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| Google's prospects from a Google user and independent investor |
There's no delete button on the Web - 9/06/2006 05:47:01 PM
Games with a purpose - 9/04/2006 06:11:00 PM
I haven't posted in a while, since I didn't have much new to say. I hoped that the Buygoogle site would bring a new perspective on the company that might make the biggest difference in the first decade of the twenty-first century, but I haven't had many new perspectives lately. Hence the silence.
But there's been a good bit of discussion in the last week about Google's "Image Labler" game, and the observers who I respect may be missing the point -- so I'll break my silence for a contrasting view. Battelle goes on about the vocabulary, arguing with Google's choice of the term "label" instead of "tag" I just wish Google would use the terminology the rest of the web has already settled upon. It's not a label. It's a tag. "Tag" means something - an intentional attribute given to an object on the web. That's what we are doing here.Who cares what they call it, certainly not me. Battelle infers that Google is simply doing what others like Flickr have done, and simply assigning text attributes to help with searching. But there are signs that tagging isn't Google's objective here, no matter what you want to call it. Philipp also sees the Image Labeler as simply a tagging exercise, using humans to annotate the Web: More than a game, for Google this is a way to tag images using human brain power... to improve their image search results. I wonder if Google can reach critical mass with this game – enough players participating long enough to label many images – to ever make this relevant for their main image search. The idea of this approach isn’t new, but scaling it with the web will be tough.But if we look at Google's longstanding aversion to human tagging, and join that with the recent acquisition of Neven Vision, you can see that there's likely a lot more to this than just getting people to label the Web for free. Luis Von Ahn is the brain behind the ESP Game, which Google licensed to create the Image Labeler. Von Ahn talked to a Google audience about the ESP Game and other "games with a purpose" that he's developed to assign meaning to words and images on the Web. You can watch the entire 1-hour talk on Google Video, and see if you don't come away with the same impression that I did -- it's not about tagging or labeling, it's about machine learning. Google was born out of a rebellion against human-edited directories of the Web that could not keep up with the Web's exponential growth, and were routinely manipulated by special interests willing to pay to subvert information for financial gain. Page and Brin put their faith in the computer algorithm, and to this day believe that the algorithm is faster, more comprehensive, and less biased than human editors. Page and Brin may love the concept of the ESP Game and Google's Image Labeler because they take the good aspects of the social web and eliminate the crap that usually comes with user-generated content. For example, the ESP Game auto-corrects because each player must independently agree on the labels. And even if large group were to conspire to subvert results (i.e. hordes of Slashdot users all tag “monkey” to every image). the game automatically inserts known images into the stream, and if players don't guess known-good labels, the labels from those players are discarded. These "symmetric validation" and similar "asymmetric validation" methods result in extraordinarily reliable results. Von Ahn points out that there is a lot of unused human capacity to do this grunt work. One slide (shown below) says that if people diverted the time they play solitaire to construction projects, they could build 1285 Empire State Buildings, or 450 Panama Canals every year. Why not have them label the Web? ![]() Of course, this is all just a means to an end. And while other observers may think the end is a set of reliably tagged images, I think that's just an intermediate step. Because once Google has a set of images that are labeled with a high signal-to-noise ratio, this would be an ideal corpus of material for their newly acquired "machine vision" technology to train on. And once Google's computers are trained to interpret images and video, then Google's algorithms can do for images and video what they've done for text -- organize it and make it universally accessible and useful. ![]() Indeed, Von Ahn alludes to that possibility in the video: If we had this information for a lot of images, we could use this information for training computer vision algorithms....one of the major stumbling blocks [to effective computer vision algorithms] was a lack of training data...And it's not just images that could benefit from this technique. The long-promised "semantic web" has been slow to realize because it's so difficult to generate all that meta-data. As Von Ahn says in the video when talking about another game under development to infer "common-sense facts" about about language: Research projects have failed due to a lack of training data, since it is so tedious to key in all those common-sense facts. But if there was a fun game that could do it ...Google used a large corpus of training documents to teach their computers to translate Arabic. Until now, there was no similar monster data set of reliable meta-data to train their computers to interpret images, or to infer meaning. With these games, Google may soon have a reliable training corpus for these purposes, too. These are ingenious games with a purpose. But while many observers would point to the obvious purpose of "tagging," that's just a means to an end. The ultimate purpose is to feed the Google AI. |
Google's secret weapon - 6/16/2006 08:19:00 AM
David Vise says investors should reward Google for investing in infrastructure, because their ability to deliver instant information is their real competitive advantage. By investing as fast as Google is, they're creating a wide competitive moat that is increasingly difficult for competitors to cross.
