SiliconBeat

Over the weekend, my column looked at the remarkable growth in Google’s lobbying operation in Washington, D.C. In just four years, Google has become the valley’s second largest company when it comes to lobbying expenditures.

Naturally, I left out a some details. While the story focused on money, there are other ways Google has been trying to extend its influence. And their adoption of these strategies shows how quickly the company has become savvy in the ways of Washington.

Let’s run through a few of these.

Google’s lobbying team includes the usual requisite of former government officials from agencies that have been having an impact on the company’s business. The lobbying team includes former employees from the Justice Department, Treasury, the FCC, and Congressional staffs, according to the Center for Responsive Politics.

One of the interesting things you can see from that data at CPR’s OpenSecrets.org is the growing range of issues that Google is lobbying on. In 2009, the top issues included advertising, energy, trade, telecom and anti-trust. Of those, only trade was listed among Google’s issues in 2005. And the list of agencies and branches of government that Google lobbies has grown extensively.

Of course, it’s no surprise that anti-trust is near the top of the list of issues. Just in the last couple of years, Google faced this anti-trust inquiries with its acquisition of DoubleClick, saw its search deal with Yahoo scuttled, and now faces a review of its plans to buy AdMob.

Google has also been savvy about hiring former government officials in non-lobbying positions. For instance, in 2008 and 2009, the U.S. Securities and Exchange Commission was concerned about some of the ways Google was accounting for various costs related to traffic acquisition, and also had questions about whether the company was being transparent enough on some issues such as whether or not it was disclosing enough information about letting a large group of contractors go. These questions were all resolved without the SEC taking any formal actions. The Google official reponding to those questions? It was Mark Fuchs, Google’s vice president of finance and chief accountant, who used to work at the SEC.

Going in the other direction, several Google employees have gone to work in the Obama administration:

• Andrew McLauglin, former Google policy chief, serves as Obama’s deputy chief technology officer.
• Katie Stanton, former principal of Google’s New Business Development team, is now Obama’s director of citizen participation.
• Sonal Shah, a Google lobbyist and head of global development issues at Google.org, served as an adivsor on the Obama transition team. She previously worked in the Treasury Department.
• Sumit Agarwal, Google’s head of mobile product management, will become deputy assistant secretary of defense for outreach and social media in the Office of the Assistant Secretary of Defense ,it was announced last week.
• CEO Eric Schmidt is a member of President Obama’s Council of Advisors on Science and Technology.

In addition, Schmidt has become chair of the New America Foundation, a non-partisan Wahshington think tank. That’s a lot of involvement in D.C. for a guy who told the Washington Post last fall he doesn’t care much for the scene:

As for Google’s relationship with Washington’s power structure, Schmidt said the tech industry is still not as strong as others in its lobbying representation on Capitol Hill, but that that’s fine with him. Google, and the tech industry, does better for itself when it focuses on ideas and innovation — and not politics, he said.

“The part of politics in Washington that’s ‘who you know’ and all that kind of stuff, it’s just not very interesting,” he said.

The company has also established a summer policy fellowship where it funds about a dozen or more undergraduate and graduate students to work with various policy organizations. Those include some that have found themselves on the opposite side of issues from Google. For instance, last summer, Google paid for one Wisconsin student to work at the American Library Association, an organization that has been opposing the company’s plans to scan books.

As I noted in the column, none of this is illegal, or unusual. What bears watching is how Google uses this growing influence. There are a lot of issues where I agree with them, and am glad to have them fighting. But there are others where I disagree (i.e., book search)

But when it comes to Washington msucle, you certainly can’t call them the underdog anymore.

Last fall, the Financial Accounting Standards Board (FASB) approved changes to the way many high-tech companies will recognize revenue. We saw the first of what will be many earnings reports affected by this when Apple reported on Monday results of its fiscal first-quarter earnings.

Other companies likely to be affected include such heavy weights as Cisco Systems and Tivo.

Often such changes take months for companies to adopt. And in this case, companies have until 2011 to adopt them. But this one is different because it will give companies a significant bump in short-term revenue. So many are racing ahead. As such, investors need to watch carefully to see if a company adopted the new standard, and if they reconciled old numbers to take the new standard into account.

On Monday, Apple disclosed the accounting change up front for this year, and also adopted it retrospectively for the past two years and reconciled past earnings in an amended annual filing. Companies are not required to do adopt it for past years. So good for Apple. Many companies may only make the change going forward, making comparisons harder.

