Monday, December 18

Summary And Review of Googled: The End of The World as We Know It by Ken Auletta

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Executive Summary

The book, Googled: The End of the World As We Know It, by Ken Auletta lets the readers into the rise and struggles of the search engine giant, Google. It lets readers into the minds of hundreds of Google’s engineers as well as the 3 co-founders themselves who take their audience on a journey from how the business started in a garage to the giant it is today. Googled explains the astronomical numbers it produces from how it receives “over 70 percent of all searches in the world to the revenue it receives in one year of over 20 billion dollars. Google takes in over 40 percent of all dollars spent on advertising on the Internet” (Auletta,2009) through different marketing forms such as pay per click. These are only a few of the enormous numbers the author shares with readers that proves how big Google really is.

Auletta shares the stories of the interviews from co-founders Larry Page and Sergey Brin as well as the CEO Eric Schmidt. It explains how they share similarities as well as many differences when it comes to managing their company. Differences come from the way they run the company from the media to the way they interact with their employees. The founders explain that engineers work for the company instead of businessmen. Their beliefs are that engineers are the one who run the company and when engineers run a company engineering is the way things are solved. “Mathematical algorithms always provide correct answers” (Auletta,2009) is the engineer’s ways of explaining the genius behind how the company is set up and ran.  The thing that makes this book such an informative and learning experience is the hundreds of interviews that are shared with the readers throughout the book.

Not only did Ken sit down with the people who started the company, but he includes stories from the people who are the masterminds behind the daily operations. These stories range from closed door interviews to cocktail parties attended to by the entire company. Google has been hidden behind closed doors for years before Auletta opened them with the stories from the many people who make up Google. 

This book is a learning experience for any manager or leader looking to enter into the business world. It teaches how the engineers manipulate their way through the media always being a step ahead of their entire market. Google puts millions of dollars into advertising throughout the World Wide Web to defer traffic through their site. Auletta lets us into the story of how Google entered the markets through the different forms of media such as; newspapers, television, telephones, Microsoft, and more. He also talks about how the company went from a small search engine to when they entered the stock market in 2004 to partnering with huge corporations on their way to becoming a multi-billion dollar company.  There are so many different ways business start from small to big, slow to fast, or many other ways but all of them experience difficulties along the way.

Googled explains how even though the company had grown so large at such a rapid pace; there are still many downfalls and setbacks that occur throughout their business life. At the end of the book Auletta concludes with his input on where he think the company is going and where it will be in years to come.

The Ten Things Managers Need To Know From Googled:

1. The main slogan that explains what Google stands for is, “don’t be evil”. What this is basically saying is don’t be afraid to start a business because there’s a bigger more successful one that’s already established. Google’s motto is an inspiration to the company’s such as Apple who stands up to the more powerful Microsoft. 

2. Improvements can always be made. Even though Google’s a billion dollar company their engineers are constantly coming up with new, more innovative ways to sell their advertising and make the world we live in easier for everyone. No matter how big or small or how well a business is run, improvements should always be an ongoing process.

3. It is very important to employ dedicated hard working employees. A company is only as good as the people who work for them. Google employs smart engineers who care about the company and want to make advances in what they do to better their company.

4. The sky’s the limit. Always believe that your business can grow and cultivate into bigger and better things. Even though Google takes a lot of heat for continuing to expand its company, it doesn’t hold them back from doing everything they can to reach another plateau. 

5. The epicenter of a business starts with advertising. Getting the business’ name into the public is important in the success of the company. When Google started it immediately dove into several media markets such as; newspapers, books, television, and many more.

6. Don’t be afraid to be innovative and step outside the box. Companies who take risks and aren’t afraid to test the waters with new ideas will be the companies who leap over the ones who settle for meritocracy.

7. Sometimes owners and CEO’s need to take a back seat and listen to the suggestions coming from the people who do the job every day. Google’s upper management has faith in their workers to allow them to freely create and execute different systems that will improve the efficiency of the company. 

