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  • >> HOCKENBERRY: Please welcome to the 25th Anniversary of the MIT Media Lab, the CEO

  • and Chairman of Google, Eric Schmidt. >> SCHMIDT: Thank you. Thank you, thank you

  • very much. Thank you for having me. >> HOCKENBERRY: When I tell you smile, you

  • have a big smile, indeed. It's great to have you here. Thanks Eric for joining.

  • >> SCHMIDT: I [INDISTINCT], this place spawned a lot of what I live in everyday. Ten years

  • ago, a lot of our employees, when I visited a long time ago, it's like I said, "That'll

  • never happen." It happens everyday now. >> HOCKENBERRY: So if somebody comes to you

  • with Media Lab on their resume, that's a good thing.

  • >> SCHMIDT: We'll hire them. We'll hire them. >> HOCKENBERRY: That's a good--you'll hire

  • them, I see. >> SCHMIDT: Yeah.

  • >> HOCKENBERRY: You know, are you sticking around for the party?

  • >> SCHMIDT: Yes. >> HOCKENBERRY: Yeah.

  • >> SCHMIDT: We have a whole team here. >> HOCKENBERRY: I see. We'll you're going...

  • >> SCHMIDT: My guess is the demos that you guys are going to see later are the future

  • for the next 10 years. >> HOCKENBERRY: That's great. But you'll probably

  • have some attention at the party later, so I'd keep your entourage like right around

  • you. Eric, I want to talk about the institution of Google and institutions of change and entrepreneurship,

  • and I think we loosely use the terms entrepreneur, innovator and discover in this economy. And

  • I'm wondering if there are institutions that foster entrepreneurs and innovators, and people

  • who discover sort of basic deep problems that may not have immediate results or those best

  • worked out in separate institutions? >> SCHMIDT: I'm struck by a couple of things.

  • One, we have Marvin Minsky here; he's one of my personal heroes. There are people who

  • in the 60's foresaw--sort of creating what we have today when they created Kendall Square

  • and Kendall Square Research, and all of that, the progenitors of modern computing. And I'm

  • really struck when I spend time in our government with how much incumbency drives no change

  • and how this group and the culture that's represented basically in Cambridge, in Silicon

  • Valley, and a few other places in America, really are different. And we, because we spend

  • so much time with each other, we assume we're the norm, we're not. We're not the norm. That's

  • why television doesn't quite make sense to us. So what they're saying, "It doesn't quite

  • compute." Whereas in this case, the students are the model of the university, the funding

  • model, their R&D centers, which are linked pretty tightly together now, really do believe

  • in discontinuous change. So I would argue that the solutions to the problems that we

  • have in humanity, in government, in society as a whole will be not made by the incumbents

  • but rather by people like people in this room. >> HOCKENBERRY: Well, let's talk a little

  • bit about the difference between an entrepreneur who takes maybe existing intellectual property

  • and takes advantage of it in the market place and creates a sustaining model for it as a

  • business; an innovator is something that seems to be a hybrid between a discoverer and an

  • entrepreneur. And then of course, I think, you know, people who work in basic research

  • labs like Watson, like Kendall, like Xerox PARC, like the Media Lab, are basically working

  • on problems where there is not necessarily an expectation. What kinds of investments

  • foster those different individuals and do you separate that function at Google?

  • >> SCHMIDT: We try not to because it's so--one of this does happen--is this all gotten interlinked

  • and these distinctions are not as important as they were, it just involves doing amazing

  • things. And one thing you learn as an executive is when you walk through the hall, if you

  • ask people who are the--think people doing the most interesting things, everyone agrees.

  • So it doesn't really matter how we score it, we actually just know. And I'm really struck

  • now by--my entire career started with DARPA, NSF, and the kind of funding that people,

  • you know, generation before me figured was important. The history of American funding

  • of major Universities, including MIT, started in the post war period by understanding that

  • having a robust investment of basic science which precedes all of us, you know, the--what

  • allows us to get these extraordinary returns in terms of semiconductors; it's really physics,

  • right? All of those investments that occurred in the 60's and 70's, and 80's, we're now

  • the beneficiaries of. So, unlike our children, let's thank our parents, right. Let's actually

  • recognize that people actually worked very hard to create an opportunity that we all

  • now a benefit from. >> HOCKENBERRY: But let's explore the frame

  • there. They were motivated by a Cold War almost fear mentality, that we had to compete with

  • the Russians. Today... >> SCHMIDT: Now we can be afraid of our competitors

  • in the economic sense. Whatever works... >> HOCKENBERRY: Right, it doesn't...

  • >> SCHMIDT: ...that causes more money to come to basic research is a good outcome.

