The Growing Google-ization Of Washington

Google’s clout has been on the rise at the FCC over the past few years, and that’s causing heartburn for some of the Silicon Valley giant’s competitors, including broadcasting and cable.

“It seems that whatever Google wants, Google gets from this commission,” said one broadcast industry lobbyist, who asked not to be identified.

“What’s frustrating is this gut reaction among regulators that if Google says something, it’s good, but if a traditional media company says something, it’s questionable,” added another broadcast industry source.

Befitting an enterprise of its size and scope, Google and its parent Alphabet Inc. have plenty of business in Washington. It encompasses international trade, patents, electronic privacy and cybersecurity and other issues.

But telecommunications and the FCC are at the center of much of its lobbying activities and they sometimes put it in conflict with broadcasting and cable.

Currently, the conflict is arising from two issues, two FCC proposals promoted by Google. The first is a plan to set aside spectrum in the UHF TV band for Wi-Fi. Broadcasters see it as another assault on their over-the-air capability.

The other would enable Google, Apple and others to market alternatives to the cable set-top box that subscribers use to navigate the 500-channel cable universe.

Broadcasters and cable operators contend the proposal would enable the suppliers of such devices to intrude on their carefully balanced relationship, tap into valuable TV viewing data and siphon away advertising dollars.

Google has also been a proponent of net neutrality, FCC regulations governing how cable operators market their last-mile broadband pipes to the home. Such rules are anathema to the operators and a concern to digital-minded broadcasters.

Like many other major corporations, Google cultivates influence by handing out huge piles of cash not only to legislators but also to the think tanks and public advocacy groups that help frame the policy debates.

But where Google has demonstrated a notable edge is in its access to the White House, which maintains varying degrees of control of federal agencies through the appointment of the people who run them.

Employees for Google and “associated entities” visited the White House 427 times since Obama took office in 2009 through October last year, according to a recent study by the watchdog Campaign for Accountability.

Also, according to that same study, Google lobbyist Johanna Shelton, a former FCC official steeped in telecommunications policy, made 128 of the White House visits, including four with the president himself.

That 128 was more than any other lobbyist. Her closest rival in terms of overall White House visits, according to the study, was a representative from Blue Cross/Blue Shield, who logged 75.

“Other companies are also trying to get White House visits, but the number that Google gets far surpasses the number that others get,” said Anne Weismann, executive director of the Campaign for Accountability. “That suggests a level of influence that other companies don’t have.”

And the revolving door between Google and the White House is spinning fast.

Twenty-two former White House officials have gone to work for Google during the Obama administration, while 31 executives from Google or one of its main outside firms have joined the White House or were appointed to federal advisory boards, according to Campaign for Accountability.

The former Google execs that have moved to the White House include Megan Smith, who is now chief technology officer for the White House’s Office of Science and Technology.

Google had no comment for this story.

The company’s defenders say that the key to Google’s success at the FCC is not its White House connections or massive lobbying war chest but that the agenda it advances just happens to coincide with that of FCC Chairman Tom Wheeler.

“The advantage for Google from a policy perspective is they are on the right side of history,” said Andrew Schwartzman, a long-time public interest advocate who is a law professor at Georgetown University.

“They represent openness; they favor unlicensed spectrum and sharing when that’s the policy. In general, they’re where Wheeler wants the FCC to be going.”

Added Kim Hart, an FCC spokeswoman: “Chairman Wheeler’s proposals aim to give consumers access to increased innovation, improved access to critical communications networks and more competition.

“These policies — from preventing fast lanes on the Internet to opening up wireless airwaves for new mobile technologies — are intended to empower consumers rather than favor any particular company.‎”

While the rapid rise in Google’s mojo at the FCC is of more intense immediate interest to pay TV operators than broadcasters, broadcasters are also concerned because the commission recently proposed a Google-backed plan that would reserve up to two UHF TV channels in each market for Wi-Fi and other unlicensed wireless uses.

Broadcasters, who oppose the proposal, fear that the initiative could interfere with their ability to switch to the new next-gen ATSC 3.0 broadcast standard and make it harder for low-power stations to find new homes after the FCC’s incentive auction this year.

Google wants additional free spectrum for Wi-Fi because more spectrum means more consumer use of its internet search engine, which is good news for its core business of selling targeted online ads, according to industry sources.

Broadcasters and pay TV operators also have concerns about a Google-backed FCC proposal to break the pay TV industry’s monopoly over set-top boxes.

