Is Google Evil 3.0


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Is Google Evil 3.0

  1. 1. Is Evil?Joe BuzzangaOct. 2011
  2. 2. E sarà mia colpa, Se cosi è(And will it be my fault, if things are so?)Stendhal, Le Rouge et Le Noir, Chapitre 4, livre 1, apocryphalquote attributed to Machiavelli
  3. 3. Topics Market Power Case Study in Market Power: Microsoft Fear, Loathing and Monsanto The Accusers and their Grievances Google On Google The Open Ideology Concluding Unscientific Postscript 4
  4. 4. A Billion Dollar Equation 5
  5. 5. In the Beginning…. The web was small, and search was young ―In 1998, the year Google was incorporated, Yahoo!, which had hundreds of millions of users, was declared the winner of the ―search engine wars‖ – it got twice as many visitors as its nearest competitor and had ―eviscerated the competition.‖ Source: Eric Schmidt’s testimony, Senate Antitrust Hearing, p.2 Sept. 21, 2011 ftc-anti-trust-senate-committee-hearing/ 6
  6. 6. But Today..Market Power 7
  7. 7. And Growing.. Source: NY Times, Oct. 13, 2011 8
  8. 8. Market Power=Marvelous Margins Some Examples 9
  9. 9. Market Power 10
  10. 10. Quasi-Monopoly Rents and Profits 11
  11. 11. Market Power: The Case of Microsoft 12
  12. 12. Bill Gates Contribution to Humanity Pay me for software ! 1976 open letter to hobbyists in Homebrew Computer Club Newsletter, Vol. 2, Issue 1, 1976 _01/gatesletter.html 13
  13. 13. The OS that Conquered the World“windows is a hairball of an operating system”---scott mcnealy, CEO Sun Microsystems 14
  14. 14. U.S vs Microsoft U.S. vs Microsoft: May,18, 1998 “Cut off the Air Supply” of Netscape  Attributed to Microsoft executive Paul Maritz, during Microsoft antitrust trial 15
  15. 15. U.S. vs Microsoft―MICROSOFTS POWER IN THE RELEVANT MARKET33. Microsoft enjoys so much power in the market for Intel-compatible PCoperating systems that if it wished to exercise this power solely in terms ofprice, it could charge a price for Windows substantially above that which could becharged in a competitive market. Moreover, it could do so for a significant periodof time without losing an unacceptable amount of business to competitors. In otherwords, Microsoft enjoys monopoly power in the relevant market.34. Viewed together, three main facts indicate that Microsoftenjoys monopoly power. First, Microsofts share of the marketfor Intel-compatible PC operating systems is extremely largeand stable. Second, Microsofts dominant market share isprotected by a high barrier to entry. Third, and largely as aresult of that barrier, Microsofts customers lack acommercially viable alternative to Windows.”Source: Judge Jackson, Findings of Fact, U.S. Vs Microsoft, 16
  16. 16. Fun With Bill ? 17
  17. 17. Awkward Transition 18
  18. 18. Fear, Loathing and Monsanto 19
  19. 19. Consider Your Friendly Wireless Carrier Source: NY Times, Oct. 9, 2011 : 20
  20. 20. Dominance Attracts Attention 21
  21. 21. The Complaints Google invades my privacy (consumers) Google violates intellectual property (media companies) Google search results are unfair (businesses) Google favors its content properties in it’s supposedly “scientific” search results rankings (businesses) Google destabilizes governments 22
  22. 22. Evil Empire? 23
  23. 23. Google On Google We’re the Good Guys Motto: “Don’t be evil” Mission: “Our mission is to organize the world’s information and make it universally accessible and useful” (Google 2010 10K, page 3) The Open Ideology The Cult of Numbers or Everything is an Engineering Problem 24
  24. 24. Evil Empire?―There is at Google a utopian spirit not unlike that found atthe Burning Man, the annual anarchic-animistic retreat inNevada’s Black Rock desert… Brin and Page have been regularattendees.…Burning Man’s ten stated principles include a devotion to―acts of giving‖; creating social environments that areunmediated by commercial sponsorships, transactions oradvertising‖; and a ―radically participatory ethic‖ that canlead to ―transformative change‖ --Source: Auletta, Ken, Googled, New York, Penguin Books,p.18 25
  25. 25. Google On Google: Products 26
  26. 26. Google’s Product Search  Not software  Not hardware  Not content  Not distribution Brilliant but vulnerable Google utterly reliant on an open web 27
  27. 27. Google on Google: Playing Defense ―Basically, any product that stands between the user and Google and has the potential to distract the choice of search destination is a threat. A great example is Firefox. Like many browsers, Firefox has a search bar built into the upper right corner. This leads to a substantial number of Google searches for which Google pays Firefox a handsome fee. They want to take any layer that lives between themselves and the consumer and make it free (or even less than free). Because these layaers are basically software products with no variable costs, this is a very viable defensive strategy ‖ --Source: The Freight Train That is Android,, March 24, 2011, Android, Chrome, Google Apps, etc are a Defensive strategy to protect search  keep the open web strong and remove any proprietary or competing product layers between Google and users  Funded by monopoly profits? 28