8. Plan for long term growth. When Google became public in the stock exchange in 2004, it decided to not pay out dividends and let everyone know who owned stock that their company is in this for long term growth. This meant if they needed money to invest in something they would have it, yet if the consumer stays in it for the long run money will be made. 

9. Make the workplace and place where someone wants to work. Google is the number one rated company to work for by Forbes magazine due to the amenities they offer their employees. An employee who enjoys his job will stay longer than one who doesn’t.

10. Different personalities in management styles are good for the company. If a company can diversify who its manager lead their employee, the company will be more successful than one set in stone managerial style.

Full Summary of Googled

Introduction

The opening sentence of the book, “This country has been Googled” (Auletta, 2009) sums up how Google has changed the media world. In the book, Auletta enters into the minds of top managers, executives, engineers as well as other successful people in the industry to explain how Google has become the media giant it is today. 

Starting in a Garage

Google’s slogan is “Don’t be evil”. What this basically means is don’t be afraid to stand up to a larger company just because they have been successful and have earned credibility. This slogan gave Brin and Page the courage to start a company out of their garage and attack the bigger companies such as Apple and Microsoft. Auletta talks about an interview he had with the CEO of Microsoft, Bill Gates, in 1998. At this time Microsoft was in its prime, with over ninety percent of all computer sales and the government threatening to sue for monopolization. When Ken sat down with Bill he asked the question, “What challenge do you fear most” (Auletta,2009)? Auletta thinking he is going to start blurting out large corporations such as Netscape or Apple, but he was wrong. After much thought Gates said, “I fear someone in a garage who is devising something completely new” (Auletta,2009).

Later that year Bill Gates biggest nightmare came true in the form of Sergey Brin and Larry Page.  Google started 11 years ago in the garage of Sergey Brin and Larry Page. The book describes the two as very brilliant yet different personalities. Brin is more of the flashy type with the book describing him as a “rebellious child” (Auletta,2009). Then there is Larry Page who is geared more toward the laid back, conservative style. These two men met at orientation at Stanford University where they found out they had many similarities and likings. The two used the universities computer to start the business until one day they got some many hits that it crashed Stanford’s entire network. The president of the university and several other professors noticed this goal mind these two students had created and wanted in on it. Brin and Page convinced the president of Stanford and 3 other investor to give them one million dollars to expand their company. After 3 years of college, Sergey and Larry dropped out of school to start what is known as Google. 

When the two college students started this business they were only 21 years of age which was a concern for the investors. The four investors made a deal with Brin and Page in that they had to find someone who is experienced in the business who can give them some insight before they would give them the investment. The two agreed and Eric Schmidt, the CEO of Google, was the third leg of this 3 headed giant. Eric was over 20 years older than Brin and Page and had earned a lot of credibility in the field being the CEO of 2 large corporations before joining their team.  Buzz, but Few Dollars Google started off as only a search engine with no profits being collected. It knew that by taking risk and employing the right people, in the long run they would become profitable.

Google’s big break came when it partnered with Netscape to become the main search engine for their site. This is when the media giant started to take off. Brin explains how, “the company got so many hits on their site that they had to shut down the search engine until they could buy more computers” (Auletta,2009). In the year 2000, the company had grown to over seven million hits a day and had no intentions of slowing down. 

Innocence or Arrogance

In 2002, Google took its biggest risk yet partnering with AOL promising them 85 cents on a dollar with a minimum revenue of 150 million dollars. Even though AOL was one of the biggest companies on the Internet, they knew that they were taking a huge risk by making the deal. One of the investors said, “you are betting the company if you do that” (Auletta,2009). If there’s one thing Google knows, is that a company has to take risks to receive larger than life profits.  Google Goes Public Brin and Page never wanted Google to go public but they know for the company to grow they needed capital. The investors and CEO tried everything they could to convince the two that this was the right way to go, but they didn’t want to be forced to give the public their inside information.

