Posts about wwgd

Post-postal

Imagine an America in which everyone has an internet connection, a device to use it, and a printer.

Ruth Goldway, the chairman of the U.S. Postal Regulatory Commission, imagined such a world when the head of the U.K.’s Royal Mail International asked at an industry conference a year ago what Google would do with the Postal Service. Goldway (who hadn’t read my book) replied, “They’d give every household a computer and a printer.” (And I’d add, of course, a broadband connection.)

Goldway was just speculating. As someone who believes in the Postal Service’s universal service obligation, it makes sense that she’d wonder about universal connectivity.

Now — as is my habit — I’ll take it farther — too far — and ask: When we all are connected, do we need a Postal Service? Or what kind of Postal Service do we need? What still needs to be delivered? What are the economics of that delivery — who’s being served and who should pay? Do we still need daily (let alone Saturday) delivery? Do we need to guarantee physical delivery to every address in America? How much could we save? Can the market take over delivery of things while the net takes over delivery of information and communication? What’s the impact on publishing and advertising, on retail, on education?

These are fascinating questions I’ve been tossing back and forth with a new friend, John Callan, a high-level consultant in the delivery industry. He did read my book (and gave Goldway a copy) and came to visit me to talk about the post office in the Google age. Callan, his colleagues, and I are thinking of holding an event to explore these questions and opportunities.

The Postal Service is forecast to lose $7.8 billion in 2010. A USPS presentation here reveals the dynamics: a 17% decline in volume from ’06-’09; a forecast 37% drop in first class ’09-’20. With its universal service obligation, the USPS has to deliver to 150 million addresses a day. With its post offices, it has 36,500 retail locations, more than McDonald’s, Starbucks, Walgreens, and Wal-Mart in the U.S. combined — and it’s not allowed to close offices for economic reasons. Its retiree health benefits alone cost $5 billion a year. Dropping Saturday delivery, as has been proposed, would save $3 billion a year — but that doesn’t solve the problem. Federal Times says the USPS is “officially in a panic” (not a bad thing, I’d say) because it could lose $250 billion in a decade.

The US Postal Service as we know it is, in a word, like much of the rest of the economy disrupted (or, if you prefer, doomed). I think it’s time to ask the radical question: Do we need it?

If all of us are connected, we don’t need the USPS to deliver letters; email is precisely the reason that first class mail is already plummeting. We consumers are, in my view, subsidizing the delivery of advertising because 71% of the USPS margin available to cover its costs comes from first class, only 21% from advertising. Yet in 2009, the USPS delivered an equivalent number of ads vs letters and by 2020 it will deliver far more ads (86 billion ads vs. 53 billion letters, according to the USPS projection). Should an ad-delivery service be the province of a government-anointed entity? I don’t think so.

So let’s zero-base the Postal Services’ services: Once more, information and communication can be handled electronically. Commercial delivery should be handled commercially. There will be an increase in parcel delivery as more and more retail moves online; that’s a profitable business the market should take over. Junk mail should pay full freight — if it is still delivered once mobile becomes a better, more targeted, and more efficient delivery mechanism for coupons and such (and if do-not-mail lists threaten to cut their volume). Magazines? Sorry, but I don’t really want to subsidize their businesses — and besides, tablet triumphalists insist we’ll be using iPads before you know it. Do we need six-day-a-week delivery to every one of 150 million addresses in America then? No; delivery of things is made on an as-ordered basis. What about out-of-the-way addresses (see: Sarah Palin)? Maybe that requires some subsidy, but that would be minimal.

What about the post offices? The USPS presentation shows far lower costs if these services were run through partners (e.g., other retailers), online, and self-service machines.

What about delivery of government paperwork? Well, it’s ludicrous that we’re not given the option to fill out the census online. We are shifting our taxes online.

Mind you, I have nothing against mailmen anymore than I have anything against pressmen. It’s just that they work in antiquated industrial structures and we can find not only efficiency but improvement of service thanks to digital — if we are all connected.

