Google Israel CEO: We’re no monopoly

The company that controls more data than anyone ever has its problems. It ‘could even end up like Nokia’

(L to R) Google Israel CEO (Meir Brand) and Amir Teig at the Digital Conference in Tel Aviv (Photo credit: Courtesy)
(L to R) Google Israel CEO (Meir Brand) and Amir Teig at the Digital Conference in Tel Aviv (Photo credit: Courtesy)

Although it seems that Google “owns” almost all the data in the world – or a good chunk of it – the company is not now, nor will it ever be, a monopoly, said Meir Brand, CEO of Google Israel. “The Internet is the most competitive venue that has ever existed. Never has it been easier to open a business, and succeed.”

Nothing is forever, said Brand – not even Google. “Who would have thought ten years ago that phone maker Nokia would be irrelevant? They were the biggest phone maker in the world, and seemingly unstoppable. Today the big players are Apple, Google, Facebook, and others. But who says they will remain successful in the future?”

Brand made the frank statements about his company’s possible future demise in an interview with Amir Teig of Israeli business daily The Marker that took place in front of about 1,000 people at the newspaper’s annual Digital conference in Tel Aviv Sunday. The conference brought together dozens of top tech industry figures from Israel to discuss the impact of technology on areas such as banking, communications, and entertainment.

Google is perhaps the biggest aggregator of data in history, with billions of people around the world using one or more of its services – from search to email to online apps. Most of Google’s services are free, but users “pay” with their data; the company uses cookies, for example, to keep track of users’ Google searches, the better to decide which ads to present to them.

Even so, said Brand, that doesn’t mean Google will forever be the biggest data company. The company could face the same fate as Microsoft and AT&T, which were once the biggest tech and communications companies.

Part of the “downfall” of those companies, Brand acknowledged, was due to regulators’ forcing them to break up in order to foster competition. AT&T was split into numerous “Baby Bells” in the early 1980s, while Microsoft has faced regulators seeking to reduce the company’s power numerous times – such as in 2009, when after a decade of legal wrangling with the European Union, the company unbundled its Internet Explorer web browser from Windows installations.

Regulators aren’t needed, Brand declared. In fact, they do much more harm than good, “and I think Israelis understand what I am talking about,” said Brand, without specifying. In any event, he said, market forces would have done to those companies what they did to Nokia, which was once the premier cellphone maker in the world. Once smartphones – particularly the iPhone – came out, it was the end of the line for Nokia, which, for various internal reasons, missed the smartphone revolution, according to industry experts.

Regulation would be harmful not just to Google, but to the many businesses that are now dependent on it for income, said Brand. “We send ten billion links a month to content sites. Those referrals help sites sell and earn money; if there were no users, there would be no one to sell to. We also help them monetize traffic – last month we made $9 billion for content sites.”

Besides, he said, Google is vulnerable in a number of ways. “It’s true that we have made a strong foray into mobile phones with our Android operating system, but the jury is still out on whether it will become the long-term standard.”

In addition, Brand said, Google was created as, and is still in its essence, a desktop company – and the desktop is dying. “We may be the strongest on the desktop web, but the battle for domination in mobile is still very open-ended. With the world moving to mobile we are finding it hard to determine who the winner is going to be.”

Teig questioned Brand about one of the most contentious issues the company has with Israeli authorities: the company does not pay value added tax on the sales of its ads, claiming that as an international company with its operations abroad, Google should not have to pay taxes in Israel. Numerous activist groups and attorneys have petitioned the courts to order the Tax Authority to collect VAT from Google, and other web ad platform providers, like Facebook – so far, without success.

Brand didn’t address the VAT issue, but he did say that Google does its fair share for the Israeli economy. “The VAT issue aside, in 2013 we paid the second highest ever corporate gains penalty to the Israeli government when we bought Waze. We believe all companies should pay what they are supposed to, and we certainly do,” Brand declared.

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