

The Google Tax - nathanpc
http://nathancampos.me/post/41014392537/the-google-tax

======
temac
> Clearly Orange has no idea how the internet works and what’s their
> involvement in it. The ISP is just a dumb pipe to connect the user to a
> server, nothing more.

Clearly Nathan Campos has no idea how the internet works. Negotiations about
charging for traffic is normal business, and has always been.

> The user fees should be equivalent to their connection speed, not their
> usage, which apparently is something that ISPs can’t understand too.

This is practiced for some land networks (in France, most of them) because the
traffic is still good enough and most people are not generating so much
traffic, but this can not happen on mobile network because of the much limited
capacity. Limiting the rate is the way to guarantee that the mean traffic does
not explode, saturating the whole thing.

> French President Francois Hollande warned Google on Wednesday that his
> government would legislate a so-called Google tax if the company doesn’t
> reach a deal with French media companies.

Orange is not a media company, and the rest of the post recognize that and
talks about ISP.

------
arkem
This sounds like a run of the mill peering negotiation[1]. The unusual thing
here is a company getting press coverage for it.

I have no idea how Google's peering arrangements are set up but I doubt that
this is the only transit arrangement Google has ever ended up in.

[1] <http://en.wikipedia.org/wiki/Peering>

~~~
powertower
My thoughts exactly at first.

There is something nonsensical about this whole matter (as reported by the
blogs) that triggers a flag for me.

More info -

(tl;dr; the _peering_ traffic between Cogent and Orange are too imbalanced;
Cogent handles Google's traffic)

In this case, the US telecommunications operator Cogent claimed, among other
things, that France Télécom was compromising the peering system (enabling
exchange of traffic flows between networks, free of charge) used by transit
operators, by requesting payment for opening up additional technical capacity
for access to Orange subscribers. Regarding this claim, the Autorité
considered that in view of the _highly asymmetric nature of the traffic
exchanged between France Télécom and Cogent, such a payment request does not
in itself constitute an anti-competitive practice inasmuch as this type of
remuneration is not uncommon in the Internet industry in cases where a
significant imbalance exists between the incoming and outgoing flows exchanged
between two networks_ , and is consistent with the overall peering policy
adopted by France Télécom, with which Cogent is familiar.

However, the Autorité also noted a certain lack of transparency in the
relationship between the domestic network of France Télécom (Orange) and its
transit operator business (Open Transit), creating a potential for margin
squeezes. France Télécom agreed to make commitments to prevent such situations
and enable appropriate monitoring.

[http://fastnetnews.com/dslprime/42-d/4881-france-telecom-
fre...](http://fastnetnews.com/dslprime/42-d/4881-france-telecom-free-to-
google-youtube-youre-blocked-unless-you-pay)

------
hazz
"Google has also been faced with demands for compensation from content
providers such as newspapers, who charge the search giant makes lots of
advertising revenue from referencing their material."

"Hollande said “Those who make a profit from the information” produced by
media companies should participate in their financing."

It's depressing to see so many examples of the abysmal understanding of the
internet that so many politicians seem to have. Ignorance can be forgiven to a
certain extent, but not even making an attempt to try to understand the
situation - just spending five minutes on google or wikipedia researching the
Googlebot will tell you about robots.txt - is inexcusable.

Public and state ignorance of computers and the internet are leading us down a
very dark path; there needs to be an effort to try to educate our political
representatives, or we risk a future where legislation like SOPA is passed
purely out of ignorance of what it means.

~~~
taligent
> just spending five minutes on google or wikipedia researching the Googlebot
> will tell you about robots.txt

So basically your position is binary: Either don't allow your site to be
indexed by Google or accept that they are going to profit from your content.