  • >> HOCKENBERRY: But do those motives pursue or produce the same kinds of outcomes? In

  • other words, do we--can we formulate the same kind of urgency about investing an innovation

  • today without a Cold War, as our parents did? >> SCHMIDT: Well, I would hope so. I mean

  • it, let's--if you watch enough television [INDISTINCT] spend enough time in Washington,

  • what's the future of America? Okay? Massive deficits, lost of manufacturing jobs overseas,

  • an increasing number of healthcare services jobs which are relatively low paid, declining

  • productivity and aside from the brilliant aspects of our leading universities, no American

  • leadership in anything. That's the sum of the message. So what's your answer? Your answer

  • is innovation. >> HOCKENBERRY: All right. But the motive

  • there is we're failing, let's stop failing. And...

  • >> SCHMIDT: Well, let's start with advanced manufacturing jobs. Here in Cambridge, you

  • have the largest cluster as far as I can tell of biotech and biologic related businesses.

  • That didn't occur by accident, it's not some random event that had occurred in Cambridge.

  • It occurred because people foresaw that a cluster of such investments built around the

  • innovation in Harvard, in MIT, in the various institutes that exist, would create whether

  • in fact the millions of jobs and leading position globally, that can be reproduced.

  • >> HOCKENBERRY: Not NSF though, not DARPA, not the institutions of government and policy

  • that were operating in the 50's and 60's. >> SCHMIDT: Well NSF and DARPA did other things.

  • They're--these guy's funding comes out of the--basically the National Institute for

  • Health. The important point is, I don't care how the money happens, what I recognize is

  • that you have young people who have an idea and they need the access. There's a problem

  • by the way in America that there's a value of deficit as it's called, that the leading

  • universities including MIT and Harvard, and another here in the Boston area, Boston University,

  • have ideas involving, for example, nanotechnology and they cannot get enough funding now. So

  • it's really a national emergency in terms of trying to get these businesses built.

  • >> HOCKENBERRY: Well, let's talk a little bit about what Marvin Minsky used to tell

  • me years ago and I thought it was so clever and advanced, and it was more evidence that--what

  • I've always believed is that Marvin is actually a visitor from another planet and it wasn't...

  • >> SCHMIDT: Would you like [INDISTINCT]? >> HOCKENBERRY: It wasn't reality. We'll talk

  • about that a little bit later. >> SCHMIDT: [INDISTINCT] Perhaps you can[INDISTINCT],

  • I'm sure. >> HOCKENBERRY: A little bit later. No, but

  • he describe that what was going on at the Media Lab was actually human evolution, it

  • wasn't a creation of tools. And the [INDISTINCT] actually on my program this morning referred

  • to this network nervous system that exists around us in the wireless domain, you've talked

  • about something called enhanced humanity. >> SCHMIDT: Yeah, [INDISTINCT].

  • >> HOCKENBERRY: Augmented humanity. What...? >> SCHMIDT: Let me make the argument as follows;

  • let's fast forward a few years. Everybody here has a mobile phone at the moment in your

  • cameras and so forth and so on, all of these phones will follow Moore's Law in these amazing

  • ways, the phones know where they are and they're highly personal. So what do I really want,

  • since I'm a tourist here in Cambridge? As I walked down the street, I want the phone

  • to, or whatever the device tablet to tell me, "Yes, you were here two years ago. Yes,

  • that store is a different store. Yes, you need some new pants, Eric. Actually, your

  • shirt is kind of dirty, maybe you should go over there, you could buy a really good bargain."

  • You walk into the store and it says, "By the way, just for you Eric, here's a 10% off coupon

  • if you buy right now." Now, this is all with my permission by the way, all something that

  • I chose to do and it remembers that. Now today, how does that work for me as an executive?

  • I have an assistant who remembers what hotels I like and where I'm going and sort of keeps

  • me and tells me, "You're late, as usual. Get over here." Why can't the device, why can't

  • the network sort of know that and help me if I want it to. Right? That's the possibility

  • that this new model describes. I'm quite convinced that what we call hyper locals, sort of local

  • mobile social, has a set of killer applications. I'm also quite convince that the Media Lab

  • has some very interesting ideas in the space that can help us with it.

  • >> HOCKENBERRY: And do you--to note the difference between an individual who has that capability

  • and an individual who doesn't have that capability at this point, just note the difference between

  • Eric and my shoes this morning. Eric [INDISTINCT] so, that's very easy.

  • >> SCHMIDT: And one of the com--one of the comments about computers is we always get

  • confused about what computers are good at. Computers are not very good at feeling, judgment,

  • emotion, although people are working on those, people--computers are extremely good at dealing

  • with billions of things of information and doing various forms of calculations that produce

  • interesting results. These computers can remember everything, and humans can remember almost

  • nothing especially as you get older, right? So the fact of the matter is that society

  • will change based on the fact that computers are very good at what they're good at and

  • computers--and people are still very good at what we're good at. And by the way, remember

  • that most of the machine learning algorithms learn from people, right, you train them.

  • So, ideally what will happen is that in this sort of, I don't know how you want to call

  • it, but in this collaboration between this emergent amount of machine technology and

  • the human condition, the collaboration is helpful to both. Right? That human can train

  • computers and can--computers can help human live their lives better. I would argue in

  • fact that the goal needs to be set completely differently than ways normally the goal has

  • been set to use computers more. I would argue that the goals is to use computers less, right?

