A spat has broken out as to whether Google is paying its share for broadband capacity. A new study by telco lobbyist Scott Cleland claims that Google uses 21 times more bandwidth than it pays for but critics say he misrepresents the economic model supporting Internet cost recovery.

The report, cited as the first ever research study of Google’s use of US consumer bandwidth and costs for 2007-1010, claims that Google’s search bots and its YouTube site now uses vastly more bandwidth than the company pays for.

“The study estimated Google used 16.5% of all U.S. consumer Internet traffic in 2008, and that share is estimated to grow to 25% in 2009 and 37% in 2010,” wrote Cleland, a policy consultant paid by ISPs and operators, including AT&T, Verizon and Time Warner Cable. “The study estimated Google’s payment to fund just the U.S. consumer broadband Internet segment to be approximately US$344 million in 2008 or 0.8% of U.S. consumer’s flat-rate monthly Internet access costs of US$44.0 billion. Thus Google’s 16.5% share of all 2008 U.S. consumer bandwidth usage, is 21 times greater than Google’s 0.8% share of U.S. consumer bandwidth costs – or an implicit US$6.9 billion subsidy of Google by U.S. consumers.”

The report, which claims to be based on “the most respected data sources available including: Cisco, IGI Group, OECD, Comscore, Hitwise, J.D. Powers, the Pew Internet and American Life Project, the USPTO, Google Planet, and company 10-K reports from Google, Limelight and Akamai” concluded that: “Any sustainable national broadband policy must ensure that the heaviest Internet users pay their fair share of the Internet infrastructure costs.”

The report goes on to lambast Google’s push for “open, high speed Internet connection into every home, at a price all of us can afford” with its Internetforeveryone initiative, stating that: “Internet connections could be more affordable for everyone, if Google simply paid its fair share of the Internet’s cost.”

While the question on whether Google is leaching off the American public when it sends out its search bots to accumulate data for that same public to peruse is an ongoing debate in Washington, industry commentators were quick to point out inconsistencies and perhaps, biases, of the Cleland report.

BAD SCIENCE: “It's not objective science, and shouldn’t be treated as such,” wrote Karl Bode at DSLReports.com. “Google doesn’t report how much they pay for bandwidth, so Cleland guesses by examining Google’s 10-Q and 10-K filings with the SEC for 2007 and 2008. Google doesn't specify anywhere how much bandwidth is consumed by Google’s webcrawling activities, so Cleland guesses there as well.”

Bode goes on to point out that the report forgets that Google owns much of their own fiber, data centers and undersea routes while direct peering with many carriers, which undermines Cleland’s central thesis that Google doesn’t contribute to the infrastructure of the Internet. “Most importantly the report ignores that consumers are paying for much of this bandwidth on their end too.”

Mike Masnick at TechDirt added: “He [Cleland] seems to conflate consumer broadband and Google’s broadband. This is based, in part, on the old telco argument that when you buy internet access, you're only buying access to the middle of the internet, and you should have to pay a second time to actually reach any endpoint or other user. So, even though consumers pay for the bandwidth they use to reach Google, Cleland appears to calculate that as being Google’s responsibility, ignoring that consumers are paying plenty for the right to reach Google (and the rest of the internet).” 

Tony Chan