If you don't see why companies and governments see more shades of grey in this
situation then the only person who is ignorant is you.

~~~
AnthonyMouse
>So basically your position is binary: Either don't allow your site to be
indexed by Google or accept that they are going to profit from your content.

Nonsense. If you want to put "no access" in robots.txt and then go to Google
and negotiate a fee from them for removing it, you're perfectly entitled to do
that. But you know perfectly well that the value of search traffic to your
site is worth more to you than the value of indexing your site is worth to
Google or any other web search engine, so any such negotiation is not going to
end with a payment from the search engine to you.

And passing a law _wouldn't even change that_. All it would do is create an
explosion of transaction costs as every single website has to negotiate with
every search engine to _not_ pay to be included in the index. Which if
anything would only cement Google's dominant position in web search forever as
any of its smaller competitors are bankrupted by transaction costs. Unless, of
course, the law allowed some kind of standard technological means of allowing
a site to specify that it doesn't require any payment to be included in the
search results... like robots.txt.

------
antr
This is the most absurd tax I've ever heard of.

Google is not responsible for this traffic, it is the user requesting it. I
consume YouTube, search, etc. content because I request it, not because Google
tells me to.

I just hope the EU slaps French politicians for this one.

------
evv
Does anybody know why Google didn't refuse these charges? This sets a really
awful precedent.

~~~
krallin
Orange has a very strong presence in Africa. It leveraged this presence to
have Google pay for their Internet trafic in France and Europe: Orange is
pivotal to Google's success in Africa.

According to Orange's CEO, Google just can't do without Orange in Africa - and
that's likely to be true.

Sources (in French, sorry!):

[http://frenchweb.fr/trafic-france-telecom-se-fait-
remunerer-...](http://frenchweb.fr/trafic-france-telecom-se-fait-remunerer-
par-google/94898)

[http://pro.clubic.com/entreprises/orange-france-
telecom/actu...](http://pro.clubic.com/entreprises/orange-france-
telecom/actualite-535938-google-remunere-orange-trafic-genere-reseau.html)

~~~
Silhouette
So this is essentially a textbook case of monopoly abuse, with the twist that
because it's across borders they're getting away with it?

I'm a little surprised the response wasn't to delist every Orange property
from the Google search engine and block access to any Google property for any
Orange customer. It seems to me that doing so would effectively render
Orange's mobile broadband offerings dead globally, for the five minutes the
discussion would last. Presumably someone at Google decided that such a
strategy was too risky legally and/or in terms of poisoning relations with
ISPs more generally.

~~~
krallin
Orange does have a strategic position in Africa where Google (for the moment)
doesn't. I'm not saying Google _needs_ Orange, but it is indeed a strategic
partner.

Orange is also an highly trusted ISP in France, and (unlike Free) counts many
corporations among its clients. Google probably would not risk alienating
those clients by engaging in an open conflict with Orange.

All in all, I don't think any other French ISP would have been able to wrestle
such a deal from Google.

------
brudgers
A plausible case can be made for charging Google based on the amount of
traffic generated by their products which is initialized outside of the
subscriber's control.

The ISP is delivering advertising from which Google benefits and which its
users are not explicitly requesting. Charging Google is analogous to a cable
provider charging an advertising agency when that agency wants to place ads on
behalf of their clients.

Other Google services such as Analytics, tracking cookies, and JavaScript
libraries also use capacity without considering the effect on the provider's
bandwidth.

Again, this is a plausible position. It is plausible because Google is
generating revenue regardless of the ISP's customers' interest and the source
of the data is outside the ISP's network.

Charging Google is a reasonable alternative to charging their customers for
something which may be of little value to them.

~~~
rryan
I disagree. A user requesting <http://example.com> is that user requesting
everything that the webmaster of example.com wanted example.com to include.
This includes ads.

The webmaster has decided that the content hosted on <http://example.com>
includes some HTML, some off-site resources (maybe images hosted on a CDN,
maybe some ads, maybe some Javascript hosted elsewhere).

Are you going to charge CDN owners too given the user doesn't 'know' that
websites often use a CDN to host their content? What about jquery.com for
hosting the version of jquery the site uses (if they don't host it
themselves)?

Why are ads special? Simply because the webmaster is being paid by the ad
network? In the CDN case, money flows in the opposite direction -- the
webmaster pays the CDN. Why shouldn't the ISP take a cut of that transaction
too?

If a website has ads the implied contract is that you get access to this
content in exchange for having these ads on the screen. Why does an ISP get to
take a cut out of that agreement between the webmaster, the ad network, and
the user? They are already compensated by the user to deliver all the bytes
the user's computer requested to them.

If an ISP is unhappy with how many bytes the user is requesting, and how many
of those bytes come from a particular source (e.g. Google) then they need to
renegotiate their contract with the user.

~~~
brudgers
Advertising is just the most obvious example of something which other networks
- such as cable television - charge the content provider to deliver to their
customers.