That is why I wish the FCC broadband plan went farther faster (as is happening elsewhere in the world), assuring everyone a high-speed connection quickly. This examination of the Postal Service is just one example of the impact universal connectivity would have on the economy. Some of that impact is painful — lost jobs, severance cost, unused real estate, mothballed trucks. But much of that impact is positive — improved service, reduced costs, reduced environmental impact, new opportunities, new entrepreneurship, new innovation. New companies would emerge to take up the opportunities this change presents, creating new jobs and value.

That’s why I was so impressed with Chairman Goldway’s answer to the WWGD? question: Rather than trying to paddle against the flood, she was at least willing to at least wonder about going with the flow.

I’ll ask: What happens if we spend capital not on money-losing, dying institutions (repeat: $250 billion losses over a decade) but on subsidies to get every American connected? If we fully examine the opportunities that presents, it could have a profound impact on policy, budgeting, and many sectors ofsociety. Let’s model that impact on the economy.

So Callan and company and I would like to get together both incumbents and entrepreneurs to imagine the near-future world of delivery after digital ubiquity. I’d like to continue the discussion with other sectors: newspapers and media, obviously, but also education (how would it change if every child were connected and equipped?); retail; real estate (what happens when all that retail leaves its brick-and-mortar stores?); financial services (why the hell are banks still building branches?); government; and on and on. That is what should inform the policy debate over broadband policy: Let’s map out all the opportunities — for entrepreneurial innovation and growth, for savings, for improvements in life, for export value — and let that inform the resources and speed we put into universal broadband.

What do you think?

TEDxNYed: This is bullshit

Here are my notes for my talk to the TEDxNYed gathering this past weekend. I used the opportunity of a TED event to question the TED format, especially in relation to education, where — as in media — we must move past the one-way lecture to collaboration. I feared I’d get tomatoes — organic — thrown at me at the first line, but I got laugh and so everything we OK from there. The video won’t be up for a week or two so I’ll share my notes. It’s not word-for-word what I delivered, but it’s close….

* * *

This is bullshit.

Why should you be sitting there listening to me? To paraphrase Dan Gillmor, you know more than I do. Will Richardson should be up here instead of me. And to paraphrase Jay Rosen, you should be the people formerly known as the audience.

But right now, you’re the audience and I’m lecturing.

That’s bullshit.

What does this remind of us of? The classroom, of course, and the entire structure of an educational system built for the industrial age, turning out students all the same, convincing them that there is one right answer — and that answer springs from the lecturn. If they veer from it they’re wrong; they fail.

What else does this remind us of? Media, old media: one-way, one-size-fits-all. The public doesn’t decide what’s news and what’s right. The journalist-as-speaker does.

But we must question this very form. We must enable students to question the form.

I, too, like lots of TED talks. But having said that….

During the latest meeting of Mothership TED, I tweeted that I didn’t think I had ever seen any TEDster tweet anything negative about a talk given there, so enthralled are they all for being there, I suppose. I asked whether they were given soma in their shwag bags.

But then, blessed irony, a disparaging tweet came from none other than TED’s curator, dean, editor, boss, Chris Anderson. Sarah Silverman had said something that caused such a kerfuffle Anderson apologized and then apologized for the apology, so flummoxed was he by someone coming into the ivory tower of TED to shake things up with words.

When I tweeted about this, trying to find out what Silverman had said, and daring to question the adoration TEDsters have for TED, one of its acolytes complained about my questioning the wonders of TED. She explained that TED gave her “validation.”

Validation.

Good God, that’s the last thing we should want. We should want questions, challenges, discussion, debate, collaboration, quests for understanding and solutions. Has the internet taught us any less?

But that is what education and media do: they validate.

They also repeat. In news, I have argued that we can no longer afford to repeat the commodified news the public already knows because we want to tell the story under our byline, exuding our ego; we must, instead, add unique value.

The same can be said of the academic lecture. Does it still make sense for countless teachers to rewrite the same essential lecture about, say, capillary action? Used to be, they had to. But not now, not since open curricula and YouTube. Just as journalists must become more curator than creator, so must educators.

