BOSTON--For millions of people, Dr. Eric Schmidt holds a map to the
Internet. As chief executive officer of the Redwood City, California, search
company Google, he has led the firm
position as a search engine well regarded for its clean
interface and speedy, highly relevant results.
Schmidt, 46, became Google's CEO last summer when co-founder Larry Page,
28, stepped down. He previously was chief executive and chairman of software
maker Novell, and before that was chief technology officer at Sun
Today, his challenge at Google is to guide the fast-growing dot-com
company into adulthood, including likely prepping it to go public at a time
when being an Internet company garners skepticism. PCWorld.com caught up with
Schmidt at a recent appearance at the Massachusetts Software and Internet
PC World: Google states that it eschews pop-up advertising
and traditional banner ads. Google doesn't accept paid placement in its search
index, and the interface seems free of commercial ties. How do you make
Schmidt: Half of Google's revenue comes from selling
text-based ads that are placed near search results and are related to the topic
of the search. Another half of its revenues come from licensing its search
technology to companies like Yahoo.
PC World: You've said Google gets 10,000 e-mail messages a
week from companies asking how they can rank higher in Google search results.
How do you balance keeping search results commercial-free and still working
with advertisers to make money?
Schmidt: In Google's case, our model seems to work where
advertising doesn't affect the ranking you get. And you can be sure our
advertising computer is separate from the search computers. They are kept
separate for a good reason. No human can get confused on this issue.
PC World: Google has added 20 years worth of searchable
archived Usenet postings and is now beta-testing a
Catalog search. What other new features will we see?
Schmidt: The catalog search is a good example of a new
service, because it was done in six months by two people. Because Google
already has the infrastructure, it's relatively easy to add new services.
As a rule, we don't preannounce new features. But the most important one
coming up is more recency added to the search index. When I started at Google,
the company was out of date, on average, every two weeks because the crawl was
a monthly cycle. We want to get to the point where Google is updated on a daily
We are working on algorithms to detect which sites are having high
traffic or high page rank or high change rates. We want to make sure those
pages are as current as possible.
Another service that takes advantage of recency is something we just
Overview of Today's
Headlines. Google reads all the newspapers on the Web every
hour and constructs a newspaper for the world by computer--no humans are
PC World: What have you learned from the mistakes of other
Schmidt: One was not to go public too soon. In other words,
build a real business. Another was to stay very focused on search. Search
companies, which I won't mention by name, tried to do so many things at the
same time, they forgot all about search. They either missed the next revolution
of search or they created an opening for a Google to enter.
PC World: Do you see Google as a network or some other type
of destination site?
Schmidt: Perhaps in the future. Today, Google is first and
foremost a technology company that builds great products that hopefully people
will want to use it.
But frankly right now we are just too overloaded with our current search
product growth to worry about anything else. We want to make sure the thing
you're looking for is on Google 100 percent of the time.
PC World: So you don't want to be the next Yahoo?
Schmidt: What we do is search. Yahoo is a portal with a
myriad of specialized services. What Google does is sufficiently limited. It's
not really targeted at what Yahoo or AOL is trying to do. Our business strategy
is not to compete, because we want them as customers.
PC World: What's next for search technology, and how can it
Schmidt: Technology is always evolving, and companies--not
just search companies--can't be afraid to take advantage of change.
When was the last time a computer or network was built to take advantage
of cheap bandwidth, cheap DRAM, and plentiful PCs? Most companies are still
building mainframes based on old computer architectures.
At Google, for example, we found it costs less money and it is more
efficient to use DRAM as storage as opposed to hard disks--which is kind of
amazing. It turns out that DRAM is 200,000 times more efficient when it comes
to storing seekable data. In a disk architecture, you have to wait for a disk
arm to retrieve information off of a hard-disk platter. DRAM is not only
cheaper, but queries are lightning fast.
Search technology has a lot of room for improvement, be it algorithms or
PC World: What are Google's biggest challenges?
Schmidt: Managing the growth. Our servers are overloaded.
There is a DRAM shortage. We're building more computers. We are adding
more-sophisticated products to the advertising side of Google. Our problems at
the moment are growth problems.
PC World: How big can Google get, and how do you sustain
Schmidt: It's a mistake to predict the size of markets that
are so new. This model has shown no signs of slowing down. So we are going to
get as much of it as we possibly can, and when we get close to that we'll
figure out other problems.
PC World: What do you bring to Google?
Schmidt: I see myself primarily as a technologist. And
what's funny is that I am not primarily used as a technologist here at Google.
I'm primarily used as an executive who has run companies.
This generation of technologists is a better group of technologists than
I am. They are quicker and they understand it better. I'm able to bring
business expertise but, more importantly, operating experience. The people here
at Google are young. Every day there are lots of new challenges. I keep things
focused. The speech I give everyday is: "This is what we do. Is what you are
doing consistent with that, and does it change the world?"