I am not a lawyer, but the implied contract argument doesn't seem to hold
water. Google and the ISP aren't in privity - unless of course there is a
contract between them such as the article provides. I'll leave aside the
applicability of common law principles to France in regard to the theory of
implied contracts required as a premise to the argument.

------
josephby
Orange knows exactly how the internet works. They’re just trying to change it
for the worse.

This is the logical consequence of people moving their activities from
decentralized, open services (email, IRC, and usenet) where revenues are
generated (and cost incurred) at the ISP, to centralized, closed services
(Facebook and twitter) where cost, revenue, and control is centralized by the
platform owner.

The natural response will be for Google and Facebook to compete (or simply
threaten to compete) with residential ISPs, forcing some sort of accommodation
by the ISPs, and binding ISPs to the media platforms (Facebook, Google, et.
al.) in ways never before seen.

------
Wilya
I'm sorry, but "Google apparently accepted to pay the fees (even worst since
the government is also forcing a decision favorable to the ISPs)" is pure
nonsense. You misread your source. The French government doesn't give a damn
about peering negociations.

The French government supported _media companies_ (which is a nice way to say
"old-school newspapers"), or at least tried to pressure Google into reaching
an agreement with them. That's a whole different issue, which just happens to
be mentioned in the same article.

------
polemic
Stopped reading at:

> _"The ISP is just a dumb pipe to connect the user to a server, nothing
> more."_

What OP means is:

> _"Ideally, I would like the ISP to act as a dumb pipe..."_

The reality is that ISP's can do whatever the heck they want, subject to the
regulatory environment and the level of ignorance of their customers.

ISP's are a lot of things, "dumb" they are not.

~~~
guard-of-terra
But they really should be since they can't usually bring any useful service
over a "vanilla" internet.

Everything they bring is either crap that degrades your experience and is hard
to out out or costs you additional money. Non-exclusive if.

------
walshemj
what a French company gets preferential treatment in France - to quote Captain
Renault: I’m shocked, shocked to find that favoring of national champions is
going on in here.

Hint Which companies got raided over the 35 hour week a few years back not
French owned ones.

------
fredgrott
a question ..maybe it is obvious.. in the past Mobile OEMS at times have paid
a bandwidth fee to telecomms to balance end users having to update an OS on
the device..

Are we sure that the event of Google paying Orange referenced in the article
is not simply Google paying a small fee due to the bandwidth consumed by the
end user when the Android OS is updated on the Orange networks? side note,
usually that download is nto counted towards user limits as usually its also
sometimes a security update.

~~~
nathanpc
I don't think so since Google isn't responsible for updating Android phones
(except for the Nexus models). That's a job for the OEMs.

------
martinced
That is really weird... Especially the warning about president Hollande about
the Google tax.

Why is it weird? Because since free.fr badly messed up and decided to give the
finger to net neutrality, a french minister did ask free.fr's CEO to come
explain himself and to fix the situation as soon as possible with Google.

Basically free.fr was planning to remove Google ads by modifying the HTML
served to users and even the socialist running France at the moment thought
that violating net neutrality like that was not acceptable (in their own words
it was a violation of net-neutrality and france is very much pro-net-
neutrality).

And Orange is an ISP, just like free.fr. Not a media company.

So I wonder if the author of TFA isn't confusing two different things: the
right to archive / link to french magazines / publications (like Lemonde.fr)
and the net-neutrality issue.

IMHO users are paying for a service and companies unable to cope with the
bandwith their users are demanding shouldn't use fake adverts to advertize
bandwith they cannot provide.

In addition to that: go Google, wire the entire europe with fiber and let's be
done with these lame ISPs ; )

~~~
jre
Those are definitely two separate problems :

On one hand, there is a peering problems between some French ISP and Google
and they don't agree on who should pay for the interconnection costs.

On the other hand, some French newspapers are complaining about Google News.

~~~
pilsetnieks
To clarify a bit - essentially Google is its own ISP, they are peering with
Tier 1 ISPs directly so this case may well be a peering negotiation gone wrong
which would have nothing to do with network neutrality.

