7 Reasons We Need to Monitor Google's Growth
Posted by keirsun on April 30, 2008 at 04:15 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
It's the last day of April, and that means this is the conclusion of our monthlong magnification of the world's most popular search engine company.
As a recap, I'm going to run through the top 7 reasons we all need to stay aware of Google's growth in the search market and, more importantly, elsewhere.
1. Yahoo is Testing Google Search Ads
Earlier this month, Yahoo performed a two week test that integrated Google's PPC ads into Yahoo's paid search results. While the test was considered by many to be an effort by Yahoo to discourage Microsoft's buyout bid, the U.S. Justice Department decided to investigate possible antitrust implications. If Google was given 100% of the paid search real estate on Yahoo, a serious PPC monopoly would arise.
2. The Google Voice: Free Speech in Search
With Google's search market share hovering near 70% in the U.S. (1), a sudden drop in search positions on Google can devastate a company that relies on Google traffic. All in all, this post is a friendly neighborhood reminder to diversify your company's sources for incoming clientele.
3. Google's Win in the FCC 700-megahertz Auction
As a result of its influence on the Federal Communications Commission Auction of 700-megahertz radio frequencies earlier this year, Google helped get new policies put into place - policies that allow for "open networks" where consumers can use a wider variety of devices and applications. As our blog post points out, a 2006 Google patent application describes a method for collecting mobile user data, which would be possible via the new consumer-friendly, mobile network environment.
4. Google Knows More about You than Your Spouse Does
After seeing how Google learns more about "Bob" in one evening than his spouse knows, we invite you to ask the question, "What does Google know about me?"
5. Google's Users are the Real Commodities
Over the course of this 3-part series-within-a-series, we discover what kind of personal information Google can collect about its users, through name-brand products such as Google Checkout, Google Talk and Gmail, in addition to Google-owned sites like YouTube, Picasa and Orkut. It's a bit of an eye-opener knowing that one of the largest potentials for future revenue is the sale of Google's user data.
6. Google's Stake in 23andMe and Google's Plans for Your Medical Records
Both of these blog posts examine how our personal health records could soon become part of Google's enormous collection of data.
To advocate on issues that concern Google, the company has hired some of the top lobbyists in the country to pound the pavement on Capitol Hill. We all know that Washington needs an education in online commerce, but should it come from one of the web's largest advertisers?
In Conclusion
As I stated at the beginning of this series, I both respect and fear Google. I use Google's services countless times every day in both my professional and personal life.
Our goal with this monthlong magnification was to make sure people are aware of Google's grasp on personal data and grip within the search industry.
Now, get back to work.
Image: b_d_solis
1. Hitwise US - Leading Search Engines, March, 2008.
Google Builds Data Center in Small Town, North Carolina
Posted by amy on April 29, 2008 at 02:08 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
When a small town in western North Carolina, suffering from the loss of their primary local industry and growing unemployment rates, heard that a major tech company was looking for real estate in the area, the Mayor himself went above and beyond to bring jobs and money back into his town.
In 2005, Google, looking to build a $600 million dollar data center complex, showed up in North Carolina—in the form of a consultant working for an anonymous tech company—and the town of Lenoir, seeing an opportunity to recover from its economic struggle, quickly got in the negotiation game.
Image of Google Data Center in Lenoir under construction: Charlotte Observer
At the beginning of the negotiations, a 127-acre plot of land was on the table and Google didn't raise any objections. But, not long into the process, Google demanded more land. Lenoir's Mayor, David Barlow did much of the leg-work himself to give Google the deal they wanted so that Lenoir, population 17,000, could be the site of one of Google's data centers. Mayor Barlow knocked on the doors of Lenoir residents, located long-lost heirs, and the city even paid for a divorce just to stitch together a 216-acre plot of land to satisfy Google. (1)
Google's demands on the water supply in Lenoir were far beyond what the small town could handle, so Mayor Barlow offered Google the best deal the town could afford: the city would pay $24 million for upgrades to the municipal water system if Google would agree to stay in town long enough to justify the huge expense. Google finally agreed to pay $1.05 million toward the water system expansion but refused to lock itself into a minimum period of residency. (1)
In addition to local tax incentives, Google pushed for a bill in the North Carolina state legislature that would make server farms exempt from sales tax on the electricity they use. Following a threat from Google's negotiator that without the exemption, "the project simply will not come to North Carolina," the bill passed in July 2007. (1)
In Lenoir, Mayor Barlow was quick to respond to Google's demands, doing his best to give them the incentives and provisions they were looking for. The mayor spent unpaid evenings and weekends putting together a deal Google could live with. All in all, a small town made big adjustments to accommodate a large company, hoping for tax money to boost the town's suffering economy. The end result of all of these negotiations also included tax rebates expected to be $5.87 million off Google's $6 million tax liability. Google's negotiator points out that this gives Lenoir $130,000 they wouldn't have otherwise. (1)
Certainly a multi-billion dollar corporation is not expected to save the small town of Lenoir just so it can build its data center there, but the events leading up to Google's deal with Lenoir suggest that Google was not opposed to capitalizing on the struggles and weakness of a small town. (1)
Food For Thought
In late 2005, Google showed up in Lenoir. Today, Google is starting to integrate into the town as they construct and test their new data center facilities. The Lenoir project received state and local incentives totaling up to $165 million over 30 years, and Google is now "mixing with local civic groups and donating charity Christmas trees for a public display" to say 'thanks.' (2)
How far should state and local governments go to entice companies like Google to share their hometowns? Did Google get too aggressive in their negotiations in Lenoir and take advantage of a small town with economic hardships? Does Google have any responsibilities to help improve the communities where the company builds data centers and other Google locations?
