With the Fourth Of July here, it's a good time to focus on freedom. It seems that often when new technology and new ways of getting revenue advance in an industry, those who don't understand that technology are exploited by those who do. Google's model seems to increasingly fit this mold, and the example it is setting is driving others down the same path.Now while I continue to talk about Google, it is because it is the leading user of the advertising revenue model and because it is the leader in search, which makes that model dangerous. It is far from the only company doing this, however, it is the company that is driving the behavior.
Google's financial model has bothered me for a long time, primarily because 97 percent of its money comes from advertising revenue yet it behaves as if it were a product company. This advertising revenue comes from selling eyeballs and the information that defines people on the Web, our virtual selves, to advertisers. The profit, which is impressively large, is the difference between the cost of the services it provides and the value of the information it is trading us for.
We go along with this largely because we both don't realize the value of what it is we are trading. And even if we did and still wanted to sell it, we have no way to actually consummate that deal.
But what if this information is captured while we are at work? Many of us have likely signed employment agreements that grant the rights to things we create to our companies. But Google appears to derive value from the information created while we use its services and, just like it doesn't compensate us for that value monetarily, it doesn't do that for our employers, either. If our employer uses a Google product, then it may pay a fee but likely doesn't account for the information value Google is pulling out of the firm. This would be like having a home-cleaning service that was aggressively priced but made up for it by taking things you probably wouldn't miss and then reselling them.
Now if there were a firm that specialized in the resale of stolen intellectual property, and it came to your company offering a free janitorial service, you'd likely chase them away with the equivalent of pitchforks. Even if they simply resold intellectual property but made no distinction on whether it was legitimately or illegitimately acquired, you would put out the garlic and keep it away from your door.
Google appears to make no distinction between the legal and illegal use of information except when it comes to its own information or information surrounding its executives. With that information, Google is highly protective. But Google has gotten into trouble repeatedly for providing information that countries and individuals felt was not its to provide. Back when CNET tried to point this out in Google's early years, instead of addressing the problem, Google blacklisted CNET.
The company's goal is to index and provide access to the world's information, regardless of ownership rights or laws. What's the difference between someone who sells stolen property and a legitimate store selling the same thing? A disregard for who owns the property and the local laws. Google has repeatedly shown both.
I really don't like the free model because I see it as a confidence game. What you are actually paying isn't disclosed, so you blindly think you aren't paying anything -- and that is the con. With Google and other "free" products and services, there is a cost. In all cases, the firm should be in full agreement with that cost and the ramifications of it before using the "free" or cheaper offering.
For security, any company that seems to show a disregard for laws and ownership rights should be looked at it for what it is. And what it's not -- a vendor that is protecting your, or your company's, rights and freedoms.
Freedom may be just a word, but many died to protect ours. Perhaps we shouldn't give it up with the false promise of "free stuff."
-- Rob Enderle is president and founder of Enderle Group. Special to Dark Reading.