January 12, 2010 3:57:00 PM
Rob Hardy - [email protected]
It might be that right now, a couple of guys in a garage are coming up with the next big thing, an item of software or hardware that is going to change our way of doing things or looking at the world. This is just what Bill Gates, head of Microsoft, used to say he worried about. And then it happened. Maybe leaders at Google now worry about the same sort of thing. After all, Sergey Brin and Larry Page were just a couple of young nerds tinkering with a new idea for a search engine in 1998, and now everyone knows what Google is and many people use it in some fashion everyday.
It is a hugely influential success, changing wide realms of computing and media. In fact, the subtitle of "Googled: The End of the World as We Know It" (The Penguin Press) is only partly hyperbole. Ken Auletta, who writes for the "New Yorker" and has written other books on media businesses, had access to the company''s eccentric founders and their Silicon Valley campus. He has written a book that is essential for understanding what the company has achieved so far, how it is continuing to change the media world, and whether it is going to be able to maintain high standards of customer service and lofty ideals of free information. This is by no means an authorized biography of the company, but includes plenty of episodes that would seem to violate Google''s jocular but earnest motto, "Don''t Be Evil."
Google is a well-loved company, at least by consumers. It is simply astonishing that one can go to Google''s main page (which has never been rented out for any advertising), tell it what you are interested in, and have it pull scads of links referring to just that. It is amazing that such a search can be done for free, and indeed Google gives away many of its services to those who use them, getting paid in other ways. Google is well known to have a conscience, funding renewable energy concerns and exercising epidemiological philanthropy.
It has a 20 percent rule, which its engineers must spend 20 percent of their time on a project of their own choosing. If you work at the GooglePlex in Silicon Valley, you get free meals and fancy snacks (prepared by the former chef to the Grateful Dead), gym facilities, espresso lounges, oil changes in your car on Thursday, dry cleaning, dog care, dentists, doctors and masseurs.
At least some of the last items reflect self-interest; employees who don''t have to go away for lunch or doctor visits have more time to spend at the office. At the same time, salaries are good (especially figuring in stock options) and benefits like maternity and paternity leave are generous. The atmosphere must be congenially geeky; you are far more likely to have your application to Harvard accepted than one to Google.
To media industries, though, Google has become an enemy. (Even those who have a partnership with Google are wary, since an alliance could easily turn into competition. For this, the word "frenemy" has specifically been coined.) Google''s reach is getting wider every week, changing the very basics of advertising, telecoms, newspapers, navigation software and book publishing. Even those who make money from the advertisements run on Google worry that the company is taking on their content for its own and cutting their profits by making it easy to track how effective an ad is. When a newspaper ran an ad, for instance, there was really no telling how many people showed up to shop for the advertised item and then how many bought it; your clicks from Google to an advertisement and then to purchase, however, can be easily tracked. Google doesn''t think there is anything wrong with analyzing such clicking, but aside from privacy issues, advertisers would rather not have their work so closely monitored.
The book publishing industry is appropriately fearful. Founder Page, in his 20 percent time, assembled a machine that would digitize books, and with typical expansiveness, proclaimed, "We''re going to scan all the books in the world." This has plunged the firm into a legal morass over copyright.
Television broadcasters not only worry that Google will somehow suck up their content, but that people who watch shows and snippets of shows on Google''s YouTube won''t have their eyes on the regular tube. Part of what is scary to other businesses is the sheer speed at which the internet has invaded all markets.
Auletta points out, "It took telephones 71 years to penetrate 50 percent of American homes, electricity 52 years, and TV three decades. The internet reached more than 50 percent of Americans in a mere decade." And Google, in its first decade, went from a garage-based company to one with more than $20 billion in revenue in 2008, and an eagerness to acquire. Google shelled out $1.65 billion for YouTube in 2006, for instance. It has yet to make it pay, but the acquisition is typical of its act first, ask questions later approach.
The approach, of course, has resulted in astonishing success overall. The founders, Page and Brin, are not only odd and funny, they are devoted engineers who deal in facts and numbers, a "thirst to quantify everything." If you can tabulate it and turn it into numerical data, Google will work with it and plan for it; but real although subjective factors like emotion and sympathy are not quantifiable. Neither are concerns about copyright, privacy, or monopoly. Income is quantifiable, but it was not something Page and Brin put as a high priority, thus endangering Google at the beginning. The engineers just wanted to do things their way, and had a distrust of executives and managers. It was only several years after the company launched that Eric Schmidt became chief executive, someone who had some engineering understanding and a good understanding of financial management. Much of this book is about the give and take between Schmidt and the founders, and it seems as if they are all working together well. That doesn''t keep them from making decisions that the public might regard as violations of the "Don''t Be Evil" maxim. When the company eventually agreed to censor such searches as "Free Tibet" from its Chinese-language version in 2002, it might have been a good, practical business decision, but it gave ammunition to those who fear Google as the next evil empire.
Google''s success is inarguable, but success might not be its long-term destiny. Auletta reminds us that Google has been in existence for barely a decade, and that years ago General Motors, IBM, AOL and the television networks were regarded as failsafe. Part of Google''s great difficulty, and its merit, is that it strives to provide free services. "You can''t beat free" is something anyone connected with the Google organization constantly hears. A search is free, but it is powered merely by advertising, the small ads showing up based on what you are interested in searching for (even if you are not doing anything remotely commercial). One of Google''s first investors notes that when the founders were at Stanford, they were idealistically opposed to advertising. They cannot be opposed now. They haven''t figured out how to make YouTube pay, and they are venturing into "cloud computing," whereby programs for word processing or other functions now on your hard drive are stored online instead. Will it pay? It will make Microsoft furious, but will it cost Microsoft and enrich Google? Will Google be able to avoid competition from other search engines, which might use algorithms that are more effective in producing accurate results? Will Google avoid governmental oversight as a monopoly? Will it be a victim of its own success and size? Google has so profoundly disturbed the world''s business landscape that no one knows what is going to happen. Auletta''s book, which because of the personalities he profiles and anecdotes about them is good reading even for people who are not interested in business, can''t give the answers, but it is asking all the right questions.
Rob Hardy is a local psychiatrist who reviews books for a hobby. His e-mail address is [email protected]