Welcome to new subs overnight from Apple News, Enders Analysis, influencer network Brilliant Beam in Houston, Texas, New Zealand broadband Chorus, streamer 1 Play Sports, Copenhagen’s Native Advertising Institute, online commerce Onnero, global crowd data giant Beonic, European telco Cetin across Czechia, Hungary, Bulgaria, and Serbia, and $25 billion real estate leader REA, among others.
Also, my tough love post on Australia’s capitulation to Big Tech pay-offs sparked a flood of sign-ups from Nine, Seven, Southern Cross Austereo, and others.
Great to have you all along, and thanks to today’s sponsor…
Before we start, just a note that I’m headed to Nova Scotia, Canada, in a fortnight to speak at The Rideau Hall Foundation about the future of journalism.
I’ll then be meeting publishers in New York. If you’re up for a coffee around October 21/22, drop me a line.
Right, let’s focus on the ashes of Google’s antitrust case, where the search giant’s lawyers had another torrid day as its witnesses were shredded over self-interest.
Let’s go…
After months of relentless kicking and mind-blowing evidence of Google’s monopolies, it was left to a hairdresser to deliver the last line of defence.
Courtney Caldwell runs a barber shop exchange, and she just loves Google.
The search giant has been so good to her and her partner, that their little Texas wannabe ShearShare has gone global.
She was ever so eager to ask the judge not to break up the $238 billion monopoly. I mean, it’s working for her just great. Yay! But journalism? Democracy?? Open web???
Not so much.
Her evidence tumbled like locks to the shopfloor though as the Department of Justice flagged that she might be just a teeny-weeny bit conflicted.
It took them, like me, roughly five minutes to Google her, find a video on YouTube (owned by Google) appearing in an ad (for Google), in which she says she was paid $500,000 (by Google).
Another day, another flub, by Google’s Louboutin-heeled $2,000-an-hour legal eagles, displaying once again the style and panache of an ‘90 spiral perm.
And just as it reminded me of Nicole Kidman in Days of Thunder, it also triggered a more recent memory…
Just a fortnight ago, the Department of Justice’s Assistant Attorney General Jonathan Kanter climbed on stage to warn antitrust lawyers about a crisis of trust in witnesses.
He revealed a new tide of big corporations were copying Big Tobacco’s playbook to pay millions to expert witnesses to influence their evidence.
With Google going down in flames in court, this is particularly timely and pertinent - and unlikely to be an accident.
Kanter’s DoJ looks certain to end with three wins from three against Google. A victory of epic scale that many would have considered impossible just months ago.
But now the court battles are being won, the real war will begin.
Google is readying to unleash an army of lobbyists and paid-off influencers to pressure politicians to ensure any censure is manageable.
That’s what led us to the barber… ✂️
Some of the best court coverage is coming from the Big Tech on Trial Substack.
Under a headline saying Google’s witness factory has some credibility issues, lawyer Tom Blakely wrote:
“Today had the feeling of Google’s lawyers adding a few cups of saccharine Google blue, green, orange, and red powder, and trying to have the court drink the Google Kool-Aid.”
He added: “When you dig into it, it turns out that much like you might have a shortlist in a kitchen drawer of local plumbers and electricians to call when you need help…
“Large corporations and law firms have shortlists of economists (or academics) who they routinely call upon.
“It is quite a revolving door. It felt like some of these witnesses were coming from some kind of Google witness factory.”
He wasn’t done.
“Google’s case has been sanitised of any notion of competition issues (remember, rival ad exchanges are largely and remarkably absent as if they simply do not exist).
“Google employees keep referring to themselves as Googlers and the whole thing has taken on the aura of the numerous works of fiction that depict this sort of Alice in Wonderland fall from reality and into some kind of bowdlerized Google fantasy land, where evidence, even the language used to describe competition issues, has been expurgated in the way a parent might childproof a home.”
Echoing Kanter, he added: “These witnesses are so palpably in the bag for Google, if not merely extensions of Google itself, it hurts the credibility of the testimony.”
Like the barbers… ✂️
Called to the bar(ber)
I know you as readers are focused on the court case, but I think it’s safe to say Google will lose it. What we really need to focus on is what happens next.
Google CEO Sundar Pichai is already focused on the remedies (a softer word for penalties) that might come. He said so on TV yesterday.
What happens, and how that will be decided will come down to money, power, politics and influence.
The frontline of that was the wood-panelled halls of the Competition Law Institute’s 51st Annual Conference in New York a fortnight ago.
There, Kanter stepped up to the stage and threw TNT and a match on the paid influence industrial complex that’s been long hidden from public gaze.
“We meet today at a truly historic moment in competition policy,” he said. The law is turning the tide on big money.
“You can feel the energy of this new era of competition enforcement in the air. I hear messages of hope from people I meet around the country,” he went on.
“People beam with optimism about the prospect of economic opportunity, freedom and self-determination…”
The problem though, is Google’s barbers… ✂️
Confidence crisis
“Expertise plays a critical role in antitrust policy” Kanter continued. “Those experts help courts better understand market realities and reach sound conclusions.
“But we have a crisis of expertise, and it is growing. I have heard whispers for years. Recently, the volume and frequency have grown...
“Let me ask you what these three stories have in common:
An international enforcer attended an event thinking they were receiving training from experts associated with the US Government. Later, they were shocked to learn the training was funded by companies the enforcer was scrutinising, with topics and content geared toward encouraging non-intervention.
An academic associated with an institute funded by several large technology firms signed an amicus brief opposing a country’s enforcement action. Later, without disclosing that fact, they gave a purportedly expert presentation at the OECD attacking that same enforcement action and advocating the OECD take a position favouring the institute’s funders.
