Google Going Local?

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The word on the street for quite some time has been that Google wants in to the home services racket. The marketplace represented by all the work done by people like plumbers and lawyers is simply too huge to ignore. At the moment, most folks in the space (like Search Initiatives) focus on helping local businesses and national businesses with lots of locations drive business to those storefronts. Some sell leads, some build websites that do well in search, and some help those businesses spend their ad dollars to maximum effect. A great many of those ad dollars are going to Google, where the click prices for local search terms like “Plumber San Diego” are insanely high — over $40 a click in the case of that particular query.

The announcement last week that Google is buying HomeJoy and rolling their team into the Google-opolis reinforces the suspicion that something is afoot. The HomeJoy guys were essentially an Uber for house cleaning. They had raised a good chunk of funding, but were struggling with their latest round. They’re also getting into hot water in places like California, where the issue of their cleaners actually being employees rather than contractors was getting nasty.

Google now owns HomeJoy and a business reviews and profiles platform called Thumbtack. They represent different angles on the same space, and it’s likely that eventually, Google will pick a path and jump in.  The smart money says that Google will follow initiatives they have been announcing recently, where they become a vendor rather than only being the marketplace where all vendors compete. In local services, this means that a local plumber signs up and agrees to cut Google not how many clicks it costs to get a potential customer, but a piece of the actual value of the work involved. Amazon is trying something similar.

It’s likely that when they roll this out, the top results on search won’t be the people willing to pay the most for the click, but rather the people willing to cut the largest check out of the job value. The math runs something like this: it varies wildly, but many businesses will spend up to 10% of the value of a job on marketing. For example, an air conditioning repair guy will have to pay about $15 a click to have any chance of getting found on Google, actually closer to $30 to guarantee top spot, but $15 should get you some visibility. We know it takes around 5 to 10 clicks to get a solid lead, and most businesses close about 25% of all jobs they quote. That means a local business has to buy something between 20 and 40 clicks to get that billed job. That’s roughly $300-$600 of marketing cost per billed job in this case. As you can easily see, it’s tough to make money in the local search market where amateurs bidding on search terms are causing huge price spikes.

Given that Google is already earning a ton of money from this area, it will be interesting to see how they pivot into competing in the space. Convincing local businesses to buy search has been hard. I can’t imagine convincing them to sign over part of the contract value will be much easier. There will be questions like: how do they check on what got billed and paid? Is the job booked and collected by Google? What if the contract goes bad, and someone gets injured? Is Google essentially becoming the prime contractor and back office for local business?

It’s a massive opportunity, but also a huge potential pain in the neck. Local is hard, really hard. It’s the “Russian Winter” of the online space. It will be fascinating to see if Google has the stomach for the fight.

Fiber for Free?

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Google is now bringing its high-speed Internet connection, Google Fiber, to public housing scattered throughout the U.S. in order to ensure students can get online whenever they want completely for free. Google’s new initiative is part for the ConnectHome program launched by the government along with the US department of Housing and Urban Development. Google did not specify how many individual homes will be included in the new program.

As of now, Google Fiber is only available in a handful of locations including Austin, Texas; Kansas City and Provo, Utah. However, there are plans for expansion in Phoenix and Portland. As part of its plan of bringing Internet into public housing residents, Google also announced that it will offer digital literacy program for people who lack basic computer education or for those who are not familiar with the Internet. An early trial of the program was undertaken and proved that half of those who signed up for the program completed and passed the training.

Other Internet service provider has also showed their intentions of joining the project of bringing low-cost Internet to public housing. Century Link is planning to release a low-cost monthly Internet in Washington and Cox Communication is also gearing up to do the same in Louisiana.

VR Goes Hard Core

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I’ve been touting the importance of Virtual Reality for a long time now. It is, I firmly believe, the next big thing to hit all of us. There is a growing band of hardware producers coming out with headsets of differing sophistication, the games guys are charging ahead and there have been some interesting applications emerging recently. The killer app for VR just showed up, and, as predicted, it’s porn.

