Larry Page’s “Tidal Wave Moment”?

Who remembers the moment, back in 1995, when Bill Gates wrote his famous Internet Tidal Wave Memo? In it he rallied his entire organization to the cause of the Internet, calling the new platform an existential threat/opportunity for Microsoft’s entire business. In the memo Gates wrote:

“I assign the Internet the highest level of importance. In this memo I want to make clear that our focus on the Internet is crucial to every part of our business. The Internet is the most important single development to come along since the IBM PC was introduced in 1981.”

The memo runs more than 5300 words and includes highly detailed product plans across all of Microsoft. In retrospect, it probably wasn’t a genius move to be so transparent – the memo became public during the US Dept. of Justice action against Microsoft in the late 1990s.

It strikes me that Larry Page at Google could have written such a memo to all Googlers last year. Of course, Page and his advisors must have learned from Microsoft’s mistakes, and certainly don’t want a declarative memo floating around the vast clouds of Internet eternity. Bad things can happen from direct mandates such as those made by Gates – in the memo he mentions that Microsoft must “match and beat” Netscape, for example, words that came back to haunt him during the DOJ action.

Here’s what Page might have written to his staff in 2011, with just a few words shifted:

” I assign social networking the highest level of importance. In this memo I want to make clear that our focus on social networking is crucial to every part of our business. Social networking is the most important single development to come along since Google was introduced in 1998.”

I very much doubt Page wrote anywhere that Google must “match and beat” Facebook. And unlike Gates, he probably did not pen detailed memos about integrating Google+ into all of Google’s products (as Gates did – for pages – declaring that Microsoft must integrate the Internet into all of its core products.)

But it’s certainly not lost on any Googler how important “social” is to the company: all of their bonuses were tied to social last year.

So why am I bringing this up now? Well, I’ve got no news hook. I’m just doing research for the book, and came across the memo, and its tone and urgency struck a familiar note. The furor around Search Plus Your World has died down, but it left a bad taste in a lot of folks’ mouths. But put in the context of “existential threat,” it’s easier to understand why Google did what it did.

Unlike the Internet, which was a freely accessible resource that any company could incorporate into its products and services, to date “social” has been dominated by one company, a company that Google has been unable to work with. Imagine if, when Gates wrote his Tidal Wave memo, the “Internet” he spoke of was controlled entirely by, say, MCI, and that Microsoft was unable to secure a deal to get all that Internet goodness into its future products.

That seems to be where Google finds itself, at least by its own reckoning. To continue being a great search engine, it needs the identity and relationship data found, for the most part, behind Facebook’s walls.

I’ve written elsewhere about the breakdown of the open web, the move toward more “walled gardens of data,” and what that does to Google’s ability to execute its core business of search. And it’s not just social – readers have sent me tons of information that predict how mobile, in particular, will escape the traditional reaches of Google’s spidering business model. I hope to pore through that information and post more here, but for now, it’s worth reading a bit of history to put Google’s moves into broader context.

18 thoughts on “Larry Page’s “Tidal Wave Moment”?”

    1. Ha. Are you suggesting he’s chasing a white whale? I think he’s playing a long term game by moving in the present day tactical environment in which he’s found himself.

      1.  “Towards thee I roll, thou all-destroying but unconquering [Facebook]; to the last I grapple with thee; from hell’s heart I stab at thee; for hate’s sake I spit my last breath at thee.”

        Just sayin’.

  1. Oddly enough, “social networking” is older than Google.  That does not bode well for Larry Page’s understanding of the tidal forces of the Internet.  Then again, he invented PageRank.  The Math Union debunked the value of citation analysis years ago — and Web spammers took advantage of PageRank as soon as Google became significant.  So his track record for understanding the Internet is not nearly as good as his track record for building a huge honking company (and Eric Schmidt and 20-30,000 other Googlers deserve some credit for that as well).

  2. In 1995, the public Internet was but a year old and Bill Gates was prescient about the existential threat.  The playing field was wide open and it could be argued whether Microsoft made a good, bad or indifferent job of it.

    In 2010, Google was to all intents the primary gateway to the Internet for the majority of the global population (barring China and Russia).  By 2010, it was abundantly clear that Facebook was the clear winner in social networking.  To gain share in social networking, Google would have to find people who have never used social networking and/or disgruntled Facebook users but in both cases the friends of these two groups would most likely be on Facebook who are unlikely to move.  Also, Google+ is not significantly different from Facebook for mass migration to take place.

