The Precursor Blog by Scott Cleland

The Father of Indexing Calls My Indexing Thesis "Nuts!"

Scott Cleland — Fri, 03 Jul 2009 16:35:59 -0400

When Investment News asked John Bogle, Vanguard's founder and the father of indexing, about my "Indexing into the Ditch" thesis (that indexing is one of the root causes of the financial crisis) he said: it “is nuts! Last time I looked, index funds accounted for about 0.4% of all stock trading ... Just perhaps the other 99.6% might bear a teeny-weeny bit of the responsibility.”

Let me first respond to Mr. Bogle's points in order.

The thesis "is nuts! "I must admit I smiled at the ad hominum implication that my thesis was "nuts" and not worth listening to; I remembered that Bernie Ebbers called me the "idiot Washington analyst" because my research was the first to charge that WorldCom's business simply did not add up.

DOJ is formally investigating another Google deal

Scott Cleland — Thu, 02 Jul 2009 19:37:24 -0400

An unusual and notable pattern appears to be developing with Google and DOJ antitrust enforcers.

Behavioral Advertising's New Swiss Cheese Privacy Proposal

Scott Cleland — Thu, 02 Jul 2009 16:03:26 -0400

The new industry-proposed "Self-Regulatory Principles for Behavioral Advertising" which Google publicly patted themselves on the back for today, conveniently do not apply to most all of Google's current advertising business.

Handset Exclusives Drive Growth & Broadband Adoption -- Why regulate tech/computer sales?

Scott Cleland — Wed, 01 Jul 2009 14:13:53 -0400

Handset marketing exclusives are a pro-competitive wellspring of wireless growth and broadband adoption. Marketing exclusives are also a legitimate, proven and widespread marketing practice that marshals maximum marketing resources for selected, potentially-hot-new-products in order to drive maximum sales and adoption.

Comcast-Clearwire 4G Rollout Spotlights Vibrant U.S. Facilities-Based Broadband Competition

Scott Cleland — Tue, 30 Jun 2009 11:23:47 -0400

Comcast-Clearwire's 4G WiMax rollout starting in Portland today, as part of broader national launch this year, is powerful evidence of the vibrancy and dynamism of the facilities-based broadband competition trajectory in the U.S.

This latest announcement provides an excellent opportunity to take stock of both the current state of broadband competition in the U.S. and the competitive trajectory of how the U.S. broadband market is getting increasingly more competitive.

Contrary to the parade of imperfection horribles claimed by anti-competition groups to try and justify a wide variety of new net neutrality-related regulations, the U.S. has more real and growing facilities-based broadband competition than any nation in the world.

The Comcast announcement provides powerful proof points of all the good aspects of vibrant facilities-based competition.

What If Columbo Investigated Special Access?

Scott Cleland — Thu, 25 Jun 2009 08:26:53 -0400

A new coalition of some struggling broadband competitors, NoChokePoints.org, is making claims that the "special access" market is being "choked" by lack of competition and is urging the FCC to reverse course and regulate lower prices for these competitors.

"Special access" is basically the business-to-business leasing market of the copper wire connections that link many buildings and cell towers to the Internet backbone at DS1 (1.5 Mbs) and DS3 (44.7 Mbs) speeds.

To solve this controversy and determine who is actually "choking," or holding up whom, I thought it would be instructive and interesting to consider how the beloved TV detective Columbo would apply his common sense questioning to get to the bottom of this whodunit.

Putting the Tech Elites' Whining in Perspective -- Swanson's new U.S. Bandwidth Boom Report

Scott Cleland — Wed, 24 Jun 2009 13:06:05 -0400

Kudos to Bret Swanson's excellent new research: "Bandwidth Boom: Measuring U.S. Communications Capacity from 2000-2008."

For the first time, it measures and puts into perspective the incredibly explosive growth in American bandwidth capacity since the U.S. began strongly promoting facilities-based broadband competition and Internet infrastructure investment.
- This research is new and interesting because it focuses on measuring supply-side bandwidth capacity, i.e. the fruit of tens of billions of dollars in infrastructure investment, rather than just the traditional demand-side measure of data traffic or usage.

This research also helps refute the constant whining and pessimism by the tech elites' that the U.S. is in the "digital dark ages," is falling behind the world in broadband, and in need of massive U.S. Government intervention in the Internet infrastructure market in order to make any progress.

What is "one click away?"

Scott Cleland — Mon, 22 Jun 2009 15:07:08 -0400

"One click away from competition" is Google's ever-present, antitrust defense slogan that Google does not have any market power to anti-competitively exercise.

In today's New York Times, Google's CEO Eric Schmidt ratcheted up the centrality of that slogan to Google's antitrust defense by claiming it applied to Google's user "customers." CEO Schmidt said:

“We are one click away from losing you as a customer, so it is very difficult for us to lock you in as a customer in a way that traditional companies have.”

The problem with Google's "one click away" slogan is that it is untrue and deceptive; it simply does not withstand close scrutiny of the facts or logic.

I. It is untrue -- a false claim.

A. The claim fails the dictionary test.

My House Internet Privacy Testimony -- "a consumer-driven, technology/competition neutral privacy framework"

Scott Cleland — Thu, 18 Jun 2009 13:00:41 -0400

Today I testified before a Joint House Subcommittee hearing of the Energy & Commerce Committee on "The Potential Privacy Implications of Behavioral Advertising."

A one-page summary is below and the full testimony is here.

Summary Testimony of Scott Cleland, President, Precursor LLC

“Why A Consumer-Driven, Technology/Competition-Neutral, Privacy Framework Is Superior to a Default ‘Finders Keepers Losers Weepers’ Privacy Framework”

Before the Joint House Energy & Commerce Hearing on Behavioral Advertising, June 18, 2009

Pew Report spotlights robust U.S. broadband adoption

Scott Cleland — Wed, 17 Jun 2009 11:31:06 -0400

Kudos to Verizon's Link Hoewing for an excellent post highlighting the recently released Pew Research Report, which shows the U.S. continues to make steady, broad, and impressive progress in broadband adoption.

This Pew research is another independent evidence point that undermines the manufactured dogma that the U.S. is failing in broadband -- dogma artificially designed to provide a cover story for abandoning successful bipartisan facilities-based competition policies in favor of a "retro" common carrier broadband/Internet regulation regime.