  • That in fact the computer is just around if you need it and otherwise you are free to

  • actually do what humans like to do which is to have a good time, be productive, care about

  • your family, or what have you. Right? And then in fact that the sort of the hours that

  • I spent reprogramming my PC in Window 7, you know, over the weekend is not a very good

  • use of my time. You know, why I chose to do that is a separate problem involving my judgment.

  • >> HOCKENBERRY: Yes. >> SCHMIDT: But the fact of the matter is...

  • >> HOCKENBERRY: Yes, I would--I would say... >> SCHMIDT: But, you know, and I would argue

  • that if you take a look, hit it with--at the iPad, part of the reason it's so successful

  • is precisely because it works so simply and it just works. And that the just works option,

  • which I think has been pioneered here and a couple of other places, is in fact a new

  • discovery for most computer scientists. And Google, of course, is also trying to do the

  • just works and its support in its businesses as well.

  • >> HOCKENBERRY: There are people who can help you with your judgment problem in this room

  • probably and you may hear from them later on today. Two questions, a personal one and

  • one I think that is more global, about the identity of Google today. I've always wanted

  • to ask you this Eric, what do you do when you absolutely don't want to be distracted?

  • >> SCHMIDT: Turn your computer off. >> HOCKENBERRY: But then--when you have to

  • actually do something as well. >> SCHMIDT: I'd read a book.

  • >> HOCKENBERRY: There we go. >> SCHMIDT: I know it's boring. I actually

  • also read a newspaper, a physical newspaper. I know it's going out of style.

  • >> HOCKENBERRY: Such a--such a chuckle head. Newspapers and books.

  • >> SCHMIDT: Newspapers and books. >> HOCKENBERRY: Love that. God, I love that.

  • >> SCHMIDT: You know, you actually read stuff. >> HOCKENBERRY: Yeah, the man needs a hug.

  • >> SCHMIDT: I also listen--I also listen to music.

  • >> HOCKENBERRY: Yeah. You're a public radio fan, too.

  • >> SCHMIDT: Yes. >> HOCKENBERRY: Yes, I'm glad of that.

  • >> SCHMIDT: Also to--I listen to public radio on--and on Podcast.

  • >> HOCKENBERRY: There we go. >> SCHMIDT: Of which there are--turns out

  • your show and virtually everything else, is now highly searchable.

  • >> HOCKENBERRY: Indeed, and the tipping points of whether people listen to things time shifted

  • or in the broadcast medium is rapidly approaching for each individual...

  • >> SCHMIDT: What's interesting is that debate is not a debate that's interesting to most

  • people. It's the debate that's fascinating to the media industry. The average person

  • now lives in a world of infinite choice of information, they carry it around with them

  • and they listen to when they want to. >> HOCKENBERRY: No, absolutely. I...

  • >> SCHMIDT: It seems pretty straight forward. >> HOCKENBERRY: So, the--no, and I agree but

  • today in your announcement of quarterly earnings, you reported a billion dollar revenue in mobile--in

  • the mobile space is that a tipping point? >> SCHMIDT: Well...

  • >> HOCKENBERRY: Advertising revenue. >> SCHMIDT: Anything that's a billion dollars

  • is good and anything that's growing fast... >> HOCKENBERRY: Oh.

  • >> SCHMIDT: And anything that's [INDISTINCT]... >> HOCKENBERRY: Let me just write that.

  • >> SCHMIDT: ...is even better. >> HOCKENBERRY: No.

  • >> SCHMIDT: A simple rule for those of you--those of you who are CEOs is that rising revenue

  • solves all known problems. So, I... >> HOCKENBERRY: Well, let's focus on that

  • thing for a moment. I think it's fair to say that in the 21st century you are one of the

  • few figures who we might compare with individuals from the classic Gilded Age of America a century

  • ago. >> SCHMIDT: Okay.

  • >> HOCKENBERRY: And that is both a responsibility and probably an annoyance.

  • >> SCHMIDT: Although, I would argue, Wall Street is top of the ladder--is there.

  • >> HOCKENBERRY: Probably, yes. In the case of the Gilded Age most of the individuals

  • who ran big institutions, big corporations were monopolies. I think, you, probably unique

  • to the individuals that we're speaking of in this room represent something that could

  • possibly be called monopoly but it's maybe something more [INDISTINCT] ubiquity. Google

  • has ubiquity. Monopolies are something--Microsoft is a monopoly, or was a monopoly at one point.

  • It'll argue that. >> SCHMIDT: Was found guilty of being a monopoly.

  • >> HOCKENBERRY: Yup. Exactly. It was found guilty of being a monopoly, actually.

  • >> SCHMIDT: Just get the facts straight. >> HOCKENBERRY: Yeah. Something that you don't

  • like to point out in crowds of people, in public...