According to Google's Carolinas Operations Manager, Tom Jacobik, "We're not here to save the town. We're here to run a business." (2)
1. The High Cost of Wooing Google, BusinessWeek, July 23, 2007.
2. Jen Aronoff, Google, Lenoir try to adapt to one another, Associated Press, February 3, 2008.
Light and Lasting Hold, But Why?
Posted by tim on April 25, 2008 at 08:42 AM
It's Friday, and that means it's time for another episode of StraightUpSearch the Podcast.
This week Tim brings Maureen and Mike into the studio for a talk about Maureen's post, Google Hairspray is Patently Puzzling.
Back with another installment next week!
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The Google Voice: Free Speech in Search
Posted by amy on April 24, 2008 at 11:59 AM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
"There is no human involvement or manipulation of results, which is why users have come to trust Google as a source of objective information untainted by paid placement." (1) This is what Google's Technology Overview page used to say. Now, this phrase is noticeably missing. (2) Human involvement or not, Google's search results have been recognized as having what seems like a very human right - freedom of speech.
From the beginning, Google founders recognized that their search engine was a business and not merely a resource. Google founders Larry Page and Sergey Brin wrote a paper about the creation of Google as Ph.D. candidates at Stanford. In that paper they stated, "we expect that advertising funded search engines will be inherently biased towards the advertisers and away from the needs of the consumers." (3) Today, 99% of Google's revenue comes from ads. (4) Brin and Page's early acknowledgement that search results would likely be biased toward advertisers, combined with Google's search results being considered protected free speech, could change the way users view Google's search results. But how did Google's search results become recognized as protected free speech? It started with one company: Search King. (5)
Search King
Google's Page Rank is a system developed to determine a page's "value" and assign the web page a rank. That rank is essentially what determines where a page will appear in Google's search results page for a relevant query. (6) Search King (7) was a company selling online advertising space on sites that were highly ranked on Google's Page Rank system and would pay the websites based in part on their Google Page Rank. (8) Search King's page rank suddenly dropped, along with the Page Rank of some of its affiliates. This downgrade meant that Search King's position in natural results dropped dramatically. Search King sued Google arguing that the Page Rank had been intentionally and maliciously downgraded. (9)
Google admitted to intentionally downgrading Search King's site and some of its affiliate sites, but stated that Google has "no obligation to rank Search King's site at its desired level, or to include Search King's web site on its search engine." Google argued that its Page Rank is protected free speech and protected by the first amendment. (10) The court found in favor of Google, saying that "it could be argued that Google acted maliciously and wrongfully", but Google's actions were privileged free speech. Also, the court stated that no website can demand to be accessible via Google. (11) The end result here - Google's search results can rank and position sites however they choose. No need to rely on relevancy or algorithms if they choose not to.
A couple of years after the Search King case, a similar case came along with similar results. Kinderstart (12) had their Page Rank drastically reduced in March 2005 and immediately lost 70% of their traffic. (13) As a result, KinderStart and other plaintiffs tried, unsuccessfully, to form a class action lawsuit to recover damages from Google for the downgrades in Page Rank. (14) The case was eventually dismissed and Google's freedom of speech remained intact.
Food For Thought
With a search market share at almost 67%, (15) a sudden and dramatic drop in search position on Google could be devastating to a company. And, if a company has no control in improving or rebuilding their search position, there may be no way to recover.
(1) Google Corporate Information, Technology Overview, last visited January 15, 2008.
(2) Google Corporate Information, Technology Overview, last visited April 24, 2008.
(3) Sergey Brin and Lawrence Page, The Anatomy of a Large-Scale Hypertextual Web Search Engine, Appendix B, Computer Science Department, Stanford University, 1998.
(4) Google 10-K, Annual Report (filed 2/15/2008).
(5) Search King v. Google, Inc., CV-02-1457 2003 WL 21464568 (W.D. Okla. May 27, 2003).
(6) Google Corporate Information, Technology Overview, last visited April 24, 2008.
(7) Search King.
(8) Search King; Complaint, Search King v. Google (filed 10/17/2002).
(9) Search King.
(10) Search King at 2.
(11) Search King at 11-12.
(12) KinderStart.com LLC v. Google, Inc., C 06-2057 JF (N.D. Cal. March 16, 2007).
(13) KinderStart.com LLC at 4.
(14) KinderStart.com LLC.
(15) Hitwise, March 2008, based on volume of searches.
Google Stockholders: Selling Class A Shares, Class B Rights
Posted by amy on April 23, 2008 at 01:52 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
We've been talking about Google, their business, their practices and products, and their future, but what we haven't talked about is who is making the big decisions.
