>>HOCKENBERRY: Please welcome to the 25th
Anniversary of the MIT Media Lab, the CEO and Chairman of Google, Eric Schmidt.
>>SCHMIDT: Thank you. Thank you, thank you very much. Thank you for having me.
>>HOCKENBERRY: When I tell you smile, you have a big smile, indeed. It’s great to have
you here. Thanks Eric for joining.>>SCHMIDT: I [INDISTINCT], this place spawned
a lot of what I live in everyday. Ten years ago, a lot of our employees, when I visited
a long time ago, it’s like I said, “That’ll never happen.” It happens everyday now.
>>HOCKENBERRY: So if somebody comes to you with Media Lab on their resume, that’s a good
thing.>>SCHMIDT: We’ll hire them. We’ll hire them.
>>HOCKENBERRY: That’s a good–you’ll hire them, I see.
>>SCHMIDT: Yeah.>>HOCKENBERRY: You know, are you sticking
around for the party?>>SCHMIDT: Yes.
>>HOCKENBERRY: Yeah.>>SCHMIDT: We have a whole team here.
>>HOCKENBERRY: I see. We’ll you’re going…>>SCHMIDT: My guess is the demos that you
guys are going to see later are the future for the next 10 years.
>>HOCKENBERRY: That’s great. But you’ll probably have some attention at the party later, so
I’d keep your entourage like right around you. Eric, I want to talk about the institution
of Google and institutions of change and entrepreneurship, and I think we loosely use the terms entrepreneur,
innovator and discover in this economy. And I’m wondering if there are institutions that
foster entrepreneurs and innovators, and people who discover sort of basic deep problems that
may not have immediate results or those best worked out in separate institutions?
>>SCHMIDT: I’m struck by a couple of things. One, we have Marvin Minsky here; he’s one
of my personal heroes. There are people who in the 60’s foresaw–sort of creating what
we have today when they created Kendall Square and Kendall Square Research, and all of that,
the progenitors of modern computing. And I’m really struck when I spend time in our government
with how much incumbency drives no change and how this group and the culture that’s
represented basically in Cambridge, in Silicon Valley, and a few other places in America,
really are different. And we, because we spend so much time with each other, we assume we’re
the norm, we’re not. We’re not the norm. That’s why television doesn’t quite make sense to
us. So what they’re saying, “It doesn’t quite compute.” Whereas in this case, the students
are the model of the university, the funding model, their R&D centers, which are linked
pretty tightly together now, really do believe in discontinuous change. So I would argue
that the solutions to the problems that we have in humanity, in government, in society
as a whole will be not made by the incumbents but rather by people like people in this room.
>>HOCKENBERRY: Well, let’s talk a little bit about the difference between an entrepreneur
who takes maybe existing intellectual property and takes advantage of it in the market place
and creates a sustaining model for it as a business; an innovator is something that seems
to be a hybrid between a discoverer and an entrepreneur. And then of course, I think,
you know, people who work in basic research labs like Watson, like Kendall, like Xerox
PARC, like the Media Lab, are basically working on problems where there is not necessarily
an expectation. What kinds of investments foster those different individuals and do
you separate that function at Google?>>SCHMIDT: We try not to because it’s so–one
of this does happen–is this all gotten interlinked and these distinctions are not as important
as they were, it just involves doing amazing things. And one thing you learn as an executive
is when you walk through the hall, if you ask people who are the–think people doing
the most interesting things, everyone agrees. So it doesn’t really matter how we score it,
we actually just know. And I’m really struck now by–my entire career started with DARPA,
NSF, and the kind of funding that people, you know, generation before me figured was
important. The history of American funding of major Universities, including MIT, started
in the post war period by understanding that having a robust investment of basic science
which precedes all of us, you know, the–what allows us to get these extraordinary returns
in terms of semiconductors; it’s really physics, right? All of those investments that occurred
in the 60’s and 70’s, and 80’s, we’re now the beneficiaries of. So, unlike our children,
let’s thank our parents, right. Let’s actually recognize that people actually worked very
hard to create an opportunity that we all now a benefit from.
>>HOCKENBERRY: But let’s explore the frame there. They were motivated by a Cold War almost
fear mentality, that we had to compete with the Russians. Today…
>>SCHMIDT: Now we can be afraid of our competitors in the economic sense. Whatever works…
>>HOCKENBERRY: Right, it doesn’t…>>SCHMIDT: …that causes more money to come
to basic research is a good outcome.>>HOCKENBERRY: But do those motives pursue
or produce the same kinds of outcomes? In other words, do we–can we formulate the same
kind of urgency about investing an innovation today without a Cold War, as our parents did?
