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REBECCA ROBERTS, host:

This is TALK OF THE NATION. I'm Rebecca Roberts, in Washington. Neal Conan is in Fort Myers, Florida. We'll catch up with him later this hour.

If you go online today, I'm willing to bet you'll use a Google product - the search engine or a Gmail or the blogging platform or YouTube or Google Maps or the Picasa photo sharing. In the last decade, Google has grown from the grad school project of two Stanford engineering students into a multinational, multibillion dollar juggernaut. It's moved from that predictable start-up garage to a sprawling campus in Mountain View, California, a campus famous for perks like good free, food and massages and a corporate uniform that's more about T-shirts than suits and ties. There motto is, famously, don't be evil. And the company's mission, according to one of its founders, is nothing less than to change the world.

But as they do that - radically changing the way we get our news and communicate with each other, shop, keep track of our medical records, archive our email - critics worry that some evil might be inherent. Ken Auleta, who writes the �Annals of Communication,� column for The New Yorker Magazine, tells the Google story in a new book. And he'll join us in just a minute.

Later this hour, Neal Conan joins us with a story about modern day slavery in Florida - but first, Google. We want to hear from you what are your unanswered questions about Google? Our number here in Washington is 800-989-8255. Our email address is talk@npr.org. And you can join the conversation at our Web site. Go to npr.org and click on TALK OF THE NATION.

If you want to learn how Google surpassed Microsoft to become king of the Internet advertising, that's also at our Web site: npr.org. Ken Auletta is the author of �Googled: The End of World as We Know It.� He joins us now from our New York bureau. It's good to have you with us.

Mr. KEN AULETTA (Author, �Googled: The End of World as We Know It�): Pleasure to be here.

ROBERTS: So, when Google started out, the whole idea was to do search faster and better and more trustworthy. And how did it evolve into this monstrous company that does so many different things?

Mr. AULETTA: Well, they started it in '98, and they had no idea how they were going to make money. They got some investment capital from two venture capitalists of $25 million, and three-and-a-half years later, they were still not making any money. They had no advertising, no subscription model. And they came across a way to do advertising that would only charge the advertiser if you clicked on the ad. And ad are those little - in that grey box on the right hand side of your search results. Those are text ads. And you only pay if you click on them. And they found that, in fact, people did click on those ads because they saw it as information. And lo and behold, today, not so many years later, those ads generate over $21 billion a year in advertising revenues.

So they found out that, in fact, it was a way to attract advertising and maybe expand into the advertising business. And then they buy YouTube in 2006, and then they say, well, you know, we can get into the television business with YouTube. And then they say, well, why don't we digitize all the books? This was in 2002. And then they're in the book business. And eventually, they will be selling electronic books. And then they say, well, why don't we create Google News to mass and aggregate all the newspapers and magazines in the world, and lo and behold, they're in the newspaper business. And why don't we create an operating system for mobile phones, and with our Android, we'll create an Android Operating System. And lo and behold, they're in the telephone business.

And why don't we have cloud computing instead of buying packaged software from Microsoft? We'll give it to you much cheaper, and it'll be in the cloud, one of their servers. So they're in the - in that business. And eventually, they stopped calling themselves a search engine, and they now call themselves a media company.

ROBERTS: And meanwhile, one thing they have never done to make money is let you buy your way to the top of their search engine.

Mr. AULETTA: No. One of the reasons why Google is among the most trusted companies or brands in the world - in addition to the very important fact that they're free - you know, cable company, television company, telephone company will never be popular like that because they're not free. Google is free. But in addition to that, they set out to try and convey a sense that they are serving the consumer first. You know, when you go on the Google home page, you don't see a clutter with advertising as you do, say, on the Yahoo home page.

And when you do a search, they don't try and box you in and keep you in a cul-de-sac that's Google. They basically send you to the site you seek. So they developed a tremendous amount of trust from users and a sense from those users that Google was serving their interests first. And additionally, as you said, they will not allow an advertiser to pay to rank higher in the search results.

