Getting to Know You

Google’s introduction of new extensions for Firefox is all about knowing more about some users.

This week, Google introduced two new Firefox extensions: Google Safe Browsing and Blogger Web Comments which are providing richer integration with the desktop and a number of new features based on your surfing patterns.

But the question, when looking at those is why is Google interested in areas that don’t seem that close to search: the truth is that they are closely tied to Google’s business model, even though it’s not totally clear on a first look.

The Google business model: advertising

When you look at Google’s revenue, it becomes immediately clear that search is not really what the company is about: Google is in the business of advertising and search is the way in which it targets its advertising properly. Viewed in that prism, Google is an advertising company and advertising companies generally need a couple of things: eyeballs and data about those eyeballs.

The first part of this is easy to understand: eyeballs, to an advertising company, represent the inventory it has available for sale. However, eyeballs in and off themselves are pretty useless. The common misconceptions made by many companies in the late 90s was that eyeballs alone were important. The truth is that, without any other type of information, eyeballs are close to useless.

However, the more information you have about a set of eyeballs, the more useful it becomes. This was the realization that Google made when it moved the advertising model on its head by targeting ads based on search terms. Google then increased the amount of eyeballs it could get by offering AdSense, a program that increased inventory and provided information back to Google about what people were looking at.

With each new member of the AdSense program, Google gets more information about Internet users. The more information it has about Internet users, the better it can target its advertising.

Enter the add-ons

In May, I posited that the Google Accelerator was about distributing the indexing work. What I failed to realize at the time was that Google was also getting a lot of user information in the process: what do people look at, how long, etc… This information is extremely useful. However, the accelerator had some issues and failed to achieve high velocity.

More deals have followed, with large partnerships aimed at pushing the Google toolbar on as many desktops as possible. One could wonder why the toolbar is so important to Google. After all, they keep trying to get it bundled left and right (with Java, for example) and are pushing it very heavily in their search engine results page. The toolbar is all about getting more information about what people visit.

The new extensions are about the same thing: getting to know you better. The Google Firefox Extensions Agreement spells it out very clearly:

By using the Extensions, you acknowledge and agree that Google may access, preserve, and disclose information regarding your use of the services if required to do so by law or under other conditions set forth in the Google Privacy Policy

Digging into the privacy policy spells things out clearly (the emphasis is mine):

  • Google collects personal information when you register for a Google service or otherwise voluntarily provide such information. We may combine personal information collected from you with information from other Google services or third parties to provide a better user experience, including customizing content for you.
  • Google uses cookies and other technologies to enhance your online experience and to learn about how you use Google services in order to improve the quality of our services.
  • Google’s servers automatically record information when you visit our website or use some of our products, including the URL, IP address, browser type and language, and the date and time of your request.

From here, we learn that Google aggregates data (no big surprise here) and can share it with third parties. Among some of the data is the URL you visited, your IP address (which can then provide some information about your physical locations), and the language you use. Those are all good attributes to narrow down information about a user. For example, if someone looks at a lot of technical web sites, Google will know that this person might respond better to a technical ad. Over time, that information can be aggregated to get a better understanding of different groups and sell very targeted advertising. Let’s look at how Google uses this information (once again, emphasis is mine and this is from their privacy policy):

  • We may use personal information to provide the services you’ve requested, including services that display customized content and advertising.
  • We may also use personal information for auditing, research and analysis to operate and improve Google technologies and services.
  • We may share aggregated non-personal information with third parties outside of Google.
  • When we use third parties to assist us in processing your personal information, we require that they comply with our Privacy Policy and any other appropriate confidentiality and security measures.
  • We may also share information with third parties in limited circumstances, including when complying with legal process, preventing fraud or imminent harm, and ensuring the security of our network and services.
  • Google processes personal information on our servers in the United States of America and in other countries. In some cases, we process personal information on a server outside your own country.

If you remember my first point (Google is an advertising company), it starts to click. The technology and services they provide are not necessarily to the end user; they can also be to advertisers. This is why there is little worry about Google identifying you personally but being able to provide aggregated non-personal information to a third part is what advertising is all about.

In the television world, much of that work is being done by Nielsen (the infamous Nielsen ratings) to define what the audience of a show is and target the advertising properly. This is where the ideas like “give me around 100,000 eyeballs for men 18-24 in the New York area” yields an ad on a sports show about a New York sports team.

However, Google can do that better in that they can offer advertisers something along the lines of “17,000 eyeballs of 19 year old men based in Manhattan, NY with an interest in the Knicks and the Xbox 360, who also read sport news three times last week from ESPN, like the Daily Show and bought hardware and books from Amazon.com in the last 30 days.” It may sound extreme but let me explain how it works:

  • The bought hardware and books can be gathered from the fact that they looked at URLs on Amazon.com and ended up on a purchase path as a result of that session (this would all be URL info)
  • The same can be true of the ESPN.com and theDailyShow sites (gathered from the URL field)
  • The interests (Xbox, the Knicks) can be inferred from where they spend time in their online session or what they searched for on Google
  • The location (Manhattan, NY) can be inferred from the IP address they used during their surfing session (alternately, if they use Google WiFi, it can be gathered from the info that client has reported)
  • The 19 year old men can be inferred from their email (Gmail) or usage patterns (this is where the research and analysis part come in) as relating to other 19 year old men

In fact Google is so sure of their data that they will guarantee advertisers that, if their ad did not get a response, they don’t pay for it. The TV station doesn’t do that. Once you’ve run the ad and they verified the audience, if you’ve met the number, you’re good.

Let’s assume that you have a million dollars in advertising to try to sell your new widget (which targets that public): where would you put it?

The rich data set that Google is building has tremendous monetary value and that is why they keep pushing new clients that provide them with more info.

Attention as value

Because that data is very valuable, the current stream of organizations like AttentionTrust is one thing Google will have to deal with down the line. Such efforts are actually putting the power in the hands of the users and could potentially represent a threat to Google, if people refuse to start providing data to it. It will be interesting to see how Google deals with this new world.

Previous Post
Signs of a Bubble
Next Post
2005 Predictions: Keeping the Score
Menu