A decade ago, Google took over the World Wide Web. Now, the Internet behemoth wants to conquer something even bigger -- Washington.
While President Obama already has CEO Eric Schmidt on speed dial, the California-based search giant is moving quickly to expand its influence in the capital in ways that are starting to bear fruit. Google increased the money it spends on lobbying in the first quarter by 57 percent over the previous year, paying $1.4 million to influence lawmakers and regulators, according to Consumer Watchdog, a nonpartisan, nonprofit public interest group that has been critical of Google's activities.
Critics believe the relationship between Google and the White House has gotten a little too cozy.
Moreover, while Google's lobbying expenses for 2009 totaled $4.03 million, first-quarter spending this year jumped 23 percent, from the $1.12 million the company spent in the fourth quarter of 2009, according to the interest group. It's a far cry from the paltry $80,000 that Google spent lobbying the federal government just seven years ago, shortly after the tech bubble burst and Silicon Valley was forced to seek greater cooperation from the federal government.
The computer and Internet industry as a whole spent $38.8 million on federal lobbying in 1998. Two years later, at the height of the bubble, it spent $56 million. By contrast, in 2009, the industry spent nearly $120 million.
Along the way, Google has dramatically expanded its D.C. staff and government affairs operations. In 2009, the computer and Internet industry employed the third-most lobbyists of any industry -- only the pharmaceutical and education industries had more, according to the Center for Responsive Politics. Industry lobbyists outnumber members of Congress more than 2-to-1.
"We established a Washington presence because we felt like it was important to give our users a voice in Washington," Google spokeswoman Mistique Cano told the CRP recently. "Technology can be complicated. We absolutely believe taking the time to help people understand our business is a worthy investment. Technology is only going to become a bigger part of our lives and the economy."
Campaign finance experts said Google's activities represent the "next wave" of the computer industry's inevitable arrival as a Washington power player. "The computer industry, by virtue of its personality, has always wanted to keep Washington at arm's length," Sheila Krumholz, executive director of the Center for Responsive Politics, told me this week. "They've found they can't, so they have jumped in."
Google's increased investment appears to be paying dividends. Over the past few years, Google has prevailed on issues like net neutrality, hacking and Chinese Internet privacy. Just this month, after initially raising doubts about Google's $750 million purchase of AdMob, a mobile advertising start-up, the Federal Trade Commission approved the deal.
And on Tuesday, Sen. Mary Landrieu, D-La., chairwoman of the Senate small business committee, stood alongside Google execs as they released a report estimating that they helped generate $54 billion in economic activities for U.S. businesses last year.
"These businesses are growing, and Google is thrilled to play a role," said Claire Hughes Johnson, Google vice president of global online sales.
But critics believe the relationship between Google and the Obama White House has gotten a little too cozy. This month, for example, a White House technology adviser hired from Google last year was reprimanded for improperly contacting former colleagues, a violation of Obama administration ethics rules. U.S. Deputy CTO Andrew McLaughlin, Google's former head of global public policy, traded e-mails with "his former employer on topics within the scope of his official duties," according to the Office of Science and Technology Policy.
"As this industry grows up, Congress begins to take notice, issues become more complicated and, inevitably, Washington gets more heavily involved," Krumholz said. "It's a natural progression. But for Google, they now have enviable access by virtue of their relationships with this administration, which they understandably want to take advantage of."
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