From an interview in the LA Times:
Q: Is Google a media company or a technology company?
A: It’s better to think of Google as a technology company. Google is run by three computer scientists, and Google is an innovator in technology in our space. We’re in the advertising business — 99% of our revenue is advertising-related. But that doesn’t make us a media company. We don’t do our own content. We get you to someone else’s content faster.
Now, it’s true that Google gets you to other people’s content faster. That’s the basis of the media revolution I’ve been on about for some time now .
But to equate Google not doing its own content with a free pass from the media company classification is, well, absurd. That presumes that media companies only make packaged goods – traditional content – and ignores the fact that the majority of media companies in a post web world (and plenty in the pre web world) are not “creators of content” they are innovators in the media experience business in one way or another. Is Comcast in the media business? After all, they really are only distributors of content. EMI Records? Well, they don’t “make their own content” – the musicians do. What about FM? We don’t “make content” – and we do have a technology platform. But don’t tell me we’re not in the media business.
Same for Google. The search engine is inherently a media tool: it innovates in the assembly of useful information. Now, let’s talk about the other media products in Google’s arsenal: Google Finance? Check. Google Video? Check. Blogger, Google Answers, Google Base, Map, Book Search, Earth, Images, Local, Catalogs, News, Mail….check check check!
I’m quite sure the folks at Google are aware of this, and this is most likely an issue of competitive semantics, in the end. First, media businesses, in the main, command far lower valuations on Wall Street than technology businesses. Bill Gates had this same issue back in the 1990s, as I pointed out earlier. And second, the entire media world is fearful of Google; insisting you are not in their business is a placating calculation. But my two cents: No one is buying it.
13 thoughts on “Eric Schmidt Still Sees Google as A Technology Company; But We Know It’s More…”
I’m first here to Bros!
Battelle you should send me a free book for all the ads I clicked for you.
Psst. Third graf should not be italicized.
Off topic but did Google get rid of cache?
There’s another reason Google might want to keep their image as a tech company rather than media: recruiting. A cornerstone of their strategy is hiring superstar engineers. That kind of candidate wants to work for a technology company, not for the tech department of a media company.
Can’t agree more with John’s argument, but why does it have to be one or the other? And more importantly, what wouldn’t fall under the definition of “media business” on the Internet today? The lines are blurred (thanks to Google).
I totally agree that Schmidt’s posturing Google as a technology company, and not a media company, is a pretty obvious subterfuge. I also agree with Roman that the lines between the two are totally blurred for any Internet business. As a “mediatech” investor, many of the more interesting and exciting investment opportunities are precisely companies that historically would have been thought of as technology vendors but in fact are equally considered media companies. Some of our most successful investments over the years have been tools/enablers for emerging platforms: Powersoft (client/server), Allaire and Akamai (Internet 1.0). And one of our recent investments that has me personally excited is Automattic, the providers of the WordPress blog publishing platform. In my view, the fact that this new tool for “2.0” web publishing is not simply a technology vendor, but will also have media-related business opportunities, is more something to be excited about than to hide from.
Blogger by definition makes them a media company. I never thought of them denying it because of how Wall Street treats Media stocks but it makes sense. If they were valued like NWS or NYT the stock would be selling at around $80.
Just as the term Web 2.0 was started to fill a void..
an official proposal for a new term…* TechMedia *
Wouldn’t it be wild if this really took off :LOL 🙂
technology is the application of science and art. and at the center of that definition is the word “application”. technology w/o an application is vapor. and money can’t be made from vaporware (well, sometimes you can). anyways, google creates technology, but it is making money from its applications, thus, it is an application (software) company: a search application, and ad application, and other applications, such as its unnamed collaboration suite (IM, email, calendar, groups, etc etc).
It should come as no surprise that, as more and more media companies (esp Newscorp) are posturing themselves as technology companies that the lines should be blurred.
After all, television is largely a technology that delivers a media. There are is a tremendous amount of tech developed by the networks – but they are seen as pure media. Because their emphasis – their ers – was media focused.
Today, we have a lot of tech – based around the provision and use of information. Without the information, the tech is worthless. It’s just gizmos.
i think maybe we are overlooking the obvious: as a tech company, schmidt’s and the founders’ ongoing roles are apparant.
but as a media company, well, who in the world would hire eric schmidt to be CEO of a major media company?
Tech or media dilemna reflects the fight between day-to-day operation, the Chief Operations Officer, who is happy with the media/sales/advertising label, and the strategy team concerned with long term competitiveness.
Disruptive edge on the market is provided by technology, day to day earnings are provided by advertising and media.
Long term versus short term. Strategy versus tactic. One can’t live without the other.
for me, google is more of an e-commerce, business site. 🙁 the PPCs overrated. and Google earns a lot with their pay-per-click programs.
but, seriously, i think google’s a bit of both: technology and media site.