| % of total revenues | 52% | 53% | 56% | 57% | 58% |
| Google Network Web Sites | $ 584,115 | $ 630,242 | $ 675,012 | $ 798,573 | $ 928,376 |
| % of total revenues | 46% | 46% | 43% | 42% | 41% |
| Total Ad Revenues | $ 1,241,112 | $ 1,367,414 | $ 1,559,691 | $ 1,896,786 | $ 2,225,693 |
| % of total revenues | 99% | 99% | 99% | 99% | 99% |
| Licensing and Other Revenues | $ 15,405 | $ 17,081 | $ 18,765 | $ 22,307 | $ 28,062 |
| % of total revenues | 1% | 1% | 1% | 1% | 1% |
| Income from Operations | $ 442,770 | $ 475,698 | $ 529,171 | $ 569,640 | $ 742,699 |
| Operating Margin | 35% | 34% | 34% | 30% | 33% |
| Net Income | $ 369,193 | $ 342,814 | $ 381,182 | $ 372,208 | $ 592,291 |
| % quarterly growth | 81% | -7% | 11% | -2% | 59% |
Posted by Cynthia Brumfield at 6:42 PM | Print | Comments (0)
My obvious less-than-positive feelings toward American companies’ complicity with the Chinese government’s censorship regime has triggered many heartfelt emails from individuals and groups who share my views. I have received a number of requests that I blog on particular articles or situations, and I regret that I cannot accomodate them all. If I did, this blog would become the China&Censorship forum.
But I will flag two articles sent to me. Hampton Stephens at TCS Daily wrote this piece yesterday in which he concluded that censorship in China is doomed to fail.
However, unfortunately for Hu [Chinese Premier Hu Jintao] and his Chinese Communist Party, and to the benefit of Gates and the rest of the American computer industry, which no doubt would love to do business in China without an authoritarian regime looking over its shoulder, the success of Chinese Internet censorship is bound to be short-lived. In the long run, the Chinese government’s efforts are likely to fail because of the sheer magnitude of its task. China’s censorship regime cannot possibly keep up with the dramatic growth in the number of Chinese Internet users and the resulting rise in the ranks of those actively working to subvert government control. Thus, the existence of the Internet will be a persistent and growing thorn in the side of the Chinese Communist Party.
Michael Shtender-Auerbach of The Century Foundation has this essay today noting that Google has rebranded itself in China, with a new, more mellifluous name, which he finds ironic, to say the least.
Last week in Beijing, Eric Schmidt, CEO of Google announced a re-branding of the company’s Chinese search engine (http://www.google.cn). Since its launch in January 2006, Google China has been dubbed “Gou Gou,” which means “old dog.” In a move to appear more in line with Chinese rural traditions, the new name “Gu Ge,” which means “valley song,” is meant to illustrate a “fruitful and rewarding experience.” Nothing could be further from the truth. Google China will be censored in accordance with the laws of the Chinese government. As of last week the General Administration of Press and Publications (GAPP), the department of media censorship in Beijing, has stepped up its efforts to shut down any media outlet, including blogs, chat rooms, television, magazines, and news Web sites that publish or discuss what the government concludes is “unhealthy” or “perverted” content.Posted by Cynthia Brumfield at 1:07 PM | Print | Comments (0)
As it gears up to get absorbed into the AT&T empire, incumbent telco BellSouth is in relatively good fighting shape. The company issued its Q1 06 earnings results this morning showing decent revenue, operating income and operating margin growth, all aided by record-breaking quarterly growth in DSL lines.
Operating revenues were up slightly year-over-year, a good sign given the continued decline in BellSouth’s access lines. Revenues rose from $5.09 billion in Q1 05 to $5.171 billion in Q1 06. At the same time, operating income climbed by 16%, from $1.635 billion to $1.9 billion, with operating margins jumping up from 19.7% to 21.9%.
Access lines continued to decline overall, slipping from 21.2 million to 19.8 million; however, most of the decline stemmed from the consumer retail market. The lucrative business access line market declined, but the retail business line continued to post quarterly gains.
DSL was the big star, with BellSouth adding 263,000 net new DSL customers during the quarter, a record for the phone company. By quarter’s end, BellSouth served 3.15 million DSL customers, or 16.4% of the homes capable of buying DSL.