Google is a multi-billion dollar corporation with thousands of employees, executives, directors and corporate officers - this can't be a three man show. As a publicly traded company, stockholders would expect to have some influence in major business decisions. Taking a look at Google's stock structure and considering all of the questions that our Google series has raised, it seems that, whatever the future intentions and direction of Google, there may not be an effective way to change the direction of their business.
When you buy stock in a company, whether it is one share or thousands, you want to make sure your investment is protected and managed appropriately. Typically, companies issue voting rights to stockholders so that each stockholder has a say in how the company acts, who runs the company, and/or how the company handles major decisions. And, companies will often share profits with shareholders by issuing dividends for each share of stock.
Google has two classes of stock; Class A common stock and Class B common stock. Google's Class A stock is what is traded on the NASDAQ under the "GOOG" symbol. If you own Google stock, you own Class A stock. Google's Class B stock is held primarily by Google's executive officers, directors, management and employees and the rights given to Class B stockholders are very different from that of Class A common stock.*
Class A:*
* 1 vote per share
* Publicly traded
* 2,776+ stockholders of record
* No dividends
Class B:*
* 10 votes per share
* Not publicly listed or traded
* 111 shareholders of record
* All held by founders, directors and executives
How does the Class A and B common structure and rights affect Google Class A stockholders? The Company?
The founders, executive officers and directors of Google together owned shares of Google's Class A and B stock that represents around 70% of the stockholder voting power. And, of that 70%, Eric Schmidt, Larry Page and Sergey Brin own both Class A and B common stock representing about 67% of the voting power as of December 31, 2007 - leaving about 3% of the voting power for the rest of the directors and executive officers to share.
This means that whether stockholders are voting on major corporate transactions, mergers, the sale of assets or the election of directors of the company, it would be almost impossible for other stockholders to influence a vote where Schmidt, Page and Brin were voting together. *
Food For Thought
Google is aware that Class A stockholders won't necessarily be happy if Google uses the voting power they have with the Class B shares to take actions that the Class A stockholders do not agree with. In their 2007 Annual Report, Google describes how the stocks work and concludes that if they took this type of action, "the price of Class A common stock could be adversely affected."* Google has gone further to keep stockholders from influencing certain business decisions. The board of directors fills vacancies on the board in many circumstances - stockholders cannot vote to elect those members.*
* December 31, 2007 Google Annual Report (Filed 02/15/08).
Google Goes To Washington: Lobbying From A Parking Lot?
Posted by amy on April 22, 2008 at 03:47 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
Well, the Google satellite photo from Google Maps has certainly painted an interesting picture of the Google lobbying efforts. Google, who spent nearly $1.4 million dollars on their lobbying efforts during the second half of 2007 (1), appears to be operating from a white utility van in a Washington, D.C. parking lot - though the picture is a bit hazy. But don't let Google Maps fool you. Google's Washington, D.C. office is the home base for a sophisticated political machine.
With a slight adjustment to the coordinates, this satellite view of Google's Washington office should be focused on a 27,000 square foot, eco-friendly Googleplex with all of the comforts of Silicon Valley Google professionals have come to expect: free gourmet lunches, foosball, ping pong, Xbox, plasma screen TVs, massage chairs and the rest of the typical Google office gear (2).
But, these people aren't your typical Googlers. The D.C. Googlers have worked with some powerful people: Pablo Chavez served as general counsel for Sen. John McCain prior to joining Google and Johanna Shelton was a top aide to Rep. John Dingell, chairman of the House Energy and Commerce Committee before she joined Google's Washington team (3).
And, Google didn't stop with their own impressive list of lobbyists - they have also hired some of the top lobbyists in the country to pound the pavement on Capitol Hill, advocating on the issues that concern Google. In addition to the $620,000.00 Google spent on their own Washington team in the first quarter of 2008 (4), they spent another $210,000 on reputable Washington lobbyists in Q1 (5).
Googlers in Washington D.C. scored a major political victory in 2007 when they helped persuade federal regulators to approve the DoubleClick acquisition despite serious consumer privacy and anti-trust concerns(6). And, because Googlers don't miss an opportunity to recruit new Google users, the D.C. staff gave "Google 101" crash courses in Google web tools to staffers on Capitol Hill. Now there are U.S. Senators giving presentations on overseas trips using Google Earth and Google Maps (7). But what does Google have on their lists for 2008?
Food For Thought
In our post, Examining Google's Plans for Your Medical Records, we examined the patent for an ad serving system that ran in an electronic medical records system and looked at the potential for Google to collect and store user's personal medical records and history. The patent is still pending, but it looks like Google could be gearing up in D.C. for the future use of this system.
In addition to the Google Lobbyists, a lobbing report for Q1 of 2008 filed by a reputable D.C. law firm reveals that, among other lobbying activities, the firm has 5 individuals lobbying health issues described as "online health-related issues" for Google. Google managed to get approval on the DoubleClick acquisition; could Google's team of lobbyists also manage to open up our medical records to Google? With the possibility of a Yahoo-Google ad serving partnership looming, is an anti-trust battle next on Google's Washington agenda?