>>SCHMIDT: Well, I would hope so. I mean it, let’s–if you watch enough television
[INDISTINCT] spend enough time in Washington, what’s the future of America? Okay? Massive
deficits, lost of manufacturing jobs overseas, an increasing number of healthcare services
jobs which are relatively low paid, declining productivity and aside from the brilliant
aspects of our leading universities, no American leadership in anything. That’s the sum of
the message. So what’s your answer? Your answer is innovation.
>>HOCKENBERRY: All right. But the motive there is we’re failing, let’s stop failing.
And…>>SCHMIDT: Well, let’s start with advanced
manufacturing jobs. Here in Cambridge, you have the largest cluster as far as I can tell
of biotech and biologic related businesses. That didn’t occur by accident, it’s not some
random event that had occurred in Cambridge. It occurred because people foresaw that a
cluster of such investments built around the innovation in Harvard, in MIT, in the various
institutes that exist, would create whether in fact the millions of jobs and leading position
globally, that can be reproduced.>>HOCKENBERRY: Not NSF though, not DARPA,
not the institutions of government and policy that were operating in the 50’s and 60’s.
>>SCHMIDT: Well NSF and DARPA did other things. They’re–these guy’s funding comes out of
the–basically the National Institute for Health. The important point is, I don’t care
how the money happens, what I recognize is that you have young people who have an idea
and they need the access. There’s a problem by the way in America that there’s a value
of deficit as it’s called, that the leading universities including MIT and Harvard, and
another here in the Boston area, Boston University, have ideas involving, for example, nanotechnology
and they cannot get enough funding now. So it’s really a national emergency in terms
of trying to get these businesses built.>>HOCKENBERRY: Well, let’s talk a little
bit about what Marvin Minsky used to tell me years ago and I thought it was so clever
and advanced, and it was more evidence that–what I’ve always believed is that Marvin is actually
a visitor from another planet and it wasn’t…>>SCHMIDT: Would you like [INDISTINCT]?
>>HOCKENBERRY: It wasn’t reality. We’ll talk about that a little bit later.
>>SCHMIDT: [INDISTINCT] Perhaps you can[INDISTINCT], I’m sure.
>>HOCKENBERRY: A little bit later. No, but he describe that what was going on at the
Media Lab was actually human evolution, it wasn’t a creation of tools. And the [INDISTINCT]
actually on my program this morning referred to this network nervous system that exists
around us in the wireless domain, you’ve talked about something called enhanced humanity.
>>SCHMIDT: Yeah, [INDISTINCT].>>HOCKENBERRY: Augmented humanity. What…?
>>SCHMIDT: Let me make the argument as follows; let’s fast forward a few years. Everybody
here has a mobile phone at the moment in your cameras and so forth and so on, all of these
phones will follow Moore’s Law in these amazing ways, the phones know where they are and they’re
highly personal. So what do I really want, since I’m a tourist here in Cambridge? As
I walked down the street, I want the phone to, or whatever the device tablet to tell
me, “Yes, you were here two years ago. Yes, that store is a different store. Yes, you
need some new pants, Eric. Actually, your shirt is kind of dirty, maybe you should go
over there, you could buy a really good bargain.” You walk into the store and it says, “By the
way, just for you Eric, here’s a 10% off coupon if you buy right now.” Now, this is all with
my permission by the way, all something that I chose to do and it remembers that. Now today,
how does that work for me as an executive? I have an assistant who remembers what hotels
I like and where I’m going and sort of keeps me and tells me, “You’re late, as usual. Get
over here.” Why can’t the device, why can’t the network sort of know that and help me
if I want it to. Right? That’s the possibility that this new model describes. I’m quite convinced
that what we call hyper locals, sort of local mobile social, has a set of killer applications.
I’m also quite convince that the Media Lab has some very interesting ideas in the space
that can help us with it.>>HOCKENBERRY: And do you–to note the difference
between an individual who has that capability and an individual who doesn’t have that capability
at this point, just note the difference between Eric and my shoes this morning. Eric [INDISTINCT]
so, that’s very easy.>>SCHMIDT: And one of the com–one of the
comments about computers is we always get confused about what computers are good at.
Computers are not very good at feeling, judgment, emotion, although people are working on those,
people–computers are extremely good at dealing with billions of things of information and
doing various forms of calculations that produce interesting results. These computers can remember
everything, and humans can remember almost nothing especially as you get older, right?