ROBERTS: What's amazing now, considering how much money that made for a lot of people, is back then in the '90s, when it was this, you know, idealistic, the best and fastest search it could be presented by two guys who are not, frankly, known for their social skills, that they got the VC money to begin with.

Mr. AULETTA: You know, I asked the VCs who put up the money, Michael Moritz and John Doerr. I said, what seduced you, what made you want to give these guys twelve-and-a-half million dollars each? And they said to me - you know, obviously, it wasn't the charm of Sergey Brin and Larry Page. They were computer scientists, and charm is not there long suit. Though Sergey Brin's a little more charming than Larry Page. But what they had, the venture capitalists told me, was not only a great product that they showed them, they demonstrated on their computers, but they had passion, they said. They really were determined to serve the users, to make this the fastest and the best search engine. And they thought they saw, in the demonstration, evidence of that. And so they were smitten, and they opened their wallet.

ROBERTS: A lot of Google's story focuses around Sergey Brin and Larry Page and how they are engineers first and they approach everything from the idea that everything is a solvable problem, and the way it's done now is probably not the best way and everything is quantifiable. And - that they, you know, don't get caught up into personality and marketing and all of that. But, of course, that reliance on engineering aspects is its own form of snobbery. How much is their personality the personality of the company still, now that it's so big?

Mr. AULETTA: Oh, it - their personalities imbue the entire Google culture. I mean, they started with an assumption that the old ways of doing things were inefficient. And then they recruited engineers and they did something to add a wrinkle to that. They not only recruited the best engineers - and they were helped, by the way, because of the dot-com collapse in '99 and 2000. They were able to hire engineers who have been laid off at other places in Silicon Valley. Buy what they did was they said we're going to give 20 percent time, a day a week time off to any engineer to work on any project they choose. And from that, they got innovation.

But the engineer - and they began - the founders began with this question, and the engineers do today, and the question is: Why? Why can't we make free phone calls? Why can't we only charge advertisers when a consumer clicks on an ad and tell them who's actually watching that ad and how much time they spend on that ad? Why can't we aggregate news and put it online for users? You know, why can't we sell - instead of packaged software, why can't we do it through cloud computing? Why, why, why?

And those questions, they came up with more efficient ways of doing this. Now, those more efficient ways of doing things sometimes caused real harm and also caused them great controversy, which is some of what we're seeing today with Google.

ROBERTS: And also wasn't necessarily the most efficient management strategy.

Mr. AULETTA: No. I mean, if in fact governments - not just in the United States, but all around the world - are questioning you and threatening antitrust action or curbing your policies because you have too much private information or because you're exceeding the boundaries, the government rules of copyright law, then you've got - that's very inefficient.

In addition to that, as I think you're suggesting, the management system at Google, which is very innovative, and it's also very inefficient at times, in that it's chaotic. I mean, you've got a troika that makes decisions. And they agree, the two co-founders and CEO Eric Schmidt, agree that they have to agree on any major decision, and sometimes that slows down things.

ROBERTS: And for the first several years when Eric Schmidt wasn't there - I mean, he was brought in, as everyone says, as the adult supervision - it was even more chaotic.

Mr. AULETTA: It was. And actually, there was a period of time before Google started making money in really late 2001 where the venture capitalists, the two venture capitalists who made the investment were getting very impatient and were really on their back, saying: Why don't you hire a CEO? And the two cofounders - who were brilliant engineers, by the way, and visionaries - they kept on humoring the venture capitalists. Oh, you know, we're looking, but we can't find the right person. If we could hire Steve Jobs, we would do that, they would say.

But then they met Eric Schmidt, who, like them, was a computer scientist, had a Ph.D., unlike them, and had real management experience in the Valley and was two decades older.

And they hired him. They had some bumps at first. They had difficulty giving up power, the two cofounders, but eventually they worked out a really good marriage.

ROBERTS: We have an email from Richard in Stoneham, Massachusetts, who says: What information does Google collect on its users? What do they do with it, who gets to see it, and how do you get off, get out of the Google grid?

