Chris One could definitely argue that Google is an advertising company, it's you know, lots of people do search. We can argue that Google search is significantly better or worse than, than Microsoft's or anybody else's. Um, but its hold over advertising is unmatched and it's not, it's not just its model that the sort of pay per click, the matching of content and advertising that's so relevant. But the fact that it has a critical mass of growth. Um, what you, if you have a critical mass of search terms, in other words, people using Google as a search engine and, and you know the largest pool of ads against which to run. To run against these search terms, you're able to match them better. And um, and if you can match them better, advertisers are inclined to use you more and it becomes a sort of self reinforcing, positive feedback route. Um, what Google does, it has is not such a monopoly on search. its switching costs of search are pretty, you know one click away. What it has beginnings of a monopoly over internet advertising?
Alex Are people aware of what they're trading when they contribute to the Google machine?
Chris I think people are on, whether explicitly or implicitly, pretty aware of what the trade off is, and um, I don't think that, that's explicit, I don't think that's necessarily just for Google. I think you know as we go online, um, the deal is relatively straightforward. So when you go on Amazon and you click, and as you click through from product to product, you start to see the recommendations appear, either based on your past history or more typically your sessions. You know as you start looking for cameras, you start to see people who click who, who looked at this also looked at that, people who bought this, er, people who clicked at this, bought that. Um, you know in this, the course of your clicking, the service becomes more useful to you. They ex, the implicit, and for many people the explicit trade off is that in exchange for watching over your shoulder, as you shop, we will help you shop better. And no one seems to have any problem with this because, because you know this is, they trust Amazon, and this is the you know, if you go into a store and er, the store assistant says can I help you. And if the store assistant is good, and you're feeling like you need help, er, you know you'll go through this little communication, here's what I'm looking for, what do you think of that, what do you think of that, and a little bit more of this, the advice will get better and better and better and eventually you will get what you want. Amazon does this exact same thing, so there's nothing new about this trade off. In the same way that you don't, that um, you know that in the stores as, as the assistant helps you shop, you are choosing to give up information about your preferences for the sake of a better experience, you do so as well in Amazon. if you don't want to give up personal information you just don't have to log in to Amazon, you can do it anonymously. Um, Google um, works the same way um, er, you type in your search term, Caribbean holiday. And Google will give you a useful set of results and they will also give you some ads um, on the site. and as your term gets more and more specific, you know maybe a date range, a price range and things like that, um, the ads will get more and more specific and more and more relevant. Um, you know presumably at certain points not only are the search terms what you're looking for, but the ads are what you're looking for as well. And so you now have two sets of results to choose from. Now you can, if the one on the right side, the ads, is actually even better than the one in the middle column, you will choose that one, and you will click there, it's your choice. And so you know Google knows what you're interested in right now, do they know who you are and do they have a profile of you. Not in any real sense um, but they are watching as you, as you click and but they, but because we trust Google to, to watch for the right reason, which is to give us better results, we're okay with this.
Alex This implicit or this explicit trade, suggests to me
Alex This implicit and explicit relationship, this trade off that we have with Google, with Amazon, suggests that actually the web isn't free, is that, would you say that would, would you say that the web is free?
Chris So there's two ways to look at this, um, there's the pure monetary definition of free, and then there's the sort of the broader definition of free, of an exchange of value. Um, the web is for you know, for, you know if you choose to make it so, the web is very much free from the monetary perspective you know, once you've paid for access, once you've paid your way in the door, your internet service provider whatever, um, you can pretty much get what you want at no additional cost. Um, that's from a strictly monetary perspective in terms of you know, just taking out your wallet and paying cash. Um, but I think that the, looking through, looking at the world through the lens of pure monetary value is not the right way to do it anymore. I think we now realise that there are other forms of value that we, we sometimes actually value even more. there's time, there's attention um, there's, there's reputation um, when I, you know a, I can get music two ways. I can go to bit torrent sort of like I know that all music is out there for free um, I can go to bit torrent and I can hunt around and find it and download it, and it will be free. Or I can go to iTunes and pay ninety nine cents. Um, which so er, because I'm older, I have more money than time, so I'll go to iTunes, it's faster, it's convenient. I'm paying for a convenience fee. I'm not really paying for music, I'm paying for convenience.
Um, my kids are younger, they have more time than money, they'll, actually they don't, but just project that they might go to bit torrent and download and download for free. So um, the time, money calculus is two dimensions of value. um, we know that time is money right, this is not an original idea but it's quite explicitly manifest on the internet today. Um, you know most of human activity is done without an exchange of, of money. You for the record are not paying me for this interview; you know I for the record am not paying you for this publicity. Um, you know when my, I have my children do not pay me to drop them off at school, my you know, I do, I, my wife doesn't pay me for washing the dishes um, you know most human activity is done er, to cement social bonds of, of various sorts. Now these social bonds turn out to be more important to us than money. If um, you know if my, if, if um, my wife paid me for doing the dishes, it would actually devalue our relationship, it would undermine the social ties that hold us together. If the only thing holding us together is payment for services rendered then we don't have a marriage. We have a contractual relationship um, so the difference, you know this has always been true from the time immemorial, the difference about the internet is this is now being done on a global level. so you know when I tweet for free, I am exchanging information um, for the sake of reputational credits, people will follow my tweets, I'll get more followers, I may be able to then use that celebrity of some sort, to achieve my own ends, whatever, whatever they may, may be. So I give away content to acquire repetition or attention credits, which I then store until I want to spend them.