So the fact of the matter is that society will change based on the fact that computers
are very good at what they’re good at and computers–and people are still very good
at what we’re good at. And by the way, remember that most of the machine learning algorithms
learn from people, right, you train them. So, ideally what will happen is that in this
sort of, I don’t know how you want to call it, but in this collaboration between this
emergent amount of machine technology and the human condition, the collaboration is
helpful to both. Right? That human can train computers and can–computers can help human
live their lives better. I would argue in fact that the goal needs to be set completely
differently than ways normally the goal has been set to use computers more. I would argue
that the goals is to use computers less, right? That in fact the computer is just around if
you need it and otherwise you are free to actually do what humans like to do which is
to have a good time, be productive, care about your family, or what have you. Right? And
then in fact that the sort of the hours that I spent reprogramming my PC in Window 7, you
know, over the weekend is not a very good use of my time. You know, why I chose to do
that is a separate problem involving my judgment.>>HOCKENBERRY: Yes.
>>SCHMIDT: But the fact of the matter is…>>HOCKENBERRY: Yes, I would–I would say…
>>SCHMIDT: But, you know, and I would argue that if you take a look, hit it with–at the
iPad, part of the reason it’s so successful is precisely because it works so simply and
it just works. And that the just works option, which I think has been pioneered here and
a couple of other places, is in fact a new discovery for most computer scientists. And
Google, of course, is also trying to do the just works and its support in its businesses
as well.>>HOCKENBERRY: There are people who can help
you with your judgment problem in this room probably and you may hear from them later
on today. Two questions, a personal one and one I think that is more global, about the
identity of Google today. I’ve always wanted to ask you this Eric, what do you do when
you absolutely don’t want to be distracted?>>SCHMIDT: Turn your computer off.
>>HOCKENBERRY: But then–when you have to actually do something as well.
>>SCHMIDT: I’d read a book.>>HOCKENBERRY: There we go.
>>SCHMIDT: I know it’s boring. I actually also read a newspaper, a physical newspaper.
I know it’s going out of style.>>HOCKENBERRY: Such a–such a chuckle head.
Newspapers and books.>>SCHMIDT: Newspapers and books.
>>HOCKENBERRY: Love that. God, I love that.>>SCHMIDT: You know, you actually read stuff.
>>HOCKENBERRY: Yeah, the man needs a hug.>>SCHMIDT: I also listen–I also listen to
music.>>HOCKENBERRY: Yeah. You’re a public radio
fan, too.>>SCHMIDT: Yes.
>>HOCKENBERRY: Yes, I’m glad of that.>>SCHMIDT: Also to–I listen to public radio
on–and on Podcast.>>HOCKENBERRY: There we go.
>>SCHMIDT: Of which there are–turns out your show and virtually everything else, is
now highly searchable.>>HOCKENBERRY: Indeed, and the tipping points
of whether people listen to things time shifted or in the broadcast medium is rapidly approaching
for each individual…>>SCHMIDT: What’s interesting is that debate
is not a debate that’s interesting to most people. It’s the debate that’s fascinating
to the media industry. The average person now lives in a world of infinite choice of
information, they carry it around with them and they listen to when they want to.
>>HOCKENBERRY: No, absolutely. I…>>SCHMIDT: It seems pretty straight forward.
>>HOCKENBERRY: So, the–no, and I agree but today in your announcement of quarterly earnings,
you reported a billion dollar revenue in mobile–in the mobile space is that a tipping point?
>>SCHMIDT: Well…>>HOCKENBERRY: Advertising revenue.
>>SCHMIDT: Anything that’s a billion dollars is good and anything that’s growing fast…
>>HOCKENBERRY: Oh.>>SCHMIDT: And anything that’s [INDISTINCT]…
>>HOCKENBERRY: Let me just write that.>>SCHMIDT: …is even better.
>>HOCKENBERRY: No.>>SCHMIDT: A simple rule for those of you–those
of you who are CEOs is that rising revenue solves all known problems. So, I…
>>HOCKENBERRY: Well, let’s focus on that thing for a moment. I think it’s fair to say
that in the 21st century you are one of the few figures who we might compare with individuals
from the classic Gilded Age of America a century ago.
>>SCHMIDT: Okay.>>HOCKENBERRY: And that is both a responsibility
and probably an annoyance.>>SCHMIDT: Although, I would argue, Wall
Street is top of the ladder–is there.>>HOCKENBERRY: Probably, yes. In the case
of the Gilded Age most of the individuals who ran big institutions, big corporations
were monopolies. I think, you, probably unique to the individuals that we’re speaking of
in this room represent something that could possibly be called monopoly but it’s maybe
something more [INDISTINCT] ubiquity. Google has ubiquity. Monopolies are something–Microsoft
is a monopoly, or was a monopoly at one point. It’ll argue that.
>>SCHMIDT: Was found guilty of being a monopoly.>>HOCKENBERRY: Yup. Exactly. It was found
guilty of being a monopoly, actually.>>SCHMIDT: Just get the facts straight.