A few years ago, I had this conversation with Bob Kerrey at the New School. He asked what he could do to compete with brilliant lectures now online at MIT. I said don’t complete, complement. I imagined a virtual Oxford based on a system of lecturers and tutors. Maybe the New School should curate the best lectures on capillary action from MIT and Stanford or a brilliant teacher who explains it well even if not from a big-school brand; that could be anyone in YouTube U. And then the New School adds value by tutoring: explaining, answering, probing, enabling.

The lecture does have its place to impart knowledge and get us to a shared starting point. But it’s not the be-all-and-end-all of education – or journalism. Now the shared lecture is a way to find efficiency in ending repetition, to make the best use of the precious teaching resource we have, to highlight and support the best. I’ll give the same advice to the academy that I give to news media: Do what you do best and link to the rest.

I still haven’t moved past the lecture and teacher as starting point. I also think we must make the students the starting point.

At a Carnegie event at the Paley Center a few weeks ago, I moderated a panel on teaching entrepreneurial journalism and it was only at the end of the session that I realized what I should have done: start with the room, not the stage. I asked the students in the room what they wished their schools were teaching them. It was a great list: practical yet visionary.

I tell media that they must become collaborative, because the public knows much, because people want to create, not just consume, because collaboration is a way to expand news, because it is a way to save expenses. I argue that news is a process, not a product. Indeed, I say that communities can now share information freely – the marginal cost of their news is zero. We in journalism should ask where we can add value. But note that that in this new ecosystem, the news doesn’t start with us. It starts with the community.

I’ve been telling companies that they need to move customers up the design chain. On a plane this week, I sat next to a manufacturer of briefcases last week and asked whether, say, TechCrunch could get road warriors to design the ultimate laptop bag for them, would he build it? Of course, he would.

So we need to move students up the education chain. They don’t always know what they need to know, but why don’t we start by finding out? Instead of giving tests to find out what they’ve learned, we should test to find out what they don’t know. Their wrong answers aren’t failures, they are needs and opportunities.

But the problem is that we start at the end, at what we think students should learn, prescribing and preordaining the outcome: We have the list of right answers. We tell them our answers before they’ve asked the questions. We drill them and test them and tell them they’ve failed if they don’t regurgitate back our lectures as lessons learned. That is a system built for the industrial age, for the assembly line, stamping out everything the same: students as widgets, all the same.

But we are no longer in the industrial age. We are in the Google age. Hear Jonathan Rosenberg, Google’s head of product management, who advised students in a blog post. Google, he said, is looking for “non-routine problem-solving skills.” The routine way to solve the problem of misspelling is, of course, the dictionary. The non-routine way is to listen to all the mistake and corrections we make and feed that back to us in the miraculous, “Did you mean?”

“In the real world,” he said, “the tests are all open book, and your success is inexorably determined by the lessons you glean from the free market.”

One more from him: “It’s easy to educate for the routine, and hard to educate for the novel.” Google sprung from seeing the novel. Is our educational system preparing students to work for or create Googles? Googles don’t come from lectures.

So if not the lecture hall, what’s the model? I mentioned one: the distributed Oxford: lectures here, teaching there.

Once you’re distributed, then one has to ask, why have a university? Why have a school? Why have a newspaper? Why have a place or a thing? Perhaps, like a new news organization, the tasks shift from creating and controlling content and managing scarcity to curating people and content and enabling an abundance of students and teachers and of knowledge: a world whether anyone can teach and everyone will learn. We must stop selling scarce chairs in lecture halls and thinking that is our value.

We must stop our culture of standardized testing and standardized teaching. Fuck the SATs.* In the Google age, what is the point of teaching memorization?

We must stop looking at education as a product – in which we turn out every student giving the same answer – to a process, in which every student looks for new answers. Life is a beta.

Why shouldn’t every university – every school – copy Google’s 20% rule, encouraging and enabling creation and experimentation, every student expected to make a book or an opera or an algorithm or a company. Rather than showing our diplomas, shouldn’t we show our portfolios of work as a far better expression of our thinking and capability? The school becomes not a factory but an incubator.