The surprising part of BellSouth’s DSL growth surge is that unlike Verizon or AT&T, BellSouth has not engaged in steep DSL price competition, although the telco has lowered the cost of promotional service somewhat. In fact, the average revenue per DSL unit was about $42, on par with what typically more expensive cable modem service costs.
Moreover, 80% of BellSouths net DSL adds reflected customers signing up for the higher-priced 3 Mbps service, a sign that a substantial portion of consumers value speed over price. BellSouth is working hard to up its DSL capacity, with plans calling for 50% of the homes passed in its territory having access to 12 Mbps to 24 Mbps by year-end 07.
In the meantime, it doesn’t look like BellSouth will ramp up its IPTV efforts as, perhaps, many expected. BellSouth is testing a version of video-over-DSL called ADSL2+, but during the company’s earnings call, executives said that the ADSL2+ test community will stay in technical trial mode and not move forward to market trial.
That doesn’t mean BellSouth isn’t in the video business. The company’s DirecTV-delivered video package gained 105,000 net new customers during the quarter, giving the telco a total of 628,000 TV customers by quarter’s end.
| BellSouth Key Statistics | 1Q05 | 2Q05 | 3Q05 | 4Q05 | 1Q06 |
| Total access lines (mil.) | 21.2 | 20.8 | 20.4 | 20.0 | 19.8 |
| DSL customers (000) | 2,349 | 2,473 | 2,678 | 2,882 | 3,145 |
| Quarterly adds (000) | 253 | 124 | 205 | 204 | 263 |
| Video (000) | 314 | 394 | 460 | 523 | 628 |
| Operating Revenues | 5,091 | 5,142 | 5,072 | 5,200 | 5,171 |
| Operating Income | $1,635 | $1,813 | $1,817 | $1,792 | $1,900 |
| Operating Margin | 19.7% | 21.3% | 21.4% | 20.7% | 21.9% |
Posted by Cynthia Brumfield at 11:35 AM | Print | Comments (0)
Anthony Townsend from the Institute for the Future has this item on the state of ad-supported muni-Wi-Fi networks. One point he makes, and it seems like an obvious one, is that cities should leverage their Wi-Fi networks to provide local information or community-created content.
Discussions about the design of today’s municipal wireless networking efforts have not yet addressed the way community-created content can be solicited and integrated in the splash pages and portal sites where wireless users are greeted when they connect. We do know that cities such as Long Beach, California and business improvement districts in New York City have experimented with local content. However, these past experiments did not leverage the tools we possess today to rethink how we might provide a community bulletin board as an integral part of the municipal wireless experience.
He’s quite right when he says that most municipal broadband networks take users out of their communities.
The directions of current municipal projects instead are unwittingly viewing the wireless network as a means to escape local communities, and as a one-way street for advertisers to subsidize the network’s operating costs.
It seems to me to be a no-brainer that the Wi-Fi log-in pages are the perfect platforms for getting across local information. I would have thought that local politicians had already figured this out. (Hat tip to SmartMobs.)
Posted by Cynthia Brumfield at 8:59 AM | Print | Comments (0)
In another sign that the web-based video market is accelerating, NBC and its 213 local affiliates announced yesterday the formation of a joint venture tentatively called National Broadband Company (get it? NBC…no need to change the stationery).
The company will be owned by NBC and offer websites video from the NBC Universal library as well as “behind-the-scenes” footage from local affiliates. The venture will not, apparently, make available online hit prime-time shows such as those offered by ABC.
As is true with most of these traditional TV network efforts to migrate content to the web, no clear business model has been advanced. NBC, like its network rivals, is plowing ahead with what seems to be the next big thing — TV over the Internet — in the hopes of sharing in the booming online ad market. The fact that the affiliates will share in the revenue helps smooth over the inevitable resentment that local broadcasters feel about their programmers bypassing them.
Posted by Cynthia Brumfield at 8:35 AM | Print | Comments (0)Writer Clive Thompson has a lengthy article in the upcoming New York Times’ Sunday magazine about the Internet in China, which uses as its central focus Google’s decision to launch a censored, Chinese version of its search engine.