(1) Information available from Lobbying Disclosure Database.
(2) Jim Puzzanghera, Google Feeling Lucky in D.C., Los Angeles Times, January 17, 2008.
(3) Lobbying Report, Google Inc., Q1, (received 4/21/2008), available from the Lobbying Disclosure Database.
(4) Lobbying Report, Google Inc., Q1, (received 4/21/2008), available from the Lobbying Disclosure Database.
(5) Podesta Group, Inc., Lobbying Report, Client: Google, Q1 (received 4/21/2008) and King & Spalding, LLP, Lobbying Report, Client: Google, Q! (received 4/20/2008), available from the Lobbying Disclosure Database.
(6) Jim Puzzanghera, Google Feeling Lucky in D.C., Los Angeles Times, January 17, 2008.
(7) Frank Davies, Working Washington in a Google-y way, San Jose Mercury News, June 24, 2007.
The Politics of Google, Yahoo and Microsoft: Searching for a Winner in the 2008 Presidential Election
Posted by amy on April 21, 2008 at 02:10 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
With the highly anticipated Pennsylvania primaries taking place tomorrow, it seemed like an appropriate time to take a look at Google's position in the political contest, and how their biggest competitors compare. Are the faces behind the Google, Yahoo and Microsoft corporations in agreement over who should be the next President of the United States? Which candidate are they supporting?
We looked at individual Presidential campaign contributions from 2007 (1) to see how the top three in search were allocating their support for the top three in Presidential politics. First we looked at overall reported individual contributions from employees of Google, Yahoo and Microsoft. Then, we took a look at how much of the overall contributed cash went to each candidate.
2007 Presidential Campaign Contributions:
Google:
- Clinton: $61,800.00
- Obama: $135,230.73
- McCain: $4,350.00
- Total Google Campaign Contributions: $201,780.73*
- Total Google Campaign Contributions: $201,780.73*
Yahoo:
- Clinton: $17,850.00
- Obama: $29,459.19
- McCain: $2,300.00
- Total Yahoo Campaign Contributions: $49,609.19*
- Total Yahoo Campaign Contributions: $49,609.19*
Microsoft:
- Clinton: $136,164.65
- Obama: $67,328.54
- McCain: $7,900.00
- Total Microsoft Campaign Contributions: $212,043.19*
- Total Microsoft Campaign Contributions: $212,043.19*
It looks like a lot of people at Google and Yahoo will be rooting for Obama in tomorrow's Pennsylvania primary - Obama received the most in campaign contributions from employees of both Yahoo and Google. The people at Microsoft disagreed with Google and Yahoo, and enthusiastically threw their campaign support to Hillary Clinton - Clinton's contributions from Microsoft employees are nearly double that of Barack Obama's. And although Microsoft, Google and Yahoo are fierce competitors online, their employees seem to have come to a consensus on John McCain - he comes in third in contributions for all three.
Will the crowds at Yahoo and Google be cheering after tomorrow's primary or will people at Microsoft be the ones celebrating? Should John McCain plan a few stops in California and Washington to stir up some support from these three online heavyweights or is it too late?
Food For Thought
Individual campaign contributions can give us a look at how the people of a corporation are thinking, but what about the corporation itself? When it comes to politics, Google definitely has an opinion - and they are equipped to throw some weight around in Washington. Tomorrow, our Google series will continue with a look at the serious side of Google's politics and how they are investing in improving their influence on the Capitol Hill and beyond.
* Total donations include donation made to candidates other than those listed here.
Update: This was our most popular blog post for the week of April 21st. Listen to the author discuss this topic on the StraightUpSearch Podcast.
(1) Chicagotribune.com, 2007 Presidential Campaign Contributions - itemized individual contributions, Source: Federal Election Commission.
Examining Google's Plans for Your Medical Records
Posted by amy on April 18, 2008 at 11:08 AM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
If a complete stranger asked you if he could read through your medical records, take some notes and record some of your personal medical history, would you let him? What if he promised that because this is highly confidential information, he will just store lots of bits and pieces of your private health records—he won't read it or share your information with anyone? Would you agree to that? No.
Google looks to be preparing to patent a much more sophisticated, and invasive, version of this stranger at the door—and you may not have a choice when it comes to Google poking through the details of your medical records.
A patent application assigned to Google in May of 2006, Method and apparatus for serving advertisements in an electronic medical record system, (1) details a method and system for collecting data from patient medical records to serve ads to doctors accessing these records through an electronic medical record system ("EMR").
The patent application details how this system will scan patient medical records, use information about the patient, the doctor, and the medical facility along with search terms, search results generated by a doctor's search and the search results selected—all to serve relevant ads to doctors while they are accessing the patient's medical records in the course of treating a patient.
There are two major issues involved in a system like this:
First, do we want advertisers influencing doctors at this point in the treatment process? If you go to see your doctor with a sore throat and cough, your doctor will examine you and ask you about symptoms and medical history. He or she is also likely to access your medical records to view other medically relevant information such as allergies, medications you are taking, etc.