>>HOCKENBERRY: Yeah. Something that you don’t like to point out in crowds of people, in
public…>>SCHMIDT: No, I could do a Google search
[INDISTINCT]>>HOCKENBERRY: Exactly right. Yeah, exactly
right. Is ubiquity–because a lot of people have described monopolies as being a non-innovative
mode that monopolies tend to become risk averse and have difficulty with innovation–is ubiquity
something different? Does the social network capability of being ubiquitous allow you an
innovative capacity that has, perhaps, not existed before?
>>SCHMIDT: We don’t phrase it that way but I’m happy with the phrasing that you described.
What we phrase it as just focus on the user and all else will work. So we don’t spend
an awful lot of time–the classic thing that happens is people who have MBA degree show
up and they say like, “Where is the revenue plan? Okay. Where is your business plan? Where
is your ROI calculation,” and so forth. And those are hard to find. What you find is a
very, very strong focus on getting more users to use stuff. And if you can get enough users
to use stuff, you can make money doing it. And so philosophically, that aligns us with
end-user interest, we hope. That it also aligns us with scale. So you have an end-user focused
business that scales rapidly; which, I think, is ultimately the way you expressed the ubiquity
point. The problem with monopoly is that monopoly ultimately allows you to–puts you in opposition
to the goals of your end-user because, ultimately, end-users, in fact, do want choice. All right?
They want–and, indeed, we do lots of things to prevent us from being a monopoly. We allow
people to take their data wherever they want and if they become dissatisfied with us and
it’s an internal check and balance on our own power.
>>HOCKENBERRY: We want to open it to questions from you, so prepare yours. [INDISTINCT] raise
your hands, call out your questions. I will repeat it so everyone can hear it. We’ll do
that in just a moment. Does Google have a foreign policy?
>>SCHMIDT: Well, you can see how well it worked in China, you know, one day, somebody
said, “Well, finally…” one of, in fact, one of your politicians in Boston said, “Google
versus China, finally an equal match.” Well, you saw what happened. We take a particular
view on information which is, I think, a western view and I think most western countries would
agree with it. What I’ve learned is an awful lot of countries that–there are an awful
lot of countries that don’t like our view, China, obviously, because of the censorship
rules, but there are others. Typical example would be that a bad video gets uploaded; we
take it down, and then YouTube gets blocked for a year. Now that could be because we so
annoyed the leaders of that country that they’re being–they’re punishing us. An alternative
hypothesis, you always want to have an alternative hypothesis in a PhD program, is that, perhaps,
those leaders are embarrassed by the multiplicity of YouTube videos critical of their leadership,
so we’re never really quite sure. So we’ve taken the position that, ultimately, if you
want to play in the modern world, you have to be pretty information transparent. We believe
in transparency and open access, and that gets us into trouble but it is what we believe.
>>HOCKENBERRY: The world population in 1800 was about two billion which is estimated to
be the amount of people or the number of people who are actively online in the world today.
What would that world look like when six to eight billion are online? And what will Google
look like in that case?>>SCHMIDT: Well, one of the things that I
am personally proudest of, and I hope you are all as well, is the number of people who
have come into the global conversation who, literally, had no choice without the success
of the Internet and telecommunication’s revolution. So I am beyond excited that there’s on the
order of four billion mobile phones, mostly which are the feature phones, the less capable
phones. I’m beyond excited that there are 800 billion–800 million to a billion smartphones.
And I’m even more excited that another generation of phones is coming–which is going to hit
that 30, 50, $60 price point, which allows you to get another billion of those phones
out into the market. So what happens when you have a powerful browser in the hands of
people who’ve never seen anything except maybe at television, in a shared model? We haven’t
heard from them. We don’t really know what they think. I personally believe they all
care about Britney Spears and I think we’re going to discover that. But we don’t–but
we don’t know. Right? So it probably means greater global brands. It probably also means
greater global access, and it also means that we may hear from them and we’ll hear what
their lives are like in the same way that CNN, in the ’70s and’80s, exposed the horrific
conditions of people that we could never see before, and television bring those images
directly to you. Now these people have phones and video cameras and they can record both
good aspects of their culture but also the terrible situations that, for example, limit
or–that are put in the third world. And I think it leads to–the transparency leads
to–the openness lead, ultimately, to making the world a better place.
>>HOCKENBERRY: So you would say, and this is a very positive note that I wasn’t necessarily
expecting, that because of precisely that, the possibilities for a huge corporation like
Google to take steps in hearing those individuals beginning to join this community and taking
steps to improve their lives, the opportunity to do good even as a ubiquitous near monopoly
is as good as it’s ever been.>>SCHMIDT: Well, the goal of the company
is to do good and so it’s only a good thing when people have access to broadband. So an
example would be the role of 4G in the western world, in Europe and in the United States.
