John Battelle's Searchblog

Also, the article quotes Google’s Eric Schmidt paraphrasing the Google founders: “We took huge risks when we had no cash. Now we have all of this cash and we take few risks.”

Whaaa? Is he serious? Eric Schmidt seriously believes that Google took more risks earlier on?

You mean like early on, before they had cash, Google was much more willing to do things like Book Search (a project of such importance that Marissa Mayer has called it Google's "moonshot"), and risk getting sued by all the copyright holders, like they are now?

Nope, that risk came about in October 2004, half a year after the IPO.

Or before they had cash, Google decided to create YouTube, and get people to host all sorts of copyrighted videos (and risk getting sued by Viacom)? Because they were much more risk-seeking and risk-taking than they are now?

Nope, that risk came about in October of 2006. (Google Video also started in early 2005, post IPO, if I remember correctly. And even then, it was much more risk averse than YouTube. Google even created its own DRM, to lower the risk even further. So if anything, the step from Google Video to YouTube shows and increase in risky behavior.)

Or before they had cash, they took a bunch of risks in China, with censorship?

Nope, that risk is recent and ongoing.

Or before they had cash, they made the decision to expand into gaudy and irrelevant banner ads (doubleclick), thus risking the alienation of the fan base that got them to where they are today? Or expand into all sorts of other non-relevance-based advertising, such as radio, etc., and again risk alienating those very same early adopter Google purists?

Again, recent and ongoing.

No, sometimes I wonder what substances these execs have stuffed into their pipes (with all due respect) when they say things like that. Google is insanely more risky now than they were before they had money. Not the other way around. And they seem to be growing riskier and riskier, trying out video ads, etc.

I remember having conversations with some fairly senior execs in 2002, and I remember proposing that they do some of the things w/r/t media they are now starting to do. Their responses were basically to say no way in h***; it's too risky. And yet now they are taking many of these exact same risks that they were too cautious to take back then, before they had money.

I believe just by the nature of going into a venture like Google they took a risk, anything after the first steps is little in contrast to the risk of just getting into the space. The fact they have a large amount of capitol only means they have much more to loose.

I don't blame bureaucracy for Google's failure to innovate.

Neither did the original CNN article (IMHO) -- like check this quote:

>> Think of it this way. If they are a household brand...

Think about that! A household brand?!? -- since when did Google say the goal of the company was to be a "household brand"?

Google has repeatedly refuted the principles which made it "popular" -- and the IPO was simply the first indication that they were going to "cash out".

When the wider public realizes this, the shares will undoubtedly tank.

Then Google will become a household brand alright -- but perhaps not the household brand it might aspire to be: instead, it will join the ranks of deflated bubble has-beens.

I believe just by the nature of going into a venture like Google they took a risk, anything after the first steps is little in contrast to the risk of just getting into the space.

While it's true that starting any venture is a risk, that argument is somewhat of a red herring for what we're talking about here. First, they were risking an Angel's money, not their own. Second, they came on to the market with a new idea, rather than tried to introduce a new idea while they were already at the top of the market.

So let's divide Google into three phases: 1996-2000, 2000-2004(IPO) and 2004-2008.

Phase 1 was startup mode. Ok fine, you build something, you're not sure if you'll succeed, but you've got youth and passion and are willing to make a go of it. If you want to call that "risky" behavior, then fine.

But what is more interesting is comparing Google from 2000-2004, with Google from 2004-2008. What Schmidt seems to be saying is that, even from 2000-2004, before Google actually had money, they were taking a lot more risks than they did from 2004-2008.

And I just don't see how that is true. Google was very, very conservative from 2000-2004. (I started using Google in late 1998/early 1999, so I watched this whole thing first-hand.) They didn't really take many risks. They didn't risk putting ads above the SERPs, like they do now. In 2000, before they really had mindshare, that would have cluttered the page too much, and put people off. In 2000, they were extremely wary of playing in the media space, with borderline legal activities such as the book scanning and rampant YouTubing. Are you kidding? If Google had tried things like that in 2000, they would have been wiped clean off the map just as fast as the original Napster had been. It's only once they started getting money (and mindshare) that they started becoming riskier in their behaviours.

Or am I high? Someone else tell me if they saw Google doing things from 2000-2004 that were riskier than they are now. Maybe I just have a blindspot?

But don't give me some platitude about how starting any business is risky. Yes yes yes, we know that. But that's not the interesting, or relevant, comparison, here.