If an advertisement for a new antibiotic pops up on the computer screen while the doctor is viewing your records, will that influence your doctor's treatment decisions? Should it? This doesn't seem the appropriate time for a sales pitch. The patent application also explains that the advertisements are configured to take the doctor to a website for the product advertised, if the doctor clicks on the ad.
Second, and much more frightening, Figure 1 (included in the Google patent application) depicts the process and function of this particular patent. The illustration shows two databases associated with Google's ad serving (111 & 116) that gather and hold sensitive and private patient information. Who controls and has access to these databases?
Food For Thought
These databases contain highly personal medical histories with information that most of us don't want to give away. However, this patent application doesn't indicate an option to opt-out. Will our medical records become part of Google's enormous collection of data without our consent? Even without our knowledge? With databases full of sensitive patient medical records, what other ways will Google find to capitalize on this data?
1. Patent Application No. 11/443,818, Method and apparatus for serving advertisements in an electronic medical record system (filed 5/30/2006).
StraightUpSearch the Podcast - Three's A Crowd
Posted by keirsun on April 18, 2008 at 10:36 AM
Hello Friday! And say hello to another episode of StraightUpSearch the podcast.
This week Amy and Vern entertain Tim and our listeners with insights into Amy's recent blog post, Yahoo Tests Google Search Ads: A Search Rivalry.
We examine the motivation behind Yahoo's recent deal with Google to display PPC ads on Yahoo search results. Is it a power play against Microsoft's recent takeover bid? How much pay-per-click market share could Google walk away with? Is three company or a crowd? Let's find out.
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Google Still Wins in FCC 700-megahertz Auction: They've Got Your Numbers Now
Posted by amy on April 16, 2008 at 09:15 AM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
It didn't take the press or the public too long to figure out that Google was a little out of their element when they participated in the Federal Communications Commission Auction of 700-megahertz radio frequencies earlier this year.
Up against players like AT&T, with annual revenue close to $120 billion, and Verizon, with annual revenue just over $90 billion; Google's seemed out of their league with revenue under $17 billion. (1)
But, what Google did manage to do by throwing around the weight they do have was get policies put in place to allow for some "open networks," which will offer consumers the ability to use a wider variety of devices and more applications on devices using these open networks. (2)
The part about more applications comes in very handy for Google, and when you look at a 2006 Google patent application, (3) it seems possible that Google accomplished exactly what they set out to do at the FCC auction.
In March of 2006, Google filed an application for a patent titled, "Targeting and/or scoring advertisements using information derived from called telephone numbers or the called telephone numbers themselves." The application describes in detail a method for Google to know about each and every call you make from your cell-phone or handheld device, and know about who and where you are calling. With the intention of serving targeted ads to consumers, Google will be gathering information about every call you make, including:
- Phone numbers you call
- The name ("...business name, an organization name, a person's surname, or a person's given name) of the called party."
- "Directory information" - the type of number (business or individual), type of business, location, etc.
- "Duration of a call from which the call-derived information was determined."
- "Cost of a call from which the call-derived information was determined."
- "Frequency of calls to the same number."
- "Frequency of calls to a type of organization."
- Frequency of calls to a type of business."
- "Number of calls to a type of person,[...] business [or] organization."
- Time lapsed since the number was last called.(4)
Without open networks (like Google pushed for in the recent FCC auction of 700-megahertz radio frequencies), Google could be restricted from collecting data if carriers who owned the network restricted their customers from using Google's applications. This could have interfered with Google's patent-pending method of collecting detailed call data. With open networks, it's possible that Google will be able to collect from any consumer, regardless of the network carrier—just as long as they will agree to use a free Google application. So far, Google hasn't had much problem attracting users for their free applications.
Rick Whitt, Google's Telecom and Media Counsel said "our objective is to bring the ethos of the Internet to the wireless world . . . gathering the world's information, making it universally accessible and easy to use." (5) Though Mr. Whitt is certainly referring to making the internet universally accessible to users, it seems equally fitting that he would be referring to making the world's call histories, and information that can be derived from them, universally accessible to Google.
1. AT&T Investor Briefing, Jan. 24, 2008; Verizon Communications Investor Quarterly 4Q 2006; Google Investor Relations, Financial Tables, 2007.
2. Cecilia Kang, AT& T, Verizon Plan Wireless Future, Washington Post, April 5, 2008.
3. U.S. Patent Application No. 11/393,384, Targeting and/or scoring advertisements using information derived from called telephone numbers or the called telephone numbers themselves (filed Mar 30, 2006).
4. U.S. Patent Application No. 11/393,384.
5. Cecilia Kang, AT& T, Verizon Plan Wireless Future, Washington Post, April 5, 2008.
Image: Milica Sekulic
Google Hairspray is Patently Puzzling
Posted by maureen on April 14, 2008 at 03:12 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
How do SEO professionals keep their hair from falling out of place while heroically rescuing a homepage from a dangerous slide down a SERP?
How can PPC experts control their perfectly curly locks while furiously adjusting ad copy and strong-arming landing pages?
Why do webmasters always flaunt dapper and date-ready hairdos, even when they're digging neck-deep in code?
What's their secret sauce, you ask? Google Hairspray, of course!