There’s another model for an alternative to the lecture and it’s Dave Winer’s view of the unconference. At the first Bloggercon, Dave had me running a panel on politics and when I said something about “my panel,” he jumped down my throat, as only Dave can. “There is no panel,” he decreed. “The room is the panel.” Ding. It was in the moment that I learned to moderate events, including those in my classroom, by drawing out the conversation and knowledge of the wise crowd in the room.

So you might ask why I didn’t do that here today. I could blame the form; didn’t want to break the form. But we all know there’s another reason:

Ego.

* That was an ad-lib

Helping news be news

Google News has just open-sourced its code to create what it calls Living Stories. What this really is, I think, is Google’s attempt to take editors to school on content presentation in our new world.

The article, I’ve argued, is outmoded as the building block of news. The new atomic unit(s) of journalism needs to reflect the transition of news from a product to a process. It needs to gather updates and corrections on a story. It needs to put that story in context and history. It needs to link to other versions of the story from other sources. Going past what Google’s Living Stories format does, it needs to open the door to collaboration. It can do so much more: showing the provenance of the news and linking to original sources, gathering comment and perspective, soliciting questions….

Daylife (where, disclosure, I’m a partner) its own vision of the future of the story, called Smart Stories, that will do more neat things; I’ll let them tell you about it. Daylife also sees that news needn’t exist in isolated, short-lived, repetitive units of presentation invented for the age of print. News should reside in a nest of relevance, which not only improves the presentation, it gives you more options on how you want to delve into the story and follow it and eventually contribute to it. It makes news more personal.

Both companies are doing something important for the benefit of journalists: making them look at what they create in a new way. This is just one possibility, just one step. We also need to think about making news embeddable and distributed. We need to insinuate news into your stream (“if the news is that important, it will find me“) and make it collaborative and enable you to triangulate from different viewpoints and footnote our work and….

The way for Google to serve the interests of news is not to make deals to mollify the mewling Associated Press or cater to pipe dreams of charging. The way that Google and other technology visionaries can help is by reshaping the form of news to show the people who do it how they can do it now. The open-sourcing of Living Stories is a welcome start.

Buzz: A beta too soon

As soon as Buzz was announced — before I could try it — I tried to intuit its goals and I found profound opportunities.

Now that I’ve tried it, reality and opportunity a fer piece apart. It’s awkward. I’d thought that I had wanted Twitter to be threaded but I was wrong; the simplest point quickly passes into an overdose of add-ons. Worse, Google didn’t think through critical issues of privacy — and it only gets worse (via danah boyd). I won’t go as far as Steve Rubel and some others, who instantly declared Buzz DOA; there is the essence of something important here (which I think will come out in mobile more than the web). But there’s no question: Buzz has kinks.

I was going to use that line in the headline — that Buzz is a beta too soon — but the irony is that Buzz is the one product Google did not release as a beta. Big mistake, I think.

In fact, even if Buzz had been released as a beta to a small audience, I’m not sure all the problems would have surfaced because it takes a lot of people using it to surface those problems: unwanted connections and too much noise.

So I wonder whether Google should have moved the users up the design chain — something I’ve been advising retailers and manufacturers to do. The sooner one can learn from one’s customers/users/public (not turning design into democracy but enabling the target to help make you smarter and make what you’re creating better), the better. What if Google had released screenshots and wireframes of Buzz? It’s not as if someone else was going to steal it; Buzz was Google catching up to Twitter, Facebook, and Foursquare anyway. Very few people would have bothered to dig into the design of the product but enough might have — the 1% rule — to warn Google off the worse of Buzz’s bloopers.

Then again, isn’t that what Google did with Wave? Some — many of the same insta-critics — declared it too difficult and DOA while I reminded people that Google specifically said it released a version very early in the process so people could use it and, more importantly, develop new products atop it and through that, Google would learn what Wave really was.

So where’s the happy medium? Or as I ask in the presentation I’ve been making on Beta (likely next book): When’s the beta baked? How done is done?

I’ll be contemplating the answer to those questions and I ask your help and opinions and stories and examples.

Were I to give Google advice on Buzz — what the heck, everyone else is — I think I’d release a product plan for comment and then put out a clearly labeled beta and then invite only volunteers to try it and then make sure that at every step there’s a clear opportunity for me to opt out of a choice and tell Google why I was doing it so Google could learn. I’d listen better.