  • >> SCHMIDT: No, I could do a Google search [INDISTINCT]

  • >> HOCKENBERRY: Exactly right. Yeah, exactly right. Is ubiquity--because a lot of people

  • have described monopolies as being a non-innovative mode that monopolies tend to become risk averse

  • and have difficulty with innovation--is ubiquity something different? Does the social network

  • capability of being ubiquitous allow you an innovative capacity that has, perhaps, not

  • existed before? >> SCHMIDT: We don't phrase it that way but

  • I'm happy with the phrasing that you described. What we phrase it as just focus on the user

  • and all else will work. So we don't spend an awful lot of time--the classic thing that

  • happens is people who have MBA degree show up and they say like, "Where is the revenue

  • plan? Okay. Where is your business plan? Where is your ROI calculation," and so forth. And

  • those are hard to find. What you find is a very, very strong focus on getting more users

  • to use stuff. And if you can get enough users to use stuff, you can make money doing it.

  • And so philosophically, that aligns us with end-user interest, we hope. That it also aligns

  • us with scale. So you have an end-user focused business that scales rapidly; which, I think,

  • is ultimately the way you expressed the ubiquity point. The problem with monopoly is that monopoly

  • ultimately allows you to--puts you in opposition to the goals of your end-user because, ultimately,

  • end-users, in fact, do want choice. All right? They want--and, indeed, we do lots of things

  • to prevent us from being a monopoly. We allow people to take their data wherever they want

  • and if they become dissatisfied with us and it's an internal check and balance on our

  • own power. >> HOCKENBERRY: We want to open it to questions

  • from you, so prepare yours. [INDISTINCT] raise your hands, call out your questions. I will

  • repeat it so everyone can hear it. We'll do that in just a moment. Does Google have a

  • foreign policy? >> SCHMIDT: Well, you can see how well it

  • worked in China, you know, one day, somebody said, "Well, finally..." one of, in fact,

  • one of your politicians in Boston said, "Google versus China, finally an equal match." Well,

  • you saw what happened. We take a particular view on information which is, I think, a western

  • view and I think most western countries would agree with it. What I've learned is an awful

  • lot of countries that--there are an awful lot of countries that don't like our view,

  • China, obviously, because of the censorship rules, but there are others. Typical example

  • would be that a bad video gets uploaded; we take it down, and then YouTube gets blocked

  • for a year. Now that could be because we so annoyed the leaders of that country that they're

  • being--they're punishing us. An alternative hypothesis, you always want to have an alternative

  • hypothesis in a PhD program, is that, perhaps, those leaders are embarrassed by the multiplicity

  • of YouTube videos critical of their leadership, so we're never really quite sure. So we've

  • taken the position that, ultimately, if you want to play in the modern world, you have

  • to be pretty information transparent. We believe in transparency and open access, and that

  • gets us into trouble but it is what we believe. >> HOCKENBERRY: The world population in 1800

  • was about two billion which is estimated to be the amount of people or the number of people

  • who are actively online in the world today. What would that world look like when six to

  • eight billion are online? And what will Google look like in that case?

  • >> SCHMIDT: Well, one of the things that I am personally proudest of, and I hope you

  • are all as well, is the number of people who have come into the global conversation who,

  • literally, had no choice without the success of the Internet and telecommunication's revolution.

  • So I am beyond excited that there's on the order of four billion mobile phones, mostly

  • which are the feature phones, the less capable phones. I'm beyond excited that there are

  • 800 billion--800 million to a billion smartphones. And I'm even more excited that another generation

  • of phones is coming--which is going to hit that 30, 50, $60 price point, which allows

  • you to get another billion of those phones out into the market. So what happens when

  • you have a powerful browser in the hands of people who've never seen anything except maybe

  • at television, in a shared model? We haven't heard from them. We don't really know what

  • they think. I personally believe they all care about Britney Spears and I think we're

  • going to discover that. But we don't--but we don't know. Right? So it probably means

  • greater global brands. It probably also means greater global access, and it also means that

  • we may hear from them and we'll hear what their lives are like in the same way that

  • CNN, in the '70s and'80s, exposed the horrific conditions of people that we could never see

  • before, and television bring those images directly to you. Now these people have phones

  • and video cameras and they can record both good aspects of their culture but also the

  • terrible situations that, for example, limit or--that are put in the third world. And I

  • think it leads to--the transparency leads to--the openness lead, ultimately, to making

  • the world a better place. >> HOCKENBERRY: So you would say, and this

  • is a very positive note that I wasn't necessarily expecting, that because of precisely that,

  • the possibilities for a huge corporation like Google to take steps in hearing those individuals

  • beginning to join this community and taking steps to improve their lives, the opportunity

  • to do good even as a ubiquitous near monopoly is as good as it's ever been.

