Google’s recent hire of Alan Davidson to be its vanguard in D.C. is a big moment for the company — a sort of recognition that nobody’s going to organize the world’s information by technology alone. The job is going to take some help from bureaucrats, the company has discovered. And Google’s not alone.
“It seems that policymaking and regulatory activity in Washington, D.C. affect Google and our users more every day,” the company posted to its blog. “It’s important to be involved — to participate in the policy process and contribute to the debates that inform it.”
As with all Google’s public statements, the language is couched in populist terms. It’s about the user, goes the refrain.
But no one doubts this new D.C. presence is about the advertising too. Some are even saying the hire is part of a trend toward greater policy awareness on the part of all digital marketing stakeholders.
Ducks in a Row
Taken at face value, the hire is simply part of Google’s maturation as a company, a natural step in its private bildungsroman tale: A young adventurer sets out in the world, acquires wealth, makes friends, and eventually learns politics.
It’s a story common to many Internet businesses that have weathered the stormy decade since the inception of online advertising.
“While some of us have been online for six, seven, eight years, we are still an incredibly new marketplace online,” said Trevor Hughes, executive director of the Network Advertising Initiative. “The market and the standards are greatly in flux, and these companies are in many cases still finding their feet. When you’re in the first five years of your existence, you frequently focus on your business model first and public policy and lobbying… later.”
The challenges go way beyond just setting up an office in Washington. Google, Yahoo, eBay and the rest are now contending with the fears of an Internet populace that’s increasingly hostile to anything it perceives as privacy invasion, and with elected leaders ever more willing to legislate privacy.
“I think more and more companies are recognizing that there is a growing concern about consumer protection, particularly with regards to data,” said Hughes. “We have seen this in very targeted forms. Consumers perceive excessive advertising inundation as a privacy issue.”
And legislators are also more aware of the Internet as a force in people’s daily lives.
“The government is focusing more and more now [on the Web],” according to Jerry Cerasale, senior VP of government affairs for the Direct Marketing Association (DMA). “They didn’t focus as heavily or know that much about it before. The companies that are still alive that have a business model that is viable now are looking and trying to protect themselves. They look to open their own Washington offices, they look to join associations.”
It should be noted not everyone agrees that Google’s lobby is part of a trend. “Google has grown to a state where having a Washington presence makes sense,” said Dave McGuire of the Center for Democracy and Technology. “I don’t really perceive a new focus on policy awareness on the part of these companies.”
The Policy Scene
Marketers have historically lacked a unified front in Internet policy debates. Efforts to deal with pending legislation on topics including email, spyware and database breach disclosure have been scattershot at best.
Some companies do their own lobbying. Among enormous bubble-era start-ups, Google is actually late to the table. Yahoo, eBay, America Online (through Time Warner) and MSN (through Microsoft) all have people in Washington. Naturally, not all these staffers work full-time to influence policy.
“A lot of companies have government affairs specialists who work for them. A lot of chief privacy officers have a government affairs angle to their job. DoubleClick has a director of privacy and technology who’s in D.C. quite a bit. I don’t think he’d call what he does lobbying, but it’s a part of the policy process,” said Hughes.
On top of their solo efforts, companies large and small work through associations like the Network Advertising Initiative and the DMA.
The NAI’s small staff has been active in many policy debates, in particular on data privacy legislation. Many of its members have a major stake in behavioral targeting, and they see loosely defined legislation on issues like spyware as a major threat.
The DMA has a broader focus — perhaps too broad. Historically, the group’s known for being better at postal regulation than email regulation — and it’s known best of all for being anti-regulation. On the Internet, with its ankle-high barrier to entry for all kinds of unsavory practices, that position can be dangerous. In 2003, the group silenced its interactive subsidiary, which had proposed a set of email best practices it deemed too restraining to marketers.
The DMA’s Cerasale admits the organization was at first slow to grok the Web’s unique appeal and risk to marketers, but he says that changed after CAN-SPAM and the group has since been a leader on authentication. Its decision today to require all members to adopt authentication standards suggests that’s true.
Yet the group has had enormous trouble hiring, including for a policy post that’s been vacant for almost a year. IAB president and CEO Greg Stuart declined to comment for this story.
Taking the Lead
Larger companies like Google are filling the gap in policy advocacy with their own efforts, and other associations have stepped in to do some of the work. And in a real sense, the smaller players rely on big companies to do the heavy policy lifting.
JupiterResearch Analyst Gary Stein thinks that’s ok. “If I were in a smaller company’s shoes, I would rather see someone like Google fighting than the IAB,” he said. “Not to take anything away from the IAB. Google… may be able to bring more resources to bear in the fight.”
Of course, Google’s ultimately not looking to defend the little guy who’s playing in its space. It has enough to worry about protecting its own interests, which fall into many categories. It’s simultaneously a search engine, ad network, email service provider, comparison shopping site, map service, blogging platform and social network.
“Especially interesting for Google is that they’re getting into businesses where the legislation is sketchy at best,” said Stein. “They could clearly go the wrong way in Google’s mind. It certainly makes sense for them to keep participating in the same way that GM is there thinking about mileage per gallon for SUVs.”