#Activate 2010 - a load of Schmidt?

Been catching up this afternoon with what Eric Schmidt said at Actvate 2010 yesterday, its been reported in the Torygraph, Grauniad and El Reg (I am ignoring the twitterstream from now on - here's why). If you are interested in what will happen in the next 2 - 3 years then its worth catching up n as there are Googlefingers in so many pies, and the guy is no fool - maybe Evil, but no fool.

Schmidt said there were 3 big trends - the growth of mobile internet connectivity, the growth of cloud computing, and networking. To me those are two big trends - mobile and cloud - the other is an underlying architecture. I also think he is trying a 3 pot shuffle - to me, the three things that look like the 3 Big Trends in the Googleverse are Mobile, Cloud - and slipping past the Privacy/Trust issue in datamining. So, in reverse order:


Trusssst in Meeee

(From the Torygraph)

Schmidt says this enables them to deliver better-targeted ads - more lucrative for Google, more relevant and less annoying for you. However, it raises privacy issues, something for which Google has been criticised.

"I think the criticism is fine. I think criticism informs us, it makes us better. It doesn't bother me at all,” Schmidt says. However, he acknowledges the problem but says it’s a broader issue. "Those concerns are real - I'm not trying to move away from them. The fact of the matter is that if you're online all the time, computers are generating a lot of information about you. This is not a Google decision, this is a societal decision. In Britain, you all allow yourselves to be photographed on every street corner. Where are the riots?”

Google, Schmidt says, is kept in check by its customers and by the competition: “All of our testing indicates that the vast majority of people are perfectly happy with our policy. And this message is the message that nobody wants to hear so let me say it again: the reality is we make decisions based on what the average user tells us and we do check. And the reason that you should trust us is that if we were to violate that trust people would move immediately to someone else. We're very non-sticky so we have a very high interest in maintaining the trust of those users."

In other words trust the Wisdom Of The Crowds to know what is good for them. In that way you can fool most of the dumb b*star....er, People most of the time...... Sadly for Google, that does not apear to be the ay it is working - too many people who can't be fooled are taking too close an interest.


Mobile Internet

(From the Grauniad)

"Mobile is the hottest area of computer technology," Schmidt said. "The smartest developers now are writing apps for mobile before they write for Windows or Apple Mac desktop operating systems. Part of that is because these devices are hugely personal to us when we use them."

Asked what he thought of the future of newspapers, Schmidt said: "What does the newsreading experience look like many years from now? I think it's delivered to a digital device, which has text, obviously, but also colour, and video, and the ability to dig very deeply into what you are supplied with. At the moment we have readers, but it's not intelligent enough; newspapers often tell me what I already know. We'll have advertising products that are much more media-centric. The most important thing is that it will be more personalised."

They will beat Apple by suing the Microsoft Gambit

"We don't have a plan to beat Apple, that's not how we operate," Schmidt says. "We're trying to do something different than Apple and the good news is that Apple is making that very easy."

"The difference between the Apple model and the Google model is easy to understand - they're completely different. The Google model is completely open. You can basically take the software - it's free - you can modify whatever you want, you can add any kind of app, you can build any kind of business model on top of it and you can add any kind of hardware. The Apple model is the inverse."

Except that when Microsoft played Apple they had all the App developers, and a good hardware distribution network - two things Google/Android is struggling with - as El Reg notes:

Google CEO Eric Schmidt has convinced himself that the company killed its sold-direct-to-netizen Nexus One phone after less than six months because it was "so successful."

"The idea a year and a half ago was to do the Nexus One to try to move the phone platform hardware business forward. It clearly did," Schmidt told The Telegraph, demonstrating just how far removed from reality his mind has become.

Microsoft never did direct sales. A lesson for Google there methinks. It is possible for them to win the "Microsoft" position in the mobile smart device market, but to do so - if Microsoft's lesson is anything to go buy - you have to have a large scale 3rd party distribution system (IBM, anyone?) and the lions share of the developers on your platform.



The Cloud

(From the ToryGraph)

This is about more than just selling people a new product, it’s about shaping a social change. Within three-to-five years, Schmidt says, we’ll be consuming almost all of our information online. We’ll do it, he adds, “on devices that are live not static. The characteristics of these devices are that they know who you are, they know where you are, they can play video and they carry memory."

To get a sense of the likely rate of change of the next three-to-five years, think back over the same period. Google has bought YouTube, launched Google Docs, taken leaps forward in mapping and expanded into mobile operating systems with Android and desktop operating systems with Chrome OS.

The Cloud is upon us! And yet, and yet...... every 10 years or so some company pops up with the (rather self serving) nostrum that The Cloud will rule. And all the Kings horses and all the Kings men spend PR money like water, but it dies down again as reality intrudes. Mr Schmidts says that:

"The internet is the most disruptive technology in history, even more than something like electricity, because it replaces scarcity with abundance, so that any business built on scarcity is completely upturned as it arrives there," Schmidt said. "You have to plan your corporate strategy around what the internet does."

Leaving aside whether or not the Internet is " the most disruptive technology in history", a lot of people think IP will be like electricity and other commodities, but consider the differences:

- There are no similar "economies of scale" for production infrastructure to justify massive centralised plants vs local production. This is seen in the (reluctant) admission by Cloudists that its benefit is not cost saving.

- The variabiity required in the end product is far higher (for now anyway), so the benefits of end product commoditisation are not as high and the complexity costs of its mass delivery are worse.

- Those who win from mass centralisation (Cloucd Co's) are not those who own the Transport infrastructure - objectives are not aligned. Witness the 'Net Neutrality bunfight.

- "There is no Plan B" if a Cloud based infrastructure goes down, at least in the forseeable future. Nobody with any form of risk will thus put all their eggs in its basket.

- There is not as much fungibility in the supply chain. Apple locks you in one way, Facebook another, etc etc. Imagine if your dishwasher would only work off one companies' electricity and your TV off anothers.

In other words, The Cloud ain't going to take over anytime soon. But then, Google knows that, which is why its not putting a lot of its resources into it - the main Googlegame is to try and wreck Microsoft's economics by giving it away for free. Which is, of course, why Microsoft has gone into Search with Bing.....