  • >> SCHMIDT: Well, the goal of the company is to do good and so it's only a good thing

  • when people have access to broadband. So an example would be the role of 4G in the western

  • world, in Europe and in the United States. Trust me, the people at the Medial Lab will

  • figure out what to do with 10 megabits but low latency that's continuously streamed to

  • your tablet and phone. Trust me, we can use that. I'm not worried about that. Same argument

  • about people who've never had access before, what will they do? Well, I mean, we think

  • they're all going to spend their time checking for crop yields and so forth. A much more

  • likely scenario is they're going to be heavily obsessed with entertainment because they're

  • human beings and people are the same everywhere. So that again is--in my view, a positive effect

  • of this. And our business approach is to get them wired and then not worry too much about

  • what happens after that because they're clever and these platforms work. And eventually,

  • there will be business opportunities five, 10, 20 years from now, which will be massive.

  • Right? >> HOCKENBERRY: But we have [INDISTINCT] listening.

  • >> SCHMIDT: Well, we better be. >> HOCKENBERRY: And that's the key.

  • >> SCHMIDT: But, more importantly, we have enough capital as a corporation to invest

  • into that market and we have the patience to understand that people are the same everywhere.

  • People, actually, want connectivity everywhere and that connectivity will benefit them in

  • education, in access. It will force their governments to become more transparent even

  • in these horrific dictatorships that exist. And it's an overwhelmingly positive message.

  • But what happens is, people say, "Oh, well, as a result, some evil person will have voice."

  • Yeah, well, the principle of free speeches that evil voices are overwhelmed by the good

  • voices. And I live in a world--and I spend an awful lot thinking [INDISTINCT] everyday.

  • I'll tell you that the overall human condition is a very positive one. That the average person

  • I deal with really does want to make the world a better place and we can all participate

  • in delivering that. It's a great message. >> HOCKENBERRY: Erich Schmidt, thank you so

  • much. Hands up. Stand please. >> [INDISTINCT]

  • >> HOCKENBERRY: What's Google's education policy? Will we see Google high school, we

  • already have Google university? >> SCHMIDT: We are working--we're working

  • on our strategy there. As you know, the--if you go back to the Nation at Risk book from

  • 1982, 1983 I believe, the problems of education in America are profound. They're complicated.

  • I would observe that much of the education establishments seems to be organized around

  • the education establishment and not measurable outcomes with [INDISTINCT] to the children.

  • So speaking as a businessman, I would start by measuring the outcomes and then iterating,

  • in trying to make things better. The contribution that Google can provide is a number. We worked

  • hard to get the schools wired. And I, on an earlier job, did that as well, to getting

  • the schools wired, getting the teachers empowered with access to the Internet, getting mobile

  • phones into that, are all very, very important. A further thing that we can do is try to promote

  • the use of video and other information sources to help advance education especially for people

  • who don't have access to very good teachers. There are, for example, people who are remarkably

  • generous and they're funding YouTube videos of the best teachers so that you can actually

  • see that and see that for free anywhere in the world. And what I want to think about

  • is you've got some brilliant student who's isolated in some rural part of our country

  • who has a broadband connection and not very many people to talk to, I want that person

  • to be able to get that same level of education that I could get. And I think that's a good

  • goal. So those are some of the things that we're working on. I'm looking for even stronger

  • technologically intensive education ideas and if you have them, we'd like to hear them.

  • Most of the ideas that are--had been discussed about education, I think, are pretty much

  • dealing with the incumbencies and the existing things rather than thinking of completely

  • new ways of affecting education. >> HOCKENBERRY: Question from up here. Speak

  • up now. Hey. >> I wanted to thank you for all of your comments

  • but specifically, the ones about incumbency and how to bring innovation and that how current

  • forces kind of fight against it. One of the things has made the Media Lab really a great

  • place since its start is small research groups working together, fostering innovation but

  • still communicating as a whole. Does that model break down when you get to something

  • the size of Google and how do you see how that kind of grassroots innovation can really

  • be fostered all the way up to the top where it can be visible and make a difference?

  • >> SCHMIDT: I think the Media Lab is, certainly, one of the first institutions that I knew.

  • It came back and, basically, argued that you had to break down the stovepipes that existed

  • in academia. And the Media Lab, to me, 25 years ago, you know, Nicholas and sort of

  • the usual suspects, sort of foresaw the need for breaking that down. And my guess is, in

  • other industries, there are other people who also saw that. But I think it's actually [INDISTINCT]

  • now that you're not going to get something interesting unless you build these teams.

  • The problem with organizations is there has to be a hierarchy, there has to be a boss,

  • there has to be a building, and so forth and so on. We tried to break that down inside

  • of our culture but we have the same problems. They're not as obvious and we talked about

  • it a lot. But I think that ultimately the reason incumbencies breakdown is because of

  • strong entrepreneurship, strong leaders, and people who are willing to hear 'no' a lot.

