Google CEO Larry Page was interviewed on Charlie Rose recently, and there was certainly some interesting stuff in there. Sadly, the interview suffers from the curse of modern journalism in that it was all a bit timid and civil (no truly harsh and confronting questions), but despite that, it’s still a good watch. Two quotes from Page really stood out to me.
We’ve talked about the early days of Android quite a bit here on OSAlert, mostly just stabbing in the dark since there’s not a whole lot of information out there for us mere mortals to work from. Still, every now and then we get interesting insights into how Android came to be, like with Dianne Hackborn’s excellent comment.
In that light, I liked the following remark from Page, where he talked about the relationship between Apple and Google when it comes to Android. “When we bought Android, we had no idea they were doing it, and they had no idea we were doing it,” he said, referring to the iPhone. Google acquired Android in 2005, and it’s logical to assume Apple was already working on the iPhone at that time.
Related to that, Page obviously addressed the legal attacks and trolling on Android, and this was the only time I noticed a sort of spark in his eyes – he’s very timid and reserved otherwise. The interview touched upon Oracle at this point, but Page clearly wanted to address everyone else as well.
“This [Oracle suit] is part of the general trend of companies,” he states, “They don’t know what to do, they just attack Android and hope they’ll make some money off of it.” It’s pretty clear by now that for some companies – especially Microsoft and Oracle – that’s the real motivation. None of these companies have contributed a single line of code or development effort to Android, yet still want an entirely free ride through patent trolling.
Apple is a bit different here, since so far they just have been looking to shutdown the Android competition, which hasn’t really been working out swell for them. Sure, Apple is making more than enough as it is, but there’s no denying that without Android, Apple would be selling even more iPhones.
It fascinates me that Page chose this specific subject to show some agitation. I don’t think Page and Brin could have anticipated – nor wanted to – that they’d be facing legal assaults from the largest incumbents in technology. I wonder what it must be like to see your company under a combined and coordinated legal assault from Microsoft, Apple, and Oracle.
I’d be fairly agitated too.
“I don’t think Page and Brin could have anticipated – nor wanted to – that they’d be facing legal assaults from the largest incumbents in technology.”
Really? If so, they’d be the most incompetent tech CEOs in history. Of course the competition would resort to legal assaults. They could not anticipate the specifics of the legal assaults, but the idea that the competition would quietly agree to lose if bested by superior technology is extremely naive.
That honor would probably belong to Ballmer. He was the one that dismissed Android as not being a threat back in 2010. – Yet Android seems to have gained more market share, in just a few years, than mobile versions of Windows have, in over a decade.
Nop, you are wrong.
The most incompetent CEOs in the history are Jonathan Schwartz and Stephen Elop!!!
They should be called anti-alchemists; because they converted gold… into nothing.
I think you mean Carly Fiorina and John Sculley.
Jonathan Schwartz was handed a stagnant Sun – the stagnation happening towards the end of Scott McNealy’s watch.
I was not a big fan of the direction Carly took HP back in the early 2000s. While I do mourn the HP of old, which once upon a time had the prestige of a company focused on engineering, I don’t know if that company would have made it another 3 years at that point… And to be fair, she start with a decimated stock (the tech bubble bursting hit their stock very hard).
Carly started the process of turning HP into a Dell clone, and at the same time participated in the final destruction of what little was left of Digital after Compaq had finished with them (RIP). Pissed off a lot of people at the time…
However, to be fair, if you look at it purely from a financial point of view it did work – immensely well actually. HP’s stock grew quite steadily over her tenure and afterwards under Mark Hurd with the EDS merger (which you could say was a continuation of her strategy) – and most people would love to have Mark Hurd back.
HP wasn’t the same company she started with, but had she not done some of the things she did it probably would have ended up just like Digital – another engineering driven company that ended up as road kill because of lack of business sense. Everyone hated her at the time, but I don’t think it is at all fair to put her on a worst of list – she was far from incompetent.
Now L~A(c)o Apotheker…
Again with the stock market! It’s all smoke and mirrors. When will you learn? You even mentioned what HP had to sacrifice in order to get those stock market “gains”. Where can HP go after that?