As a child, Larry Page read a book about a man named Alessandro Volta who was the first person to discover electricity. Volta was a very outspoken man letting out the secrets of how he discovered it. A few years later, a man by the name of Benjamin Franklin got the credit for discovering electricity thanks to the works of Volta. Unlike Volta, Franklin was a quiet man who keeps his discoveries to himself. This is one of the reasons the co-founders didn’t want to go public with their business.

After much deliberation with top management, Sergey and Brin came up with a proposal to present to the SEC. In the letter it said, “Google is not a conventional company and we do not plan on being one” (Auletta,2009). They wanted to make sure that the concentration was on the people using the search engine instead of the investors having control. Also in the letter they explain how, “they would be unconcerned with quarterly market expectations and they would not pay dividends” (Auletta,2009). In 2004, Google went public and entered into the stock market. Many people criticized the company calling them greedy for not paying dividends to shareholders and keeping things a secret.

What people didn’t understand is that Google was in this for the long run. They didn’t pay dividends because they wanted to have the capital to expand their business so more money could be made. This didn’t just mean more money for the owners, but more for the investors who would stick with the company. When Auletta did an interview with the two founders, he asked them if they thought they made the right move. Page answered on behave of the two saying, “We were concerned with going public because we thought we could have to change the way we operated, comprised our principles. I ended up being a good way of stating up front the kinds of things we were thinking about and making sure that everyone who participating was comfortable. In going public you take a lot of shareholders, and obviously shareholders have some amount of rights. But we, who are running the company, also have some degree of rights. We felt it was better to be explicit…..and allow us to do the kinds of things we wanted to do” (Auletta,2009). In hind sight, going public was one of the best things the company did because when it started collecting capital there wasn’t anyone who could stop Google.

New Evil Empire

The year 2004 is when Google started changing the media world as we know it. They were on a fast train to the top and wanted to kick anyone aside who got in their way. Dozens of times in the book it is mentioned that Google employees engineers not businessmen. Engineers are innovators and thinkers who believe that anything and everything can be improved in some way. Engineers ask the question, “why”. “Why must things be done this way. Why can’t all books be digital? Why can’t we just read the newspaper online” (Auletta,2009)? Google began to cripple many industries across the world such as newspapers, magazines, music, and many more. Google was even hurting the movie and television industry with “6.9 billion dollars in revenue lost in 2005 due to piracy ” (Auletta,2009).

The engineers were goal seekers always coming up with new ideas. The way Google works is through an algorithmic formula that the engineers came up with that combines several different aspects to have the highest searched at the top of their page. Google had come up with something no one else in the industry knew how to do. One thing that makes Google so successful is the top management understands that your company is only as good as who works for you. Every engineer in the company is allowed one day out of a five day week to work on what every that want to. They have the freedom to create and design things that will allow the come to run more efficiently making it easier on the users. By the end of 2006, Google had partnered up with several large corporations and had “over 10,000 employed with over half of them being engineers and had reached over ten billion dollars in revenue” (Auletta,2009).

War on Multiple Fronts

Once a company gets so big, it has to come up with new ways to expand leading to confrontations with other big companies. The CEO of Verizon explained it best saying, “Once you wake the bears, they come out of the woods and beat the shit out of you” (Auletta,2009). Several companies started attacking Google because they were taking over the entire media industry. Viacom sued Google for one billion dollars in March of 2007 for copyright laws for the site they purchased, YouTube. Several other companies jumped on the Viacom bandwagon with the case being brought all the way to the Supreme Court and is still ongoing today. This case snowballed into other up and coming media corporations such as Facebook. Facebook was the first big media concern that Google thought could challenge them. As Google always does, it didn’t back down and wanted to do something about it. “On April 2007, Google paid 3.1 billion dollars outbidding Microsoft and yahoo to purchase Double Click” (Auletta,2009). Double Click allowed Google to not only display text ads on the side of their pages, but they could now post digital ads. Herbert Allen III said of Google, “They want to be the digital advertising network for all forms of advertising. They want to be the advertising operating system, sitting in the middle of all advertising” (Auletta,2009). What makes Google so successful is their never quit mentality.  