  • And if you look at the, again, the Silicon Valley sort of archetype, it's a person who

  • is young, rejects existing orthodoxies, and is willing to put heart, body, and soul into

  • making something happen. And we celebrate the winners but remember there's lots of losers

  • too and that's part of the system. The typical venture investment is one in ten is successful,

  • the typical Google scale investment is one in a 100 to one in a 1,000, which is just

  • how the economics work. So it's important to remember that we have a lot of people who

  • are trying very hard. A few succeed but we want to celebrate everybody who tries to change

  • something. It's that changing--that yearning for change that, I think, drives societies

  • so fundamentally better. >> HOCKENBERRY: How many in this room have

  • heard the word 'no' a lot? Clap if you have. >> SCHMIDT: All the entrepreneurs.

  • >> HOCKENBERRY: Here you go. >> SCHMIDT: Just try to raise money in the

  • last year, year and a half. You understand what I'm talking about?

  • >> HOCKENBERRY: Sure. Sure. Right, indeed. Question. Right here in the front.

  • >> [INDISTINCT] >> HOCKENBERRY: How is expensive journalism

  • going to be paid for if, as Eric has suggested, people are going to be hugely interested in

  • Britney Spears, perhaps, in the future and other entertainment models?

  • >> SCHMIDT: We all benefited from a unique combination of events; strong classified revenues

  • for newspapers, local pseudo-monopolies where the local news was only really under the hands

  • of one or two providers, the emergence of print advertising and so forth, and the fact

  • that people just like to read and read physical newspapers, all of those trends and magazines

  • as well, all of those trends as you know have been under tremendous attack. And it's a real

  • lost for, I think, a vibrant society. So what happened is those models would essentially

  • throw off a public good which is the ability to fund investigative journalism. Even a couple

  • of proposals have had to replace that. A number of, again, very generous people have funded

  • nonprofits which attempt to fund that public good. A number of the newspapers are doing

  • well enough that they'll clearly survive any--they've become national essentially. You know, clearly

  • have enough to continue to fund that public good. But there's a clear loss of voices.

  • When you talk to the folks in the media industry, there's a lot excitement about subscription

  • models because they're used to subscription models. So from a Google perspective, we want

  • to empower these subscription models and we want to let the--between the publisher and

  • the consumer, they can figure out, "Is this information that's going to--people will subscribe

  • for it or whether it's going to be advertising supported." So the restructuring is dramatic.

  • It's incredibly painful. There are models that are successful. Huffington Post is an

  • example of a Google partner which I think people here know which appears to be doing

  • quite well in an advertising model. So there are mechanisms which do work which ultimately

  • I think will generate enough profit that they'll be able to fund that public good.

  • >> HOCKENBERRY: Is that hyperdizing (ph) though the subscription model and the advertising

  • model in the sense that people talk about journalistic institution as communities, and

  • PR for instance being a community? It's a kind of a subscription model. You'd sign up

  • to be a part of the community as this revenue as a result to that Huffington Post has a

  • community aspect to it in addition to being this advertising--are those merging ultimately?

  • >> SCHMIDT: They are. But I would rather--again, we always talk about the incumbents. I'd rather

  • talk about the end-user, right? Because the end-user will ultimately determine the outcome

  • of this and let's talk about what the end-user is going to do. Today, I read the physical

  • newspaper. Five to ten years from now I'll have this incredibly intelligent tablet which

  • will have every aspect of the newspaper that I care about expect maybe that grainy feeling

  • and the stuff on my hands. But what's important about that content is it will know who I am.

  • It will remember what I read. It will suggest things that I should know. We can actually,

  • using algorithms now, suggest serendipity. We can find related stories and stories that

  • you should know about and furthermore we can do very sophisticated advertising on such

  • a device. We can do advertising that's targeted at you today. People here--those of you who

  • read a newspaper this morning--I did, right? Does anybody remember the actual physical

  • ads in the newspaper? Typically not. It's hard to sort of remember. And they are there.

  • You just went by them. Whereas we can generate ads that are so good, so targeted, that you

  • will remember and we hope that they will help pay for the quality of the content that you're

  • getting. >> HOCKENBERRY: What's the responsibility

  • of an institution like Google, though, to lower the cost of entry? A newspaper has a

  • low cost of entry. People can be civically engage and get the information about their

  • world at a low cost. If everything's on a tablet, certain people will be able to pay

  • that cost of entry, others will not. Is that Google's responsibility to lower that cost

  • of entry? >> SCHMIDT: Well, we would argue that since

  • almost everything on Google is free for end-users, that's a pretty good responsibility right

  • there. >> HOCKENBERRY: That should be.

  • >> SCHMIDT: I mean, the fact that basically we don't charge for access to this information,

  • and we're not planning on, and we--and I suspect we never will, is probably a pretty good starting

  • point. >> HOCKENBERRY: Question right here.

  • >> [INDISTINCT] >> HOCKENBERRY: What mechanisms do you use

  • to listen to users? Do you employ particular strategies to make you're getting the right

  • signal? >> SCHMIDT: There's ultimately an inventor

  • and it goes like this. The inventor walks into my office and says, "I have a brilliant

  • product and I built and it's going to do great." And I say, "Wonderful. I completely agree

  • with you." And then we measure them to the nanosecond. And if the slope is a hockey stick

  • up like that, they're a brilliant inventor. And if the slope is like this, they get cancelled.