Trust me, the people at the Medial Lab will figure out what to do with 10 megabits but
low latency that’s continuously streamed to your tablet and phone. Trust me, we can use
that. I’m not worried about that. Same argument about people who’ve never had access before,
what will they do? Well, I mean, we think they’re all going to spend their time checking
for crop yields and so forth. A much more likely scenario is they’re going to be heavily
obsessed with entertainment because they’re human beings and people are the same everywhere.
So that again is–in my view, a positive effect of this. And our business approach is to get
them wired and then not worry too much about what happens after that because they’re clever
and these platforms work. And eventually, there will be business opportunities five,
10, 20 years from now, which will be massive. Right?
>>HOCKENBERRY: But we have [INDISTINCT] listening.>>SCHMIDT: Well, we better be.
>>HOCKENBERRY: And that’s the key.>>SCHMIDT: But, more importantly, we have
enough capital as a corporation to invest into that market and we have the patience
to understand that people are the same everywhere. People, actually, want connectivity everywhere
and that connectivity will benefit them in education, in access. It will force their
governments to become more transparent even in these horrific dictatorships that exist.
And it’s an overwhelmingly positive message. But what happens is, people say, “Oh, well,
as a result, some evil person will have voice.” Yeah, well, the principle of free speeches
that evil voices are overwhelmed by the good voices. And I live in a world–and I spend
an awful lot thinking [INDISTINCT] everyday. I’ll tell you that the overall human condition
is a very positive one. That the average person I deal with really does want to make the world
a better place and we can all participate in delivering that. It’s a great message.
>>HOCKENBERRY: Erich Schmidt, thank you so much. Hands up. Stand please.
>>[INDISTINCT]>>HOCKENBERRY: What’s Google’s education
policy? Will we see Google high school, we already have Google university?
>>SCHMIDT: We are working–we’re working on our strategy there. As you know, the–if
you go back to the Nation at Risk book from 1982, 1983 I believe, the problems of education
in America are profound. They’re complicated. I would observe that much of the education
establishments seems to be organized around the education establishment and not measurable
outcomes with [INDISTINCT] to the children. So speaking as a businessman, I would start
by measuring the outcomes and then iterating, in trying to make things better. The contribution
that Google can provide is a number. We worked hard to get the schools wired. And I, on an
earlier job, did that as well, to getting the schools wired, getting the teachers empowered
with access to the Internet, getting mobile phones into that, are all very, very important.
A further thing that we can do is try to promote the use of video and other information sources
to help advance education especially for people who don’t have access to very good teachers.
There are, for example, people who are remarkably generous and they’re funding YouTube videos
of the best teachers so that you can actually see that and see that for free anywhere in
the world. And what I want to think about is you’ve got some brilliant student who’s
isolated in some rural part of our country who has a broadband connection and not very
many people to talk to, I want that person to be able to get that same level of education
that I could get. And I think that’s a good goal. So those are some of the things that
we’re working on. I’m looking for even stronger technologically intensive education ideas
and if you have them, we’d like to hear them. Most of the ideas that are–had been discussed
about education, I think, are pretty much dealing with the incumbencies and the existing
things rather than thinking of completely new ways of affecting education.
>>HOCKENBERRY: Question from up here. Speak up now. Hey.
>>I wanted to thank you for all of your comments but specifically, the ones about incumbency
and how to bring innovation and that how current forces kind of fight against it. One of the
things has made the Media Lab really a great place since its start is small research groups
working together, fostering innovation but still communicating as a whole. Does that
model break down when you get to something the size of Google and how do you see how
that kind of grassroots innovation can really be fostered all the way up to the top where
it can be visible and make a difference?>>SCHMIDT: I think the Media Lab is, certainly,
one of the first institutions that I knew. It came back and, basically, argued that you
had to break down the stovepipes that existed in academia. And the Media Lab, to me, 25
years ago, you know, Nicholas and sort of the usual suspects, sort of foresaw the need
for breaking that down. And my guess is, in other industries, there are other people who
also saw that. But I think it’s actually [INDISTINCT] now that you’re not going to get something
interesting unless you build these teams. The problem with organizations is there has
to be a hierarchy, there has to be a boss, there has to be a building, and so forth and
so on. We tried to break that down inside of our culture but we have the same problems.