Is Old Media Drowning?

Google had started to take a toll on more and more industries as the years went on. They had converted large quantities of advertising toward the Internet and they were in the epicenter of it. One of the biggest industries hit was music. Technology had made it to where the consumer didn’t have to buy a CD anymore, they could just download it on the Internet. Jeffery Cole from the University of Southern California explains how, “in the nineties an best selling records sold 15 million copies whereas in 2007 top selling records averaged only 3.7 million copies sold ” (Auletta,2009). Along with Music the newspaper industry has deflated over the last decade due to more and more people reading it over the Internet. “In 2007, newspaper advertising dropped 9.4 percent since 2000, which when adjusted for inflation is twenty percent” (Auletta,2009). This just proves how Google has changed the media industry all together. The brilliant engineers ask the questions such as why can’t newspaper be read on the Internet and they come up with a way it can be done.

There are many more advertising industries Google has crippled such as book publishers, television, Hollywood, telephone companies, and many more. Old media is not completely a thing of the past but it is diminishing by the minute due to advanced technology and the Internet.  Happy Birthday September 2009 marked 10 years since Google started in the garage of Larry Page and Sergey Brin. The company had come a long way from starting as an unprofitable search engine expanding to Gmail, YouTube, and now Google maps which gives directions to anywhere in the world. The best quote in this book is, “Google’s power is measured by the companies that fear it and the public that adore it ” (Auletta,2009). With the additions of AdSense and AdWords to websites that has allowed small business to be reached and the purchase of Double Click that allows websites such as Facebook, YouTube, and Twitter to advertise digitally, Google has gone from “zero to twenty billion dollars in revenues in 400 weeks ” (Auletta,2009).

As stated before, people attack companies that are this successful and Google is no exception. Brin was asked, “What value is Google producing for society? He thought for a minute and his answer was simple, ‘People with the right information make better decisions for them. People presented with the right commercial opportunities will buy things suited for them. Brin then tells a story about how he was in Zambia in a taxi when the driver was telling him how he needed a DVD drive to finish building a computer which he was going to pay 200 dollars for. Brin told the driver in the United States you can get them for around 30 dollars. He said think if the information was there, he could of got it a lot cheaper and been more efficient at his job’” (Auletta,2009). When the two college students from Stanford started this company, their goals were to make this country a better place that was more efficient for everyone and in different ways they have accomplished it. 

Where is the Wave: Taking Google

Even though Google has on average two thirds of all web video tracking and account for forty percent of all advertising spend online, no one knows what is in store for the company’s future. Google has stepped on the feet of many large corporation and they are doing what they can to take down the media giant. Some newspaper and magazines are trying to get Google to pay for their stories instead of allowing readers to view them free. The biggest hurdles they face is the battle with the computer giant Microsoft. If Google lets its foot off the gas it could be in the same position as the big three car companies, AOL, IBM, who everyone said there’s no way they would lose direction of their company. IBM at one time had seventy percent market share, when the government challenged them and lead IBM in a spiral downwards. 

Another danger imposed on the company lies within the concrete walls. With a company this large and powerful, arrogance take a toll on upper management and employees causing them to lose focus on the task at hand. Yossi Vardi the directory for start-ups explains it best when she says, “if you are successful and young and everything plays into your direction, you fell that you can do anything. And history is littered with examples of people who believe too much in their own virtue and lost humility that is a counterweight to hubris” (Auletta,2009). Marissa Miller commented on that statement saying, “the good thing is that our founders have a passion for user, not making money” (Auletta,2009). It seems as Google is invincible at this moment in time, but one big innovation can put a blunder in any company’s business. 

