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WASHINGTON � Google. It’s a noun. It’s a verb. It’s what people do before they do anything else on the Web. Google, it sometimes seems, is everywhere. Everywhere, that is, except Washington. Although the company has morphed from a two-man startup working out of a small garage into a multibillion-dollar company whose footprint stretches around the globe, its profile in the nation’s capital has remained almost invisible. That seems about to change, though. With its stock trading well north of $400 a share, the search-engine giant is gobbling up competitors and diversifying into a wide array of e-commerce, threatening the financial interests of entities from Amazon to eBay to Comcast. And while those companies may be in danger of being outflanked on the Internet, they hold a distinct advantage in the corridors of Congress. “Google has lived in a completely unregulated space for an eternity,” says Jonathan Askin, a former Federal Communications Commission lawyer and general counsel at Pulver.com. “Whether they like it or not, the ugly face of regulation has reared its head, potentially laying down the law on Google.” The company likes to champion its motto of “Democracy on the Web.” But when it comes to democracy in Washington, Google essentially remains a startup. Perhaps as a result, today, Google faces a raft of high-profile lawsuits, public relations battles, and looming legislation that could dramatically change the company’s fortunes. How the company responds to those challenges, and, in particular, whether it can learn to play the Washington power game, may go a long way toward determining whether Google truly becomes the next Microsoft or just another dot-com boom tale gone bust.
Companies Learn How To Play BallThere are exceptions to the rule that big companies have to have a big presence in Washington, but not many.

THE WORLD’S INFORMATION Perhaps the most pressing battle facing Google is its ongoing fight with the Justice Department. Just last week the DOJ filed suit against Google for its refusal to comply with a subpoena requesting 1 million Internet addresses accessible through its search engine and a random sample of 1 million search queries submitted to Google over a one-week period. The subpoena is part of an effort by federal prosecutors to enforce a controversial Internet pornography law. Microsoft, Yahoo and America Online received identical subpoenas and have complied with them. Google refused and has retained Perkins Coie attorney Albert Gidari of Seattle to fight the subpoena, citing customers’ privacy rights and the broad scope of the data requested. Though Google has won praise in many quarters for resisting the government’s investigation, for others the dispute reveals inherent problems with the company’s business practices. “A key issue of our criticism is their tendency to hold on to data indefinitely,” says Kurt Opsahl of the Electronic Frontier Foundation, an Internet nonprofit that focuses on civil liberties. “The DOJ subpoena highlights some of the risks of holding on to [information]. If you build it, they will come.” The company is also facing another highly publicized lawsuit, stemming from its controversial program, Google Print. Google plans to scan books from five major libraries, making the company the sole owner of the digital versions. Publishing companies and some libraries cried foul, citing copyright infringement. After discussions with interested parties and Google collapsed last fall, the Authors Guild and McGraw-Hill filed separate actions. Kilpatrick Stockton’s Joseph Beck is acting as lead counsel for Google. Beyond its legal battles, Google has also been facing tough criticism from consumers over its recent decision to self-censor its search-engine content in China. The Chinese government had previously censored Google’s site. The company says it complies with local laws in other countries such as the United States, France and Germany. PRIORITY ACCESS The lawsuits come as Google has decided to substantially bolster its presence in Washington. Up until the spring of 2005, Google’s investment in K Street was limited to a $100,000 retainer with Furman “Trey” Barnes of Public Policy Partners. Barnes has represented Google since 2003 on issues including privacy, copyright and patent reform. Last year the company also invested in-house, adding Andrew McLaughlin, who works out of New York, as a senior policy associate. “Google has been woefully underrepresented in Washington,” says one telecom industry lobbyist, who spoke on the condition of anonymity. The company tried to change that last summer when it hired longtime tech guru Alan Davidson. Formerly of the Center for Democracy & Technology, Davidson was well known as a policy wonk in tech communities who specialized as a privacy expert and who testified on Capitol Hill. Davidson’s former boss at the CDT, Jerry Berman, says that setting up a Washington office is a sign that Google is beginning to understand that, however brilliant its technology and whatever its goals, “they realize now that policy is made in Washington and that has an enormous impact on what they are doing.” Since June, Davidson has been moving full speed