May 19, 2009
PhillyDeals: Google CEO advocates life away from the computer, too Joseph N. DiStefano, The Philadelphia Inquirer tell a friend >>article link >>
Google chief executive Eric Schmidt took questions from reporters after speaking at Penn’s graduation yesterday.
On Philadelphia’s biggest company: “We have a pretty good relationship with Comcast. We have a series of advertising partnerships. . . . It’s a pretty lucrative deal for them.
“Right now cable is two-thirds of the broadband industry in the U.S. Comcast is the strongest player in the biggest part of broadband in the U.S. . . . We are very dependent on Comcast.”
He talks to Comcast chief executive Brian Roberts “every week. That’s how important it is. All the political issues, all the policy issues. He calls me up to think through the business strategy.”
On lobbying Washington policymakers, where Google (like Comcast) has lately spent millions:
“We went from being a start-up to being an institution very quickly. We have organizations that spend a lot of time complaining about us and criticizing us. That’s healthy. But we had to get [used to] that fact; we were no longer an itty-bitty start-up.”
On the Justice Department’s competition police: “Microsoft blocked new applications for Windows. That was part of the 1997 litigation. . . . Those are not things that Google can do or would do. . . .
“As I understand antitrust and the way government works, as long as we benefit end-users and are consistent with our principles, we will be just fine.
“I don’t think the government will stop the Internet.”
On Google and newspapers: “The hallmark of a successful democracy is investigative reporting. Investigative reporting is not done anywhere else.”
Isn’t Google making news unprofitable by giving it away? “Papers allow [Google] to search for information. If the newspapers did not want that to occur, it’s easy for them to block that. Newspapers have made the decision it’s OK for us to point to their content because we send traffic to their sites. . . .
“We’re in this together.” Most likely papers “will evolve” into paid online services.
On Penn: “In the last 10 years it’s become the buzz school everyone wants to go to.” Google hires a complement of Penn engineers, and more interns from Wharton than any other non-engineering school.
On Googling too much: “Our goal is to have you be as attached as possible. . . . But know where the off button is. It’s possible to spend your life inside the computer.
“These tools are enormously powerful. Use them, then turn them off. . . . Life is the people around you. Talk to them.”
On Thursday’s Google outage: “We’re not perfect.”
Like other firms
I asked Keith Hylton of Boston University School of Law, author of Antitrust Law: Economic Theory and Common Law Evolution (Cambridge University Press, 2003), if President Obama’s Justice Department is likely to attack Google the way its predecessors went after Microsoft, Intel, IBM, and AT&T.
How can you be anticompetitive if, like Google, you give your services away? “Google’s service is by no means free. It is paid for by advertisers,” who pass the cost to the public, Hylton told me.
“Consumers really don’t see the price they’re paying for Google’s service. Competition in Google’s market could lead to lower prices, as happens in most other markets.”
Justice acts when competitors complain. Hylton: “Google has already been the target of complaints by Microsoft and other firms. The Google-Yahoo partnership led Microsoft and other firms to complain.” Google dissolved it.
“The same coalition of firms that complained about the Google-Yahoo deal are sitting on the sidelines waiting for Google to do something new that would justify a fresh complaint.”
But: “Overall, I don’t see Google as a likely target for the enforcement agencies.
“This is not because I think they never do anything evil. Google acts in self-interested, profit-maximizing ways just like every other firm.
“The reason Google is an unlikely target” is that it has had the benefit of watching Microsoft’s mistakes. And “they have the money and a sufficient interest in image to pay for high-priced lawyers and lobbyists.”
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