Has Google Lost its Way?

There was an article in the Financial Times yesterday quoting Eric Schmidt, CEO of Google, about the company’s current focus and its vision for the future. It’s an interesting bit of insight if you read between the lines, and may be an indication of the point at which Google has lost direction in the headlong pursuit of continuing monster growth.

Search is today’s major Internet battleground because an overwhelming portion of user tasks on the net initiate with search. Search is now an integral part of most major marketing strategies, and is at the center of online advertising. Google, already the leader in text advertising, recently won a bidding fight with Microsoft to purchase DoubleClick, the leading broker of banner advertising. That in turn has launched speculation that Microsoft will make a bid for Yahoo! just to keep up.

This battle is all about the revenue available from online advertising, and the continuing growth from online advertising is focusing ever more aggressively on ads targetted at specific users based on contextual, behavioral and historical personal data. Simply put, the more Google knows about you, the more they can charge for ads. And that desire to gather more and more data about you is at the heart of Google’s forward-looking strategy. This isn’t a surprise–privacy groups have been raising red flags about Google’s collection of personal data for some time, and the purchase of DoubleClick, including its own massive database of users, has sent privacy advocates into a tizzy.

What is a little surprising is how the CEO of Google framed this move as part of Google’s vision of the future. Schmidt said building a bigger database of personal data is key to Google’s expansion and the  "logical extension" of its celebrated mission to organise the world’s information.

"We are very early in the total information we have within Google. The algorithms will get better and we will get better at personalisation."

Later on, he says:

"We cannot even answer the most basic questions because we don’t know enough about you. That is the most important aspect of Google’s expansion.”

Now hold that thought that while I digress for a moment about what’s wrong with search engines. The problem with search engines is that you have to already know something about what you’re searching for in order for a search to be effective. This is critical not only for framing an effective search expression, but it’s even more critical for understanding the results. If, for example, you know absolutely nothing about Direct Response Marketing, other than the search term, you’ll have very little foundation to determine which results to put faith in. Should you believe the top search engine responses, which are vendors? Should you believe information from a Multi-Level marketing organization? From the AMA? Search engines provide no context for helping a user make such determinations of credibility or relevance.

So, while Schmidt says Google is early in it’s evolution, I couldn’t agree more. Search engines aren’t really all that great in organizing the world’s information so that it can be accessed in meaningful ways. I wish there were a statistic, for example, on abandoned searches. I bet the number is significant. But in looking forward to how Google should grow to address that challenge, I think we start to see where Google is really headed.

We already have an analog for effective searches that are personalized for the user. They’re called librarians. If you walk into a library and ask for a particular bit of information, the librarian is trained to ask a very small set of incisive questions to narrow down your search to identify the most reliable source for that information–without ever gathering personal information about all the other things you’re interested in. Google doesn’t want to do that. They’re married to the magic box where you just type in a word, and presto, you get tons of answers, relevant or not. Their idea of evolution is to gather so much information about every person that comes into the library, that they don’t have to ask you any questions, they can divine what you want based on your profile.

It doesn’t take much of a genius to figure out that asking two or three questions is a lot more effective than trying to store a massive profiling database to predetermine the answers. But it turns out that massive profiling database is where the money is for Google, because advertisers salivate over being able to precisely target their ads, and in turn to measure your response.

And this is where it gets down to brass tacks for Google. It’s not really about providing the best access to the world’s information for its users. If that were the case, it would emulate the thousands of years of history we have with libraries, and build a model where a few incisive questions lead to the right answer without a massive profiling of every breath you take. Instead, Google is all about organizing the world’s information about users, because that’s how it pays the bills.

Personally, I don’t have a problem with contextual heuristics that are used to actually help users find what they’re looking for–the kind of technology companies like Baynote provide. I think it’s a valid business model, but it doesn’t require the creation of massive profiling databases that store personal information. Why isn’t Google pioneering that kind of technology? Because it doesn’t come with $Billions in revenue. What I see happening with Google is a fork in the road when they choose to prioritize either the relevance and experience for the user trying to find information, or for the advertiser trying to find buyers. It’s really a question of who Google chooses to elevate as its true customer. From my position, it looks like they’re leaning toward the advertisers as their customers, and the search user as the raw materials for their business. I’m sure it’s good for Wall Street, but Main Street is starting to wonder about their privacy. In the end, that will eat into profits and brand equity.


3 thoughts on “Has Google Lost its Way?

  1. Chris

    Hey Adam! Good to see you here. Thanks for the link.

    I think it’s inevitable that any time a company grows that large, it runs into more challenges. It’s like speed–the faster you go, the more resistance there is pushing back against you. The bigger Google gets–especially if they’re growing on the back of personal data–the more people are going to worry about them. But more than that, I think they’re failing to innovate in the area that matters most–making information more accessible and relevant. They’re innovating a ton, to be sure, but not in ways that searchers really can see and feel. I think that will hurt them doubly when their growth attracts more negative attention.

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