  • Right? And then by the way, we asked them to do it again because they're--it's great

  • to have an inventor who's failed once, right? Because they really are a lot more humble

  • to start with, and they listen a lot better. You need the input from the end-user but you

  • need the inventor with a passion. If you listen to the end-user, they'll just give you a jumble

  • of feedback. You need that person who has that creative spark. And by person, sometimes

  • it's a team. Sometimes it's a group. Sometimes it's a set of things. In our case, we do a

  • tremendous amount of, basically, blind testing along the way, so we really insist on the

  • state of the art in terms of user testing, in all sorts of ways in which we do that.

  • And then the most important thing is we typically do what we call 'dog food', you know, eat

  • your own dog food, so we use--we test this stuff internally and then we roll it out to

  • friends. And my guess is, if we took the union of the--of you all in this room and ten of

  • your friends, if you all and ten of your friends like something, that's a pretty good predictor

  • for pretty much everybody, right? If we could invent such a great product.

  • >> HOCKENBERRY: But if--okay, [INDISTINCT] right here.

  • >> [INDISTINCT] >> HOCKENBERRY: Will Google ever create its

  • own content? It, up till now, rides on mainstream media in presenting news.

  • >> SCHMIDT: Yeah. The term 'ride on the back of' is a sort of loaded question.

  • >> [INDISTINCT] >> SCHMIDT: Yeah. And so, when I'm asked that

  • question, it's usually in the context of, "And therefore you should pay me a lot of

  • money for my content." So--no, no, I'm saying--but if that's--but just so, I want to be clear

  • on that. What we do with the mainstream media is we send a tremendous amount of traffic

  • to their websites and so that each of them has an opportunity to actually not accept

  • that traffic. They can actually choose not to do that. But they all choose to do it,

  • so we have this conversation all the time. Furthermore, what we do is we provide advertising

  • model and to some degree, subscription models, which allow them to then sell that content.

  • And that's, I think, how we do it. With respect to doing our own content, we've typically

  • found that there's a line there that we should not cross, that it's better to let the content

  • folks do the content and have us basically provide the platform, the monetization and

  • so forth. Partly because the company is run by computer scientists, and as arrogant as

  • we are, we're not necessarily so good at these other businesses. And the second thing is

  • it's better to have the competition among the content players for the end-user voice.

  • As I said we've typically not gone across that although we enable end-users to create

  • a lot of content and let the market sort it out.

  • >> HOCKENBERRY: Questions on the mystifyingly silent middle section here? Anything? Any

  • questions from--no? Would you call denying access to content that has been criticized

  • in countries where you've worked a form of content creation in a sense that you're negatively

  • selecting what gets seen? >> SCHMIDT: Well, again, I'm not sure what

  • you're referring to because if you're referring to China, we actually took a very pro-content

  • position and then… >> HOCKENBERRY: Actually, I'm not--[INDISTINCT]

  • much more generally, if you were in the position of taking stuff down or having to make that

  • choice… >> SCHMIDT: We only do

  • >> HOCKENBERRY: …is that not content creation and so [INDISTINCT]?

  • >> SCHMIDT: No, it's not. It's under duress and under threat of a gun. You know, one way

  • to understand it is that every country--I've now learned this the hard way--every country

  • has the same debate we have about free speech and what is permitted content and so forth,

  • and at least in the sort of democratically or the pseudo-democratically thing, they have

  • a process which involves rule of law. And so we have learned the hard way is that we

  • have to respect their rule of law even if we disagree with it, but we do our very best

  • to publicize when this is occurring. So if you disagree about a policy in a foreign country

  • because the country is--we are subject to their laws, they can actually arrest and imprison

  • our employees, we are forced to operate under their laws even if we disagree with them.

  • >> HOCKENBERRY: Okay. It's been great, the time that you've spent with us, it's really

  • thrilling. I think we're going to sort of wind up with one more question right here.

  • >> Is there [INDISTINCT] >> HOCKENBERRY: Is there a class of information

  • that you expect never to be able to find on Google?

  • >> SCHMIDT: Well, hopefully, the information that you choose not to give Google which should

  • be the information--right? That would be the simplest answer.

  • >> HOCKENBERRY: Well, what about the number of people who died today from malaria?

  • >> SCHMIDT: Well, presumably, that's a publicly knowable question.

  • >> HOCKENBERRY: In a month, not today. >> SCHMIDT: Well, but in theory we'd like

  • to be able to… >> HOCKENBERRY: There are limitations that--because

  • of your restrictions, but there are also limitations because of

  • >> SCHMIDT: No, I mean, maybe there--there are all sorts of laws about this. There is,

  • for example, a law that limits the aperture of the satellites that we can launch to take

  • pictures for Google Earth, and that's a limit. That's one that's imposed on us by U.S. law

  • which we're just subject to, so there's a category of those. But I think the most important

  • message is anything that's publicly accessible that's, again, legitimate and legal, we would

  • like you to be able to find out instantaneously. That's about information access. Information

  • that is private should remain private. And I hope that that's a clear answer.