Mr. AULETTA: You can opt out of the Google grid anytime you want, but there's a penalty for that in that when you opt out, you have to sign in every time. They don't have basic information on you, which makes your life easier when you're online, and - but the larger answer to that very good question is every time you do a search on Google - and this is true, by the way, of most places when you go online - there's a cookie that's attached to you. They don't know your name on that cookie, but think of it as a hat check, and on that�

ROBERTS: And cookie is, just to explain, a little piece of software that sits on your computer.

Mr. AULETTA: That sits on your computer and - or your browser. And that piece of software, that cookie contains all the information about every search you do, what you read online, what clicks you make on ads, what purchases you make. Again, it doesn't have your name, but it collects an enormous amount of information.

So, for instance, when you do a search, and you suddenly, you know, you start typing in, and they give you - a menu drops down, they say do you mean, and they give you a choice of three or four things, the reason they can give you that choice in part is because of your cookie. They know the previous searches you've done.

So in that sense, it makes your search life more efficient. On the other hand, that's a tremendous amount of data that they've collected on you over the years, and an advertiser would die to get access to it.

ROBERTS: We are talking about the Internet phenomenon that is Google with Ken Auletta, author of "Googled: The End of the World as We Know It." We're also taking your calls at 800-989-8255. And you can send us email. The address is talk@npr.org. I'm Rebecca Roberts. It's TALK OF THE NATION from NPR News.

(Soundbite of music)

ROBERTS: This is TALK OF THE NATION. I'm Rebecca Roberts, in Washington. Neal Conan is visiting member station WGCU, and we'll catch up with him later.

We are still talking about Google, and if you did any kind of Internet search today, chances are your search engine was Google. It's gone from a small start-up to a company that will probably generate $20 billion in advertising revenues this year. And as Google's CEO Eric Schmidt tells author Ken Auletta, the company's on the brink of becoming the world's first $100 billion media company.

Ken Auletta is our guest today. His book is called "Googled: The End of the World as We Know It," and he joins us from our New York bureau. If you have unanswered questions about Google, then give us a call: 800-989-8255, or email: talk@npr.org.

Ken Auletta, we just heard from an emailer some of the concerns about how much of the information Google is acquiring, and the answer is a whole, whole lot. I think the second part of that question is: And what are they doing with it?

Mr. AULETTA: Well, what they're doing is basically telling advertisers, they have a program called AdSense, and they tell an advertiser - if you are, say, Hewlett-Packard, and you want to advertise on technology blogs, they will marry you with technology blogs and shoot your ads to them. It's all done online. It's very efficient. And so suddenly, these Web sites that are technology-oriented are getting ads from companies like Hewlett-Packard or Intel, and so they love it. And it's one of the reasons why Google has a huge online constituency.

But for the advertiser, they also love it because it's targeted advertising because Google is basically telling them: You don't need a shotgun anymore to reach - and guess at who you're reaching. We will send a rifle shot to these sites, and you only get charged if someone clicks on your ad. And once they click on your ad and then maybe purchase something, you have a direct relationship with them as an advertiser. And by the way, Mr. Advertiser, you can go online and see how many clicks you're getting hour by hour.

So advertisers say, wow, this is a really much more efficient system than advertising on radio or television and guessing. I should spend $3 million on a 30-second spot in the Super Bowl this year and guess at who's actually sold - or my products have sold itself to based on that versus actually knowing who purchases something based on my online ad?

ROBERTS: Let's hear from Angela in Myrtle Beach, South Carolina. Angela, welcome to TALK OF THE NATION.

ANGELA (Caller): Hi. I'm curious if there's been any analysis done on how Google affects small businesses or any business or any company that sells a product. For instance, last week, I built my own antenna. I don't need to go buy one because I can just type into Google: How do I build an antenna? And there's always directions on how to do it, and that's for a lot of things that I use daily.

Mr. AULETTA: It's - Google Search is an amazing product, and it's one of the reasons why two-thirds - more than two-thirds of everyone in America uses it. Seventy percent of the people in the world use Google Search. They are dominant, and in four-tenths of a second, on average, you're getting your search result.

