Google CFO: Regulatory scrutiny is "part of growing up"

At Google, it's OK to shut down a project. In fact, it's OK to celebrate it, CFO Patrick Pichette told attendees at the Morgan Stanley Media and Telecom Conference in San Francisco.

Failure is part of the innovation process, he said. It's going to happen. But when it does, you celebrate what you've been able to do and then move on to another project. Google - and Yahoo, as well, in recent months - have not been shy about shuttering projects that aren't working. Google isn't make any apologies for that.

Pichette covered a number of topics during today's panel, including regulatory scrutiny and the effects of the recession.

Google is big, he said. There's no doubt about that. And when you get that big, you attract scrutiny - "It's part of growing up," he said.

The comment comes on the heels of a back-and-forth exchange between Google and Microsoft over a regulatory investigation of Google by the European Union.  Google published a blog post that essentially pointed the finger at Microsoft for complaining to the EU about its role in the advertising business. Microsoft, in turn, countered with a blog post that essentially said that it didn't matter who complained and that the regulators will determine if there's a there there, not a competitor.

During the panel, Pichette also said that the mood at Google remains "electric" despite the effects of the recession. The company launched new products, entered some new spaces and made some acquisitions to position itself for growth when the pendulum swung on the recession.

"It's been a great time for us in the last 12 months, 18 months," he said.

Among those launches was the Nexus One smartphone, which wasn't Google's first Android-based phone to be released during the downturn but represented a new approach to selling phones for Google. The Nexus One, unlike other devices, is sold separately by Google instead of the wireless carriers. Pichette said the company wanted to "raise the bar" for smartphones, to show consumers that there were other innovative and attractive devices beyond the iPhone. He called it a "benchmark setter."

Finally, Pichette also spoke about Google-owned YouTube and, specifically, whether the company felt threatened by uploaded videos within Facebook, something that could be stealing share from YouTube. He said Facebook is an ally when it comes to video, not a competitor. Truth be told, there are plenty of people who are sharing YouTube videos via Facebook

"YouTube is a giant," he said. "Every week, we serve a billion videos with some form of advertising. It's ginormous."

YouTube is definitely a source of future growth and the company is committed to growing it. Pichette noted that Google conducted more experiments and made more changes to YouTube in 2009 that it did in the previous two years combined.