They’re not as obvious and we talked about it a lot. But I think that ultimately the
reason incumbencies breakdown is because of strong entrepreneurship, strong leaders, and
people who are willing to hear ‘no’ a lot. And if you look at the, again, the Silicon
Valley sort of archetype, it’s a person who is young, rejects existing orthodoxies, and
is willing to put heart, body, and soul into making something happen. And we celebrate
the winners but remember there’s lots of losers too and that’s part of the system. The typical
venture investment is one in ten is successful, the typical Google scale investment is one
in a 100 to one in a 1,000, which is just how the economics work. So it’s important
to remember that we have a lot of people who are trying very hard. A few succeed but we
want to celebrate everybody who tries to change something. It’s that changing–that yearning
for change that, I think, drives societies so fundamentally better.
>>HOCKENBERRY: How many in this room have heard the word ‘no’ a lot? Clap if you have.
>>SCHMIDT: All the entrepreneurs.>>HOCKENBERRY: Here you go.
>>SCHMIDT: Just try to raise money in the last year, year and a half. You understand
what I’m talking about?>>HOCKENBERRY: Sure. Sure. Right, indeed.
Question. Right here in the front.>>[INDISTINCT]
>>HOCKENBERRY: How is expensive journalism going to be paid for if, as Eric has suggested,
people are going to be hugely interested in Britney Spears, perhaps, in the future and
other entertainment models?>>SCHMIDT: We all benefited from a unique
combination of events; strong classified revenues for newspapers, local pseudo-monopolies where
the local news was only really under the hands of one or two providers, the emergence of
print advertising and so forth, and the fact that people just like to read and read physical
newspapers, all of those trends and magazines as well, all of those trends as you know have
been under tremendous attack. And it’s a real lost for, I think, a vibrant society. So what
happened is those models would essentially throw off a public good which is the ability
to fund investigative journalism. Even a couple of proposals have had to replace that. A number
of, again, very generous people have funded nonprofits which attempt to fund that public
good. A number of the newspapers are doing well enough that they’ll clearly survive any–they’ve
become national essentially. You know, clearly have enough to continue to fund that public
good. But there’s a clear loss of voices. When you talk to the folks in the media industry,
there’s a lot excitement about subscription models because they’re used to subscription
models. So from a Google perspective, we want to empower these subscription models and we
want to let the–between the publisher and the consumer, they can figure out, “Is this
information that’s going to–people will subscribe for it or whether it’s going to be advertising
supported.” So the restructuring is dramatic. It’s incredibly painful. There are models
that are successful. Huffington Post is an example of a Google partner which I think
people here know which appears to be doing quite well in an advertising model. So there
are mechanisms which do work which ultimately I think will generate enough profit that they’ll
be able to fund that public good.>>HOCKENBERRY: Is that hyperdizing (ph) though
the subscription model and the advertising model in the sense that people talk about
journalistic institution as communities, and PR for instance being a community? It’s a
kind of a subscription model. You’d sign up to be a part of the community as this revenue
as a result to that Huffington Post has a community aspect to it in addition to being
this advertising–are those merging ultimately?>>SCHMIDT: They are. But I would rather–again,
we always talk about the incumbents. I’d rather talk about the end-user, right? Because the
end-user will ultimately determine the outcome of this and let’s talk about what the end-user
is going to do. Today, I read the physical newspaper. Five to ten years from now I’ll
have this incredibly intelligent tablet which will have every aspect of the newspaper that
I care about expect maybe that grainy feeling and the stuff on my hands. But what’s important
about that content is it will know who I am. It will remember what I read. It will suggest
things that I should know. We can actually, using algorithms now, suggest serendipity.
We can find related stories and stories that you should know about and furthermore we can
do very sophisticated advertising on such a device. We can do advertising that’s targeted
at you today. People here–those of you who read a newspaper this morning–I did, right?
Does anybody remember the actual physical ads in the newspaper? Typically not. It’s
hard to sort of remember. And they are there. You just went by them. Whereas we can generate
ads that are so good, so targeted, that you will remember and we hope that they will help
pay for the quality of the content that you’re getting.
>>HOCKENBERRY: What’s the responsibility of an institution like Google, though, to
lower the cost of entry? A newspaper has a low cost of entry. People can be civically
engage and get the information about their world at a low cost. If everything’s on a
tablet, certain people will be able to pay that cost of entry, others will not. Is that
Google’s responsibility to lower that cost of entry?
>>SCHMIDT: Well, we would argue that since almost everything on Google is free for end-users,
that’s a pretty good responsibility right there.
>>HOCKENBERRY: That should be.>>SCHMIDT: I mean, the fact that basically
we don’t charge for access to this information, and we’re not planning on, and we–and I suspect
we never will, is probably a pretty good starting point.
>>HOCKENBERRY: Question right here.>>[INDISTINCT]
>>HOCKENBERRY: What mechanisms do you use to listen to users? Do you employ particular
strategies to make you’re getting the right signal?