A Court of Appeals cited an economic study written by a professor paid by the defendants in support of the defendants’ litigation position. But the paper had no disclosure and so the court had no way to know. That decision has become binding precedent in some courts that impacts scores of unrelated cases.
“These are all true stories. What do they have in common?
“You may be thinking these involve the same academics, or maybe the same small group of companies, but they do not.
“These are just a few of countless examples of a pervasive breakdown in the distinction between expertise and advocacy.
“All over the world, money earmarked to discourage antitrust enforcement is finding its way into the expert community.
“The inevitable incentive of that flow of money is to distort the academic dialogue and reshape expertise into advocacy.
“We see this playing out from academia, to economics, to public policy. We see it in academic workshops, treatises, and wonky empirical reports.
“The expertise-buying game is ascendant. Conflicts of interest and capture have become so rampant it’s increasingly rare to encounter a truly neutral academic expert.”
Like our cuddly barbers above… ✂️
Murky work
Kanter continues: “Let me say this clearly. This will not end well. Already we see a seeping distrust of expertise by the courts and by law enforcers.
“Unless we find a new way forward, we may see the critical role of expertise in competition policy dwindle away. No one should welcome that outcome.
“Competition enforcers rely on expertise in nearly every part of our work.
“We rely on our Expert Analysis Group - dozens of PhD economists, statisticians, data scientists, financial analysts and technologists. They remain the gold standard.
“Increasingly, EAG is relying on varied forms of expertise, from behavioural economists to algorithmic experts, to understand the market realities.
“We routinely pull in outside experts, as part of policy and fact-gathering efforts. These experts rely on academic communities for the building blocks of their analyses.
“But if a paper was shadow-funded or influenced by corporate money, it can pass that influence and whatever flaws or biases it introduced into the papers that build on it.
“This insidious ripple effect is difficult - if not nearly impossible - to detect.
“The world is a murky enough place.
“We believe in an independent academic dialogue as a critical element of finding truth. And as markets evolve, we need that in order to get competition policy right.
“I want to be extremely clear. I do not think we should do anything to chill honest and open debate.
“The concerns I am raising relate to the more insidious influence that flows from the blurring of lines between advocacy and expertise.
“We need the building blocks of expertise to be solid. Trusted experts, in courtrooms or academic journals, are critical to the expansion of human knowledge.
“For generations, universities have resided as neutral centrepieces of thought leadership in the antitrust and competition policy community.
“But that trust is eroding among enforcement authorities. I am here as a call to action so that we can restore that trust.”
Less barbers… ✂️
Big Tobacco Tech
“Money earmarked by corporations and foundations to discourage antitrust enforcement is flowing by the millions into academia.
“It funds conferences, centres, papers, and everything in between. It provides professors with connections, influence, opportunities, and consulting dollars.
“And one thing is for sure: The companies cutting those checks are not doing so in order to encourage the unfettered discussion of impartial investigators.
“No. Cheques are being cut, university centres and institutes established, and conferences being funded, specifically to influence the evolution of expert thought.
“All that money is turning our experts into advocates. Sometimes knowingly and directly. Sometimes indirectly by affecting incentives and capturing institutions.
“This playbook is not new. We saw it play out most tragically with Big Tobacco’s campaign to twist scientific research about the harms caused by its products.
“In the 1950s, tobacco was faced with emerging science on the negative health effects.
“The industry recognised it could not solve the problem through advertising, which would come off as transparently self-interested.
“Instead, it decided to seize control of the scientific process from within.
“Tobacco poured millions into research, identifying, supporting, and amplifying sceptics, with the goal of attracting more researchers to their view.
“The strategy was massively successful, suppressing for decades the scientific consensus that smoking causes lung cancer, and leading to countless deaths.
“It infected the legal system as well, with Big Tobacco’s hand-picked experts testifying repeatedly that there was no conclusive link between smoking and health.
“Influence campaigns like this are pernicious because they are subtle. Many academics consider themselves distant and the money makes no difference.
“But research shows that corporate influence can impact a researcher - whether consciously or unconsciously.
“We see reports of academics who receive funding from corporations feeling pressure to self-censor, or corporations lobbying university administrations behind the scenes.
“As Upton Sinclair said: It is difficult to get a man to understand something, when his salary depends on his not understanding it.
“As enforcers, we are learning more how the expert influence game in antitrust is being played.
“One tactic involves the use of academic research centres, which allow corporate funders to evade disclosure requirements.
“Policies often do not require disclosure of an institution’s funding sources.
“Even new policies often fail to account for the invasive and insidious capture that occurs over years or decades of influence and funding.
“A company seeking to buy influence channels money through an endowment can often avoid impacted professors having to report the company’s involvement.
“It leads to advocacy being deceptively presented as expertise. When expertise loses its independence, we lose something profoundly important.
“The reputation of our academic institutions, built over generations, will quickly erode.
“I fear that as the line blurs, we risk losing expertise altogether. But that is precisely where we are heading as a community.”
So…
Let’s cut to the chase… ✂️
Yesterday, I reported how Google was able to persuade Australian publishers to take a dirty cheque to halt Government policy to rein them in.
I have reported previously about how Big Tech lobbying led Canada’s politicians to sideline tough sanctions and opt for self-interest.
Weeks ago, California buckled under Big Tech pressure to kill a very good bill designed to preserve local news organisations.
GNI
Today, I am beginning an investigation into the Google News Initiative.
Most major publishers I know have taken this money, and it has influenced their actions, and their reporting. Why are so few in the antitrust court one wonders…
It’s uncommon for me to announce an investigation, but this is different, as I am making an open offer to whistleblowers and insiders to step up.
I will protect sources. There’s no deadline. It will take time to do it properly, but I am opening the channels now. DM me...
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