  28. 28. Google’s Customers It’s not you and I Who are our customers? Our customers are over one million of advertisers, from small businesses targeting local customers to many of the worlds largest global enterprises, who use Google AdWords to reach millions of users around the world. Source: Google Investor Relations FAQ 29
  29. 29. Google Revenues --Source: Google 2010 10K, p.2996% of Revenues is Advertising (2010)(can this be consistent with the lofty mission?) 30
  30. 30. Early View of Advertising―Currently, the predominant businessmodel for commercial search engines isadvertising. The goals of theadvertising business model do notalways correspond to providing qualitysearch to users….For this type of reason and historicalexperience with other media [Bagdikian83], we expect that advertising fundedsearch engines will be inherentlybiased towards the advertisers andaway from the needs of the consumers.”Source: Brin & Page: The Anatomy of a LargeScale Hypertextual Web Search Engine, Figure 1: High Level Google ArchitectureAppendix A, Advertising and Mixed Motives,Stanford University, 1998 31
  31. 31. But today…The Revolution will be Ad-Supported 32
  32. 32. Some Google Highlights (source Google 2010 10K)“Google Instant (launched late last year) starts searching with everykeystroke, thereby saving users time on every search. To date, GoogleInstant has now saved our users over 100 billion keystrokes andcounting. Going forward, this is just the tip of the iceberg in termsof the kind of interactivity one should expect to see in search.Google Translate works in 58 languages…weve now scanned (and enable searchers to discover) more than 15million books, which we estimate to be more than 10 percent of allthe books published since Gutenberg—and were still going strong.These books span hundreds of languages and over three million arealready available online as Google eBooks.YouTube, which is only six years old, now serves over two billionvideos per day from a selection of over 500 million.Android, our own mobile operating system for smartphones, firstshipped only two years ago, and now its the most used in the worldwith over 300,000 devices activated daily.Chrome (Google’s web browser) was released two and a half years ago.Today, at version 10 Chrome is over six times faster than it was thenand over 120 million people now use it. What’s more, it’s helpingpush browser standards forward everywhere.” 33
  33. 33. A Syllogism on Domination 1 Search is the oxygen of the internet economy Google Dominates Search Google is the oxygen of the internet economy1.―Search is the oxygen of the information economy‖Doug Merrill, Google CIO, Aug. 2007 34
  34. 34. Why Google is Different than Microsoft Search actually works No customer lock in; no switching cost Search is the “oxygen” of the web--- and the web disrupts everything  More transformative than MSFT Windows Open Ideology Share the same engineering arrogance and hubris 35
  35. 35. U.S. vs Google―Senator Herb Kohl, a Democrat from Wisconsin and chairman of the panel,said Google’s mission appears to have changed over the years, as it hasacquired companies like Motorola Mobility and Zagat. Early on, Google’s―goal was to get the user off Google’s home page and on to the Web sites itlists as soon as possible,‖ Mr. Kohl said. But critics now say Googlefavors its own businesses over others in its search results and otherbusinesses like advertising and mobile.‖Source: NY Times, Sept. 21, 2011 Times Google 36
  36. 36. Google’s Response Significant competition from other search engines and other ways of finding information ―Among major search engines, Microsoft‟s Bing has continued to gain in popularity, perhaps because it comes pre-installed as the search default on over 70 percent of new computers sold. Microsoft‟s Bing is the exclusive search provider for Yahoo!… …Microsoft‟s Bing launched in June 2009 and has grown so rapidly that some commentators have speculated that it could overtake Google as early as 2012.‖ Source: Eric Schmidt’s Testimony, Senate Antitrust Hearing, Sept. 22, 2011 37
  37. 37. Google’s Response―Google‟s search results are ultimately ascientific opinion as to what information userswill find most useful.”Source: Schmidt testimony, Senate Antitrust Hearing, p.3 38
  38. 38. The Virtuous Google 39
  39. 39. The Virtuous Google 40
  40. 40. The Open Ideology 41
