[Plura-list] Canadian telco monopolists run the show; Google cheats on location privacy; The antitrust case against Prime

Cory Doctorow doctorow at craphound.com
Tue Jun 1 13:36:27 EDT 2021


This Friday, Jun 4, I'm appearing with David Dayen in the Second Life
Book Club!


And next Monday, Jun 7, I'm helping Terry Miles launch his debut novel



Today's links

* Canadian telco monopolists run the show: The CRTC just put Teksavvy
out of business.

* Google cheats on location privacy: Part of the attribution con.

* The antitrust case against Prime: The dotted line to higher prices.

* This day in history: 2006, 2010, 2016, 2020

* Colophon: Recent publications, upcoming/recent appearances, current
writing projects, current reading


👨🏻‍🎤 Canadian telco monopolists run the show

If there's one lesson you'd hope governments would take away from the
pandemic and the lockdown, it's that good internet policy - universal
access at fair prices, managed in the public interest - is a
prerequisite for *all* good policy.

Canada didn't get the memo.

Last week, the CRTC - Canada's telecoms regulator - released its
long-awaited decision on the wholesale prices paid by small, innovative
ISPs to access the facilities of Canada's telecoms monopolists.

It's the worst such decision in history.


Ian Scott (a former teleco lobbyist that Justin Trudeau's Liberals put
in charge of the CRTC) shocked the nation by reversing the Commission's
own policy, dramatically raising wholesale prices, signing a
death-warrant for Canada's entire independent ISP sector.

The decision means hundreds of millions of dollars in windfall profits
for the Big Three Canadian telco monopolists, and ends ambitious plans
by Canada's wonderful indie ISPs like Teksavvy to lay both rural and
urban fiber.

Even worse: Scott has reversed the CRTC's order for the Big Three to
refund millions in price-gouged overcharges to indie ISPs, despite a
vast public record that indicates that this money was illegally extracted.

It's the latest in a string of terrible internet policy decisions from
Scott's CRTC, including a rule that indie telcos that bid on wireless
spectrum must also strike deals with the Big Three monopolists,
guaranteeing that such efforts will lose money and fail.

Ian Scott is a dingo babysitter, a fox in the henhouse, a gator in the
swamp. Teksavvy is calling on the Liberals to #FireIanScott.

According to the Toronto Star, the Liberal government isn't happy with
Scott's decision, but it's hard to imagine them taking action on this
issue, given the Liberals' idiotic internet regulation attempts.


Trudeau will be remembered as the first Liberal PM to be stupider about
the internet than the Tories. After all, his first broken election
promise was the repeal of Bill C-51, the Tories' mass surveillance act,
which he whipped his caucus to vote for.


Today, the Liberals are pushing hard for Bill C-10,  an internet
censorship bill that has far-reaching implications for everything from
podcasts to blog posts, despite government misinformation to the contrary.


The Trudeau reality-distortion-field is in full effect with Bill C-10,
with Liberal spin-doctors having convinced Canadians that opposition to
Bill C-10 comes from Tory simps who've been conned about the true extent
of the bill.

But C-10 really does reach into every aspect of Canadians' online lives,
and will empower future government appointees to inflict harms even
greater than the damage Ian Scott is dealing to the nation's digital future.

Worse, the NDP and Bloc Quebecois have joined with with the Liberals in
supporting this bill, refusing to back amendments that would have
repaired many of the serious defects in the language.


Assuming that anything the Tories want to do to the internet is fucking
awful is a pretty good rule of thumb, but not this time. Not only are
they right about the potential harms of C-10, but they're also poised to
weaponise it after their next election win.

After all, as bad as schmucks like Ian Scott are, Tory appointees are
even worse: just imagine how PM Doug Ford (or worse, PM Faith Goldy)
would use these censorship powers.


👨🏻‍🎤 Google cheats on location privacy

Arizona AG Mark Brnovich is suing Google for lying to its users about
location privacy, tracking them even after they opted out. A newly
released set of unredacted Google records are explosive evidence of the
company's deception.


The documents show that Google deliberately engineered its products so
that you couldn't get your own location, or share it with an app,
without also giving your location data to Google, too.


They reveal a system so deliberately tangled that even senior Google
product managers *who worked on location systems* didn't understand how
they worked.


They also reveal internal message board conversations between Googlers
who were outraged to learn how hard it was to disable location tracking.


A thread by Jason Kint of Digital Content Next gives chapter and verse
on the revelations from the document drop:


What I found particularly striking, though, was the history of location
privacy in Google's settings. At one point, the company made it easy to
turn off location tracking, and then was aghast when users disabled
tracking in *droves*.

