Wednesday, September 12, 2007

TYCOONHYPE: The Camel's Nose Is Indeed Under The Tent

Several years ago, Larry Ellison, the Chairman of Oracle, got into a spat with the San Jose International Airport authorities. In a nutshell, he wanted to ignore the night operations curfew and fly in and out whenever he wanted (i.e., the middle of the night). Of course, a Gulfstream V is no seagull - it makes noise. Hence, the curfew. Ol' Larry decided that curfews were for the little people and had his pilots fly in and out whenever he pleased, and decided to pay the several-thousand dollar fines each time. He ended up suing the city and winning on a technicality.

Now, in an even more over-the-top move, the private B767-200 airliner owned by the founders of Google (well, not actually by them... in order to avoid taxes and such, creating an ownership structure for these kinds of assets gets pretty complicated) has been cleared for landing at Moffett Federal Airfield (formerly Naval Air Station Moffett Field). It will be joined by a couple of their Gulfstream 550s. The Navy finally closed up shop at Moffett in 1994, after there was no need for the P-3s previously stationed there to patrol for Russian submarines off the Pacific coast, and handed the place over to NASA. Understandably, the folks who live in the area have consistently been opposed to expanding operations at this particular airport (mostly due to noise constraints). Nowadays the only highlight of Moffett's operations is when Air Force One comes to the area.

Coming soon to the skies above silicon valley: The GooglePlane

As could be reasonably expected, the locals are a little pissed off. Whoever set this deal up was smart enough to paint a veneer of pretext ("scientific missions") over the unprecedented grant of landing rights at a federal - that is to say United States Federal Government - airfield. There will undoubtedly be another set of pissed-off people, however: those others who have offices in silicon valley, private jets, and frustrating commutes to those jets on US-101 or I-880 (in the backs of their limousines, natch). At present, they have to use either San Francisco, San Jose, or Oakland airports, with the landing/departure queues that go along with those busy facilities.

The New York Times has more:
For Google’s Founders, a Coveted Landing Strip
(Copyright New York Times, 2007-09-12)

In the annals of perks enjoyed by America’s corporate executives, the founders of Google may have set a new standard: an uncrowded, federally managed runway for their private jet that is only a few minutes’ drive from their offices.

For $1.3 million a year, Larry Page and Sergey Brin get to park their customized wide-body Boeing 767-200 on Moffett Field, an airport run by NASA that is generally closed to private aircraft.

It is a perk that is likely to turn other Silicon Valley tycoons green with envy as no other private jets have landing rights there. But it may not sit well with a community that generally considers itself proud to have Google in its midst.

How did the two billionaires get such a coveted parking place for the jet, which is unusually large and rare by private jet standards? Officials at the Ames Research Center of the National Aeronautics and Space Administration said the agency signed a unique agreement last month that allows it to place scientific instruments and researchers on planes used by the Google founders. NASA gets to collect scientific data on some flights of those jets, which in addition to the Boeing 767-200 includes two Gulfstream Vs.

“It was an opportunity for us to defray some of the fixed costs we have to maintain the airfield as well as to have flights of opportunity for our science missions,” said Steven Zornetzer, associate director for institutions and research at the Ames Center. “It seemed like a win-win situation.”

NASA said it had already run one mission on one of the Gulfstream Vs, to observe the Aurigid meteor shower on Aug. 31.

Moffett Field is nearly adjacent to Google’s Mountain View, Calif., headquarters, and the four-mile drive between the two locations takes just seven minutes, according to Google Maps. Other Silicon Valley executives have to fight traffic to get to their large jets parked at San Francisco or San Jose international airports or even further.

Two private aviation industry executives said that parking two Gulfstream jets at San Francisco or San Jose airports would cost between $240,000 and $360,000 a year, or more, depending on the parking location and the amount of fuel purchased. As for the Boeing, one of the executives, who asked not to be identified because his wealthy clients insist on privacy, said that most private jet facilities at large airports are not equipped to take in a jet that big. “It’s like if you lived in a condo and decided to own a semi,” he said.