So as you said, it's great for you in that you can build your antenna, but it's also great for small businesses. If they can rise to the top, if they have an arcane business, let's say, and can rise to the top of a search result, they are generating a lot of income.

On the other hand, if they can't rise to the top or they're buried on page three or four of the search result, they're often unhappy. But Google argues that they're buried on page three or four because they're not getting enough traffic. If they got more traffic, they would rise to the top.

ROBERTS: Well, this leads to a question from Diana in Kalamazoo, who says: I'm on Google dozens, if not hundreds, of times per day for my job as a librarian and for personal information, but I wonder about Google's algorithm and the way in which it ranks sites.

If search results are ranked based on popularity, this self-perpetuating cycle leads to the largest Web sites getting more users, while users don't even know that the smaller enterprises exist, since they don't show up on the first page of Google hits. How's the little guy supposed to keep up?

Mr. AULETTA: Well, it's a good question. The truth is that we don't know what's in that black box or the algorithm. The algorithm is basically a mathematical formula that determines who rises to the top of the search results.

We know that the key ingredient of that algorithm is, as your emailer said, the popularity of the site, the wisdom of the crowd. So, in other words, the site that gets the most traffic will rise higher than a site that gets less traffic. But we also know that Google has some other wrinkles in the algorithm.

I mean, for instance, I know from the reporting I did from my book that serious journalistic institutions - not just the New York Times, but certainly the New York Times among them - tend to get some extra points because they are perceived as more authoritative. And I'm sure the same is true of NPR, by the way. But we don't know what else is in that algorithm.

Now, some people complain about that. Actually, I think there's a very good reason why Google doesn't share that algorithm, and that's because they don't want people to game the system. And they're constantly changing the algorithm because there are thousands of people there, they're called search engine marketers, who are advising businesses and others how to game the algorithm and how to game the - and rise to the top of Google Search. And in order to keep the trust of its users, Google keeps that algorithm in a black box.

ROBERTS: Let's hear from Rich in Minneapolis. Rich, welcome to TALK OF THE NATION.

RICH (Caller): Hi, thank you. My question has to do with more of a social impact. And I notice, like for instance, a lot of times I'll be sitting around with a lot of friends, we'll have a question, and someone, like, Googles it on their phone. We have an immediate answer, and it's widespread.

I mean, it's a very - something that affects a lot of conversations and fact-checking and things like that. And I'm just wondering if you could comment, you know, how that socially has impacted society and things like that.

Mr. AULETTA: Well, you know, it is, as a service, I mean, it's beloved, and that's one of the reasons why it has, you know, more than two-thirds of all the traffic, search traffic in the United States.

There are concerns about that. I mean, if you talk to many educators, they will tell you that they really worry about their students, particularly younger students, who are doing their research on Google and may be borrowing text from someone when they do a search or maybe not reading a book and just cribbing a paragraph here and there from different results.

That's very worrisome to educators, and it should be. And there are teachers who ban their students from doing a Google or any other search because they worry about the loss of people actually delving into a book and wrestling with a subject and - so that they really understand it, as opposed to a shortcut like a search.

And on the other hand, if you live in the third world and you can't afford textbooks and you can't afford the expensive infrastructure of broadband and wires, but maybe you have much-cheaper-to-produce cell-phone coverage and wireless coverage, then the idea that you could actually do Google Search and use the information as your textbook in many developing countries, that becomes a very attractive option.

ROBERTS: Let's hear from Matt in Athens, Ohio. Matt, welcome to TALK OF THE NATION.

MATT (Caller): Hi, how are you doing?

ROBERTS: Good.

MATT: I guess my question for your guest is I used to work for an Internet service provider, a local one that did pretty much dial-up only, and after 2001 and the whole 9/11 thing, our Internet service provider was approached by the government to institute I believe a piece of software called Carnivore that would watch everything that everyone was doing.