: MORE: This is a video I did for the release of What Would Google Do? summarizing the beta section in the book, which in turn inspired the thinking above:

Google’s Buzz(machine)

I still need more time to get my head around Google Buzz, which will enable users to post and share updates, links, photos, videos with the world or with friends tied to geography via the web, mobile apps, and voice. Buzz also promises to prioritize the “buzzes” we get. I think this could be the beginning of some big things:

* The hyperpersonal news stream, which Marissa Mayer has been talking about. The key value here is not just aggregating our streams but prioritizing them by listening to signals that unlock relevance. Those are the buzzwords Bradley Horowitz et al used in the Google presentation of Buzz. This is an attempt to attack with Clay Shirky variously calls filter failure and algorithmic authority. It also has big business implications: the more relevant Google can get with advertising (or some new version of it).

* The annotated world will attach data to locations, data that Google will, in turn, help organize. Buzz will intuit and confirm our location (even guessing what business we might be buzzing from in a given building) so we can post about places; it will display posts about those places; this will make Google’s Place Pages and, of course, maps richer; it will yield more local advertising opportunities.

* Local is clearly a big Google priority. Newspapers, Yellow Pages, local media, and perhaps even craigslist better watch out. Google is gunning to organize our areas and with that comes an incredible flood of advertising opportunity.

* Personalization is key to this: relevance in your feed; publishing to your friends (even understanding who your friends are). I think this portends the end of the universal search and thus of search-engine optimization (there’ll be no way to calculate how high a result rises when everyone’s results are different).

* Voice is rising in importance: You an post a buzz using only voice from your mobile device (read: while driving). This is one reason why Google has been working (through Goog411) to get better and better at voice recognition. Will the keyboard become less important? Will we post more when all we have to do is talk? Will Google then have more to organize for us?

* Social. Google has tried to attack social before and failed. Microsoftlike, it’s trying again. I am disappointed that its interface with Twitter, for example, is only one-way: I can bring Twitter into Buzz but not use Buzz to publish to Twitter. Silly. I’ve long said that the winner in social is not a site; the internet is our social network. The winner will be the company that helps us organize that. To do that, it must be open to all input and output. That’s where we should be looking with Google and Facebook. In that sense, Twitter is ahead of both of them.

* Live. When I first published this post, I left out live. Silly me. Twitter snuck up on Google as on all of us. Google has not been good at live. It needs content to ferment like wine and cheese with our clicks and links telling Google about relevance and authority. Now Google is trying to get live with our updates.

I’ve said since my book came out that there are three wars Google has not yet won: local, live, and social. Well, we see Buzz on those battlefields.

This could be big. Or Buzz could be the next Orkut or SideWiki (read: fizzle). Who knows? But in Buzz, I see Google trying to do attack profound opportunities. Now if I can just use the damned thing.

What Toyota should do

Including my parents, we own four Toyotas in my family; over time, we’ve probably owned eight or 10. Will we ever buy another? Depends. Depends on whether we can trust the company given its performance lately.

There’s a reason we bought our Toyotas. They are incredibly reliable. I abuse mine, skipping service calls. But — knock wood — I’ve not had any major problems. So even though I don’t much like Toyota design and — as a professor, can no longer afford to pay for that styling with the Lexus brand — I thought I was pretty much stuck buying them forever. Why fix what’s not broken, eh?

But now we find out our Toyotas are broken. We find out that Toyota has known this for too long and done nothing. We call our dealer and get stonewalled about the problem with brakes in the Prius our son drives. Dealers in California drop ABC because it dared to report on the problems.

Didn’t these people read Cluetrain? (Should I send them a copy of What Would Google Do?)

Their behavior is all the more unforgivable because there are so many new tools to use to learn about and fix problems and keep customers informed — and because there have been so many lessons from other companies (start with Dell).

If Toyota were the trustworthy company, brand, and product I thought it was — if it is to regain my trust — I suggest:

The company should gather and publish openly a complete record of all repairs and reported problems for all its models. I hope to hell they’re doing this internally as a way to see when problems emerge. But if they don’t, we should. I’d love it if we had a carwiki where we could all do this with cars (and other products) to show trends and alert companies and — if they don’t respond — warn customers. Think of it as a SeeClickFix for our stuff.