The article presents a far more nuanced view of how the Chinese people feel about the government’s policies than is typically presented in Western journalism, arguing in essence that Western critics of the government’s censorship policies are far more upset about the situation than are the Chinese people. The article also takes a kinder view of Google’s decision to block content than is usually expressed.
While Thompson spent time with Google’s point-man in China, Kai-Fu Lee, only co-founder Sergey Brin was authorized to discuss Google’s position on censorship. What Brin told Thompson was that Google’s decision to accede to government demands was truly motivated by a desire to provide information to the Chinese people, and that Google doesn’t expect to make a profit in China for some time to come.
What eventually drove Google into China was a carrot and a stick. Baidu was the stick: by 2005, it had thoroughly whomped its competition, amassing nearly half of the Chinese search market, while Google’s market share remained stuck at 27 percent. The carrot was Google’s halcyon concept of itself, the belief that merely by improving access to information in an authoritarian country, it would be doing good. Certainly, the company’s officials figured, it could do better than the local Chinese firms, which acquiesce to the censorship regime with a shrug. Sure, Google would have to censor the most politically sensitive Web sites — religious groups, democracy groups, memorials of the Tiananmen Square massacre — along with p*rn*graphy. But that was only a tiny percentage of what Chinese users search for on Google. Google could still improve Chinese citizens’ ability to learn about AIDS, environmental problems, avian flu, world markets. Revenue, Brin told me, wasn’t a big part of the equation. He said he thought it would be years before Google would make much if any profit in China. In fact, he argued, going into China “wasn’t as much a business decision as a decision about getting people information. And we decided in the end that we should make this compromise.”
Yahoo, on the other hand, is painted with a very black hat indeed. One high-profile Chinese blogger working outside of China called the company a “sellout” and said the Chinese people “hate” Yahoo.
I expected Zhao [Zhao Zing, a blogger shut down by MSN] to be much angrier with the American Internet companies than he was. He was surprisingly philosophical. He ranked the companies in order of ethics, ticking them off with his fingers. Google, he said, was at the top of the pile. It was genuinely improving the quality of Chinese information and trying to do its best within a bad system. Microsoft came next; Zhao was obviously unhappy with its decision, but he said that it had produced such an easy-to-use blogging tool that, on balance, Microsoft was helping Chinese people to speak publicly. Yahoo came last, and Zhao had nothing but venom for the company.
“Google has struck a compromise,” he said, and compromises are sometimes necessary. Yahoo’s behavior, he added, put it in a different category: “Yahoo is a sellout. Chinese people hate Yahoo.” The difference, Zhao said, was that Yahoo had put individual dissidents in serious danger and done so apparently without thinking much about the human damage. (Yahoo did not respond to requests for comment.) Google, by contrast, had avoided introducing any service that could get someone jailed. It was censoring information, but Zhao considered that a sin of omission, rather than of commission.
Despite all this drama, Thompson makes the case that the Chinese people are accustomed to the government censorship and take a much more philosophical view of the situation.
But perhaps the distorted universe is less of a problem in China, because — as many Chinese citizens told me — the Chinese people long ago learned to read past the distortions of Communist propaganda and media control. Guo Liang, the professor at the Chinese social sciences academy, told me about one revealing encounter. “These guys at Harvard did a study of the Chinese Internet,” Guo said. “I talked to them and asked, ‘What were your results?’ They said, ‘We think the Chinese government tries to control the Internet.’ I just laughed. I said, ‘We know that!’ ” Google’s filtering of its results was not controversial for Guo because it was nothing new.
Thompson points out, however, that the Chinese people may simply be “cowed” by the government, trained like cattle to simply accept the limitations.
They may be right about their users’ behavior. But you could just as easily argue that their users are incurious because they’re cowed. Who would openly search for illegal content in a public Internet cafe — or even at home, since the government requires that every person with personal Internet access register his name and phone number with the government for tracking purposes? It is also possible that the government’s crackdown on the Internet could become more intense if the country’s huge population of poor farmers begins agitating online. The government is reasonably tolerant of well-educated professionals online. But the farmers, upset about corrupt local officials, are serious activists, and they pose a real threat to Beijing; they staged 70,000 demonstrations in 2004, many of which the government violently suppressed.Posted by Cynthia Brumfield at 7:28 AM | Print | Comments (0)
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