This is surprising given how strong the power of defaults is: most users
never change any settings. The fact that users disabled location
tracking widely and immediately speaks volumes about what how people
value location privacy.

But despite this "revealed preference" (to use econo-jargon), Google's
response wasn't to turn location tracking off by default - rather, it
responded by using dark patterns to turn tracking back on and make it
nearly impossible to disable again.

The location tracking opt-outs were smeared out across multiple sets of
preference screens, and the company leaned hard on its mobile device
partners to follow suit. The names of the manufacturers who caved are
still redacted in the docs, except for LG.

This is a prime example of consent theater: the company asks you for
your consent to creepily follow you 24/7. You say no, so it asks again,
in such a convoluted way that you don't even realize you've said yes.
Talk about "manufacturing consent."


It's worth asking why Google was so thirsty for our location. The
company will claim that it's because location tracking improves search
results, which is doubtless true; location data lets them give good
results for "pizza" instead of making you search for "pizza nyc."

But that's not the main event from a business perspective. As the UK
Competition and Markets Authority Report on ad-tech made clear, Facebook
and Google have monopolized the ad market by offering "attribution."


What's "attribution?" It's when a company shows you an ad and then
tracks every click you make, every location you visit and every purchase
you make (merging data from payment processors) to prove to advertisers
that you bought something after seeing an ad for it.

Attribution solves the age-old advertising problem, famously articulated
by the department store mogul John Wanamaker: "Half the money I spend on
advertising is wasted; the trouble is I don't know which half."

That may be great news for advertisers, but who gives a shit? The fact
that advertisers' lives are made easier if I let them follow me around
24/7 forever to see if their ads worked is *not my problem*.

I mean, advertisers' lives would be easier if, instead of showing you an
ad, they could reach inside your bank-account, withdraw some of your
money, and send you a product because they think you need it. We'd be
idiots to let them, though.

Advertisers are willing to pay *huge* premiums for attribution tracking
(despite the fact that, as with the entire ad-tech stack, attribution
data is full of Big Tech frauds that make advertising look far more
effective than it ever is or will be).

That's why Google was so desperate to keep location turned on - why it
was willing to commit outright fraud and to bully its partners into
following suit.

One of the major promises of a Google antitrust breakup is the
possibility of ending attribution. Unfortunately, that's not what many
competition regulators view as the "solution to "the attribution problem."

Indeed, the CMA's report sees the major attribution problem as being a
lack of competition among attributors. Rather than allowing Facebook and
Google to monopolize attribution, the CMA proposes to let everyone get
in on the game.

This is not what we need from our competition policy. We don't want
competition to see which companies can inflict the most human rights
abuses at the lowest cost.


👨🏻‍🎤 The antitrust case against Prime

The starting gun on Big Tech trustbusting was fired in 2017, when Lina
Khan, then a law student (now an FTC trustbuster!) published "Amazon's
Antitrust Paradox," a law-review article showing how Amazon formed a
monopoly without legal trouble.


The key was a Reagan-era shift in antitrust policy, based on the
theories of the Nixonite criminal Robert Bork. Bork held that the only
time we should fight monopolies is when they inflicted "consumer
welfare" harms, by driving up prices.

That meant that monopolies that made prices go *down* - by abusing their
workers and suppliers, rather than their customers - were safe from
antitrust enforcement. Borkism was hugely popular with wealthy people,
who bankrolled its global expansion.

Every president since Reagan has embraced and furthered the "consumer
welfare" doctrine, which meant that when Amazon tapped into the capital
markets for billions, it was able to safely offer prices below their
wholesale cost, using investor cash for subsidies.

Then, after it had extinguished all its competitors, it could end its
subsidy and switch it to its suppliers - forcing them to cut their
margins and wages to unsustainable levels to maintain those prices.

This was "Amazon's antitrust paradox": it could inflict vast monopoly
harms on the economy but never face antitrust enforcement because it
harmed workers and other businesses, not "consumers."

Now that the Big Tech trustbusting movement is in full swing, state
attorneys general and the feds (DoJ and FTC) have brought antitrust
actions against GAFAM, including multiple suits against Amazon.

One of the more interesting suits is DC Attorney General Karl Racine's
cast against Amazon:


As Matt Stoller explains, the DC-Amazon case has a better chance of
succeeding than any of the other antitrust actions brought so far,
because it accuses Amazon of driving up prices.


To understand how that works, you need to understand the role Amazon
Prime plays in the company's business. Jeff Bezos described Prime as "a
moat around our best customers." Once you pay for fast, flat-rate
delivery, you're powerfully incentivized to order from Amazon.