When Hyundai entered the U.S. and had plenty of reliability problems, it extended its warranty to 10 years and that, today, is a selling point. In the age of open and social data, Toyota could regain its perch as a reliable brand by becoming the open brand, by making reliability a collaborative effort.

I think the company should also reengineer its cars for regular updates, like phones. Mind you, in my book — and when I discuss my likely next book, Beta — I am always quick to caution that I don’t want to drive the beta car or fly in the beta jet. When safety is an issue, perfection has to be the goal.

But we know that there can always be improvements. Nothing’s perfect. My Nexus One worked but after getting its update — automatically — on Friday, it works better and does more. In many of their systems, cars could operate similarly.

The problem with the Prius brakes is in its software. An update will allegedly fix it. Priuses sold last month had the update. Why the hell wasn’t the update pushed out to every Prius? Why did we have to argue with our dealer about this? Because it’s treated as a problem, a recall, a liability in both legal and PR terms. But if the culture of cars were like those of computers and phones — if they could get updates automatically — then it would be less of a big deal: Problem found, problem solved, asap. Improvement suggested, improvement implemented, anytime.

I wish we could drive our cars up to our home wi-fi or the nearest Starbucks (or dealer … or even my mobile phone) and connect to get updates and improvements. If that were possible — if that’s how many problems were solved — then cars would be engineered differently, operating as much as possible under drive-by-wire and nodes of a network.

When we talked about this yesterday, my colleague Peter Hauck blanched at the idea that cars could be hacked. Yes, I can see new plotlines for TV detective shows or even 24: at the stroke of midnight, the hacker’s worm has every car in America turn right, stop, and go into reverse (not-so-subtle metaphor there).

Yet by opening up, car companies can not only discover problems but fix them — and improve their cars. Look at what is happening at Local Motors as members of the community collaborate to design cars and even make economic decisions about them. Now just as I always give my caveat about the beta car, I also always have to issue my caveat about the democratic car: I don’t want design by vote — I don’t want the Homer Simpsonmobile — but I do think the smart car company would be open to the smarts of its drivers. I’ll bet that the community of Toyota drivers could find problems faster than the company and suggest fixes and suggest improvements.

So, Toyota, you can issue overdue recalls and then apologize until you’re blue in the face but that won’t regain my trust. You have to do something bold and become the first car company that enables its community of drivers. If you don’t do it, I’ll bet Ford will.

Google news

First, the news: Google told me today that they would consider giving more transparency about revenue splits in Adsense.

At a private meeting with a dozen and a half media people at Davos with CEO Eric Schmidt, President of sales Nikesh Arora, search boss Marissa Mayer, YouTube founder Chad Hurley, and counsel/”chief diplomat” (Schmidt’s joke) David Drummond in a Davos apartment dolled up with lava lamps, the execs discussed China, the company’s push into display, critics from France to News Corp., Android and its phone strategy, and news.

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AdSense: At the DLD conference in Munich Monday, Burda CEO Paul-Bernhard Kallen, on a panel with Drummond, said publishers wanted transparency and their “fair share.” I asked him, a fair share of what — AdSense? Kallen said yes. And that put a fence around this debate. Drummond went on to emphasize that publishers do not deserve a share of a search for a camera that doesn’t involve their content. He also said transparency could be discussed.

At today’s briefing, Arora said that the company was considering more transparency. I confirmed with Google’s people that this was new. I suspect that they’re not going to promise the possibility and not deliver something.

I’m happy about this because, with China, this seems to strike off my two biggest complaints — both in What Would Google Do? — about Google: its prior lack of support of free speech in China and its hypocrisy on transparency and ad rates.

* * *

China: “We made a decision that was consistent with our values,” Schmidt said. “We’re not going to operate differently in China as opposed to the rest of the world,” said Drummond.

When is Gooogle going to do something? “It should happen soon,” Drummond said.