Smoke and mirrors… I hate to tell you but the job of a CEO of a publicly traded company is to make money for its investors, and well, that is it really. If you don’t make them more money they fire you. The people who own the stock own the company. If you feel bad about what happened to HP you should blame HP (as in Bill Hewlett and Dave Packard) – no one put a gun to their head and made them go public…
The old HP was a prestigious technology company with a reputation for focusing on products and engineering. I miss it, but it is mostly for nostalgic reasons. I don’t honestly think that company would have survived past 2005 intact and neither do most. I would still be missing HP had Carly not come along because it would have went out of business long ago (or been bought by someone else who probably would have done worse).
So what exactly was sacrificed? Carly isn’t to blame for HP’s current problems. She grew HP’s PC division, and it eventually became the largest in the world. It was Leo that decided to try and kill the golden goose…
You miss the point. My point is stop using stock market voodoo to judge a CEO’s performance. Yes, CEO are supposed to bump up stock prices. But as we’ve established elsewhere, they’re illusions.
Did I blame Carly for HP’s current problems? No. They were problems under her tenure that speak for themselves. And how did she grow HP’s PC division? By buying Compaq. You’ll argue that’s a legitimate success. I argue it’s not a sustainable kind, and these kinds of quick fixes do not fix the problems of the organization.
With Ballmer, Microsoft even celebrated the iPhone funeral in Redmond.
http://blogs.seattleweekly.com/dailyweekly/2010/09/microsoft_throws…
http://brooksreview.net/2011/05/ballmer/
Ballmer is also famous for saying:
“There^aEURTMs no chance that the iPhone is going to get any significant market share. No chance.”
http://www.usatoday.com/money/companies/management/2007-04-29-ballm…
http://brooksreview.net/2011/05/ballmer/
Wishful thinking.
Ballmer is famous for being an idiot and a fanatic.
Sadly, this never prevented anyone from taking power — quite the contrary actually.
Of course, legal assaults are par for the course – I meant it more in a sense that a few guys on a university doing a search engine on a single server could not have anticipated this.
Edited 2012-05-23 17:27 UTC
Particularly if those guys were deeply imbued with a shared culture that all information should be free and open to Google, that copying anything was OK, that casually cloning, undermining and killing other companies products was OK as long as it was for free and was ‘open’. Somewhere deep inside I think these guys just think it’s OK to share anything and everything with anyone (except their search algorithms of course), and probably are taken aback that people get pissed off about their stuff being copied.
I am not sure it’s worth the effort but here goes.
There is zero evidence that Apple “have been looking to shutdown the Android competition, which hasn’t really been working out swell for them”
All the evidence I can see points to Apple having a strategy of waging a long attritional legal campaign to deter other companies from copying their designs. One may argue that Apple are deluded that such copying is occurring, or that such copying is OK or that Apple do just as much copying, but it is abundantly clear that Apple genuinely believes such copying is occurring and that they want to stop it, or at least drastically reduce it. It also seems clear that no one with an ounce of common sense would think that through clever legal manoeuvre it would be possible to suppress permanently, or even for a significant period of time, competition in the hottest tech markets. And certainly there is no evidence that anyone at Apple thinks such silly things. It seems to me pretty straight forward, Apple think they get copied too much, they want to reduce that copying, so by being very proactive in taking robustly fought legal actions they want to deter companies from copying in future. One can accept that analysis of Apple’s intentions with out in any way endorsing or approving their actions.
Turning to the Page interview, when he says “When we bought Android, we had no idea they were doing it, and they had no idea we were doing it” I think he is being truthful. At that time Google’s main worry was the possible rise of Windows Mobile (and an ancillary concern about RIM I suspect) because if Microsoft had managed to take over the smart phone OS space like that had the desktop space then there would be a good chance that Google’s services would be shut out. Android was originally a play largely against MS, to trump them by undercutting a paid license OS model with an equally good and free one. But then the iPhone was announced and overnight any half way intelligent observer knew that all previous phone systems were obsolete. At that point Android had to retool and reorient and it had to adopt the same design paradigm as the iPhone and be at least good enough so that the Android OEMs could sell against the iPhone.