Yes, I'm joking, but my jest is based in truth. In October of 2005, Google acquired an interest in a patent from L'Oreal for an aerosol styling composition that provides a "supple and long-lasting hold"(1).
As you may have already guessed, we're continuing our Monthlong Magnification of Google with a look at Google's patents, patent applications, and patent transfers - even the ones that seem a bit absurd, which is the case for my Google Hairspray example.
Like many a large company in the tech sector, Google has a growing list of patents. Here's the breakdown:
Google Patent Information (as of 4/14/2008)(2)
- Patents: 77
- Patent Apps/Patents Pending: 84
- Patent Title Transfers: 666
Now let's compare these numbers to Yahoo and Microsoft.
Yahoo! Patent Information (as of 4/14/2008)(3)
- Patents: 109
- Patent Apps/Patents Pending: 402
- Patent Title Transfers: 35
Microsoft Patent Information (as of 4/14/2008)(4)
- Patents: 8,499
- Patent Apps/Patents Pending: 12,351
- Patent Title Transfers: 658
By looking at the numbers, Google's 77 original patents, which are primarily search related, are a respectable amount but far from what you would expect from a corporation the size of Google. The majority of Google's patents, such as its aerosol styling composition, come from assignments, which are essentially patent title transfers by sale or other ownership transfer. Google even outnumbers Microsoft in number of transferred patent titles.
Hence, the patent that may one day become Google Hairspray, which, by the way, provides "satisfactory hold that is resistant to the usual movements of the head and the hair and to gusts of wind"(5), found itself in Google's back pocket following an assignment.
My question is, what does Google want with my hair?
Food for Thought
What opportunities do Google's acquired patents create when it comes to user data collection? As we have seen, it is likely that Google's largest and most valuable asset is the immense amount of user data it has collected. Could new technologies offer new opportunities to gather information about what we do on the internet, at home, or in a doctor's office?
Update: This was our most popular blog post for the week of April 14th. Listen to the author discuss this topic on the StraightUpSearch Podcast.
1. U.S. Patent Application No. 10/229,285, Aerosol styling composition based on carboxyalkylcellulose (filed Aug. 28, 2002).
2. United States Patent and Trademark Office ("USPTO"), Electronic Business Center, (April 14, 2008).
3. United States Patent and Trademark Office ("USPTO"), Electronic Business Center, (April 14, 2008).
4. United States Patent and Trademark Office ("USPTO"), Electronic Business Center, (April 14, 2008).
5. U.S. Patent Application No. 10/229,285, Aerosol styling composition based on carboxyalkylcellulose (filed Aug. 28, 2002).
Yahoo Tests Google Search Ads: A Search Rivalry
Posted by amy on April 11, 2008 at 03:52 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
With over 66% of US search volume (1), Google is clearly the dominant player in search. And, though Google has more than three times the search volume of Yahoo, their closest competitor has managed to hang on to their competitive status despite Google's enormous growth. On April 9, 2008, Yahoo announced that it will be testing Google's web search ads on Yahoo's own search service (2). So, what does this mean for Google, Yahoo, Microsoft and users?
The Yahoo-Google Test
In what has been discussed as an attempt to push Microsoft to raise its bid to purchase Yahoo, Yahoo has agreed to a two-week test of Google's search ads. Yahoo will serve Google search ads to approximately 3% of the users on Yahoo's own search services. Though there is no comment from Google or Yahoo on the likelihood of this becoming a larger scale or longer term deal, analysts and sources seem to think a more permanent agreement would be good for Yahoo:
A full-scale deal with Google would boost Yahoo's cash flow by reducing spending on rival technology and allow it to redirect staff and resources into its larger business selling corporate brand advertising such as banner ads(3)
Google stands to benefit from the deal as well. First, stalling Microsoft in its attempted purchase of Yahoo keeps Google from having to deal with a much more powerful and diversified competitor that would threaten Google's stronghold. Second, Google stands to "make more money from the alliance" with Yahoo. (4) And third, it is likely that Google has seen an opportunity to expand its user data collection into competitor's territory—a priceless opportunity for Google.
Microsoft is already letting Google know there is no escaping the realities of competition if it comes to a long-term deal with Yahoo. If Yahoo decided to allow Google to serve ads to a greater percentage of searchers and/or made this test a more permanent deal, it is likely that Microsoft will raise anti-trust issues.(5) Members of the US senate are also watching this short-term Google/Yahoo alliance closely to assure that it does not have an effect on market competition. And, the long term possibilities are being monitored as well: Senator Herb Kohl from Wisconsin said,"[s]hould there be moves to make this agreement permanent, we will examine it closely in the Antitrust Subcommittee to ensure that it does not harm competition."(6)
Food For Thought
As we learned from our series, Google's Users are the Real Commodities - Parts 1, 2, and 3, there doesn't seem to be much information Google can't learn about you. Email contents, cell phone numbers, habits and hobbies—a user's personal details are constantly being collected. But, there is one major exception to Google's seemingly limitless data gathering potential—until now, Google didn't have access to search and other data about users of competing search engines. This deal could give Google access to user data from its biggest competitor.