The proposal, which has been publicly promoted by President Obama, would clear the way for Google and others to sell their own set-top boxes and apps to consumers.

Google, according to industry sources, wants to add consumer TV viewing habits to its search engine data, giving it additional information to sell to advertisers.

Pay TV operators don’t want to lose the $20 billion a year the FCC says they currently reap from leasing set-top boxes to consumers.

Broadcasters and other pay TV programmers are concerned that the proposal could have the effect of leveling the playing field between them and Netflix and similar over-the-top services.

In addition, broadcasters are concerned that the proposal would allow third-party providers to replace ads in programs accessed through their devices, or at least insert their own pop-ups, wraparounds and banners ads into the streams that consumers use to access and view broadcast programming and other traditional pay TV fare.

Google was also on the winning side when the FCC, over the strenuous objections of cable TV operators and the phone companies, adopted a tough net neutrality regime in February 2015.

The net neutrality regs are intended to prevent internet service providers like cable operators from discriminating against some content providers in pricing and quality of service. All content would be entitled to the same treatment.

Although Google favors such rules, it took a back seat in the lobbying push in 2014 and 2015, possibly because Republican policymakers felt rules, based on telephone regulations, went way too far.

One slight setback for Google on the regulatory front recently: Despite its opposition, Wheeler has made clear that he wants to extend the same privacy regulations that currently apply to cable and satellite operators to Google and any other companies that may offer competitive TV set-top boxes and apps in the future — a market that has Google’s interest. 

For the most part, Google plays the Washington game as other companies and industries do.

Google parent Alphabet Inc. reported spending $16.66 million on federal lobbying last year. That’s almost as much as the $17.36 million reported by the National Association of Broadcasters, and slightly more than the $16.37 million reported by AT&T, the $15.68 million reported by Comcast and the $14.12 million reported by the National Cable & Telecommunications Association, according to the Center for Responsive Politics.

Google has learned to use coalitions with watchdog-group-like-sounding names to promote its positions.

Google, for instance, is currently part of a coalition called Consumer Video Choice that is promoting the FCC’s proposal to open up the set-top box market to competition.

CVC’s members include groups that receive financial backing from Google, including Public Knowledge and the New America Foundation’s Open Technology Institute.

Members of the pay TV industry’s own coalition opposing the FCC proposal — Future of TV — include AT&T, Comcast/Universal, Dish Network, the Motion Picture Association of America, National Cable & Telecommunications Association and Time Warner Cable.}

Google also donates to trade associations, think tanks and advocacy groups. How much the groups actually receive is difficult to tally and compare because there are no consistent disclosure standards.

Some groups — including even the Campaign for Accountability that conducted the study on Google’s White House visits cited in this story, for instance — refuse to disclose any of their funding sources.

On its “transparency” web page, Google publishes a “representative listing” of 42 trade and other membership organizations that it sponsors, including the Association of National Advertisers, CTIA-The Wireless Association, the Computer & Communications Industry Association and the Consumer Electronics Association (now the Consumer Technology Association).

In addition, it lists “examples” of more than 100 other think tanks and advocacy groups that receive Google support, including the Brookings Institution, the Consumer Federation of America, the Electronic Frontier Foundation, the Heritage Foundation and the National Hispanic Media Coalition.

Google’s website does not detail how much it donates to each of the groups.

But New America Foundation, whose Open Technology Institute is a member of Google’s Consumer Video Choice Coalition, received more than $1 million from Alphabet Inc. Executive Chairman Eric Schmidt and his wife Wendy during the association’s 2015-16 year, according to the foundation’s website.

Google itself contributed at least another $250,000 to the foundation that same year, the foundation’s website says. Schmidt, who was formerly NAF’s chairman, continues to serve on the foundation’s board.

Public Knowledge, another watchdog group member of Google’s Consumer Video Choice Coalition, received at least $25,000 from Google in 2015, according to the group. (Gigi Sohn, Public Knowledge’s former president, is currently a top adviser to Wheeler.)

Google’s contributions to the watchdog groups and think tanks comes with at least tacit strings attached, John Simpson, director of Consumer Watchdog’s privacy project, told TVNewsCheck.

“It encourages these organizations to frame the public policy debate in ways that are often to Google’s advantage,” he said. “It’s very rare that an organization bites the hand that feeds it.”

“It raises the question of whether they [Google] are trying to silence these groups,” added the Campaign for Accountability’s Weismann.

“If you throw a lot of money at these groups, it may temper their inclination to do anything critical of what Google does.”