    Google can play the long game in social networking just as Microsoft has been playing the long game wrt web search with Bing for over 10 years now and annually lose ~$1bn doing so.  This is a classic error of market leaders in one category who want to be market leaders in another category where a dominant market leader has already been annointed by users.  Yep, they should all go re-read Crossing the Chasm and the Innovator’s Dilemma.

    Google is an engineering company and an appropriate response would be to create a new market where it can be the profitable leader.  Alternatively, they could re-invent an existing fragmented or poorly served market.  Both options sound a bit like Apple – well, it didn’t do them any harm. 

    1. Yes, I think Google (and honestly, many others) underestimated the size of the direct threat social had on the old model of search (not searchable, discovery tool etc)

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  4. Hi John,
    that’s an interesting way to look at, but it sure does not apply to a company that puts ethics above all else. Going into our 14th year as a company, we are doing fine: profits are at record level, we have a simply beautiful product line, and of course, we are very well diversified. But there’s more at stake, the net itself is under threat.

    That’s what keeps us awake at night and drives the thoughtful discussions at the many Google cafeterias, internal mailing lists, Google bus and everywhere else. Facebook, Twitter and other closed web companies had a choice to either let us thoughtfully show all their information on Google or keep the best part for themselves and serve their own ads.

    This is against our core values, we shouldn’t be asked to pay to spread knowledge. No one knows better than you how much money Google has spent to scan other people’s books, or to fight other companies that want to profit from their copyright, patents and other excuses. Let their data be free, we’re ready to crawl and display it along Google ads. 

    1. I appreciate your comment Matt, and know that core belief is strong within the ranks of Googlers. But what in the post do you disagree with? The post was an attempt to put Google’s moves with G+ into context – the company, i think, had no other choice. It seems to me our old concepts of how the open web should work is fundamentally broken, by the rise of apps and services that for various reasons believe sharing with Google will hurt their core business propositions. And the Open vs. Closed analogy works only so far. I think the key is to ask what kind of commons do we want (as I wrote in the previous post), and fight for that. It was an inability to come to business terms that led to Twitter and Facebook not working with Google. That requires two sides agreeing on the value and opportunity costs associated with a deal. And those two sides could not. I don’t blame anyone for this – I am sure each side felt they were giving up more value than the other. The result, as I’ve written as well, is that we get – for a while only, I hope – a broken web experience. I’d also argue that Google’s mission of “spreading knowledge” is great, but you do it with ads attached and by hovering up data and using it to create new (and potentially competing) services. Twitter and Facebook don’t want to see their native ability to be independent companies at the mercy or a powerful third party. Perhaps Google would agree to not run ads against their data, and to not build competing services? And/or split the revenue 50.50 with the partners? I’m only sort of joking here. I’m sure all cards were on the table, and so far what I’ve heard from each side is that the other asked for too much. You know I’m a fan of Google. And I’m a fan of the Internet. I’ll be down there soon and hope we can talk more.

      1. I apologize for the delay in responding, now that I am an executive (you may have heard about the two trips I took to Asia this month) time is more limited.

        The huge difference is that our ads are not evil, they do not take away from the experience but instead enhance it. The same cannot be said about networks that have differentiated ads. In a Googley world users would not know what’s an ad and what’s not as both would be blended into a marvelous and unified product.

        I’m speaking for myself here, but writers, filmmakers and other content owners should invest to produce
        top quality content but then release their masterpieces for free so we can crawl and display to the world. With so much wealth and education disparity in the world, they shouldn’t be like Microsoft, Apple and other greedy companies that try to profit from their own R&D and ingenuity.

        Call me before coming to the Plex so we can continue this discussion. I’ll also introduce you to some of our new team-members and maybe I’ll show you some of our beta products. Maybe 😉

      2. To me was just day as a Googler, but others noticed that I was no longer the old Matt Cutts. You know, the one that made weird, Marshall Applewhite style videos saying nothing or dispensing mundane advice on things like robots.txt, get press and even relationship advice. I had moved up.

        Now I’m laying a bit low, it’s time for Amit to go out there and ruin his reputation with “my dream while growing up in India…Star Trek AI” and other nonsense when all he wants is to increase Google’s revenue. We’re diversified John, each site we index is a potential revenue source. Amit has mastered forcing sites to advertise (nothing works like a sudden drop in the ranks!!) and we choose to go live with the algorithm that results in most clicks on ads. If a new vertical search start-up starts to get big, my team sees if their content is “thin or shallow” and penalizes them. These are exciting times John.

        P.S. For your next book I have a few anecdotes about hot mangoes, why I left Facebook in disgust (I’m huge on privacy) and watching porn while eating cooking. That last one never get old.

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