Where does Coca-Cola's competitive advantage lie? In its secret formula, most would say. But the real moat around the soft-drinks business is its powerful distribution system. Strangely enough, the same is true of Google. |
It's not an Excel killer, it's the Google Grid - 6/06/2006 10:54:00 PM
Google Spreadsheet. Some say it's an Excel killer. Others say it's a trivial toy. Some worry that there's no business model, while others think Google's just poking sticks at Microsoft.
I say it's another step on the path to the Google Grid. Store all your info online, choose what to publish and who can view and edit. Sure it's a spreadsheet. Sure it's not nearly as capable as Excel. But it's not about the spreadsheet, or the calendar, or notebook, is it? These are all interesting and useful demo applications to refine and scale the Grid. |
Vonage train wreck realized - 5/24/2006 09:12:00 AM
In the first three hours of trading as a public company Vonage stock is off 11%, after being down as much as 14%. Ouch.
As I explained two weeks ago, this thing is the anti-Google. Vonage has a decent product, but they're losing shiploads of money every quarter while Google rakes in massive margins; Vonage founder Citron has a blemished reputation while Google's executive team is clean and the brand (used to be) squeaky clean; Vonage's high-priced product is competing in field of free alternatives and declining prices while Google built their business on free services that are immune to price competition. I can't predict the future, and maybe Vonage will bounce back. But those who compared Vonage to Google because both courted the individual investor missed these big differences. Vonage should never have been marketed to the unsophisticated investor. Update 2:58 PM: Vonage ended its first day of trading down 12.6% from it's IPO price, "turning in the worst IPO debut in nearly two years" according to the Wall Street Journal (subscription required). Update 5/26 7:07 AM: Vonage dropped another 12.5% in its second day of trading, now down 24% from the IPO price. Sickening. Why would anyone buy stock from this guy? ![]() |
Vonage IPO trainwreck - 5/09/2006 10:57:00 PM
As a customer of the Vonage VoIP service, I have the opportunity to participate in their IPO. How cool is that? Just go to the Vonage IPO website, read the prospectus, and sign up for an allocation of shares at the initial offering price range of $16-$18. Sweet.
Now, I bought into Google's IPO which worked out great, and I'm a fairly satisfied Vonage user, so buying into Vonage should be a sure thing, right? But after reading the Vonage prospectus, I'm staying far, far away from this one. Let's take a little trip down memory lane and compare Google's story in the summer of 2004 with the Vonage story in the summer of 2006. We know how the Google story has evolved in two years, how will the Vonage story turn out? IPO Auction
But looking at the same factors for Vonage, and one can only come to the opposite conclusion. Opening the Vonage IPO to customers is likely to be a curse, not a gift. |
Google and the market for TV ads - 5/09/2006 09:01:00 PM
BuyGoogle has been beating the drum that a great way to understand the mechanics and motives of Google is to view it as a marketplace. Now there's more evidence of Google's true character -- Google is bidding to provide a marketplace for TV advertising.
360techblog reports that eBay and Google are competing to replace the old-fashioned "up front" method of selling TV ads, which requires advertisers to commit a year in advance for ad slots. In its place would be a real-time auction. So if you thought that Google and eBay were on a collision course, now they're directly competing for a truly gigantic ($100 billion?) market. Next time some Google action doesn't make sense, don't think about Google as a search engine, or a media company, or a content provider, or a portal, or a software developer -- Google is an info marketplace. (via Battelle) |
Will new entrants bust the online ad market? - 5/09/2006 12:29:03 PM
Om Malik raises the specter of an "eyeball bust" on the arrival of new entrants to the online advertising market. He argues that, with Microsoft entering the market with its adCenter product, and with Yahoo revamping it's advertising vehicle, that there will be a supply glut and keyword prices will plummet, and the online advertising boom will bust:
The problem is that if three companies are chasing the same advertising dollars, the keyword prices would go down, which theoretically means, the publisher cut of the revenues are going to go down. Ergo… problems down the line. The only problem is that this isn't how the economics of online advertising works. More companies chasing ad dollars will do nothing to prices, since those companies don't create supply or set prices. It's like the stock market. In the stock market, you have companies selling shares and investors buying them. The brokers just facilitate transactions - they don't create supply, and they don't set prices. In the online advertising market, you have people looking for things, and advertisers wanting their attention. Google, Yahoo and Microsoft are brokers bringing the two groups together -- they don't create supply, and they don't set prices. Prices are set by supply (of people looking for something) and demand (of advertisers selling something). Just because Yahoo, Microsoft, MySpace or some startup decides to "chase the same advertising dollars" doesn't mean that any of them has created a larger supply of people searching for information, watching online video, or writing snarky blog posts. Just as the entry of a new broker into the stock market doesn't change the prices of securities, the entry of Microsoft or anyone else into the advertising market won't alter the supply-demand curve of that market. Now if new products are created that make each click more (or less) relevant to the advertiser, then prices will rise (or fall). And if one broker is more (or less) effective at delivering interested customers to hungry advertisers, then the market share among the players will change -- but the overall pricing should not. Understanding that Google and their competitors are marketplaces is important to understanding their prospects, and what could be next. |
