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Yeahhh this is pretty weak. Reading the doc [1] there's nothing about getting users "hooked on search". The point is that Google is able to "ignore the demand s

Yeahhh this is pretty weak. Reading the doc [1] there's nothing about getting users "hooked on search". The point is that Google is able to "ignore the demand side" simply because search is so sticky: it turns out that users are not likely to switch search engines if the results are good enough. That means it has similar economics to drugs and cigarettes, but not that search is addictive like the headline heavily implies. Ars is usually better than this. [1] https://www.justice.gov/d9/2023-09/416692.pdf https://www.justice.gov/d9/2023-09/416692.pdf

JumpCrisscross 3y ago
> is able to "ignore the demand side" simply because search is so sticky Because of their “marketing/distribution investments,” not any product attributes [1]. [1] https://www.bloomberg.com/news/articles/2023-09-29/google-search-is-like-cigarettes-or-drugs-executive-said https://www.bloomberg.com/news/articles/2023-09-29/google-se...
- timmaxw 3y ago
  The full quote from the trial exhibit is: > When talking about revenue, we could mostly ignore the demand side of the equation (users and queries) and only focus on supply side of advertisers, ad formats, and sales. Sure, we had to build the best product, made smart marketing/distribution investments to get our product everywhere, but we could essentially tear the economics textbook in half. They explicitly mention "we had to build the best product", so I'm not sure where you're getting the "not any product attributes" bit from. (Your linked article is paywalled.)
  - pdonis 3y ago
    > They explicitly mention "we had to build the best product" But to them, "the best product" is the one that maximizes their profits from ads, not the one that does the best job of giving users what they want. Obviously there is overlap between these, but they're not the same thing.
    - timmaxw 3y ago
      At tech companies I've worked at, when people use phrases like "the best product" or "product quality", they are in fact using those phrases to mean "the product that does the best job of giving users what they want".
      - pdonis 3y ago
        > when people use phrases like "the best product" or "product quality", they are in fact using those phrases to mean "the product that does the best job of giving users what they want". Perhaps, but Google's actual behavior makes it clear that, whether they want to admit it or not, Google's executives are not using the terms that way.
      - salawat 3y ago
        Not in any of the companies I've been at, no matter how hard I've fought to make it so.
irrational 3y ago
> users are not likely to switch search engines if the results are good enough I’ve been using DDG for a few years. I don’t even remember why I started using it. So far the results from DDG have been “good enough” that I’ve never felt the need to switch to Google, even for a single search. If DDG was the default search engine in people’s browsers, I wonder how many would just use it instead of changing to google.
pdonis 3y ago
> Google is able to "ignore the demand side" To me this shows how disconnected from reality Google's executives are. They think advertising is just the "supply" side and that they can ignore the "demand" side entirely. In fact, since advertisers are Google's customers, Google is the supply side--they supply the advertising opportunities--and the advertisers are the demand side--they pay for the advertising opportunities that are available. Users are neither supply nor demand to Google, economically speaking: they are a capital resource that Google uses to produce what they supply to their customers. In other words, the complacent position Google's executives feel themselves to be in is not because they are somehow avoiding supply and demand economics: it is because, due to their first-mover position in search, they have a huge capital resource--all the users who use Google search because it was the first good enough search engine available and force of habit is very strong--which their search competitors do not have. But that resource is not unassailable. Google's search experience has been deteriorating because of ads. But Google's executives don't even see that. They think their search team is doing an awesome job.
- pinkmuffinere 3y ago
  I don't think it's accurate to say that users are only a capital resource. The users are still customers for Google, even if they are not explicitly paying out of their own wallets for the service -- they are free to walk away at any time. Google has to keep both the users and the advertisers 'happy enough' if they want to succeed. The article highlights that the bar to keep the users 'happy enough' is fairly low.
  - pdonis 3y ago
    > The users are still customers for Google, even if they are not explicitly paying out of their own wallets for the service -- they are free to walk away at any time. No, that still doesn't make them customers. It makes them a capital resource that Google does not have complete control over. Which is something I'm not sure Google's executives fully grasp. It is true that there can be customer relationships, in the economic sense, even if the value exchanged is not money on either side of the relationship. But in a customer relationship, the value exchange choice is voluntary on both sides. That is not true in the case of Google and its users; Google's value exchange choices are voluntary (it decides how its search service works and what ads to show the user, and what data to harvest from user interactions), but many user choices are not (users can choose whether or not to use Google search and what terms to search for, but they cannot choose what ads they get shown or what data Google harvests from their search activity).

