Eric Schmidt: All of Google's Strategic Initiatives in 2011 are Mobile
In the latest Harvard Business Review, guest contributor Eric Schmidt, CEO of Google, writes about the company's plans for the coming year, saying “as I think about Google's strategic initiatives in 2011, I realize they're all about mobile.”
Context & Ripple Effects
This HBR essay formalizes a position Schmidt has been building publicly for years: he laid out his thinking on search, books, news and mobile in an August 2009 interview with TechCrunch, and back in 2006 he floated the idea of free cellphones funded by ads when most of Google's attention was still on the desktop web.
Declaring 'all about mobile' in the Harvard Business Review matters because it is the CEO putting the company's whole 2011 agenda behind one screen size — and because Google enters the year under scrutiny, with a noted Google-watcher having just presented evidence that search favors Google's own services like Gmail and Maps, a charge Google disputes.
First-order effects
- Google's engineering and product resources for 2011 tilt toward Android and mobile services, forcing internal initiatives to justify themselves against a mobile yardstick rather than desktop search economics.
- Rivals — Apple on handsets, Microsoft in mobile search and ads, and Groupon in local deals where Google is preparing its own group-buying service per a leaked fact sheet — now face a fully committed Google on their home turf.
Second-order effects
- Carriers, handset makers and developers building on Android get a clearer signal that Google will keep subsidizing the platform to protect mobile query volume, deepening dependence on Google's ad engine for revenue.
- Advertisers and agencies must plan for a world where Google's auction pricing increasingly reflects mobile inventory, pressuring budgets out of print and desktop display formats.
Third-order effects
- If Schmidt's framing holds, Google's identity shifts from a search company with a mobile arm to a mobile-first company whose desktop properties become the legacy business — with regulators and rivals watching whether self-preferencing in search extends onto the phone.
- The industry-wide implication is that the smartphone becomes the primary surface for both information access and advertising, reordering which companies capture value across the ecosystem.
The trend: Google is completing its multi-year pivot from desktop search dominance to mobile-first strategy, a shift Schmidt has signaled since his 2006-2009 public statements.