Not only is this testing period an opportunity for Google to gather search data from a new set of searchers, it's also an opportunity to see how their competition operates from the inside. Will the inside look at Yahoo's search ad strengths and weaknesses give Google the advantage it needs to start tearing away at Yahoo's search share and bottom line, while simultaneously collecting Yahoo user data? This test, and a long term deal with Google, may be one of the only options for Yahoo to remain independent, but should Yahoo take the chance?
Update: This was our most popular blog post for the week of April 7th. Listen to the author discuss this topic on the StraightUpSearch Podcast.
1. Hitwise US - Leading Search Engines, February, 2008.
2. Reuters, Yahoo to test Google ads as defense vs. Microsoft, April 9,2008.
3. Reuters, Yahoo to test Google ads as defense vs. Microsoft, April 9,2008.
4. Michael Liedtke, The Associated Press, Yahoo-Microsoft Battle Bolsters Google, Friday, April 11, 2008.
5. Reuters, Yahoo to test Google ads as defense vs. Microsoft, April 9,2008.
6. Reuters, US antitrust panel senator watching Yahoo/Google link, April 9, 2008.
Kluster Kasting
Posted by tim on April 11, 2008 at 09:12 AM
It's Friday morning and that means it's time for another serving of the StraightUpSearch podcast.
This week Christopher and Carly both make a return trip to the studio to talk about Carly's post, With Kluster, Social Media Marketing Pays Big.
We talk about what a site like Kluster can mean for companies to finally get into the social web in a big, and importantly, transparent way.
Christopher might also be suggesting that everything we need to know we can learn from the Simpsons. Maybe.
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Mapping Google's Stake in 23andMe
Posted by keirsun on April 10, 2008 at 02:44 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
In May 2007, Google invested almost 4 million dollars in founder Sergey Brin's fiancé's (now wife) new company, 23andMe, Inc.
According to its website, 23andMe is "a web-based service that helps you read and understand your DNA."
For $1,000 anyone can purchase a 23andMe DNA kit that includes a mail-in collection for a saliva sample. 23andMe then extracts DNA from your saliva and runs a genetic profile that provides information about ancestry, lineage, medical history, etc. The company provides this information via password protected profiles on their website.(1)
From the get-go, bloggers and journalists have questioned Google's investment in the genetic mapping company. On one hand, it could be viewed as an innocent investment in a spouse's startup. On the other, the investment could be seen as Google's first step towards indexing genetic information.
As Kevin Kelleher at GigaOm points out, Google's investment may be in reaction to Microsoft's purchase of Medstory, a health-care search engine.
But as Duncan Riley at TechCrunch plainly states, "...no one really knows why Google invested in the company aside from Brin's marital relationship."
Total venture capital investment in 23andMe is estimated at around $10 million dollars. Google's $3.9 million investment gives them a minority interest in the company. In addition to Google, Genentech, Inc. was also one of the startup's investors.(2) Genentech's CEO, Arthur Levinson, sits on Google's Board of Directors.(3)
In addition to being a 23andMe co-founder, Brin's wife, Anne Wojcicki, is also a shareholder and member of the startup's board of directors.(4)
Is it possible that Google, Levinson, and Wojcicki constitute a majority stake in 23andMe? Does Google's stake in 23andMe allow them access and/or use of data collected by 23andMe, including genetic profiles? The company's privacy statement says no. "23andMe will not release your personal information to any outside company without your explicit consent."(5)
But maybe the bigger question is, what is the real benefit of collecting DNA from a willing customer?
A recent Special Report on Human Genomics from the ETC Group, points out:
[T]he information gleaned from most genetic tests has very limited use for patients, but it is extremely valuable to companies and researchers trying to establish links between medical conditions and genetic variations, enabling - they hope - the eventual development of drugs targeted to people with specific genetic profiles.(6)
The report goes on to speculate that in the short-term, if it's possible to prescribe medication based on genetic profiling, this could lead to a new market of "personalized drugs," which may even bring back drugs that have been taken off the market due to adverse reactions in certain groups of people.
Through clever (and often misleading) marketing, some companies are persuading consumers to pay for storage of genetic data and health information, which the companies intend to use (e.g., sell) for research and drug development.(7)
Let's look again at the 23andMe Privacy Statement:
One of 23andMe's goals is to contribute to scientific research and the advancement of genetic knowledge. To achieve our research goals, 23andMe may enter into partnerships with commercial and/or non-profit organizations that conduct scientific and/or medical research. Such partnerships may allow an organization access to our databases of Genetic Information and other contributed Phenotypic Information, so that, for example, the organization can search, without knowing the identities of the individuals involved, for the correlation between presence of a particular genetic variation and a particular health condition or trait. We may receive compensation from these research partners.(8)
23andMe continues to affirm the privacy of its clients' personal information:
Partner organizations will not have access to your Account Information (e.g., name, contact information, payment information).(9)
Earlier this year at the World Economic Forum in Davos, Switzerland, 23andMe distributed one thousand free DNA collection kits to some of the world's most powerful people. The Davos contributors also received free 23andMe memberships. Promotional moves like this have helped 23andMe get a leg up on its DNA collection competition.