The adult industry has always driven the online world. Pretty much every innovation you could come up with, from online payment to HD streaming, was brought to us in good part by porn. The latest wave is starting to break over VR, and like it or not, it’s going to be a major driver for this industry.

The poster children for this innovation are a sex toy manufacturer called Lovense and an online VR porn studio called Virtual Real Porn. Neither gets major points for naming, but the product combination is fascinating. I haven’t tried either, and likely won’t, but the story is compelling.

The Porn studio dreamed up its own tech to film convincing VR porn, and the sex toy guys came up with devices that guys (ahem) plug into which generate physical sensations that coordinate with the visuals. Supposedly, the combined impact is remarkable. Why bother? Well, traditional porn relies on the point of view of the director. You simply see what the camera sees. In a VR deployment, you are essentially watching the action and can (to some extent) move around it to catch the action at different angles. What makes VR different is the fact that it generates “presence.” It fools the mind into thinking that you are actually there. Apparently, even in this early iteration, the impact is real.

Neither of these companies is making mainstream news, but then when was the last time you heard a story about the traditional porn industry (short of condom use and HIV scares). Globally, the adult biz is worth about $100Bn annually with the US contributing about $13Bn (that’s just a touch under what the magazine industry is worth). Those are huge markets, and especially given that the customers of this industry skew heavily male (and maybe geeky?), I’d expect adoption rates to be through the roof pretty quickly.

There’s a Brit TV comedy from the late 80’s called Red Dwarf. It’s a brilliant (if patchy) SciFi spoof, and one of its more compelling story-lines involves the Better than Life VR system. Essentially, you plug it in and you can be anything you want. You can date Marilyn Monroe, climb Everest, fly to the moon; all you need is enough credits on your system.  The unexpected side effect is that people become addicted to BTL more quickly and permanently than crack cocaine, leading to societal collapse. A recent survey of young men concluded that in many cases, guys would rather play games and watch online porn than actually put the effort into forming relationships with real women. Oh, dear. This may not end well.

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Glass 2.0?

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Really? Are we still talking about Google Glass? Apparently, we are. It looks like Google is planning an extensive re-launch of what is arguably its most divisive product, this time focused on the “Enterprise Edition.”

Just in case you missed my earlier four hundred rants about this product, Google Glass is the wearable tech that evolved the term “Glassholes” to characterize its users. Nothing says, “I’m white, entitled and I know somebody with juice in Silicon Valley” like wearing Google Glass. I tried it on a couple of times, and was reasonably underwhelmed by what it could actually do. However, the substantial product shortcomings never really got a fair hearing in comparison to the avalanche of deserved contempt the “ambassadors” wearing the product generated.

Glass became totemic for everything we hate about “those people.” The harder Google pushed, the more stories emerged about boorish Glass usage. Some of the stories are doubtless urban legend but there were enough of them to lead Google to eventually pull the plug on Glass as a consumer device.

Glass’ upcoming rebirth in the technical and medical fields makes a lot of sense. In the same way a surveyor or doctor might pick up their allocated equipment for each shift, so I can readily see Glass as a useful enterprise tool. The ability to show a distant colleague exactly what’s happening on the job at that point or recall data real-time without having to manipulate a device by hand is a great idea whose time has come.

It’s unlikely that Google will sell anywhere near as many items as they would had they conquered the consumer market as planned, but the numbers they do sell will likely be more robust, have longer battery lives and boast larger, more useful screens. They will also get the public more used to eye-wearables in general. Perhaps after we have gotten used to seeing our doctors or auto mechanics wearing Glass, we will become less bothered by the application as a whole.

Apple’s iPod Touch is Getting a Facelift

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Apple seems to not have forgotten its roots, as recent reports suggest that the iconic computer and phone manufacturer are releasing a brand new iPod Touch. Yes, it’s been a while since the iPod has really, really meant something in the world of consumer electronics, but new models will likely be announced this week. Additionally, the company is expected to unveil new models of iPod Shuffle and the iPad Nano.

