Will Google's limitless business plan test the limits of its ethics code?

Will Google's limitless business plan test the limits of its ethics code?

Summary: Google last week announced a limitless business strategy

TOPICS: Google

Is it OK for Google to keep launching businesses and not monetizing them and putting many companies out of business, causing the loss of many jobs, and preventing the creation of many new businesses and many new jobs?

The answer is yes, it is OK, because it is not illegal. But is it ethical?

It was not illegal for Microsoft to integrate software into its operating system platform. It was not illegal for Microsoft to become a giant, dominant power in PC markets and use that scale against smaller competitors. There is no law that prevents a company from attaining a monopoly position.What tripped up Microsoft was it engaged in illegal, anti-competitive business activities.

It is not illegal for Google to continue to integrate products and services into its dominant online platform but is it ethical?

Google's business activities seem far removed from its mission statement (from its prospectus):

Our mission is to organize the world’s information and make it universally accessible and useful.

There is nothing in Google's prospectus or founder's letter that says "our mission is to connect users with information they seek and launch masses of online services ranging from maps, email, online applications, plus desktop applications such as photo-organizers and anything else that can be presented through the internet or viewed in a browser, mostly for free."

Google has a code of conduct. It starts with this sentence:

Our informal corporate motto is "Don't be evil."

What does "informal" mean in this context? How binding is an "informal" code of conduct? Does it mean kinda, sorta, is it said with accompanying hand gestures indicating quotation marks? What is Google's "formal" corporate motto?

The Google Code of Conduct also states that its employees are "striving to the highest possible standard of ethical business conduct."

Is it ethical to launch businesses that put others out of work, that limit the business potential of other companies, other people--and not seek to monetize those businesses?

I say it is not ethical. It is not in Google's mission statements. And Google has an unfair advantage because it doesn't even want the money from those business groups.

Wall Street analysts are not pressuring Google to make money from those business groups but they pressure GOOG competitors to make money.

Investors cannot pressure Google to make money from those business groups because their shares carry minimal voting rights. Google's founders deliberately set up two classes of shares when they launched the public company so that they could make decisions independent of shareholder (fellow owners) wishes.

If Google had to monetize the many services and products it gives away for free then at least that might help level the playing field because those business groups would be accountable to a P/L. Google's many smaller competitors are trying to monetize the similar services they developed and offer; they don't have the luxury of having a core cash-cow which enables them to enter other adjacent markets just because they can.

Just because you can use your scale and massive market presence doesn't mean you should. Microsoft did this, investing billions it reaped from the PC markets into satellite, cable, telco companies and lost fortunes. [It was a bit too early in those investments...today that would be a great strategy against competitors.]

Size and dominant presence in any market bring with it a core responsibility to do the right thing. The New York Times recognizes its dominant, monopoly position in markets and it strives incredibly hard to be accurate and fair; yet it doesn't have to.

When it comes to Google and its bitorrent launch of free online services and PC software--it is not ethical to take away somebody's lunch and not even bother to eat it.

(Please continue reading...)

Topic: Google

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  • Are pyramid sales schemes legal in the USA?

    The GOOGLE ad model, with its affiliates programs, seems awfully like pyramidal sales that are illegal here. Those that get to the top of the pyramid can have unfair advantage over others.
    • It is *not* a pyramind scheme

      ...I'll sign you up for a pyramid scheme so you can tell the difference :-)
  • Many competitors supply free software...

    ... with equivalent functionality. Most of Google's free services have been those expected of portals, and portals are supported by advertising, so this is not far from Google's main business.

    So Google has neither gone afield nor produced additional harm with these services.

    But were Google to add services which would not be expected of a portal and invest substantially, then investors would be right to complain. Offer free email, certainly, but going to any great expense to offer Word Processing would be worrisome.

    As far as damaging other companies is concerned, most startups are intended for sale to larger companies. Now even more than previously.
    When Google buys small companies, the existing internet software market is working as expected.

    As a model for comparison, there's an obvious ethical failing in some open source projects, when the intent is to use volunteer labor to reduce salaries and employment.

    By that standard, Google is innocent. The company is just one more shark among the sharks. But a shark that hires people and pays them salaries.

    Or did you have a specific example in mind which would contradict these conclusions?
    Anton Philidor
    • What does a photo organizer have to do with

      ...being a portal? And yes, GOOG has a word processor, Writely. And GOOG can buy one company and scale it across its massive global platform and it wins automatically, not because it has a better product.
      • Ask Microsoft and Yahoo about photo organizers.

        AOL probably has one as well, though I'm too fastisious to check. Google may be laggard if Picasa doesn't connect to blogs or web pages and the others do.

        I wouldn't consider Writely a winner yet. First it has to become widsely available. Then it has to become popular. Then advertisers have to consider it worthwhile.
        And even if all these things somehow happened, the word processing functions still would be different, and thought of differently, from those in Microsoft products.

        Writely appears to me one more entry on the long list of alternatives to Word, Wordpad, and Notepad. None of these are considered replacements, but are used only for purposes that are often specific and minimal.
        Anton Philidor
  • Oh for crying out loud

    Grow up a little, Tom.