Eric Schmidt In India: On Broadband, Newspapers, Mobile Ads, Android, Twitter, Facebook & More


Google Chairman Eric Schmidt made all the right noises in India, sending a message out to policymakers in particular that India needs a free Internet, and especially the fact that “you need entrepreneurs to take risks, not go to jail.” Schmidt also had suggestions on how to grow broadband, on recent copyright related rulings in Google’s battle with news organizations, android versus chrome, Google Reader, the change in Google’s strategy after Larry Page took over as CEO from Schmidt, North Korea, among other things. An overview:

On India & What It Needs: Many of the next five billion on the Internet will come from India. Surely there will be many more languages. We need changes in regulatory structure, and lowering of cost of devices. The sum of all of that, this place is going to be rocking. As the Internet has emerged in many countries, there are quite a few countries with no law for the Internet, and those are free and open. There are other governments that try and censor the Internet. India is a country with a strong system for freedom of expression, and there are some clarification needed (in the law). You want entrepreneurs to take risks, and not go to jail. Not everyone who is going to join the Internet will be a perfect citizen, and it’s important that all the intermediaries have the ability to take that information down.

On growing Broadband: There’s no huge debate in the industry on the right path. Take fiber optic cables, and run them into every part of the ground. Those will last for 30-40 years, and scale to infinite bandwidth. The fact is that fiber solves every connectivity problem, but you (India) don’t have enough of it. People choose to have 4g and WiFi. In America, the percentage of bandwidth is more WiFi than 3g and 4g, and both are important. That will give you more bandwidth. The telecom industry here is under-capitalized, and they don’t have enough bandwidth. The Internet here feels like America in 1994, with tremendous upside.

On India & Mobile: The problems that we have in India can be solved – the education problem is that standards are not strong enough, and not enough schools. But for a person who has nothing, a mobile app is phenomenal. It solves your educational problem that’s a strength of the Internet, highly individual learning. Medicine, in the rural areas, there is poor information. Large under-served banking situation. Here are many startups that are building commerce systems to move money around. Think about corruption, which is a problem in India and many other countries. Its easy to investigate on the Internet. The level of accuracy and precision is phenomenal. There are negatives in loss of privacy and the possible misuse of this information by governments.

On Privacy: We need to fight for our privacy else we’ll lose it. It’s natural for these tools and technology to aggregate information. In Mexico they have set up a system to monitor the activities, and it includes the development of a full dossier. I don’t know if they will need it and use it, but they have a horrific drug problem. It’s important that as tech becomes pervasive, the law protects.

On Google and Privacy concerns: The Internet does that (creates privacy issues). Google is an example of a company on top of the Internet, and if Google didn’t exist, the problems still would. In societies that I’m familiar with, if a juvenile commits a crime, the records can be expunged. How is that possible in an always on Internet? How is it possible to get those deleted? I try to avoid off the record interviews. (Say) if I was giving sensitive info, and I would lose my job. You take notes as a journalist and write those down. Where do those go? If the Chinese hack into the New York Times’ servers? These are some of the problems when everyone is connected.

On Google and Anonymity: If you choose to be logged in and let us get info about you, we can deliver better services to you. The internet has been good about allowing anonymity. In China, VPNs are how you avoid their censors.

On Google Now & Anonymity: in the longer term, you want to think about computers as an assistant in day-to-day life. In developed countries, they become much more of your personal memory and serve as a digital aid and assistant. Computers are very good at a needle in a haystack problems, but very bad in judgments. Google has a product call Google now, which makes suggestions. If it thinks you’re going from home to office, it can suggest things for you to do.

On France and payments to publishers: The French have a model which is a partnership model they have a problem where the digital transition is not having fast from a revenue perspective. we agreed to create a digital transition fund over a five-year period. that will be run by a board. The members will choose tech and new ways of monetizing. The reason i like this model is that I don’t like randomly writing cheques in the old model, but it’s a good idea.

On Germany and the judgment that asks sites to pay for links: With the Germans, they invented a new concept called ancillary copyright. This construct breaks the things how the Internet works. A law was passed a few weeks ago. It gives an opt out for small number of words and length. It doesn’t address the biz model question. We think that is best addressed through subscriptions and monetization.

On Google Reader and Google’s approach to products: We had priorities. There are very good choices among RSS readers, but it’s with a heavy heart answer this question.