Google is between a rock and hard place when it comes to mobile. No one makes much money from mobile advertising. The rates of ad earnings per mobile user is much, much lower than per desktop users. If that continues to be true and if mobile does erode the old desktop/browser web model with a new mobile device and app model then Google’s long term revenue stream is potentially threatened. I remain unconvinced that Android is the correct answer to Google’s long term problems with mobile and I think they remain between a rock and hard place. I wonder if an ever deeper alliance with Apple might have been a better bet, but I understand that maybe Google thought it too risky because a rampant and dominant Apple might have screwed them eventually. Tough call.
If you tamper with the evidence to prove your point, you havent even convinced yourself there’s an actual case..
Apple has a history of sidelining successful developers in its community (although they tend to be smaller scale than google), by taking their products and integrating a (better) clone.
And MS was completely out of the question, as they seemingly screwed over all their mobile partners by malice and by accident.
I’m sorry, do you know them personally to make such conclusions?
Asserting patent claims that go beyond the UI and anything visual is, in fact, such evidence. I can understand that “slide-to-unlock” is more of a visual element, but real time API patent?
Ask Diane Hackborn about it, or read her comments.
Google made 7% of their total revenue, that is not a small amount.
Deeper alliance with Apple wouldn’t have made a difference in the situation, while still leaving Google “out cold” if Apple ever decided to ditch Google. Android is the moat around their castle, that works perfectly well.
I don’t know them personally but I have read extensively on Google and it’s founders including several books, many article and interviews. I have also observed Google’s actions over many years. The the evidence I feel is pretty strong that it is correct saying that the culture of Google is “that all information should be free and open to Google, that copying anything was OK”. I do not know of any evidence that the two founders of Google hold different views than that expressed by Google’s collective culture or have battled to change that culture, and in many interviews they seem to endorse it. I am surprised that anybody finds this controversial. Google wants to open up all the world’s data for inspection. Is that not what Google says it wants? If one believes such a thing as a central organising pillar of one’s corporate culture (irrespective of whether it is a good or bad thing) then certain patterns of behaviour will result.
But how is that evidence of Apple’s strategic goals? That is just one tactical legal battle in a legal war, the issue at point is what is the aim of that war. It is often, lazily, claimed it is to ‘shut down the competition’. I am arguing that not only is that not the aim of Apple’s legal war but that such an aim is patently absurd and would only be pursued by foolish people. I don’t think Apple’s management look like such fools. It’s perfectly possible to still object to Apple’s legal actions whilst making statement that are accurate about what they are doing and why. Spouting inaccurate hyperbole is never good for one’s cause in my experience.
First off one has to bear in mind that Google make more money from iOS than from Android. That has been confirmed by Google in public statements and is not disputed.
Horace Dediu at Asymco calculates that overall, Android could amount to about 3.5% of total Google revenues and about 5% of operating earnings.
http://www.asymco.com/2012/05/16/androids-contribution-to-google/
Horace in another article calculates that Google receives a contribution of $2.75 per device per year from Android
http://www.asymco.com/2012/05/14/the-android-income-statement/
Lets assume that Android reaches an installed base of 1 billion devices in the next couple of years and that all of those devices include Google services and thus generate income for Google at the rate that such devices appear to do. That means 1 billion Android devices earns Google around $2.75 billion per year (which tallies nicely with your $7% figure). So with a billion devices Google’s Android business is nice but not spectacular and will not break even for several years (until the costs of the wholly Android based Motorola acquisition are recouped for example).
The crucial strategic issue for Google and for any assessment of it’s Android strategy is whether those mobile revenues are additional to Google’s existing business. If one believes, as I do, that the rise of mobile internet connected computing devices will lead to a long term and secular decline in desktop computing then Google may be faced with declining revenues. This is because of the key point I made and which you did not address which is that all evidence indicates strongly that each mobile user generate much less advertising income than each desktop user and almost all of Google’s income is from advertising.
Finally as a comparison of the merits of relative business strategies one can compare Google’s mobile business strategy (Android) to Apple’s (selling integrated devices attached to content stacks).
Google makes about $2.75 per handset.
Apple makes a profit of $357 per iPhone and continues to make revenue in relation to content transactions.
Do the math. If both iOS and Android reach a billion devices each (which is quite possible and in fact likely) which business strategy is better?
If the internet based on desktop browsers actually declines how can Google make up the shortfall in revenues from mobile?