According to Jesse Reynolds from the Center for Genetics and Society, "[t]he highest profile company in this field is 23andMe, backed by Google both financially and maritally."(10) Reynolds points to Google's recent unveiling of its health records program at a conference in Orlando as a likely connection between the two companies.(11) "Not only is Google an investor in 23andMe, it is also a likely future business partner," states Reynolds.
Google Health is expected to launch sometime this year.
According to a New York Times article about Anne Wojcicki and 23andMe, Google's chief executive, Eric Schmidt, "declined to comment about 23andMe's business or its future products," but did point out the objective measures Google took in evaluating its 23andMe investment.(12)
However, the NYT article's author made an observation that bears highlighting: "Mr. Schmidt said that the Google investment in 23andMe would eventually benefit Google and its users."
The nature of that benefit is a mystery that is beginning to be mapped.
Food for Thought
If Google were able to combine the immense amounts of user data they collect right now with the health and medical data that could potentially be gathered from Google Health AND combine that with data potentially available to them through 23andMe, a person's Google profile could be a dangerous thing. What if this hypothetical Google profile ever got into the hands of a health insurance provider? Could you be denied coverage based on a genetic predisposition to cancer? What if you also often search terms like "breathing problems" and "wheezing," or you've emailed a cancer specialist to try and get an appointment?
1. 23andMe, website, last visited April 8, 2008.
2. SEC Form 8-K, Google Inc. Regulation FD Disclosure, May 22, 2007.
3. Google Corporate Information, last visited April 8, 2008.
4. SEC Form 8-K, Google Inc. Regulation FD Disclosure, May 22, 2007.
5. 23andMe, Full Privacy Statement, last visited April 8, 2008.
6. ETC Group, Report on Human Genomics, Part I, Direct-to-Consumer DNA Testing and the Myth of Personalized Medicine: Spit Kits, SNP Chips and Human Genomics, March 2008.
7. ETC Group, Report on Human Genomics, Part I, March 2008.
8. 23andMe, Privacy Statement, last visited April 10, 2008.
9. 23andMe, Privacy Statement, last visited April 10, 2008.
10. Jesse Reynolds, Genomes of the Rich and Famous, Biopolitical Times, Mar. 5, 2008.
11. Jefferson Graham, Prognosis is bright for Google's health records plan, USA Today, Feb. 28, 2008.
12. Katie Hafner, Silicon Valley Wide-Eyed Over a Bride, The New York Times, May 29, 2007.
Image: dannysullivan
Google's Users are the Real Commodities - Pt. 3
Posted by keirsun on April 07, 2008 at 01:37 PM
A Monthlong Magnification of Google: the Company, the Technologies, and the Extracurricular Activities
If you've been following along, then you already know what user information Google collects with its name-brand services, in addition to the kind of user information collected by Google via services such as YouTube, Picasa, Blogger and Orkut.
Today, in Part 3 of our mini-series, we want to throw out the question: What does this mean for the future of Google?
Is There a Challenger in the Audience?
At this time, there is little risk of Google's position being challenged. Because of the volume of data Google has and continues to collect, their dominance in search share, and the high returns they are able to get for advertisers, challenging or ultimately deconstructing Google would harm advertisers much more than it would hurt Google.
Google already has such a large amount of data and market share, advertisers have come to rely on the returns and sales they get from Google ad platforms. Challenging Google would mean that these marketers may have to spend the same or more money on ads for less return.
Connection is the Key
Google has worked hard to promote connectivity between user applications. iGoogle homepages connect to a user's Gmail account, which can connect to Google Talk and so on. This type of integration means that all of the different Google applications could have a complete set of user data rather than fragmented bits of data spread between applications.
The data is most valuable to Google in aggregate. Altogether it gives Google its advantage in online advertising.
If Google ever divided its services or products into separate entities, by choice or otherwise, maintaining a full set of data assures that each division will keep the same market advantage as they had with Google as one entity.
The Value of User Data
Possibly the biggest potential for future revenue is a sale of Google's user data. If Google transferred that asset, you would receive notification, but there would be little chance that you would be able to stop the transfer.
"If Google becomes involved in a merger, acquisition, or any form of sale of some or all of its assets, we will provide notice before personal information is transferred and becomes subject to a different privacy policy."(1)
But what if the United States government privately (or even publicly) asks Google to share its user data for the sake of national security, or any other reason?
Per Google's Privacy FAQs there is little that users can do to protect their Google-use data from government inquiries:
Google does comply with valid legal process, such as search warrants, court orders, or subpoenas seeking personal information. These same processes apply to all law-abiding companies. As has always been the case, the primary protections you have against intrusions by the government are the laws that apply to where you live.
According to a recent Wall Street Journal article, the National Security Agency (NSA) "now monitors huge volumes of records of domestic emails and Internet searches". Google has reportedly denied any involvement with the NSA's Terrorist Surveillance Program.
Google's user data, or at least the rights to it, will undoubtedly make news headlines far into the future. And with the ongoing release of new applications and services, Google will apparently have little trouble collecting more and more of it.
In the next chapter of our Monthlong Magnification of Google, we'll take a closer look at the search engine's investment in a DNA profiling company.
1. Google Privacy Policy, last visited April 7, 2008.
Image: PPDIGITAL