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London - There is a tendency to regard the corporate giants of the digital age as warm and cuddly because the bosses wear T-shirts and trade under mantras such as ‘do no evil’.
But the reality is that Google, Facebook and the other behemoths of the online era are no different to the monopolists of old, like Standard Oil, AT&T and IBM, all of which were eventually broken up by the US trust busters.
It was only last month that Google organised its users to launch a viral lobbying campaign against the Stop Online Piracy Act (SOPA), designed to protect intellectual property.
It halted the progress on Capitol Hill to the horror of the music, film and TV production companies.
It intends to agglomerate information gleaned from its gmail, YouTube and other databases so that it can more accurately target advertising.
It is not alone. In New York this week Facebook, which is organising the web world’s biggest initial public offering of $10bn (valuing the group at $100bn) unveiled a new marketing strategy.
It will offer a series of packages to advertisers called Facebook Premium, which will mine the personal websites of millions of people across the globe, to help make sure that the commercials being sold reach like-minded people.
This kind of tailored, unsolicited marketing is gradually starting to overwhelm the display advertising in newspapers and free-to-air television, potentially stifling content suppliers, from which intellectual property already has been purloined.
This is a distortion of the freedom of the worldwide web to which its founders were so committed.
The driving force behind such practices is commercialism. In the process of converting Mark Zuckerberg into a multi-billionaire, Wall Street is quite happy to encourage Facebook, like Google before it, to trample over personal privacy.
One was reminded of the market distortions caused by digital commerce by a report into competition and innovation in the mobile phone markets, produced by the OECD.
The report focuses on phone call termination rates, which are controlled by the mobile networks.
Regulators, including the EU, have sought to clampdown on this market distortion and between 2006 and 2011 rates tumbled by 53pc across all OECD countries.
Despite this, the OECD found that rates vary widely from zero in Canada, and near zero in the US and Israel, to $0.165 per minute in Chile. Britain is at the cheaper end at $0.04 per minute.
The reason that mobile operators have been able to distort the market in this way is because there are so few of them. Yet the authorities have stood meekly by as the main players become ever-bigger with, for instance, the merger of Orange and T-Mobile to create Everything, Everywhere.
Digital industries have moved a long way in the wrong direction from the original raison d’être of creating new public spaces for the benefit of mankind.. - Daily Mail