Google, Just Cut The BS And Give The Gordon Gekko Speech Already
techcrunch.com
techcrunch.com
No part of this agreement creates any business relationship between Verizon and Google. I'm still not understanding.
Since Google dominates current services, it doesn't need to monopolize them, just ensure that anything new coming along has some hurdles to clear.
Everyone always forgets how vulnerable Google is to competition. Best case for Google is net neutrality, second best case is to have signed deals with the top ISPs to prevent its competitors from signing google-harming deals with them.
Verizon's network performance makes QoS an issue. Imagine facetime over the mobile network, etc. Chances are Apple is very concerned about the Facetime experience and wants non-neutral QoS to benefit it.
Further, Google is making tons of money on mobile ads, etc. All Apple needs to do is direct search traffic to Bing (or to Apple's own search engine) and that's a significant revenue boost.
Search is no longer a hard problem. Microsoft cloned Google search fairly quickly and is very likely to help Apple by offering a good deal on revenue sharing.
These factors combine to suggest that Google is VERY worried about an Apple/Verizon deal.
Imagine if tens of millions more iPads are sold, each with Verizon 4G and non-net-neutral search redirects.
Does anyone really think consumers would care? Bing and Google return almost identical results, and Apple is probably less than two years away from being able to engineer its own Google caliber search engine.
I think that what people forget about Google is that in spite of all the brilliant engineering (which is surely unrivaled) most of the actual revenue comes from simple search which is very much threatened by net non-neutrality.
Google was forced to backpedal on its previous stance out of the necessity to stop Apple from making a google-killing deal with Verizon.
All this is speculative and based on speculation about how successful Apple's devices will be on Verizon (and how little customers care which search engine handles their searches). But Billions of dollars are enough to make any company change course on a dime.
Before agreement: - wired: unregulated - wireless: unregulated.
After agreement: - wired: net neutrality - wireless: unregulated but reviewed yearly
We all benefit from wired NN. Google didn't gain any special privilege here.
Olive branch?
A fig leaf is a token cover-up gesture that doesn't fool anyone.
In addition, now that Android sales have taken off Google isn't an outsider looking in at an industry whose gatekeepers could easily shut them out from mobile search and advertising. They own the #2 platform, and they've got enough pull to ensure that Google gets a piece of the mobile pie - which means that net neutrality isn't worth as much to Google as it was two years ago.
This article is spot-on. Google was enthusiastic about net neutrality when it was essential to their financial success. Now that it has a cost, they're discovering the virtues of compromise... which wouldn't be an issue without the relentless Google PR about how principled they are. As pg said once, the trick with declaring that you're not evil is that people will hold you to it.
Which is probably a few more months. Yes there have been iPhone/Verizon rumors forever, but I get the impression they're real this time.
Gosh, it's almost as if Verizon has just recently made some kind of strategic deal to achieve a position where Google needs them more than they need Google, and has therefore begun dictating terms.
(Replying to parent since we cannot go beyond Level 4 nesting)
Once you are at the top, and you got the majority of the market, your best actions (in monetary terms) is to stop entrants.
It's not like Google is going to go ahead and say "well let's squash the competition by paying for prioritized traffic for all of our properties." It will be more like something along the lines of "hey let's get android OS updates onto user's phones faster, we can pay to have that "updating service" have higher priority than normal http traffic." Updates are big files, and people don't want to wait hours for an OTA download, so bump up the speed a bit. But from there it is a slippery slope.
As it is, if any of the telco's started seriously violating net-neutrality, that could actually become a catalyst for real legislation. That is a check on the isp's. If we adopt this suggestion into law, it gives the giants something to hide behind. "Oh, you don't like that we are selling a "video service" that pipes youtube to your phone? Well, bring it up at our review a year from now." A year is a long time in this industry. Perhaps a year from now they claim that they can't afford to pay for the LTE infrastructure being utilized for this youtube pipe without the special service fee, or people will just dislike having their youtube run at a slower bandwidth. so it continues.
By saying "anything goes" we are letting the isp's set the terms of net neutrality. And the isp's have a terrible history when it comes to treating customers right.
It is bad for small players and startups who would like to compete with the established players on equal terms.
Could they have approached net-neutrality with a "cut off your nose to spite your face" approach? Absolutely. Could they have won out in the face of adversity? Maybe. Would it have been good business? Most assuredly not.
Google in acting in self-preservation; nothing more, nothing less. They aren't martyrs. I can understand if you are upset about them not admitting this fact, but anything else is naive.
Would an "all or nothing" net neutrality position be, erm, unconventional business? Absolutely. Would anyone have believed before Google's arrival that an ad company would be the single biggest name on the Internet? Again, debatable.
Just my guess.
Patronizing comments about "academics" and "idealism" ought typically to be delivered before the target's company has attained megasuccess. Larry and Sergey's competency to lead a multibillion-dollar corporation has been proven for many years. More to the point, so has their ability to do it in a less evil way, a way that raised the bar for everyone. The issue is not whether it's possible for Google to be Google; we have an existence proof for that. The issue is whether Google is breaking its own values, and if so what the consequences will be.
Would it have been good business? Most assuredly not.
This wretched argument, so sure of its own hard-nosed realistic businessism, is just what people were saying 10 years ago to prove that Google should sell banner ads. Oh sure, that home page was cute. But look at all the money they were leaving on the table! Well let's just remember how things turned out: by sticking to their guns, rejecting that thinking, and putting users first, Google made orders of magnitude more money than they would have had they followed that path. (How do we know this? Because countless counterexamples ended up in the dotcom garbage bin.) Oh yeah, and they changed the world and the industry forever.
So what was really good for business?
There may be a huge outrage over it, but I tend to doubt it.
Furthermore, the anecdote "Sergey Brin did not want to cave to any of the Chinese demands to operate inside of mainland China, but Eric Schmidt talked him into it", if true, is pretty good evidence that the founders are more idealistic. I don't think that is patronizing.
If they had just said from the beginning that they were out for their own interest (just like everyone else), and not tried to play the good guy even when it would hurt them, then nobody would be surprised by this.
In addition to the fact that the law affords managements a lot of leeway in determining how to maximize shareholder value, Larry, Sergey, and Eric hold voting control due to the dual share class structure that public shareholders agreed to when they bid for shares in the IPO.
You can think of it as a limited partnership with three general partners.
In private conversations with Googlers and ex-Googlers over the past couple of days, the vast majority of them seem to be disturbed by what Google is doing here as well.
If that's accurate, it's significant: it means this isn't all a big misunderstanding, and hints at how much damage Google could potentially do to itself here.
I still think they're smart enough not to let that happen, though it does look like they've painted themselves into a corner. I wonder if they realized how tremendous an asset their standing up for net neutrality was.