Actually using it as an offensive weapon? It’s more of an evidence than “I’ve read about them a lot”.
Yep. I will turn this sentence in your second paragraph against your first paragraph.
So? You did use the word “mobile”, didn’t you? (Not android, not smartphones, not iOS.)
Google’s mobile strategy is obviously not Android only. In fact, considering the options, Android was the best business decision Google made in mobile.
But hey, if you can compare a product company’s overall business strategy and a service company’s overall business strategy and say one of them is better, you might want to claim that oranges are better than apples.(or maybe you’re implying that oranges should become apples?)
Edited 2012-05-24 16:46 UTC
Why throw those two words on the end? Are you implying that they believed that information should not be free and open to others back in their college days?
If you take those two words off the end, and remove the overly emphatic word “all” – you get this:
If the tech industry had a bit more of that shared culture (and it could manage to survive an IPO fully intact) the world would be a much better place. But alas that is not the way it works…
Your making a morality case here – and your using it relative to a discussion about US tech companies… I know that for the purposes of campaign contributions businesses in the U.S. are the equivalent of citizens – but companies do not and never have made decisions based on “its the right thing to do” unless that was qualified with the suffix “to make more money”.
Google is not Larry and Sergey – it hasn’t been for at least a decade. Apple is not/was not the two Steves – that shipped sailed eons ago. These are no longer people we are talking about – decisions are ultimately made by the investors, for the investors. Publicly traded companies are simply machines for making more money – they don’t care how as long as they can get away with it and not have the government step in and stop them.
What Larry and Sergey did or did not believe 15 years ago has almost no bearing whatsoever on the Google of today. “Do No Evil” is now “Do No Evil… if you can possibly avoid it without pissing off the board too much”. I’m not complaining – that wishy-washy mission statement is loads better than most companies… Regardless, Larry and Sergey worry about what is good for their company, not about hurting Steve Job’s feelings.
If releasing a free product will help them make more money, so what if the free product kills off businesses in the process? Yes – Google cannibalizes markets. You don’t think Apple is cannibalizing the music industry right now??? The difference (as you pointed out) is that Google does do these things in the name of making free and open products (for whatever that is worth) – Apple does it because they really really like to make a metric f*ck-ton of money – they don’t pretend otherwise.
Just to be clear – there is nothing at all wrong with that, but I’m not the one sounding like a spurned lover when describing Google. Google is Apple’s competitor – not their ex-girlfriend.
Edited 2012-05-24 06:44 UTC
QoTD!!!
I’m not really sure why you got downgraded to -2. Very thoughtful posting. (edit: I should have included the original quote by Tony. My bad.)
Edited 2012-05-24 15:30 UTC
Let’s break this down one company at a time:
Oracle: Not a competitor in the mobile space, so it wouldn’t be logical for Google to think that they’d be sued by a company that doesn’t compete in this sector.
Apple: Right in the summary for this article, Page mentions that Google had no knowledge that Apple was working on a mobile OS. Again, it wouldn’t make sense for them to expect lawsuits from a company not in the mobile market.
Microsoft: Windows CE had been around for a while when Google purchased Android, but Microsoft has only become more offensive with their patents in the past few years since they are losing marketshare (and mindshare) in several of their markets.
Of course, anyone should anticipate legal battles if they become successful enough, but I don’t think anyone in 2005 could have expected Google to be sued by even one of these companies over Android, let alone all three.
Not Oracle, but sun was a major player in the mobile space. There is a reason why Sun wouldn’t bless the apache harmony project as Java. Sun had licensed JavaME (Mobile Edition) to dumb phone makers. They have zero market now, due in no small part to google’s actions. I totally understand why they *feel* like they’ve been screwed over. However they weren’t in a legal sense.
Sorry, what?!?!
J2ME or Java ME was essentially killed off when iPhone came out without support for it. If anything, Oracle should be kissing Google’s feet for keeping Java(in whatever form it is) in the mobile market.
Sun had the most to do with Java ME’s destruction.
Don’t you get it? Only Apple is allowed to demolish competitors.
Yes Apple also played a huge part in killing JavaME. But having a Java-like environment that was good and free didn’t help keep JavaME afloat.
There is no single redeeming feature of Java ME whatsoever.