Apple’s upcoming iPod Touch will likely offer a 64-bit processor, or the same processor as the iPhone 5S. The music player with touchscreen display is also expected to include an improved back-facing camera, and additional storage option including models with 128GB non-expandable internal storage.

This round of updates in the Apple factory should not have surprised anyone. Back in June, Apple launched the revamped version of its Music App to compete with Spotify. Adding new, inexpensive iPod Touch models with new bells and whistles could help the new Apple Music rake in additional revenue from new subscribers, although the new Apple music player is also coming to Android this fall.

Some have suggested that Apple might use the new iPods to sell more Beats Music-branded headsets and earphones. The new reports about the iPod refresh also comes as Apple introduces the new build for the iOS, a beta preview, and it highlights the company’s first attempt in the online news business.

RIP Google+

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Way back on June 6th, 2012 in the third month of this here blog, I bemoaned the annexation of what was Google Places, by the then upstart social media initiative Google+. At the time I said:

“Google+ has enjoyed rapid growth with millions joining the platform, but there appears to be good data that although many join, the level or return visits and engagement is much lower than on Facebook. Given that, Google’s strategy of fusing Google+ with the very successful and highly used Google Places follows the Google Buzz strategy of essentially forcing a large number of users (in this case local businesses and reviewers) to join the game.”

And now, a few years later, even after they forced users and businesses to come, the party has never really improved. The good features they came up with — like the pics and video streams and hangouts — have been carved off the corpse, the leadership has gone, and we are left with a platform that doesn’t even require you to create a profile to use Google products like Gmail.

Although they haven’t officially stuck a fork in it yet, Google+ is clearly done. What contributed most to the demise? Well, it’s exactly as stated back in 2012: engagement (or lack thereof). I have a rule of thumb, the “ten minute test.” when I come across something interesting online, I dig in, then eventually end up deciding if I’m prepared to dedicate about ten minutes a day to it to stay engaged.

I’m probably a poor use case in the example of Google+, since I really don’t do much Facebook (let alone Google+). But what’s clear is that millions of users went there once, did what they had to do to keep using Google products, and never returned. The upside of that limited engagement was that it did get most of us permanently logged into Google in general, and it allowed Google to get a much stronger handle on local businesses in general. Beyond that, there simply wasn’t a compelling reason to keep folks going back. People are busy. Finding time to check Facebook, Twitter, and Instagram takes time. It feels like most of us held an informal meeting and agreed not to participate.

The other problem with Google+ (aside from its weirdly un-intuitive user interface) was how restricted it felt. Google keeps a famously vice-like grip on its products, and Google+ somehow felt like a social platform designed by the Post Office; not fun.

In any event, Google is clearly unwinding the remains. It’s not a huge problem for most people as they weren’t using it in the first place. Some marketeers were exploiting the heck out of it, but I imagine even they will get over it soon enough. It’s another example of Google being fabulously great at a handful of things (most importantly search and advertising) and stumbling over many others. They always want to play, but they typically show up late and demand by sheer willpower to be allowed into the game. They don’t always win.

When AI Meets PC

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Google has spent many years and billions of dollars making its algorithms really smart. They detect behavior and the kind of content we look at, and then Google targets ads to users which its algorithms “think” fit them best. The recent calamity where it categorized African Americans as “Gorillas,” and more recently the one where it categorized a Chinese man as a “horse,” may be just the tip of a problem that most of us probably didn’t see coming.

If you make your algorithms super smart, the problem is they will behave as trained and work really hard to send the right ads to the best match, irrespective of the societal norms. In recent studies, researchers at Carnegie Mellon created fake male and female users and browsed sites which have a strong gender bias — think caranddriver.com vs. cosmopolitan.com. It’s not an exact study, but it’s an interesting approach. They then set these fake identities to browse gender-neutral sites and tracked what ads Google presented to the various fake users.