  41. 41. Google View: We’re the Good Guys―At Google we believe that open is better than closed.‖--Source: Schmidt Testimony, Sept 21, 2011, p.6―We have also made strategic investments in critical productareas, like Android, Chrome, and Chrome OS—following ourcore philosophy of building open platforms with optionality,and creating infrastructure that allows everyone on the webto succeed‖.--Source: Google 2010 10K, p.3 • Develop an open marketplace • Support Standards • Provide APIs • Release source code 42
  42. 42. Apple vs Google―We did not enter the search business, Jobs said. They entered thephone business. Make no mistake they want to kill the iPhone. Wewon’t let them, he says. …This don’t be evil mantra: ―It’s bullshit.‖Source: Steve Jobs, Wired, Jan. 30, 2010 /lazy-apples-steve-jobs 43
  43. 43. Apple vs Google A Googler (Tim Bray): ―The iPhone vision of the mobile Internet’s future omits controversy, sex, and freedom, but includes strict limits on who can know what and who can say what. It’s a sterile Disney-fied walled garden surrounded by sharp-toothed lawyers. The people who create the apps serve at the landlord’s pleasure and fear his anger. I hate it. I hate it even though the iPhone hardware and software are great, because freedom’s not just another word for anything, nor is it an optional ingredient. The big thing about the Web isn’t the technology, it’s that it’s the first-ever platform without a vendor (credit for first pointing this out goes to Dave Winer).‖ --Source: Ongoing by Tim Bray (personal blog) 44
  44. 44. The Open Ideology 45
  45. 45. Is Android Really “Open”So, What’s Android’s Definition of Open Source?For Google and Android, open source basically means you can download andcompile the code, and this makes it open source. However, Androiddevelopers can download code and do what they want with it, but they can’t 07/the-open-governance-index-see updates immediately like Firefox changes. They have to wait until Googlemeasuring-openness-from-android-to-gives them the updates they need. As far as openness, transparency, and webkit/community, they don’t exist with Android. Google still rules the roost.Is There a Better Open Source Definition?According to the software industry, the term open source has three coreprinciples. These are:•A license that insures the code can be modified, reused and distributed•A community development approach.•Assurance the user has total freedom over the device and software•Android has maintained their open source stature in totally legal ways. Youcan download the code, use it, and redistribute it. However, the communitydevelopment atmosphere and total freedom to control devices thatutilize the software platform are very lacking. 46
  46. 46. The Ideology of “Open”While we are committed to opening the code for our developer tools, not all Google productsare open source. Our goal is to keep the Internet open, which promotes choice andcompetition and keeps users and developers from getting locked in. In many cases,most notably our search and ads products, opening up the code wouldnot contribute to these goals and would actually hurt users. 47
  47. 47. The Open IdeologyClosed Open 48
  48. 48. The Open Ideology :What is Property?La propriété, cest le vol! (Property is Theft!) --Proudhon Private property a historically specific concept tied to the industrial revolution and its economic infrastructure There is an edgy and radical element in the open source movement. Google’s role is ambiguous 49
  49. 49. The Cunning of History 50
  50. 50. The Network Revolution Open Closed Microprocessors Open Network Protocols ( TCP/IP) Software•Circuit Switched •Packet Switched•Analog •Native Digital•Command And Control •Flat, Anarchic•Dumb End Points •Smart End Points•Separate Networks •Media Unified on IP 51
  51. 51. Publishing’s Future?Source: NY Times, Oct.16, 2011 52
  52. 52. The Open Ideology: The Extreme View―For the first time in human history, we face an economy inwhich the most important goods have zero marginal cost.Two different philosophies about the nature of humanintellectual production are in confrontation. One of them hasall the chips; the other has all the right answers. This ispart of the long struggle in the history of human beings forthe creation of freedom. This time, we win.‖--Source: Eben Moglen, Freeing the Mind: Free Software and the Death ofProprietary Culture, Keynote Address, University of Maine Law School,June 29, 2003, p.3, 15 53
  53. 53. Concluding Unscientific Postscript Evil is a moral concept, companies are amoral Google is virtuous: maximizes shareholder value The Google wave has already crested Google’s Strengths are its weaknesses STM and other content providers are collateral damage  Short term protection by the power structure  Long term? 54