This change is not trivial. To see the impact on revenue, look at the revised numbers from years past. The change bumped revenue for Q1 2009 (last year) from $10.2 billion (0ld) to $11.9 billion (new). As far as I can tell, the company didn’t disclose what the current quarter revenue would have been under the old standard.

Still, that didn’t stop the company, in a press release, from crowing about the big numbers:

“If you annualize our quarterly revenue, it’s surprising that Apple is now a $50+ billion company,” said Steve Jobs, Apple’s CEO. “The new products we are planning to release this year are very strong, starting this week with a major new product that we’re really excited about.”

That’s true. But under the old standard, Apple’s annualized revenue wouldn’t be quite as high. It would probably be four or five billion less, though still over $50 billion.

So what’s going on? For the details, read on. Read the rest of this entry »

Boy, is that an understatement.

I have been learning that lesson all week since we published my story Monday on  “Why we didn’t get a Wii for Christmas.” The story, which I figured was a pretty innocent tale of my family’s decision, has sent some members of the gaming community off the deep end. Read the rest of this entry »

Last year, our most popular post by far was “HP’s Mark Hurd made $42.5 million in fiscal 2008.” The post has drawn a whopping 254 comments, with more still coming in.

So given the interest, it seems only right to post an update with Hurd’s last salary numbers for fiscal year 2009: $24.2 million. A story in the Mercury News this week covered the basics: Read the rest of this entry »

In my column yesterday about the Google and China mess, I explored how this rift could affect Silicon Valley’s relationship with China. But within the column, I also included this thought:

“The conventional wisdom that has been shattered was based on a kind of digital utopianism prevalent throughout Silicon Valley. This line of thinking holds that the Internet, and Web-based services like Google, Twitter and Facebook, are liberating forces. Maybe it would take five years, maybe a couple of decades, but over time as more Chinese gained access and technology, there would be the inevitable dismantling of cultural, economic and political barriers.”

That spurred some discussions on Twitter and got me thinking more about that idea. By coincidence, I was catching up this morning on my backlog of TED videos, when a talk by Evgeny Morozov came up called: “How the ‘Net aids dictatorships.” The talk is summarized as:

“TED Fellow and journalist Evgeny Morozov punctures what he calls “iPod liberalism” — the assumption that tech innovation always promotes freedom, democracy — with chilling examples of ways the Internet helps oppressive regimes stifle dissent.”

Morozov’s talk got me thinking more about this subject.

Read the rest of this entry »

If you have a Google Wave account, click to see the full post where you can see an embedded copy of our Google Wave chat:
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I’ve been following the patent reform debate closely. This is one of those perennial issues that everyone wants to see fixed, but can never find a compromise. But today comes word that the White House has backed a compromise that promises to move legislation at least out of committee. From the Wall Street Journal:

“President Barack Obama’s administration supports major changes proposed in landmark patent legislation, likely accompanied by a roughly 15% fee hike, U.S. Patent and Trademark Office Director David Kappos said Tuesday.

“While a compromise, it clearly moves the ball forward,” Kappos said of the bill, which if approved would bring the first major changes to the patent process in 50 years. On Monday, Commerce Secretary Gary Locke wrote a letter to the Senate Judiciary Committee expressing support for the Senate legislation.

The bill, introduced by Sen. Patrick Leahy, D-Vt., pushes to harmonize the U.S. patent process with international standards and grants the patent office more authority to make rules and increase fees.

We’ll see if the center holds on this. Among the biggest changes: Read the rest of this entry »

A few months ago, I wrote a column calling the Federal Trade Commission’s attempts to regulate blogging a mistake:

“I have no doubt the folks at the Federal Trade Commission have all the best intentions when it comes setting out disclosure guidelines for bloggers in order to protect consumers. But it’s an effort that’s doomed from the start.”

I can’t link to the column because it’s behind our paywall. But I figured no good would come of it.

Well, I didn’t expect the FTC to listen to me, and they didn’t let me down. On Monday, the FTC released new rules to regulate product endorsements in advertisements and blogs.

I could offer up an extended rant on this, but I’ll just point you to Jeff Jarvis’ stinging rebuke instead. Jarvis writes: Read the rest of this entry »

I was reading a post on Daily Kos today,the progressive political blogging site, through my Bloglines feed reader, when the ad below popped up:

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On Monday, President Obama gave a major policy speech announcing his official innovation policy. Countless folks I’ve talked to across Silicon Valley have been urging him to lay out his agenda and address head-on his plans for one of the most important sectors of the American economy.

I’m still catching up on the details of the announcement. And it comes with a long white paper mapping out all the nitty gritty. You can press and the white paper here: Read the rest of this entry »