Google and the Paradox of Choice - 5/07/2006 01:03:00 PM
![]() In his book The Paradox of Choice, author Barry Schwartz says that contrary to conventional wisdom, giving people many choices is often bad for them:
One way to solve the paradox, Schwartz argues, is to hire an agent to do the choosing for you, so you don't have to suffer the consequences of choice (choice paralysis or buyer's remorse). So when a real estate agent shows you three homes, or an insurance broker presents a small handful of options, Schwartz says you may not make the perfect selection out of all possibilities, but you're more likely to take *some* action, and to feel better about it later. Google is an agent for finding information, and the relevance of their results helps hide much of the irrelevant crap that's out there. But according to Schwartz, the sheer volume of results may be leaving searchers with an inability to choose, or bad feelings about their choices. To remedy this Schwartz recommends that Google develop "hierarchical searching" where people can choose from a small set of branches, and narrow down from there what they're looking for -- a series of choices from a small number of alternatives rather than a bewildering set of thousands of results. Seems like Google's doing this already with some searches, like for jobs, cars, homes, and health. ![]() ![]() |
Microsoft adCenter is broken - 5/04/2006 10:31:00 PM
Google PC and a billion bucks to Dell - 5/03/2006 05:20:00 PM
Maybe Google's gonna go for it and challenge Microsoft on their home turf, the desktop PC. CNET thinks so.
Until last week, Google was able to pretend that Microsoft wasn't their biggest threat. That charade ended when Microsoft said they would make a $2 billion down payment on a big mortgage to kill Google (giving Microsoft stock a $32 billion black eye), and Google gave themselves a PR fat lip by complaining to the Feds about Microsoft's anti-competitive nature and getting unfairly accused of hypocrisy. Now the gloves are off and the arms race has begun. Microsoft and Amazon teamed up on search and possibly advertising, and the thought of a "Yahoosoft" mashup has sparked talk of consolidation in the information industry. The thought of Microsoft multiplying 90% of the world's desktops by the user base of Amazon, plus the search and advertising savvy of Yahoo, raised to the power of 2 billion bucks, has spooked investors. Google shares are down 10% since announcing surprisingly strong first quarter results on April 20. Since there's no more pretending that Microsoft and Google aren't each other's Public Enemy Number One, there's no reason for Google not to go for the jugular -- the desktop. It's clear that Microsoft will use their dominance of PC operating systems to try to crush Google in online services, while Google has a lot of benefits to offer the desktop user, and a lot of experience designing cheap, reliable, network-attached systems. There's been occasional speculation about a Google PC for some time now, culminating at the Consumer Electronics Show in Las Vegas in January. But at the show, Larry Page just toyed with the audience, hinting around by showing off the MIT Media Lab's $100 hand-crank laptop and releasing Google Pack (yawn), along with an upgrade of Google Video - but saying nothing explicit about a Google PC. At the time, a spokesperson said that Google had no interest in building consumer hardware, preferring to work instead with their hardware partners. Putting together the puzzle pieces, we find:
I hope Google is getting more for its billion dollars than that - could Dell be producing a $249, stripped down, reliable, network-attached, no spyware, no Microsoft, Google PC? If so, it would be a perfect Mother's Day present for my mom. |
Microsoft dances with Yahoo? - 5/03/2006 02:00:22 AM
The Wall Street Journal's venerable Heard on the Street column speculates (subscription required) that Microsoft and Yahoo could do a big deal together.
The article says Microsoft could sell MSN to Yahoo, though it seems terribly unlikely that Microsoft would spin off their online services, the new heart of Microsoft's strategy. Maybe Microsoft could buy a stake in Yahoo, giving it access to Yahoo's ad system in exchange for cash and traffic from Vista and IE7 default search. Or Microsoft could do an outright acquisition, which is also unlikely because it would be a huge deal when Microsoft's stock price is already devalued. If this happens, looks like eBay is out in the cold, and Amazon's still a question mark (though they did just dump Google search for Microsoft Live). The article did nail the two big issues -- technology and users. Yahoo has a big user base and adequate search and ad technology, while Microsoft potentially has many users in Vista and IE7, but badly lagging technology. Steve "Monkey Boy" Ballmer says he's changed his tune from " developers developers developers developers developers" to " advertisers advertisers advertisers advertisers advertisers." Seems to me Microsoft is in a bad place because they *didn't* invest in R&D until too late. Trying to recruit advertisers without an ad system or traffic seems a bit bass-ackwards. That's why it's an arms race, and consolidation is coming . |
Could censorship hurt Google's stock price? - 5/03/2006 12:32:00 AM
Conventional wisdom holds that Google compromised their principles so they could make a ship load of money in China. But tomorrow's Wall Street Journal has a good opinion piece on Google's censorship problem (subscription required) that argues that Google's stock price could be at risk alongside it's Don't Be Evil ethic.
