ITxpo: Keynote with Eric Schmidt of Google

The keynote interview with Dr. Eric Schmidt, CEO of Google, was as interesting for what he didn’t reveal as what he said. Eric has a bracingly dry sense of humor about his business and the industry, but he is deadly serious about the company and its responsibilities and challenges. He is also skilled at the art of offering insightful answers that do not directly answer the questions he is asked, so be forewarned as you read my notes. (Unless noted, everything below that is not a question is a paraphrase or direct quote of Eric.)

Q:Has the Internet leveled the playing field such that the dominant players in the industry can’t exercise their power? A:You know, “dominant” has a specific legal meaning…

There have been a lot of changes in the industry over the last 10-15 years. Back then, email was something you had to get in the car and drive to the office to do. I’d drop my daughter off, go to the office, do email, finish email and then hop in the car and go home…

(On how Google solves the performance and responsiveness issues that other companies might face online:) The problems are easier for Google because our data tends to be more static and lends itself to being replicated, as opposed to transaction based data that changes frequently.

(On Google’s internal systems🙂 When I got to Google we were going to build our own financial system because we were frustrated with the limitations of Intuit’s Quickbooks and its five-user license. Seriously. So I said that isn’t going to work exceptionally well when it comes to Sarbanes Oxley and auditing. We implemented Oracle Financials and put it in a box, and said “we aren’t going to change this.” Then we built a system around it to manage the business’s contact with it and we change that frequently.

Our focus is on personalization and comprehensiveness. For instance, you can see Google internet search results, your intranet (with the Google search appliance), and your hard drive all in one results list. Of course that brings in the issue of privacy, and that is where the “don’t be evil” corporate culture comes in. …Anyone can pull the ripcord and say “that’s evil” from an end user perspective and stop the train. [And no, Dave, I didn’t get a chance to ask him about autolinking, and he didn’t volunteer an opinion.]

We’re not in the information technology business, we’re in the information business. We have only digitized a very small percentage of all available content. There is a lot of room in the market.

(On advertising🙂 We don’t run the business as an advertising business. We run it based on end user satisfaction. If we keep our users satisfied, we keep our ad inventory up, which keeps advertisers happy. Q: You’ve taken away ad revenue from magazines and other traditional content players…. A: I prefer to think we’ve grown the market. There is a growing shift to more contextual ads and we are playing in that market. Q: You also seem to be important to a very large base of very small companies…. AIt is scary to understand that you are fundamentally in the revenue chain of a small business. We disseminate that information across the company and use it in planning products.

Q: You hired the lead developer of Firefox. Are you going to build a browser? A: We decided a long time ago that we would pursue a browser independence strategy, so that our services would work well on all browsers. These people, like the one you mentioned, are working on that, and do important work with the open source community as well.

Respecting your customers

Catching up on non-ITxpo related topics this morning, two things caught my eye. First, my delayed reaction to the announcement that the New York Times will be putting some of its content, notably op-ed columns, behind a for-pay wall starting in September. This is of course brilliant because the Times’s editorial opposite number, the Wall Street Journal, has its constellation of right wing editorial columnists available for free. So now there will be even less of an opposing voice online. What’s most depressing as a user and reader of the Times is that this move comes after a history of reader-and-blogger-friendly decisions, including RSS support. So long, NYT, we’ll miss you. Is there an editorial forum out there that wants to stay on the record, and stay in the conversation? (For straight news, the BBC is looking better all the time.)

Second, the announcement from Microsoft about their new ID infrastructure, InfoCard. On the surface, the announcement sounds a lot like Apple’s Keychain; a local system solution to hold identity information such as login names, passports, and certificates. The difference is that InfoCard, like its failed Passport predecessor, can also hold credit card information. The shift in Microsoft’s identity management strategy, from central control to user application, represents a clear victory for Microsoft’s customers, and may be a pretty good indication that Microsoft is doing a better job of listening than it was four years ago. (More information about InfoCard, including a description of the user experience and some underlying technology notes, courtesy Johannes Ernst.)

Connection? Your customers will be the people who tell you whether your new business plans will succeed or fail. Learning to listen to them is an essential skill that must be mastered if you are to compete.

—Which gets me nice and warmed up for the final session I’ll attend at ITxpo, Are Your Customers and Users Revolting?, where three Gartner analysts will discuss customer collaboration and communication technologies and the implications for enterprises. I’m going to see if I can arrange some sort of connectivity in the room so I can blog the session, but otherwise I’ll take notes and post later.