The proposed merger of AT&T and Time Warner has drawn censure from both sides of the political aisle, as well as a Senate hearing that looked into the potential for the combined company to become a monopoly.
But if we are going to examine media monopolies, we should look first at Silicon Valley, not the fading phone business.
Mark Cuban, the internet entrepreneur, said at the meeting of the Senate Judiciary Antitrust Subcommittee last week that the truly dominant companies in media distribution these days were Facebook, Google, Apple and Amazon.
“Facebook is without question in a dominant position, if not the dominant position, for content delivery,” he said.
Look at the numbers. Alphabet (the parent company of Google) and Facebook are among the 10 largest companies in the world. Alphabet alone has a market capitalization of around $550 billion. AT&T and Time Warner combined would be about $300 billion.
The radio industry is about to learn what many others already have — when you push Irving Azoff, he pushes back. Usually harder.
After nearly two years of negotiations over licensing rates for radio song plays, the Radio Licensing Music Committee (RMLC) recently “ambushed” Global Music Rights (GMR) — the nascent U.S. performance rights organization launched in late 2013 by Azoff, in conjunction with MSG Entertainment and with former ASCAP executive Randy Grimmett at the helm — with an antitrust lawsuit filed in the U.S. Eastern District Court of Pennsylvania on Nov. 18.
That was followed by the filing, on Dec. 6, Daniel Petrocelli and his firm O’Melveny & Myers of an antitrust suit on behalf of GMR against the RLMC in the U.S. Central District Court of California. Petrocelli stresses that the suit is not retaliatory, but was filed to fight the RLMC’s “collusive tactics to depress [the] prices” that radio stations pay songwriters.
Azoff, the legendary artist manager who began GMR because he felt songwriters were getting shortchanged in performance licensing, tells Billboard that he takes “artist rights very seriously. I grew up around guys named Lew Wasserman[former head of MCA, now known as Universal Music Group] and Steve Ross [who created Warner Music Group], who taught me to respect talent. We feel that they [the RMLC] violated respect for talent. We didn’t start this fight, but we aren’t going away.”
[Editor Charlie sez: No more White House Spotify playlists?]
Team Trump has announced the composition of the President’s Strategic and Policy Forum – and there’s no place for internet oligarchs like Eric Schmidt, Larry Page, Jeff Bezos or the world’s fifth-richest man, Mark Zuckerberg.
Former General Electric CEO Jack Welch has a seat, as does Ginni Rometty, head of everything at IBM. The forum is headed by Stephen A Schwarzman, co-founder of private equity giant Blackstone.
“The panel will be a strong voice on Team Trump for corporate America and the interests of the 1 per cent,” writes Larry Kumer of the Fabius Maximus blog, noting that for a populist President-elect, there’s no representation for organised labour.
But it’s not merely corporate – that much can be expected from a CEO President-elect. DC sources tell us that Trump’s antipathy towards Big Internet is based on jobs. A second Trump term depends on jobs growth; while internet companies such as Amazon, Google and Uber destroy jobs, manufacturing industries create them.
It’s a sign of which corporations Team Trump thinks can generate jobs. Outgoing President Obama couldn’t get enough of Big Internet, and today many agencies reflect Google’s agenda. The Google Transparency project has documented the busy revolving door between DC and Mountain View, and the amount of Google-friendly policy activity has become frantic in recent months. Examples include ripping up the rules for TV licensing – which proved too much even for the Democrat FCC Commissioner with the swing vote to approve – and locking the Register of Copyright out of her office.
President-elect Trump has made it clear that he is more than a little hostile towards the FCC’s implementation of net neutrality, both in his own words and, today, the appointment of two long-time adversaries of the policy to his transition team.
Jeffrey Eisenach is an economist and government veteran who worked at the FTC in the ’80s; he’s worked for a number of think tanks and research institutes that transmute industry money into custom expert critique, and under their auspices was a vocal opponent of the FCC’s current net neutrality rules….
Eisenach described net neutrality as “an effort by one set of private interests to enrich itself by using the power of the state to obtain free services from another” in his testimony before the Senate Judiciary Committee in 2014. He suggested ISPs have no reason to discriminate between services, and they engender innovation rather than stifle it.
Google’s unprecedented Obama Administration influence and its self-serving anti-employment, anti-property, and pro-regulatory policy agenda, are on a collision course with the job-creating, pro-property, deregulatory Trump Administration growth agenda.
Keep watch to see who adapts to whom and how.
I. Google’s Unprecedented Lobbying Influence
Current Alphabet-Google Chairman Eric Schmidt enjoys the privilege of being the onlycorporate leader of a publicly-traded company on the President’s nineteen member Council of Advisors on Science and Technology.
Coincidentally, former Google Senior Engineer from 2006-2013, Mikey Dickerson, is Deputy U.S. Chief Information Officer and Administrator of the U.S. Digital Service, a new organization and position.
Renata Hesse, Google’s former outside antitrust defense counsel, is coincidentally now Acting U.S. Assistant Attorney General for Antitrust, who coincidentally is the lead liaison with EU antitrust authorities concerning the EU’s three pending monopolization cases against Google.
Former Google Deputy General Counsel and head of patents and patent strategy from 2003-2012, Michelle Lee, is coincidentally now Under Secretary of Commerce for Intellectual Property and Director of the U.S. Patent & Trademark Office, who coincidentally joined the USPTO just when Google faced several new serious patent lawsuits.
And coincidentally yet again, the U.S. Register of Copyright, Maria Pallante, just got fired coincidentally after she disagreed with Renata Hesse and Google’s position on a music copyright consent decree and with the FCC-Google position that FCC authority should supersede copyright in the FCC’s Set-Top Box rulemaking.
Coincidentally, Google employees visited the Obama White House 427 times per White House Logs including 128 visits coincidentally by Google’s lobbyist Joanna Shelton alone, many more times than any other special interest.
And a final coincidence, Google also has generated the most “revolving door” moves of any company with this Administration with 251 Google employees either entering the government or government employees joining Google, according to the Google Transparency Project.
Donald Trump is rumored to be appointing Google crony Joshua Wright to oversee Federal Trade Commission policy. Google couldn’t ask for more.
The Obama Department of Justice filed notice on November 11 that it intended to use the peoples money to appeal BMI Rate Court Judge Louis Stanton’s devastating ruling against the DOJ’s bizarre position on “100% licensing”. Professor Steve Winogradsky and I summarized the results of the ruling in this post. Aside from the terrible legal […]