>>SCHMIDT: There’s ultimately an inventor and it goes like this. The inventor walks
into my office and says, “I have a brilliant product and I built and it’s going to do great.”
And I say, “Wonderful. I completely agree with you.” And then we measure them to the
nanosecond. And if the slope is a hockey stick up like that, they’re a brilliant inventor.
And if the slope is like this, they get cancelled. Right? And then by the way, we asked them
to do it again because they’re–it’s great to have an inventor who’s failed once, right?
Because they really are a lot more humble to start with, and they listen a lot better.
You need the input from the end-user but you need the inventor with a passion. If you listen
to the end-user, they’ll just give you a jumble of feedback. You need that person who has
that creative spark. And by person, sometimes it’s a team. Sometimes it’s a group. Sometimes
it’s a set of things. In our case, we do a tremendous amount of, basically, blind testing
in all sorts of ways in which we do that. And then the most important thing is we typically
do what we call ‘dog food’, you know, eat your own dog food, so we use–we test this
stuff internally and then we roll it out to friends. And my guess is, if we took the union
of the–of you all in this room and ten of your friends, if you all and ten of your friends
like something, that’s a pretty good predictor for pretty much everybody, right? If we could
invent such a great product.>>HOCKENBERRY: But if–okay, [INDISTINCT]
>>HOCKENBERRY: Will Google ever create its own content? It, up till now, rides on mainstream
media in presenting news.>>SCHMIDT: Yeah. The term ‘ride on the back
of’ is a sort of loaded question.>>[INDISTINCT]
>>SCHMIDT: Yeah. And so, when I’m asked that question, it’s usually in the context of,
“And therefore you should pay me a lot of money for my content.” So–no, no, I’m saying–but
if that’s–but just so, I want to be clear on that. What we do with the mainstream media
is we send a tremendous amount of traffic to their websites and so that each of them
has an opportunity to actually not accept that traffic. They can actually choose not
to do that. But they all choose to do it, so we have this conversation all the time.
Furthermore, what we do is we provide advertising model and to some degree, subscription models,
which allow them to then sell that content. And that’s, I think, how we do it. With respect
to doing our own content, we’ve typically found that there’s a line there that we should
not cross, that it’s better to let the content folks do the content and have us basically
provide the platform, the monetization and so forth. Partly because the company is run
by computer scientists, and as arrogant as we are, we’re not necessarily so good at these
other businesses. And the second thing is it’s better to have the competition among
the content players for the end-user voice. As I said we’ve typically not gone across
that although we enable end-users to create a lot of content and let the market sort it
out.>>HOCKENBERRY: Questions on the mystifyingly
silent middle section here? Anything? Any questions from–no? Would you call denying
access to content that has been criticized in countries where you’ve worked a form of
content creation in a sense that you’re negatively selecting what gets seen?
>>SCHMIDT: Well, again, I’m not sure what you’re referring to because if you’re referring
to China, we actually took a very pro-content position and then…
>>HOCKENBERRY: Actually, I’m not–[INDISTINCT] much more generally, if you were in the position
of taking stuff down or having to make that choice…
>>SCHMIDT: We only do…>>HOCKENBERRY: …is that not content creation
and so [INDISTINCT]?>>SCHMIDT: No, it’s not. It’s under duress
and under threat of a gun. You know, one way to understand it is that every country–I’ve
now learned this the hard way–every country has the same debate we have about free speech
and what is permitted content and so forth, and at least in the sort of democratically
or the pseudo-democratically thing, they have a process which involves rule of law. And
so we have learned the hard way is that we have to respect their rule of law even if
we disagree with it, but we do our very best to publicize when this is occurring. So if
you disagree about a policy in a foreign country because the country is–we are subject to
their laws, they can actually arrest and imprison our employees, we are forced to operate under
their laws even if we disagree with them.>>HOCKENBERRY: Okay. It’s been great, the
time that you’ve spent with us, it’s really thrilling. I think we’re going to sort of
wind up with one more question right here.>>Is there [INDISTINCT]
>>HOCKENBERRY: Is there a class of information that you expect never to be able to find on
Google?>>SCHMIDT: Well, hopefully, the information
that you choose not to give Google which should be the information–right? That would be the
simplest answer.>>HOCKENBERRY: Well, what about the number
of people who died today from malaria?>>SCHMIDT: Well, presumably, that’s a publicly
knowable question.>>HOCKENBERRY: In a month, not today.
>>SCHMIDT: Well, but in theory we’d like to be able to…
>>HOCKENBERRY: There are limitations that–because of your restrictions, but there are also limitations
because of…>>SCHMIDT: No, I mean, maybe there–there
are all sorts of laws about this. There is, for example, a law that limits the aperture
of the satellites that we can launch to take pictures for Google Earth, and that’s a limit.