However, as the case is, it may be very difficult to distinguish between
Google the ISP and Google the content provider, and it seems from the article
that this might be the case of people confusing Google the ISP with Google the
content provider.

~~~
temac
The article contains great confusion about ISP matters and "content" matters,
but I don't see how Orange and Google should give a fuck about "content"
matter (including the political circus) when they are negotiating peering
agreements‎. If they do somehow, they this would be in very bad faith, but
there is no sign they have done so in this story.

------
OGinparadise
_Clearly Orange has no idea how the internet works...The ISP is just a dumb
pipe to connect the user to a server, nothing more._

Yay! you go and tell them what the internet is and how to run their business
since they have no idea
<http://en.wikipedia.org/wiki/Orange_%28telecommunications%29>

>> _If their users are using too much bandwidth and the costs are higher than
the profits they should start to rethink the price of their service, not go
after Google saying that they are evil for transferring all that data._

That's _one_ option, the other is to approach Netflix, Google or whatever and
negotiate. NEGOTIATE is the keyword and you need to keep in mind that
different countries have different laws.

Raising prices on everyone because xx% makes Youtube Orange's largest
bandwidth hog could make the rest of your customers mad.

~~~
AnthonyMouse
>That's one option, the other is to approach Netflix, Google or whatever and
negotiate.

Negotiate implies a free market. There is no free market for access to an
ISP's residential customers. They have a complete monopoly over the ability to
send packets to those people, resulting in a market failure that requires
government regulation to avoid monopoly abuse.

>Raising prices on everyone because xx% makes Youtube Orange's largest
bandwidth hog could make the rest of your customers mad.

Do you have some evidence that xx% is actually simultaneously some small
percentage of users _and_ still use enough bandwidth as a small minority to
require a nontrivial price increase for all customers? Raising prices on all
users in order to pay for expansion to meet demand created by a substantial
majority of users is not exactly unreasonable. Especially if the remaining
minority is offered the chance to buy a less expensive connection with
insufficient capacity to stream video, since they by definition don't want to
do that anyway.

~~~
temac
> Negotiate implies a free market. There is no free market for access to an
> ISP's residential customers. They have a complete monopoly over the ability
> to send packets to those people, resulting in a market failure that requires
> government regulation to avoid monopoly abuse.

This kind of theory is ridiculous. It is like saying that there is no free
market in the sale of carrot, because as soon as I enter a shop that sells
carrot and start to buy some the other shops have no ability to sell some to
me at the same time.

Now there are some situation where you get something that looks like more a
real monopoly, e.g. watter supply. But ISP in France is nothing like a
monopoly. Pretending otherwise with utterly contrived theories is complete
lack of good faith.

~~~
AnthonyMouse
>It is like saying that there is no free market in the sale of carrot, because
as soon as I enter a shop that sells carrot and start to buy some the other
shops have no ability to sell some to me at the same time.

You are very indignantly failing to understand that there is more than one
market in play here.

Some user, Joe Smith, subscribes to Orange as an ISP. That user may have other
choices; Orange may have competitors. That is not the market I am referring
to.

Once Joe Smith and however many thousand others like him subscribe to Orange,
Orange has a monopoly _on those customers_. If you are a content distributor,
it is not possible for you to send packets to any of those customers without
going through Orange. You must, at some point, connect to their network in
order to reach those customers. Other than government regulation, nothing
stops them from charging monopoly rents for anyone to make such a connection.

The content distributor has no control over what decisions end customers make
in choosing between ISPs. Their choice or lack thereof is completely
irrelevant since the content distributor has little if any ability to
influence it: _Maybe_ if you're YouTube you could cause an ISP to lose
sufficiently many customers through having slow or no access to YouTube, but
probably not even then since if YouTube's competitors are still fast customers
are more likely to blame YouTube than Orange, and if you _are_ the little
YouTube competitor then it's totally hopeless because Orange can just cut you
off if you don't pay whatever they ask and the large majority of their
customers won't even notice.

Internet service is not a carrot. If you need a bunch of carrots you can still
get all of them in one place and if that store mistreats you in any way you
can choose from multiple alternative suppliers. If you need to reach the
entire general public, each and every ISP can hold you up for access to their
subset of the customers, because you don't need 100 carrots, you need 1/100th
of every carrot in the world. There is no way for you to go to Free and
negotiate with them for access to Orange's customer base. It doesn't do you a
lick of good to get twice as much bandwidth to Free's customers if your
problem is not enough bandwidth to Orange's customers. You have to negotiate
directly or indirectly with Orange, who can hold up all comers.

