Google’s Schmidt admits bungling Facebook, talks partnership with Apple

This week I’m at the Wall Street Journal‘s D9 conference in Rancho Palos Verdes, Calif. The event features a series of tech luminaries interviewed by Walt Mossberg and Kara Swisher, of the Journal‘s All Things Digital Website. Last night’s kick-off interviewee was Eric Schmidt, formerly CEO of Google

Schmidt, who now sits on the Google board and deals with external issues relevant to the company–“deals, evangelism, government,” in his words–had a lot of fascinating things to say, and if you’ve got time I recommend watching the video. But I thought I’d call out a few of the things he said–mainly about Apple, because that’s how I roll. 

When Mossberg asked Schmidt about the Google relationship with Apple, the former executive admitted that it can be testy. “It started off as very much a partnership”–Schmidt was on Apple’s board of directors for three years–“but now with Android it’s much more rough. We have a partnership with them and we compete with them. We have a very good search partnership and a very good maps partnership, but we compete” when it comes to smartphones. 

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There’s nothing unexpected in any of that, but Schmidt did drop one tidbit when Mossberg asked if he expected those mapping and search relationships with Apple to continue. “I certainly hope so,” said Schmidt, adding that “we just renewed” both the map and search deals with Apple.

That’s interesting news, considering reports that Apple has been busily building its own maps infrastructure. Of course, nobody knows what the details of those deals are. It’s possible, for example, that Apple has an opt-out clause. Or perhaps Apple is content with the quality of Google’s services–for now. 

Schmidt also spent a little time talking about what he called the “Gang of Four”–Google, Apple, Amazon, and Facebook. These are four companies that, in Schmidt’s estimation, all have a size and global reach that just ten years ago would have been the provenance of a single company (Microsoft, and before them, IBM).

“We’ve never had four companies growing at the scale that those four are in aggregate,” in customers, cash flow, reach, partners, software development tools, and so on, according to Schmidt.

Note that Microsoft isn’t among those four. That’s not an oversight: “Microsoft is not driving a revolution in the minds of consumers,” said Schmidt. It’s quite a fall from a company that only a decade ago seemed to have the tech industry by the throat.

Swisher said that Steve Jobs told her, sotto voce, that “an Android phone is a probe in your pocket. We could do that, too, but we don’t have a search engine to suck it back into.” Schmidt denied that secondhand accusation: “We don’t suck it into anywhere,” he said.

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The bottom line, Schmidt said, is that when it comes to phones, “the Apple model is the inverse of the Google model. The Apple model produces beautiful products with a specific market size and share. The Google model is just the inverse. It’s OK. Let the market decide. It’s called competition.”

But when it comes to that competition, Schmidt suggested that it’ll be hard rowing for platforms other than iOS and Android, just because of the sheer amount of time it takes to develop for those two platforms. He took a shot at the “closed nature of iOS” a few times, but also said that in maybe ten years all apps will be built using HTML5 and related technologies, because all platforms (including Google’s and Apple’s) support it.

Finally, regarding the recently-announced Google Wallet initiative, which allows you to buy stuff with your smartphone, Schmidt said that there’s “no intent to favor just one platform.” In other words, don’t be surprised to see Google Wallet support come to the iPhone eventually. 

But even there, Schmidt couldn’t help but taking a parting shot at Apple: While answering an audience question about integrating Google’s voice-recognition systems into iOS, he said Google has to be careful in developing apps for other platforms, because they might waste their time building an app that would just get rejected.

Socially screwing up

When former Google CEO Eric Schmidt took the stage, it was almost guaranteed that he would blurt out something controversial. But Schmidt didn’t go over the top — he did, however, admit that Google “screwed up” on its social strategy, and that it’s his fault.

Schmidt said that after reexamining four-year-old memos: “I clearly knew that I had to do something, and I failed to do it. A CEO should take responsibility. I screwed up.” Google’s current chairman was referring to his efforts to team up with Facebook, a move that was rebuffed by the social networking giant.

Despite Facebook’s frosty relationship with Google — evidenced by the revelation that Facebook hired PR firm Burson-Marsteller to slam Google in the press for privacy invasions — Schmidt piled on the praise for the social network.

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“Facebook’s done a number of things which I admire,” Schmidt said. “It’s the first generally available way of disambiguating identity. Historically, on the Internet such a fundamental service wouldn’t be owned by a single company. I think the industry would benefit from an alternative to that. … Identity is incredibly useful because in the online world you need to know who you are dealing with.” 

Schmidt spoke of how pairing Google search with the social data Facebook now has on almost 700 million people would be a huge for Google — especially now that Google Offers, the company’s answer the Groupon, has officially launched in Portland, Ore. But because Facebook and Google are squabbling, it will be difficult for Google to make search more social — as Bing is doing with its Facebook partnership. 

If you’re waiting for your “Schmidt moment” of brutal, borderline-inappropriate honesty, it came when he said that Google wouldn’t attempt to acquire a social network like Twitter “because we can get people to give us that information.”

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Jim Love, Chief Content Officer, IT World Canada

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