And around the same time, Google instituted Gmail. I know I got an invite for it and was one of the first people that I knew that had it, and basically one of the rumors that was going around at the time that Gmail came out was that if you ever have a Gmail account, anything you delete out of your inbox, whether it goes to trash or not, is permanently stored on their servers and can be searched later on, whether it be by the government or whoever.

I mean, even if you delete your account, they've still got your old emails, whether they're trash or spam or whatever. I was wondering if you could comment on whether that rumor was true, or is it inactive, or is it active or anything like that. And I'll take my question off the air, my answer off the air.

ROBERTS: Well, at first, Gmail didn't even have a delete feature.

Mr. AULETTA: That's actually where the rumor starts. What - I report this in the book where Larry Page and Sergey Brin did not want a delete button because they said people may change their mind. Essentially, what they were saying is we know better. And a ruckus was caused by this and there was debate internally, but outside, people were really upset, and they were compelled to add a delete button.

So if you delete an email, it's deleted. But at first, it wasn't going to be. But the other point, under the Patriot Act, the federal government has subpoenaed and asked for information about email use to track down alleged terrorists. And every company that has an email system has complied with those subpoenas.

So, there is evidence that be it Yahoo! or Google or Microsoft or others, their email systems have been looked at or certain individuals have been looked at, who - because of alleged terrorist ties.

ROBERTS: This is Michael(ph) in Union City, California. Michael, welcome to TALK OF THE NATION.

MICHAEL: Hey, thanks for taking my call. I'm calling about that slogan, do no evil. My understanding was, Google, a year or so ago, wanted to make sure that the Chinese population, I thought, had access to Google. And my understanding was they cut some kind of deal with the Chinese government to give them information about potential dissidents that the Chinese government then used to incarcerate people.

If - and so, I'd like you talk about that, how true that is. And if it is true, should that do no evil logo have an asterisk saying, unless you can give us a lot of money and then we'll sell people out. I'll take my answer off the air. Thank you.

ROBERTS: Thanks, Michael.

Mr. AULETTA: Michael, what happened, it wasn't Google that turned over dissidents, it was Yahoo! And those dissidents, a couple of them were jailed, and they made a mistake in sharing information with the Chinese government. But what happened with Google is that Google wanted to get into China, and they did in 2004, as every company does. It's the largest consumer market in the world.

But then, the Chinese government after allowing Google search, suddenly said, well, we want to make some changes in Google search. For instance, when someone wants to do a search at Tiananmen Square, we don't want them to see any tanks. We want them only to see smiling faces. And by the way, we don't want any reports about the Dalai Lama or Tibet or et cetera, et cetera.

So Google was faced with a choice. Do they accept this limited form of censorship - but it is censorship - or do they exit China? They chose to accept that limited form of censorship. And so, the argument is, does that mean that Google did evil? Well, they certainly compromised on their principles, didn't they? And I mean, the truth is, Don't Be Evil is a slogan that makes people at Google feel good. And they - they are very idealistic people, very often. And they want to do good. And they do a lot of good in this world, including, you know, they give one percent of their profits to the Google charity to do good works. So, they do a lot of noble things. But in China, they were not noble and they violated their own precepts.

ROBERTS: We have an email from Jessica(ph) in Oregon that says, how will the new program Google Wave change the way they communicate on the Internet?

Mr. AULETTA: Well, it allows collaboration between people. For instance, if I am writing a piece for The New Yorker or a book, I can have my editor work with me on it as I'm writing or I could share it with other people and get ideas - wisdom of crowds, et cetera. Now, the thought of doing that, to me, is repugnant. I mean, I would no more do something like that because if you're writing a book or doing journalism, it's�

ROBERTS: Although that might say more about your editor.

(Soundbite of laughter)

Mr. AULETTA: Yeah. No, but it could. Yeah, but it could, but also, you know, also it says something about how you work. I mean, I don't hand in - I don't hand things in in chapters, I do it all at once when I'm done. But anyway, there are a lot of people in the social networking world, it encourages collaboration. And Wave advances your ability to collaborate.

