Google CEO Eric Schmidt unplugged

Google CEO Eric Schmidt was quizzed at the Gartner Symposium/ITxpo today, but didn’t break a sweat. There were no revelations or trash talking (Google seeks to do and say no evil) in the Q&A with Gartner analysts Andy Kyte and Neil MacDonald.


Google CEO Eric Schmidt was quizzed at the Gartner Symposium/ITxpo today, but didn’t break a sweat. There were no revelations or trash talking (Google seeks to do and say no evil) in the Q&A with Gartner analysts Andy Kyte and Neil MacDonald.  They asked about competition with Microsoft, and Schmidt responded that his primary competitor on a daily basis is Yahoo and that Microsoft is a new entrant in Google's space. "It remains to be seen exactly how it will play out," Schmidt said.  He views Google as being in the information industry, not so much the IT industry. "The information industry is much larger than the IT industry--IT is a part of it. If you look at the information industry, there are no single solutions--there are many different ways and culture and media formats differences. It's likely that search is such in its infancy, estimates are that we are a couple of percent in digitization of all available content--it's many orders of magnitude from being saturated or really exploiting this opportunity." Google is helping to raise the percentage of content by digitizing libraries of books. He doesn't expect that searching audio visual content will improve anytime soon. "For the moment, it's going to be keywords and text search," he said.

While Schmidt didn't say much about competing with Yahoo, other than the two companies have different approaches, or Microsoft, he is betting that his team's able to have technical, business model and user experience breakthroughs. "In a normal company, you have a five-year plan and you would be able to answer questions. Google in not run that way. What I hope to be able to say in the next five years is that we will have out-innovated all of the other companies."

It will be interesting to see how Google morphs. It sounds like Google trusts its instincts more than most companies; but with increased opportunities and pressures from Yahoo, Microsoft and others, Google will have more complex decision trees to navigate, even with all its PhDs. Thinking of itself as an information company that relies on IT to deliver its services is a step in the right direction.

In response to a question about privacy, Schmidt said that Google only publishes publicly available information (phone numbers, etc.), and acknowledged concern that broadly available satellite imagery enables bad things. But, he believes that the "value of more information so overwhelms its misuse, especially if it's properly taken care of and people have the opportunity to opt out, that we've not had material problems there." He also said that Google has a good handle on click fraud. "One of the great technical challenges, which our computer scientists like, is detecting these at scale. We have been able to detect them, so it appears as though the problem, which I don't think will ever go away, is both manageable and from a financial perspective at the company it's not material."

In speaking to the audience of IT professionals, he said that Google wasn’t a good example to follow because its homegrown systems are specialized for a particular application—delivering ads and Web search results in a flash (immediate access). "Our life is a little easier than the average IT professional because most of the data we have is replicable without a lot of updates--you can have a master slave architecture with a master and bunch of slaves, and they don't change very often, whereas classic Oracle or SAP database systems are doing lots of updates, logging and transactions, and all of that adds up to increased cost and complexity," Schmidt said.  However, he did promote the Google search appliance to the audience. He said the the biggest change in the last ten years for IT professionals is the emergence of powerful Web-centric applications, of which Google has been an innovator and  beneficiary.

He shared some stories about the company's culture. For example, he noted that when he joined the company in 2001, the company was run on a five-user license of Intuit Quickbooks, considered building its own financial general ledger, but Schmidt convinced the founders to go with Oracle after a lengthy fight.  He outlined Google's unique division of labor, in which engineers spend 70 percent of time on core functionality, such as ads and search; 20 percent on adjacent businesses, like Google News, and 10 percent on whatever they find interesting.  

Schmidt reaffirmed that Google would not build a browser. "We are working on a browser independent strategy," Schmidt said. "We want to make sure all of our services and platforms run equally well on all browsers."


Tommorow, Google is hosting a Google 'factory tour' for the press and analysts at its Mountain View, California headquarters. I caught up with Schmidt after the Gartner Q&A and he mentioned that Google would have a "small announcement tomorrow on the UI [user interface] as a capstone to the event."  The company will also outline its new RSS ad service. We will let you know what we find--stay tuned...