  • >> HOCKENBERRY: Google, when the company was formed, was a huge number, right?

  • >> SCHMIDT: At Google. >> HOCKENBERRY: Yes.

  • >> SCHMIDT: Ten to the 100ths. >> HOCKENBERRY: Yes. Now...

  • >> SCHMIDT: Still a large number. >> HOCKENBERRY: ...now, it's a verb in addition

  • to being a number. >> SCHMIDT: It's still also a very large number.

  • >> HOCKENBERRY: Right. Right. What will it be in 25 years, do you think?

  • >> SCHMIDT: You mean--it'll still be a very large number. We did the math. We did the

  • math. >> HOCKENBERRY: That--that much is true.

  • >> SCHMIDT: We did the math on how big 10 to the 100th is and, just for those of you

  • who are not so technical, it's not--it's not the same thing as--it's like multiplying.

  • It's a very, very large number. It's much larger than the number of proteins and electrons

  • and so forth in the universe. >> HOCKENBERRY: So, if a billion is a--always

  • a good thing, at Google is always a really, really

  • >> SCHMIDT: It's very [INDISTINCT] >> HOCKENBERRY: …really good thing.

  • >> SCHMIDT: Yeah, so what happens is it's a billion--it's basically exabytes and petabytes

  • and zettabytes and gigabytes and so forth, and we got a long way to go before we get

  • to Google. I think in--one of the things to remember is to do a little bit of compounding.

  • And humans are very, very bad with compounding, so let's do a little math. Here we are at

  • MIT and so forth and so on, so Moore's Law is doubling every 18 months. Most people believe

  • Moore's Law can continue for another 10 to 20 years. We're always projecting the end

  • of Moore's Law but the physicists and chemists and so forth are doing amazing things with

  • parallelism. So 10 to the 18th is roughly an increase of a thousand--let's say let's

  • do the math, roughly a hundred and five years which means roughly 10,000. Did I get that

  • right? No? So I think it's 10,000 in 10 years, so in 15 years how much time is that? Do the

  • math. So, all of a sudden, the underlying computation, everything we see today in 10

  • to 15 years will be that many more orders of magnitude of information and access and

  • speed. So if everything is 10,000 times faster, cheaper, more prevalent, what does that all

  • [INDISTINCT]? That's why I come back and I argue about, computers will remember pretty

  • much everything that you let them remember, will pretty much know what everything is up

  • to in terms of things that you want to publish with it. There'll be a very, very large number

  • of devices. These are activities that the Media Lab is working on a lot. And that it

  • will sort of take all of this for granted. And I think all of us are planning on being

  • alive for the next 10 to 15 years, so hopefully we're all going to be part of this and we're

  • all going to see it. And I would argue that society--society has to really think about

  • what it means to have all of these things. This is a question far beyond the pay grade

  • of Google or of anybody here in the room. What does it mean to have this kind of access,

  • this kind of information? I'm quite convince it's all positive but I suspect it has a lot

  • of surprises. >> HOCKENBERRY: You're roughly how old?

  • >> SCHMIDT: Fifty-five. >> HOCKENBERRY: Fifty-five. You will retire

  • when your job ceases to be blank. >> SCHMIDT: Well, we actually agreed that

  • I have to stay at Google, with Larry and Sergey, for a very long time.

  • >> HOCKENBERRY: But just personally, I'll stop doing this as a job when it stops being

  • blank. >> SCHMIDT: My current plan is to do it when

  • I keel over which hopefully will be a long time from now because the opportunity to empower

  • people with information is the opportunity of a lifetime. I would argue that within your

  • career and the things that you do, you do it--you don't have to do this anymore, you

  • do it because you enjoy it and because you have a huge impact. And for me personally,

  • the opportunity to serve--to serve the interest of broad access to information for the 6 billion

  • is a tremen--I mean, Megan, who's one of your stellar graduates here, and I were talking

  • about Google app engine--Google Earth engine basically, as an opportunity to take Google

  • Earth and instrument it and make it dynamic, right? And then take programs and feeds from

  • everyone. So you can see the impact of what's happening to the world that we--that is the

  • only world we have, and the world that we all love. It's a tremendous opportunity for

  • all of us, and I love to be part of it. >> HOCKENBERRY: And you're innovating from

  • within at Google to make it possible. >> SCHMIDT: Absolutely.

  • >> HOCKENBERRY: Eric Schmidt, thank you so much.

  • >> SCHMIDT: Thank you so much. Thanks, John. >> HOCKENBERRY: Well, great.

  • >> SCHMIDT: Thank you so much.

>> HOCKENBERRY: Please welcome to the 25th Anniversary of the MIT Media Lab, the CEO

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埃裡克-施密特在麻省理工學院媒體實驗室 (Eric Schmidt at MIT Media Lab)

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