Locking customers into buying from Amazon locks businesses into selling
on Amazon. That allows Amazon to structure its own market - and the
markets of all other businesses.

For example, Amazon gives search preference to Prime-eligible items.
Realistically, if you're an Amazon seller and you're not in the first
screen or two of results, you will not make *any* sales.

(Incidentally, if you've ever seen those breakdowns of the ad-tech
market that show Amazon making billions from ad-sales and wondered how
that worked, it's not actual ad-sales revenue in the way that Google and
Facebook get paid for ads)

(Those "ad-sale" billions are the fees Amazon charges its own sellers
for search-results preference - to have a "sponsored product" show up in
the results when you search on Amazon - it's not an "ad" - it's a "bribe")

If you want to be Prime eligible, you have to sign up for a *lot* of
conditions: you have to promise you won't sell more cheaply anywhere
else, you have to let Amazon pack and ship your products, and you have
to give up commissions of up to 45% on each sale.

To recap: Prime means you have to sell on Amazon because that's where
everyone buys. To sell on Prime, you have to give Amazon 45% of the
sale-price, and you can't sell more cheaply anywhere else.

What that means is that every merchant that wants to sell on Amazon
(which is every merchant that wants to sell goods on the internet
outside of China) has to charge 35-45% *more* for its products, and not
just on Amazon, but *everywhere*.

The "free shipping" you get on Prime items is actually paid for by a
one-third markup that everyone who buys anything on Amazon, or in *any
other store*, pays.

In other words, Amazon hasn't just used its monopoly power to raise
prices on its own customers, but on *everyone's* customers. And that is
the *one thing* that US antitrust law still vigorously punishes.


👨🏻‍🎤 This day in history

#15yrsago Canadian MP has .CA registry censor site that criticized him

#10yrsago Sensation: Acerbic novel about pop culture and popular madness
as functions of parasitic manipulation

#5yrsago United Arab Emirates hacked UK journalist

#5yrsago Untangling the Web: the NSA’s supremely weird, florid guide to
the Internet

#5yrsago Company Town: Madeline Ashby’s tale of sex and Singularity
cults is a locked-door mystery at sea

#5yrsago Geek Feminist Revolution: Kameron Hurley’s measured essays on
the importance of rage

#1yrago After Jim Crow, broken windows

#1yrago Australia caves on "robodebt"


👨🏻‍🎤 Colophon

Today's top sources: Peter Nowack.

Currently writing:

* Spill, a Little Brother short story about pipeline protests. Last
Thursday's progress: 306 words (3117 words total).

* A short story about consumer data co-ops.  PLANNING

* A Little Brother short story about remote invigilation.  PLANNING

* A nonfiction book about excessive buyer-power in the arts, co-written
with Rebecca Giblin, "The Shakedown."  FINAL EDITS

* A post-GND utopian novel, "The Lost Cause."  FINISHED

* A cyberpunk noir thriller novel, "Red Team Blues."  FINISHED

Currently reading: Analogia by George Dyson.

Latest podcast: How To Destroy Surveillance Capitalism (Part 06)

Upcoming appearances:

* In conversation with David Dayen (Second Life Book Club), Jun 4,

* Book launch for Terry Miles's Rabbits (Book Soup), Jun 7,

Recent appearances:

* Get Your News On With Ron/Ron Placone:

* Seize the Means of Computation, Consensus 2021

* How to Destroy Surveillance Capitalism:

Latest book:

* "Attack Surface": The third Little Brother novel, a standalone
technothriller for adults. The *Washington Post* called it "a political
cyberthriller, vigorous, bold and savvy about the limits of revolution
and resistance." Order signed, personalized copies from Dark Delicacies

* "How to Destroy Surveillance Capitalism": an anti-monopoly pamphlet
analyzing the true harms of surveillance capitalism and proposing a
(print edition:
(signed copies:

* "Little Brother/Homeland": A reissue omnibus edition with a new
introduction by Edward Snowden:
https://us.macmillan.com/books/9781250774583; personalized/signed copies

* "Poesy the Monster Slayer" a picture book about monsters, bedtime,
gender, and kicking ass. Order here:
https://us.macmillan.com/books/9781626723627. Get a personalized, signed
copy here:

Upcoming books:

* The Shakedown, with Rebecca Giblin, nonfiction/business/politics,
Beacon Press 2022

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"*When life gives you SARS, you make sarsaparilla*" -Joey "Accordion
Guy" DeVilla

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