Was Google’s original stance on China — making it an exception to its own rules — a mistake? “We said consistently we would evaluate the position,” said Schmidt, “and people didn’t believe us.”

On the attacks, Schmidt said the company had a moral need to “make sure our systems are safe from attack anywhere.”

They wouldn’t discuss any details about any discussions with China. One editor asked whether Google was upset that other companies — especially those that also suffered attacks — have not come forward to openly support Google. I went farther and said that Microsoft had thrown Google under the bus and backed up over it. Schmidt repeatedly said that he manages Google, not other companies. “We speak for ourselves.”

Drummond said the problem of censorship is not in China alone. Hurley said YouTube is blocked in China, Turkey, and Iran “because of freedom of speech.”

“I believe this is an evergreen story for Google and other online companies,” Schmidt said. “As the world goes online, every country is going to have a discussion about what’s appropriate and what’s not. And a lot of these organizations [that is, governments] have not really thought through what they’re doing. We have a strong view about transparency.” [It’s about to get a little stronger, it seems.]

Though Schmidt joked about Drummond as Google’s diplomat and apolgized for mixing metaphors, he emphasized that Google is not a country, does not set laws, and does not have a police force — or diplomats This is a government-to-government issue, he said.

* * *

Google’s reputation: I asked whether it was lonely at the top, getting grief from France to Germany to News Corp to China. Is it because Google is so big? Is it because it is putting itself on the ledge? Is it a PR problem? Schmidt said no.

“Google is fundamentally disruptive because of our innovation,” Schmidt said. “Google, because of our architecture, does things at a larger scale than others can. We are in the information space, which everyone has an opinion on. … You asked me how does it feel from a Google perspective? It feels as if we’re in the right place.” These aren’t crises, Schmidt said. He treated them as a factor in doing business. “It’s constnat. It’s because it’s information that maters.”

* * *

Innovation: Schmidt later talked about the difficulty we all know companies such as this can have: growing big and killing innovation. He talked about the canonical Silicon Valley story: a company starts, it innovates, it grows to middle age, it grows bored, it is sold to another company. Schmidt et al are clearly aware of that threat. Apple, he said, has “proven the model of innovation at scale.”

* * *

Phones: Will they have a tablet? “You might want to tell me what the difference is between a large phone and a tablet,” Schmidt said.

How will they make money on phones? “Not to worry,” Schmidt said. “We do not charge for Android because we can make money in other contexts.”

The strategy, he said, is to establish volume for application development to follow. “The phone is defined by the apps,” he said.

Schmidt took my Nexus One and demonstrated Google Sky. Mayer said the guy in charge of mobile uses Google Goggles to take pictures of wine labels and search on them so he can sound smart: “It tastes of apricot blossoms.” Mayer told Schmidt about Layar (a very neat agumented reality program I wrote about here earlier); he didn’t even know about it yet.

* * *

The economy: “The recession is very much behind us,” Schmidt said. “We see growth and successful businesses I think pretty much everywhere in the world.””

* * *

Display ads: Schmidt said the company is “trying to apply the science of Google to the display space. Display is likely to be our next really big business globally.”

Arora said that today marketers buy sites when they want to buy audiences. He said Google will “bring measurability to the process of display” and it is “trying to find a way for the industry to bring the entire inventory together.” That is, “most agencies and buyers don’t have the tools to aggregate across publishers.” Schmidt added: “Before the google question was applied to this, you couldn’t have scale.”

Isn’t this just an ad network? Arora said it would be a collection of networks, an exchange that would “allow you to separate the best owners of inventory from the best sellers of inventory.” I don’t understand what that means and will ask.

Aren’t publishers going to see Google as again disintermediating them and hurting their brands? I asked. Google said the platform will bring greater transparency, more inventory, faster, with scale and speed and that publishers who participate will gain more revenue from the inventory they have (and don’t sell). Indeed, I was talking with one newspaper editor before the meeting as he lamented the small size of the percentage that is sold.

* * *

Relations with newspapers: “We depend on high-quality content,” Schmidt said.

Mayer said Google will help publishers make more money. It will create better advertising products for them, improving display. It will provide ads that are more relevant. It will support pay efforts.