That’s one that’s imposed on us by U.S. law which we’re just subject to, so there’s a
category of those. But I think the most important message is anything that’s publicly accessible
that’s, again, legitimate and legal, we would like you to be able to find out instantaneously.
That’s about information access. Information that is private should remain private. And
I hope that that’s a clear answer.>>HOCKENBERRY: Google, when the company was
formed, was a huge number, right?>>SCHMIDT: At Google.
>>HOCKENBERRY: Yes.>>SCHMIDT: Ten to the 100ths.
>>HOCKENBERRY: Yes. Now…>>SCHMIDT: Still a large number.
>>HOCKENBERRY: …now, it’s a verb in addition to being a number.
>>SCHMIDT: It’s still also a very large number.>>HOCKENBERRY: Right. Right. What will it
be in 25 years, do you think?>>SCHMIDT: You mean–it’ll still be a very
large number. We did the math. We did the math.
>>HOCKENBERRY: That–that much is true.>>SCHMIDT: We did the math on how big 10
to the 100th is and, just for those of you who are not so technical, it’s not–it’s not
the same thing as–it’s like multiplying. It’s a very, very large number. It’s much
larger than the number of proteins and electrons and so forth in the universe.
>>HOCKENBERRY: So, if a billion is a–always a good thing, at Google is always a really,
really…>>SCHMIDT: It’s very [INDISTINCT]
>>HOCKENBERRY: …really good thing.>>SCHMIDT: Yeah, so what happens is it’s
a billion–it’s basically exabytes and petabytes and zettabytes and gigabytes and so forth,
and we got a long way to go before we get to Google. I think in–one of the things to
remember is to do a little bit of compounding. And humans are very, very bad with compounding,
so let’s do a little math. Here we are at MIT and so forth and so on, so Moore’s Law
is doubling every 18 months. Most people believe Moore’s Law can continue for another 10 to
20 years. We’re always projecting the end of Moore’s Law but the physicists and chemists
and so forth are doing amazing things with parallelism. So 10 to the 18th is roughly
an increase of a thousand–let’s say let’s do the math, roughly a hundred and five years
which means roughly 10,000. Did I get that right? No? So I think it’s 10,000 in 10 years,
so in 15 years how much time is that? Do the math. So, all of a sudden, the underlying
computation, everything we see today in 10 to 15 years will be that many more orders
of magnitude of information and access and speed. So if everything is 10,000 times faster,
cheaper, more prevalent, what does that all [INDISTINCT]? That’s why I come back and I
argue about, computers will remember pretty much everything that you let them remember,
will pretty much know what everything is up to in terms of things that you want to publish
with it. There’ll be a very, very large number of devices. These are activities that the
Media Lab is working on a lot. And that it will sort of take all of this for granted.
And I think all of us are planning on being alive for the next 10 to 15 years, so hopefully
we’re all going to be part of this and we’re all going to see it. And I would argue that
society–society has to really think about what it means to have all of these things.
This is a question far beyond the pay grade of Google or of anybody here in the room.
What does it mean to have this kind of access, this kind of information? I’m quite convince
it’s all positive but I suspect it has a lot of surprises.
>>HOCKENBERRY: You’re roughly how old?>>SCHMIDT: Fifty-five.
>>HOCKENBERRY: Fifty-five. You will retire when your job ceases to be blank.
>>SCHMIDT: Well, we actually agreed that I have to stay at Google, with Larry and Sergey,
for a very long time.>>HOCKENBERRY: But just personally, I’ll
stop doing this as a job when it stops being blank.
>>SCHMIDT: My current plan is to do it when I keel over which hopefully will be a long
time from now because the opportunity to empower people with information is the opportunity
of a lifetime. I would argue that within your career and the things that you do, you do
it–you don’t have to do this anymore, you do it because you enjoy it and because you
have a huge impact. And for me personally, the opportunity to serve–to serve the interest
of broad access to information for the 6 billion is a tremen–I mean, Megan, who’s one of your
stellar graduates here, and I were talking about Google app engine–Google Earth engine
basically, as an opportunity to take Google Earth and instrument it and make it dynamic,
right? And then take programs and feeds from everyone. So you can see the impact of what’s
happening to the world that we–that is the only world we have, and the world that we
all love. It’s a tremendous opportunity for all of us, and I love to be part of it.
>>HOCKENBERRY: And you’re innovating from within at Google to make it possible.
>>SCHMIDT: Absolutely.>>HOCKENBERRY: Eric Schmidt, thank you so
much.>>SCHMIDT: Thank you so much. Thanks, John.
>>HOCKENBERRY: Well, great.>>SCHMIDT: Thank you so much.
Written by Michelle Gutierrez
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