ahead, opening an office at 1001 Pennsylvania Ave. N.W., above the swanky restaurant Ten Penh, making Google a neighbor of heavyweights such as the Carlyle Group and the law firm Crowell & Moring. Davidson says his operation flows from Google’s mission of organizing the Internet. “Google takes the policy issues very seriously, and that’s why we have a presence in Washington and why we’re so engaged in representing our users’ interests in Washington,” he says. But Davidson’s goal to represent Google in Washington has remained relatively low-key. He’s made the rounds at the tech associations and engaged in a debate on Capitol Hill this past fall with Allan Alder, the general counsel for the Association of American Publishers. But he hasn’t launched the typical meet-and-greet sessions with lawmakers, hired any additional in-house help, or even set up a political action committee � actions that are typically viewed as politics 101 in the lobbying community. Industry insiders say it is widely known that Google has been trying to land a senior Republican lobbyist, likely from the FCC or the Senate, but Davidson declined to discuss the issue. In an effort to fill out Google’s outside lobbying operation, Davidson hired tax specialist Capitol Tax Partners last month, putting it on a $20,000-a-month retainer to lobby on corporate tax issues. Google’s exertions to expand inside the Beltway come just as the public policy debate on telecom reform is ramping up; this is potentially a key issue for the company, as it is looking at offering Voice Over Internet Protocol service to its users. Lawmakers are expected to take up telecom legislation this year, with pieces of it potentially passing by the end of the session. Drafts of the reform bill have included a section on net neutrality, which will be of key importance to Google as it explores providing more content for users. Although content services such as Google Video are still fledglings, some companies may be looking to kill them in the nest. Old-line telecoms including BellSouth and AT&T are pushing Congress to allow network operators to charge a fee for priority access to the network, especially for bandwidth hogs like digital television. Google has balked at the idea of one company having priority or faster service over another on the Internet. AT&T and BellSouth maintain that in order to be profitable they need to charge a fee for priority service as they move into the digital-television market and compete against cable providers. “We’re entering a world with two very established types of companies able to give broadband to a consumer,” says Kim Bayliss, a telecom lobbyist at Dutko Worldwide. “What types of controls are the carriers going to have? . . . There’s a feeling [on the tech side] that there’s not sufficient rules to the extent of net-neutrality enforcement.” Davidson declined to get into a detailed discussion about Google’s legislative priorities. “There are a large number of issues that we are following and involved with,” he says. Among those he mentioned are content regulation, spyware, patent reform and privacy rights. THE MICROSOFT MODEL Google’s approach to lobbying has been strikingly different from that of one of its closest competitors, Yahoo. While both search engines have sought to diversify by partnering with old-guard media, they haven’t been using the same playbook in Washington. In 1998, after the Digital Manufacturing Copyright Act was passed, Yahoo hired John Scheibel, formerly the vice president and general counsel for the Computer and Communications Industry Association. The company was just three years old and had yet to go public. Yahoo’s lobbying presence remained largely in-house until 2003, when the company received more support to hire outside shops. Since then, its presence in Washington has grown quickly. According to lobbying reports, Yahoo spent $1.08 million on lobbying for the first six months of 2005. The company’s lobbying arm includes five in-house lobbyists and five more lobby shops on retainer. Tech companies have long viewed Washington with suspicion. The most famous example, of course, was tech behemoth Microsoft, which publicly shunned the arena for years � that is, until it became apparent that the software giant lacked the political clout to head off the antitrust lawsuit brought by the DOJ. It had little muscle beyond lobbyist Jack Krumholz and its membership in the Business Software Alliance. But that has changed dramatically in the past six years. During the first six months of 2005 alone, Microsoft spent $6.2 million on lobbying. “Ten years ago, Microsoft had one person. Now it’s a very big operation,” says Berman of CDT. “The Internet is growing up. I think [Google] understands that they’ve got to make a larger commitment.” So is Google taking a lesson from Microsoft and trying to stay ahead of trouble? “This has been an evolution and will continue to be an evolution as Google gets more involved in policy issues,” says Davidson. “Was public policy on the minds of our founders in the garage when they founded Google? Probably not.” Anna Palmer is a reporter with Legal Times, a Recorder affiliate based in Washington, D.C.

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