ROBERTS: You're listening to TALK OF THE NATION from NPR News.

Let's hear from Frank(ph) in Middletown, New York. Frank, welcome to TALK OF THE NATION.

FRANK (Caller): Hi, how are you doing?

ROBERTS: Good. How are you?

FRANK: I had a question - good. I just have a quick question for your guest. I hope it's not too early for this because it was just announced about two hours ago, formally, about Google Chrome OS. I read some information on the Internet as it's being released in the press conference. And it looks very promising. I just want to know if it's a very, very ambitious program and whatnot. How well do you think it's going to hold up in the world with all these other conglomerate OSs like Microsoft and Apple?

Mr. AULETTA: I don't know the answer to that. But I know that - and no one else does, by the way. You can just guess at that. But their - Google has ambitions to create an operating system, which is what the OS is, that would be better than Microsoft's operating system and maybe better than Apple's. And that's - this is just another indication that Google is coming right at Microsoft.

I mean, I tell this story in my book at the beginning of Chapter two of interviewing Bill Gates in 1998 and I said to him, Mr. Gates, what do you worry about in the future - most? What's your greatest nightmare? And he thoughtfully leaned back, and I thought he would say one of his competitors - Netscape or Oracle or Apple. And instead, what he said, I worry about someone in the garage inventing some new technology I've never thought of. That's my nightmare.

Well, in 1998, in the garage, were two guys - Larry Page and Sergey Brin of Google. And they have become Microsoft's worst nightmare. And this is just - the announcement today is just another indication of Google's intentions. Google is creating, not just software to cloud computing and search which competes against Microsoft and all other apps which compete against Microsoft, but by creating an operating system, they're going right to the heart of Microsoft's business.

Now, whether they actually make a success of it or not, we don't know. And for instance, over a year ago, they announced the Chrome browser and they said this would be a game changer. Well, it hasn't been a game changer. And there are other browsers that are deemed to be superior to Chrome. Will that be true with the new operating - Chrome operating system? I don't know.

ROBERTS: Well, also, it seemed that Brin and Page were sort of slow to understand what a threat they represented in Microsoft's eyes. Microsoft was going to try to compete with them.

Mr. AULETTA: I don't think they were slow. I think what they did was - and Eric Schmidt was very instrumental in this - Eric Schmidt was a longtime foe of Microsoft. He worked at Sun Microsystems and�

ROBERTS: Which does not put him in the minority in Silicon Valley.

(Soundbite of laughter)

Mr. AULETTA: That's right. Exactly right. And so, he thought of Microsoft, as some others did, as the evil empire. And - but one of the things he did when he came to Google in 2001, he advised Sergey Brin and Larry Page, don't do what Netscape did. Don't moon the giant. Don't let them know that you are obsessed with them, that you want to beat them. And keep a low profile. Well, he - they've succeeded in doing that for a number of years. But now, that low profile is gone. And their lust to compete against Microsoft is apparent.

ROBERTS: Ken Auletta writes "The Annals of Communication" column for the New Yorker magazine. Although, I do - Ken Auletta, before I let you go - have to ask you this final question which is from Bruce(ph) in Oakland. Does your guest know what the inside of the Google airplane looks like?

Mr. AULETTA: I have not been on that airplane. But I know it has big beds. There are two of them, by the way, not�

ROBERTS: It's like a 767, right?

Mr. AULETAA: It's a 767.

ROBERTS: This is not a little gulf stream.

Mr. AULETTA: And each of them have king size beds - the two founders use it. Larry Page also flies his own helicopter. And it's - but it also can seat, I'm told, about 30 people. So, they can take groups of engineers around the world to visit their various sites. But it's very comfortable. And sometimes, Page and Brin have been known to jump on one of those planes to go to Alaska or Africa for the weekend and take photographs.

ROBERTS: Ken Auletta, thank you so much for joining us.

Mr. AULETTA: Pleasure.

ROBERTS: Ken Auletta's book is called "Googled: The End of the World as we Know It." He joined us from our bureau in New York.

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