The thinking that Larry, Sergei and I have: it’s that we need to make these systems global platforms. Under my leadership, it was try this, try that. Now it is about understanding the global impact of our products: YouTube, Gmail, Chrome, Maps, Android, and i’m not even saying Search and Ads. There is really no peer. The term we used is Spring Cleaning.

On Mobile Advertising: Do you think advertising is going to away? It’s not going to go away. It changes. Part of Google’s success is that we think it’s both a science and an art. The form factor and the physical size of the ad is small, which does effect… we are in the process of changing and adapting our mobile ads products. no one should be confused about the future. It is mobile. It is tablets and mobile devices.

(On tiny screens) Our formats work better than any other forms. We’re doing just fine. We’re very very proud. We can prove that our ads are effective. The conversion ratios are all going to be very good on mobile. The reason to believe that mobile ads are going to be more valuable is that we have more info about the consumer. We know their location. They can target the areas. For all of those reasons, mobile ad revenue on a per ad basis should be higher. It is true in aggregate levels. Mobile is through the roof.

On Twitter As A News Organization: I don’t know their plans. What is impressive to me is the scale of reach of Twitter, and how effectively 140 characters has been used for promotion.

Journalism will have more celebrity in it, rather than less. The average person is obsessed with celebrity. they will trust celebrity, for reasons I’m not quite sure.

On Rumors That Schmidt Is Leaving Google: Completely false. This (plans to sell 40% of his stake) is just is a diversification sale.

On North Korea: it’s the last place of no internet connectivity. They have a 1 million or so network of cellphones by an Egyptian conglomerate. It’s the last closed country in the world. My goal was to get them to open up data (connectivity). They have a Korean intranet. They’re isolated and their bizarre behavior hasn’t served them. They just repeated anti-American propaganda.

The Internet was built for everyone, including North Koreans. There is no carve out for North Koreans. They don’t understand the choices that citizens face. It hurts their economy. The quickest way of getting people educated in North Korea is to open up the Internet. Indians are depressed at a 5% growth rate. Can you imagine if Europe or the US had a 5% growth rate?

On Google & Health Services: It would be better if they (health services) were more transparent. Medicine would be intuition based. Medicine can be treated as an engineering problem. The same doctors who go through same procedures have higher outputs. People can take healthcare into their own phones. There are patches that measure things, and there’s a pill wifi’s out the state of your stomach.

On Android vs Chrome: We don’t make decisions on the basis of who is ahead. Chrome and Chromium are the wold’s best HTML5 authoring and development systems. If you’re not using Chrome as an advertiser, for example, right now you should be using Chrome. It’s faster and safer and more secure than any other browser choices. In Android, which is primarily a Java-like development environment, it solves a different problem. There’s going to be more commonality for sure but they’re certainly going to remain separate for a very, very long time because they solve different problems.

On Google and net neutrality: I haven’t seen the text of the French law. Google’s position is that we’re not in favor of a content owner to also own a network and unfavorably influence. The best solution to net neutrality is huge competition. Our real solution is to have 3-4 mobile and broadband operators, with different or orthogonal architecture. A multi-layered approach of competition.

On Why Nexus Devices Don’t Come To India: I do apologize, we are working on it. We want to fully service the market.

On Newspapers and business models: This (problem) has been around for a decade, and newspapers had static ads, circulation and classifieds. All of those declined because of Internet, viewing patterns, and demographic issues. It is doing well in India and Britian. The increase in cost of newsprint cost of labor, and has made it difficult. We have a couple of very very good examples. One is politico and the other is the Huffington Post. News sites are going to be advertising supported. A reasonable prediction is that those with print subscribers will transition to online. That’s reasonable in most countries. 5-10 years from now, what will your average reader look like? He will have a subscription on a tablet. It will be possible to go infinitely deep into a story. Newspapers will thrive, but in this model, with subscriptions and sponsorships. The newspapers that have been successful are in the middle – neither national nor local.

Kindle or blackberry? blackberry, but it is in trouble.

Facebook or twitter? twitter has a more distinct model because of celebrity. Facebook is in transition, but i don’t know what they’re going to transition to.

Amazon or apple? I have a soft spot for Apple. They’ll both do well, it will build beautiful products. Amazon has well passed its ability to change distribution and marketing.

iPad mini or iPad? iPad. The mini is too small. Frankly, the Samsung 10 inch tablet, I would like that. More apps, more scalable.

India or China? In the short term China gets all the attention, and in the long term the math favors india. And I’m a mathematician.