Personal Insights

With business conditions today, what the author wrote is true because this world is getting more technical with the Internet becoming an everyday thing in our lives. Ken got the underground information about how the biggest media advertiser runs its company. The subtitle of Ken’s book, The End of the World as We Know IT, explains how Google has changed the way businesses operate. Small businesses are getting more advertising because consumers can access more information through search engines. Also Google has allowed business to advertise in ways that could have never reached the amount of consumers Google has allowed them to. The economy is hurting in the business world, but Google has done nothing but help business and corporations try to get back on their feet.

If I were the author of the book I would have done these 3 things differently:

1. I would have written about Google being voted the number one company in the world to work for. A business is only as good as the people who work for you and keeping them happy is a huge step in the right direction. Google has amazing amenities for their workers free of charge such as a gym, recreation center, massage room, pool tables, and many more.

2. If I would have written the book I would have tried to write a little more about the technical side of the company. He explains a lot about the struggles and triumphs as well as the many innovations Google brought into the industry, but he did really explain a lot of how all of this happened. I know Google is very secretive about their information, but I’m sure he had more about the technical side than that. 

3. The last thing I would have done different would to shorten the book. The author left out some parts that would have made the book more interesting like what it is like to work for the company and the technological side of things. I found myself reading a lot of the same types of stories throughout the book. 

Reading the book made me think differently about the topic in these ways:

1. One way it made me feel different about the topic the amount of people it takes to run a company like this. I learned that it takes many minds to construct and execute even a website like Google. 

2. Another thing that made me feel different about the topic is the amount of money that goes into building a website. Google has spend billions of dollars advertising to try to gain as much market share as possible 

3. Reading the book made me think differently about the power that’s behind Google. I learned that the world has been Googled is a true statement because everyone has been affected by the way Google has changed the media industry. 

I’ll apply what I’ve learned in this book to my career by:

1. One thing I will apply to my career is the belief that improvements can always be made. Even though Google has a multi-billion dollar company, the engineers are always thinking of ways they can make their company more efficient to the consumer. 

2. Another thing I will take is to not be afraid to start a business just because there are bigger more successful ones in the market. Often business owner are scared to open business because of the giant corporations. I learned that you have to take risk to become successful

3. Always have a plan for long term growth. The founders of Google have always had a plan for the future which comes from the passion they have from the company. 

Here is a sampling of what others have said about the book and its author:

1. “A sharp and probing analysis of the apocalyptic upheavals in the media and entertainment industries” (Progressive Book Club,2009).

2. “That’s news-biz terminology for when a reporter just puts everything he knows into a story — is not selective. Ken Auletta is a stellar reporter, but this book is a fire hose that is flopping out of control. I feel as though I have re-lived the entire history of Google and modern media in real time. What I had hoped for was something to help me make sense of it” (Audible Inc,1997).

3. “Delivers the real scoop on how this Internet giant fits into the larger media landscape. . . . Auletta’s years of research and firsthand access to insiders, critics, competitors, and commentators give readers a well-rounded perspective on the company and how it fits into the wider milieu” (Progressive Book Club,2009).

My Synthesis and Summary of the Critics Reviews

These three critics have different views about the book. All three of them agree that the book provides great information about Google and its growth in the media world. The last two both hit on how wonderful of a reporter he is but had different views of the entire book as a whole. The thing that the second critic didn’t like about the book was the length and amount of information put into it. I believe that it was a good book but the length was an issue for me as well. There were too many stories that were exactly alike that the author could have left out of the book to shorten it up a little. I also agree with all three critics on how it gave the reader a great perspective on how Google took over the media world.

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To contact the author of this “Summary and Review of Googled” please email Randy.Bouquet@selu.edu.

David C. Wyld (dwyld@selu.edu) is the Robert Maurin Professor of Management at Southeastern Louisiana University in Hammond, Louisiana. He is a management consultant, researcher/writer, and executive educator. His blog, Wyld About Business, can be viewed at http://wyld-business.blogspot.com/.  

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