She also said Google is working on making news as compelling as possible. “The issue is one of engagement online: if they spent more time online it would be much easier to make money with it,” she said and then added that publsihers must “bring the news to users’ digital doorsteps.” Amen. I’ve written often here about the challenges of engagement and the need to think distributed. Those are ripe areas for Google to help news.

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YouTube: Schmidt said he was very pleased with YouTube and that it was making money but he and Hurley wouldn’t get in the slightest bit specific about the definition of making money (profit? cash flow?) let alone numbers. “In the last year, Chad managed to figure out a way to make money using partners and their video content on YouTube,” Schmidt said. Hurley said it took longer than expected to get their because of delays in bringing in Doubleclick. He said they have a sales force selling video in 20 countries. They also recently made a deal with channels 4 and 5 in the UK to distribute content and they’re going to live-stream cricket.

* * *

Pay: Will Lewis of the Telegraph asked “what’s it like being so brutally attacked by News Corp. What side of genius to you think their pay wall idea is?” Of course, Google’s execs didn’t take the bait.

They talked about hybrid business models and said they’d support them and pretty much left it at that.

* * *

Globalization: Schmidt said a majority of Google users are outside the U.S. and he expects that soon most revenue will come from outside the U.S.

* * *

: The Guardian’s Alan Rusbridger on the briefing: Google as a country.

The rise of the interest-state

In the post below, on Google standing up to China over its spying on dissidents and censorship, I note how Zeit Online calls Google a quasi-state — in a post under the headline “The Google Republic” — and Fallows says Google “broke diplomatic relations with China” as if Google were a nation.

What this says, of course, is that the internet is the New World and Google is its biggest colonizer: the sun never sets on Google.

It also says that on the internet, new states form across interests, ignoring borders. Those interests can be business — and we’ve seen what look like business-states before — but also causes, principles, and dangers (e.g., Al Qaeda). Interest-states will gain more power and that power will come from nations.

Just as what we’re seeing in the economy is more than a mere crisis — it is the shift from the industrial economy to what follows — similarly, in political structure, we are beginning to witness the emergence of new and competitive interest-states. In What Would Google Do?, I said this:

Whatever causes they take up, Generation G will be able to organize without organizations, as Shirky wrote in Here Comes Everybody. That ability to coalesce will have a profound destabilizing impact on institutions. We can organize bypassing governments, borders, political parties, companies, academic institutions, religious groups, and ethnic groups, inevitably reducing their power and hold on our lives. In an essay in Foreign Affairs in 2008, Richard Haass argued that the world structure is moving from bi- and unipolarity (i.e., the Cold War and its aftermath) to nonpolarity (i.e., no one’s in charge). We now operate in an open marketplace of influence. Google makes it possible to broadcast our interests and find, organize, and act in concert with others. One need no longer control institutions to control agendas. Haass chronicles the dilution of governments. Bloggers Umair Haque and Fred Wilson have written about the fall of the firm, and earlier I examined the idea that networks are becoming more efficient than corporations. In my blog, I follow the crumbling of the fourth estate, the press. One could debate the stature and power of the first estate, the church. What’s left? The internet is fueling the rise of the third estate—the rise of the people. That might bode anarchy except that the internet also brings the power to organize.

Our organization is ad hoc. We can find and take action with people of like interest, need, opinion, taste, background, and worldview anywhere in the world. I hope this could lead to a new growth in individual leadership: Online, you can accomplish what you want alone and you can gather a group to collaborate. Being out of power need not be an excuse or a bar from seeking power. That may encourage more involvement in communities and nations—witness the youth armies that gathered in Facebook around Barack Obama, a powerful lesson for a generation to have learned.

: MORE: Siva Vaidhyanathan responds (as part of a conversation between us in both this post and the one below):

My book plays this in a slightly different way: The Internet has enough diverse interests and players that it demands governance. No traditional state is in the position or willing to assume that role. So Google governs the Internet.

One could read this showdown (as I do) as a classic international power conflict between a major traditional state and a new, virtual state: the Googlenet.

Google is taking a risky stand to defend the Internet generally. This is what a weaker, threatened state would do.