JumpCrisscross 3y ago

> is able to "ignore the demand side" simply because search is so sticky Because of their “marketing/distribution investments,” not any product attributes [1]. [1] https://www.bloomberg.com/news/articles/2023-09-29/google-search-is-like-cigarettes-or-drugs-executive-said https://www.bloomberg.com/news/articles/2023-09-29/google-se...

timmaxw 3y ago
The full quote from the trial exhibit is: > When talking about revenue, we could mostly ignore the demand side of the equation (users and queries) and only focus on supply side of advertisers, ad formats, and sales. Sure, we had to build the best product, made smart marketing/distribution investments to get our product everywhere, but we could essentially tear the economics textbook in half. They explicitly mention "we had to build the best product", so I'm not sure where you're getting the "not any product attributes" bit from. (Your linked article is paywalled.)
- pdonis 3y ago
  > They explicitly mention "we had to build the best product" But to them, "the best product" is the one that maximizes their profits from ads, not the one that does the best job of giving users what they want. Obviously there is overlap between these, but they're not the same thing.
  - timmaxw 3y ago
    At tech companies I've worked at, when people use phrases like "the best product" or "product quality", they are in fact using those phrases to mean "the product that does the best job of giving users what they want".
    - pdonis 3y ago
      > when people use phrases like "the best product" or "product quality", they are in fact using those phrases to mean "the product that does the best job of giving users what they want". Perhaps, but Google's actual behavior makes it clear that, whether they want to admit it or not, Google's executives are not using the terms that way.
    - salawat 3y ago
      Not in any of the companies I've been at, no matter how hard I've fought to make it so.

irrational 3y ago

> users are not likely to switch search engines if the results are good enough I’ve been using DDG for a few years. I don’t even remember why I started using it. So far the results from DDG have been “good enough” that I’ve never felt the need to switch to Google, even for a single search. If DDG was the default search engine in people’s browsers, I wonder how many would just use it instead of changing to google.

pdonis 3y ago

> Google is able to "ignore the demand side" To me this shows how disconnected from reality Google's executives are. They think advertising is just the "supply" side and that they can ignore the "demand" side entirely. In fact, since advertisers are Google's customers, Google is the supply side--they supply the advertising opportunities--and the advertisers are the demand side--they pay for the advertising opportunities that are available. Users are neither supply nor demand to Google, economically speaking: they are a capital resource that Google uses to produce what they supply to their customers. In other words, the complacent position Google's executives feel themselves to be in is not because they are somehow avoiding supply and demand economics: it is because, due to their first-mover position in search, they have a huge capital resource--all the users who use Google search because it was the first good enough search engine available and force of habit is very strong--which their search competitors do not have. But that resource is not unassailable. Google's search experience has been deteriorating because of ads. But Google's executives don't even see that. They think their search team is doing an awesome job.

pinkmuffinere 3y ago
I don't think it's accurate to say that users are only a capital resource. The users are still customers for Google, even if they are not explicitly paying out of their own wallets for the service -- they are free to walk away at any time. Google has to keep both the users and the advertisers 'happy enough' if they want to succeed. The article highlights that the bar to keep the users 'happy enough' is fairly low.
- pdonis 3y ago
  > The users are still customers for Google, even if they are not explicitly paying out of their own wallets for the service -- they are free to walk away at any time. No, that still doesn't make them customers. It makes them a capital resource that Google does not have complete control over. Which is something I'm not sure Google's executives fully grasp. It is true that there can be customer relationships, in the economic sense, even if the value exchanged is not money on either side of the relationship. But in a customer relationship, the value exchange choice is voluntary on both sides. That is not true in the case of Google and its users; Google's value exchange choices are voluntary (it decides how its search service works and what ads to show the user, and what data to harvest from user interactions), but many user choices are not (users can choose whether or not to use Google search and what terms to search for, but they cannot choose what ads they get shown or what data Google harvests from their search activity).