Even if Android was all Qt, Java ME would be dead.
+100 if I could…
I dabbled in JavaME back in the day – both “naked” and the “extended” version that Blackberry called their API…
It was horsesh*t, there really isn’t a nice way to put it. Compared to to Cocoa Touch or the Android SDK it was like programming in QuickBasic. Horrible…
Micro Edition.
Also, “zero” isn’t quite right… NVM huge existing base, it still ships on tons of less expensive devices (I wouldn’t be surprised if on more devices than all smartphone OS ones combined) – “dumb phones”* like Nokia S40 or most of what Samsung sells.
And not only “dumb phones” – Bada and Symbian include it, too.
Yeah, its prospects are not great, but it’s out there and will still serve an important role for quite some time.
(I mean, one of the most popular j2me apps is the #1 mobile browser – and its users, usually on “dumb phone” handsets ( http://www.opera.com/smw/2011/11/ ), do increasingly seek out games, social apps, utilities http://www.opera.com/smw/2012/03/ )
* but really, if we’d try to apply any resemblance of rigorous definition, S40 is more of a smartphone than iPhone in its first year…
Or what about such very popular “dumb phones” like LG Cookie, Samsung Corby or Star? (“sub-Bada” touchscreens http://www.mobile-review.com/review/samsung-star2-s5260-rev-en.shtm… )
To the best of my knowledge Apple has never sued Google.
Google on the other hand now owns a company that sued Apple, sued Apple before Apple sued it, and is suing several companies using FRAND patents.
Don’t mince words… Apple suing Samsung/HTC is really Apple suing Google by proxy. Everyone knows it…
And frankly I hope they lose. Badly. I would rather see these kinds of things worked out in the marketplace, not in the courts.
I would have greatly preferred Google figure out a less unseemly way to retaliate against Apple in this case – but let’s be honest and call it what it is – retaliation. I don’t like what Google is doing one bit, but do you think Google would have even considered buying Motorola Mobility had it not been for the HTC/Samsung lawsuits. Who started this in the first place???
I’m not defending Google – I’m defending sanity… Apple is a great company – I like their products and services. Google is also a great company – I like their stuff too. I also sometimes don’t like things both of them do.
I think both companies are rather exceptional in their own way – and I don’t feel a need to ridicule either of them to make myself feel better about the other one.
I’m just saying, it is possible to both appreciate Apple for the good things they do and deride them for the bad things.
You, on the other hand, just seem to always be defending Apple – it doesn’t seem to matter what they do… Is there anything that Apple has ever done that you don’t agree with?
… we talk about the same media? Modern journalism is all bout provocation, sensation and catchy one-liners. At least, that’s my impression.
Edited 2012-05-23 20:43 UTC
That’s what they want you to think. The reality is they are trying to sell advertising space, and they will do anything, and everything, to please their advertisers or their celebrity guests.
The end result is AOL, Gawker, and 24 hr cable news channels who give way too much time to the latest media whore.
The irony of it all is this is Charlie Rose we are talking about. He’s the farthest you could get from the advertising you’re talking about. His show is on Public Broadcasting. They don’t have ads other than a brief mention of the donors at the end of the show. He does a very good job of asking tough questions to politicians and is mostly unbiased.
The more they shout, scream and attack you … the closer you are to doing the right thing.
Therefore I’d take it as a compliment, of sorts.
Edited 2012-05-23 21:35 UTC
I’m not sure what the market would look like.
I think Nokia wouldn’t have joined with Microsoft.
Palm would still be a semi-successful entity not owned by HP.
RIM would be doing better.
I think Microsoft wouldn’t have joined with Nokia.
Windows phone 7 would be as popular as the Zune was.
The only exciting thing would be whatever hardware palm had decided to do. I was still tempted to buy a palm pre instead of the captivate a few years ago.
I don’t think history would just reset itself like that. More likely, the iPhone would grow more than it did without Android. Those other companies would still tank because they were stagnant and resting on their laurels, and we’d be likely left with an Apple dominated smartphone market.
Ack, forgot to include the apple prediction.
Yes, they’d have a majority share, but maybe only half of Android’s current market share would be theirs.
I only listen to Google interviews from Eric Schmidt. He’s soooo quotable.