"The Internship" opened yesterday here on the banks of the Lower Colorado River. Now, comes another paean to Google. Full disclosure: this blog resides on Blogger (a Google ap), this blogger's browser of choice here is Chrome, and this blogger's home-page desktop (until it goes dark on November 1, 2013) is iGoogle. And this blogger's default e-mail client (in geek-speak) is... hold it... hold it: Gmail! Is there an insidious pattern here? Then, in his next breath, John Gapper mentions Amazon as another 21st century biz-giant and guess what? This blogger is hip-deep in Amazon apps: Instant Video, Kindle Books, and assorted retail purchases. Unfortunately, someone will have to pry Google and Amazon out of this blogger's cold, dead hands when the Grim Reaper finally visits. If this is (fair & balanced) cyber-dependency, so be it.
Google Is The General Electric Of The 21st century
By John Gapper
Tag Cloud of the following article
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Everywhere one looks, Google is doing remarkable things. It could soon overtake Apple in downloads of applications; it is developing self-driving cars; people wear its kooky augmented reality Glass spectacles; it is signing renewable power deals in South Africa and Sweden.
From being a one-product company that tapped a stream of wealth with paid internet search, Google is emerging as the dominant consumer technology company of the early 21st century, along with Amazon. Fred Wilson, a leading New York venture capitalist, accuses it of trying to control the internet, “like Microsoft tried with personal computing.... Who will stop Google?”
My answer is: nobody, or not easily. Indeed, the best comparison for Google seems to me not Microsoft in the 1980s but General Electric in the late 19th century the age of electrification. Like GE, Google is a multifaceted industrial enterprise riding a wave of technology with an uncanny ability not only to invent far-reaching products but also to produce them commercially.
It coincides with Larry Page’s ascent to being undisputed leader of the company he founded at Stanford University with Sergey Brin 15 years ago. Instead of the “Google guys” – Mr Page, Mr Brin and Eric Schmidt, its former chief executive and now chairman running it as an amiable mixture of a company and a chaotic research lab, Mr Page has made it formidably focused.
Google’s growing lead in data analysis and artificial intelligence became clear at its developers’ conference in May. “It’s easy for consumers to switch to another search engine, but it is difficult to make anything as good,” says Benedict Evans, an analyst. “Google is a massive machine learning project, and it’s been feeding the machine for a decade.”
All of this is happening at a time of growing scepticism about Silicon Valley its airy claims to be changing the world for the better when the people who most benefit are its own billionaires; its use of low-tax jurisdictions to avoid corporate tax; the dubious ways in which many free services collect and exploit personal data; the triviality of countless start-ups.
The social networking boom that started a decade ago is waning, with Zynga, the internet games company, laying off 18 per cent of employees. George Packer wrote in The New Yorker of Silicon Valley: “The hottest tech start-ups are solving all the problems of being 20 years old, with cash in hand, because that’s who thinks them up.”
Google is not without sin it faces heavy criticism for its tax avoidance, and despite its proclamation of being an open standards company, it fights as hard as Microsoft to keep others stuck to its platform. But Mr Page can hardly be accused of lacking purpose and vision.
He has extended its search lead into mobile, through Android and Chrome software, and he shows no signs of being satisfied. “We haven’t seen this rate of change in technology for a long time, probably not since the birth of personal computing,” he remarked happily at the May conference.
Meanwhile, other Silicon Valley giants face varying degrees of difficulty. Investors have soured on Apple since Tim Cook became chief executive, discouraged by, among other things, its botched attempt to rival Google Maps. Yahoo, run by an ex-Googler, Marissa Mayer, is struggling to replicate its engineering strength, while Facebook is trying to move to mobile.
None matches its computer science research capacity, or ability to turn ideas into products. The clearest manifestation is Google X, its “moonshot” research lab, which is developing wearable computers and “autonomous” cars. But research in software and artificial intelligence lies at Google’s core.
What was once a search company has become an internet, data and software company with boundless ambition and the capacity to deliver a flow of unexpected products. In that sense, Mr Page is a latter-day Thomas Edison, a commercial inventor marked by “the utterly fearless range of his experimental activities,” according to Randall Stross, a biographer.
Compared with the 1890s, Google resembles GE, while Amazon is like Sears Roebuck, the catalogue shopping company that transformed US retailing. GE was founded in 1892 and Sears Roebuck in 1893, at a time when the continent was altered by the telegraph and electricity.
Mr Page often talks of his fascination with Nikola Tesla, the Serbian US immigrant who worked for Edison and later fought him in the “wars of current” the battle between Edison and Westinghouse over whether the US should adopt DC or AC electricity. He read a biography of Tesla as a child and “cried at the end because I realised you can be the world’s greatest inventor and still be a failure”.
Both Tesla and Edison were equal parts inventors and showmen, and neither one succeeded completely in business GE was formed in a merger, with Edison losing control. Henry Ford is said to have called him “the world’s greatest inventor and the world’s worst businessman”. Mr Page, who has a $20bn fortune, scores higher.
But electricity disrupted industries as fully as the internet. The Brooklyn Eagle wrote of incumbent gas companies: “To see them squirm and writhe is a public satisfaction that lifts Edison to a higher plane than that of the wonderful inventor and causes him to be regarded as a benefactor of the human race.”
GE had many rivals, yet its combination of inventiveness and commercial acumen marked it out from the pack, setting it up to exploit the technology Edison had pioneered for the next century. The unnerving thing about Mr Page is that he studies history. Ω
[John Gapper is associate editor and chief business commentator of the Financial Times. GApper won an open scholarship to Exeter College, Oxford University, where he studied Philosophy, Politics and Economics. He came to the U.S. when he was awarded a Harkness Fellowship to study at the Wharton School of the University of Pennsylvania. Gapper was co-author with Nick Denton of All That Glitters: The Fall of Barings (2011) and he also has written a mystery novel A Fatal Debt (2012).]
Copyright © 2013 The Financial Times Ltd.
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