The agreement is raising questions from local officials and community activists, who have a long history of opposing the expansion of flights at Moffett Field, an historic airport that was once under the supervision of the United States Navy, but was transferred to NASA in 1994.

“The Google flights represent the possibility that the camel’s nose is under the tent, and that NASA is looking at opening up the use of the runways to help pay for it,” said Lenny Siegel, director of the Pacific Studies Center, a local nonprofit group that over the years has opposed various proposed expansions of civilian flights at Moffett Field. “The majority of the people in the community are against that.”

Mr. Siegel said he was hoping NASA would provide clear answers about the agreement. “If they are doing science missions, that’s O.K.,” Mr. Siegel said. “If they are doing it just because they are rich and popular, it is not O.K.”

Google and Ames Research Center have other agreements to collaborate on research, as well as a preliminary plan for Google to build as much as a million square feet of space at Ames. The deal for the planes, which are not owned by Google, was unrelated to the Google agreements, Mr. Zornetzer said. It was signed with H211, a limited liability corporation that counts Eric E. Schmidt, Google’s chief executive, as one of its principals. The ownership of the planes is held by other affiliated companies.

Google, for its part, says that this is a personal matter involving the founders, who would not comment. Ken Ambrose, whom NASA identified as a representative of H211, did not return calls seeking comment.

“This is not a new issue,” said Representative Anna Eshoo, a Democrat, whose district includes Moffett Field. “You have to live with your neighbors. You are not out in the middle of the desert. You are in the heart of Silicon Valley.”

Some details of the agreement were reported Wednesday in The San Francisco Chronicle and The Palo Alto Daily News.

The plane’s presence at Moffett Field was first reported last week by the technology gossip blog Valleywag. The Google founders’ jet has been the talk of Silicon Valley since 2005, when the pair purchased the plane, which in a normal configuration can hold 180 passengers.

A year later, attention on the plane intensified after The Wall Street Journal wrote about a legal dispute between the owners and a contractor who was charged with refurbishing it. In the article, the contractor described requests for modifying the plane to include California king-size beds for the founders. At one point, the founders asked whether hammocks could be hung from the ceiling. The contractor said that Mr. Schmidt had described the jet as “party plane.”

The extravagance of the plane stands in contrast to the low-key image cut by Mr. Brin and Mr. Page, whose lifestyle is less flashy than that of other Silicon Valley billionaires. They have been intensely private about the plane as they have been about all details of their private lives. Ever since the Navy decided to close operations at Moffett Field in the early 1990s, local communities have been opposed to expanding the airport’s use. In 1992, voters in Mountain View and Sunnyvale overwhelmingly rejected the idea of opening up Moffett Field to general aviation in nonbinding votes. A plan to open the field to air cargo companies like FedEx and UPS was shot down in the late 1990s, in part due to community opposition.

Mr. Zornetzer said NASA was not expecting the deal to create a large number of new flights at Moffett. While two other private parties are allowed to use the airfield, a helicopter operator and Lockheed Martin, none of those agreements are for flying private jets. NASA officials said it has no agreements allowing private jets to land at any of its other facilities. As news of the jet’s presence at Moffett Field spread, private jet owners and operators have begun coveting the airfield.

“Everyone who operates private jets or owns them has been eyeing that gorgeous runway eager to take off from there,” said Nicholas Solinger, chief strategy officer for XOJET, a private aviation company. Mr. Solinger said Moffett was far better situated for most Silicon Valley executives than the airports at San Jose and San Francisco. “People will now redouble their efforts to get access to that airfield,” he said.

"Redouble?" "Green with envy?" Never mind that - you can bet your bottom dollar that Larry Ellison and the rest his buddies are going to be screaming bloody murder, and that within a relatively short period of time one of two things will happen: either the Google chiefs will have to park their plane somewhere else, or they won't be the only ones at Moffett.

Just something to keep in mind while you're taking off your shoes and throwing away all those dangerous >3.4 oz. liquids at the airport security checkpoint. Isn't flying in the USA fun? For these guys, it most definitely is.

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