Looks like I'm not the only one who will use Google's shareholder meeting on May 11 to protest the fact that Google, the company that wants to "organize the world's information," has compromised its principles and built a sophisticated censorship system. Amnesty International plans a media campaign to coincide with the shareholder meeting to raise awareness of this issue. It's not just about being a "do-gooder," but Google's censorship could hurt its brand, and its stock price: Shareholders should take heed, and not just because it's morally repugnant to collaborate with repression. In the short term, it's obviously good business to be in China, but there are longer-term consequences that should be considered.Tech companies say they have no choice ... American tech companies say they are simply complying with the laws of the land to avoid getting kicked out.... but that's an illogical argument and a rationalization. But they could resist more forcefully, as they do when protesting China's failure to protect intellectual property. They are willing to cave on human rights for a simple and understandable reason: They feel they can't afford not to be in China.Should Google get credit for "agonizing" over their decision, when they ultimately caved? Google says it agonized over launching a censored, local search engine early this year. But the company decided that offering is better than its older offshore service, which was slower than services of Chinese competitors and vulnerable to wholesale government shutdowns.For Google, this issue is bigger than China. Google has destroyed user trust and tarnished the Google brand. There also is the risk to tech companies' reputations. Yahoo and Google have faced a PR backlash, including an unflattering congressional hearing that has helped take the shine off of Google's "Don't Be Evil" motto. There's a reason companies respond to political pressure on human-rights issues, as many did during the Apartheid era in South Africa: To protect their most important bottom-line asset -- their brand.As Google demonstrated when it stood up to the US DoJ, resistance isn't futile. |
Arms race and industry consolidation - 4/28/2006 10:40:00 AM
![]() The online arms race has officially begun. What Google does best is to "deliver innovation at scale," solving difficult problems for a global user base. While Google has been quietly investing huge sums in building out their massive infrastructure, Microsoft has been busy doing what they do best -- developing desktop software, marketing and throwing chairs. Despite vicious threats to "f***ing kill Google," it seems that Microsoft is just now waking up to the reality that to kill Google in the market for online services, Microsoft will need something it surprisingly doesn't have -- scale. So Ray Ozzie promises to spend "staggering amounts of money" to build out Microsoft's data centers and to develop a "Live Drive" to compete with Google's rumored Gdrive or Google Grid. Unfortunately for Microsoft, which is losing money in MSN and seeing revenue and market share fall year-over-year, it really will take staggering amounts of cash to catch up. This reality dawned on Microsoft investors this morning, who sold Microsoft stock en masse after Microsoft announced they would be investing another $2 billion to build out their online services infrastructure. ![]() Microsoft stock is down this morning more than 11% - losing $30 billion in market capitalization - which is a much more staggering amount of money than the $2 billion Microsoft will invest this year in MSN. Maybe investors are not only worried about a money pit of investment weighing down future earnings, but they also wonder whether Microsoft can ever catch up with Google just by writing big checks. A Wall Street Journal article this morning (sub req'd) quotes a Goldman analyst saying that Microsoft spending is "snowballing," while another analyst wonders if Microsoft's investments "will be a fruitful exercise or a dog chasing its tail." ![]() With $35 billion in the bank, Microsoft certainly has the cash to win the arms race. But it's doubtful that Microsoft has the know-how, at least not today. Google has already built out out a global, distributed computing infrastructure that gets a lot of bang for every buck. And Google's engineers have built a company around online information services, while Microsoft's engineers have built a company around personal desktop software. In short, Google has a huge head start. If Google keeps going fast, Microsoft can't catch up just by spending a lot of money. For smaller competitors like Yahoo, eBay and Amazon, it's increasingly clear that none of them has the resources to participate in this arms race. For them, consolidation is coming. Let's hope Google participates in the consolidation, and uses its own cash hoard to deny critical capabilities to the competition. |
Censorship is the solution - 4/24/2006 05:33:00 PM
![]() Today's Da Vinci Code puzzle is puzzling on another level -- the solution to the puzzle is the word "censorship". With all the angst Google went through deciding to implement a massive censorship program in China, would Google intentionally trivialize censorship as the answer to this fun puzzle game? Or was this an Easter egg of sorts by the team that designed the game? Or maybe it's a riff on the widespread censorship of the Da Vinci Code book itself? Interestingly (ironically?) the Da Vinci Code movie was approved for release in China on May 19 along with the rest of the world. |
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