The results were striking. Male users of news sites like CNN were more frequently shown job ads with higher salaries than females on the same sites. They also found that an image search for CEO only presented 11% female results. Frequent browsers about addiction were sent ads for rehab.

Some of these results can be explained empirically. The fact is there are many fewer female CEOs, so the number of images indexed is likely proportionately lower. Likewise, the addiction result. Google tracks your browsing history, so if you spend a lot of time looking at fly fishing sites, it’s likely that’s what you will get ads for on CNN.  The fact that it also works for addiction feels different to fly fishing, but it’s not really.

The jobs and gender question is much weirder. It suggests that Google is divining your gender from your behavior, then making a value judgment. If we can assume that job ads don’t/can’t in the vast majority of cases specify gender, then it’s odd and perhaps worrying that Google is doing the math for us. It seems unlikely that someone in Google sat down and came up with this as a neat strategy. But rather, it’s probably the Google ‘brain’ watching the kinds of jobs people of different gender apply for and preferring those kinds of jobs to that gender because they are more likely to earn that click. Google only gets paid when ads get clicked on, so it tries really hard to fit the best ad to what it knows about the user every time. That’s fine for fly fishing, but weird for jobs.

I suspect that this is simply the unintended consequence of the AI running the ad platform getting a little too good at its job. In society, we adopt behaviors and constructs to address what we perceive to be intrinsic societal problems. We make extra efforts to be inclusive; we go the extra mile. AIs don’t have the same PC conscience, unless it’s programmed into them. I imagine there will be a bunch of changes made in the near future to “level the playing field” on this topic. Ironically, it will probably reduce the overall effectiveness of Google’s ad product in some areas. But that might be a small price to pay to avoid the discrimination law suits.

Breaking the “Capacity Limit” in Fiber Optics

With the amount of internet-connected devices increasing every day, the need for better, faster Internet is significant. University researchers have come up with a very clever solution to this problem.

Engineers at the University of California, San Diego have broken the “capacity limit” for fiber optic transmission, paving the way for faster, longer and potentially cheaper fiber networks. Currently, there is a limit on the intensity of light you can send through a fiber optic link, which arises from the fact that when you increase the intensity of light through a fiber cable, noise, distortion and signal dilution increases. This is called the optical Kerr effect, and it causes problems for fiber network designers.

Eventually the Kerr effect becomes so great that, at high intensity levels, distortion entirely prevents an outbound signal from being correctly interpreted by a receiver. The issue gets worse the longer a cable is, so to increase the transmission rate through a fiber optic link by increasing the intensity level while keeping noise at bay, you have to include signal repeaters along the way.

This new breakthrough helps increase the capacity limit of high-bandwidth fiber optic cables by conditioning signals with “frequency combs”, allowing the receiver to predict any noise that is introduced during the transmission. The ability to predict noise patterns means the receiver can reconstruct the intended data from the noisy signal. Thus, the amount of power that can be sent through a fiber optic cable can be increased significantly without worrying about the effects of noise. Researchers were able to increase the signal power in a fiber cable by 20 fold and still get data at the end.

The use of frequency combs also means data can be sent along longer cables without the need for repeaters, which has the potential to reduce the cost of fiber networks. For example, engineers were able to send data through over 7,000 miles of fiber cable with standard amplifiers and no repeaters. With this breakthrough, hopefully we can see the capacity of fiber cables increased beyond what is currently possible in real-world applications.

Does Google Have a Color Problem?

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The story this week that has been setting social media on fire is the one about the algorithmic miss classification of some photos by Google+.  The problem is that it classified a picture of a nice African American couple as “Gorillas.” That’s horrible, and what’s worse is that the only way Google could find to fix the immediate problem was to remove the tag entirely. Obviously, it was a mistake and Google apologized profusely.

Image recognition is much tougher than you might think. I read recently that at any given moment, about 65% of our brain processing power is focused on visual processing. We are extremely good at it, and we evolved that skill over millions of years. We recognize things and people with incredibly few visual clues. Expecting software to be as good as we are is probably unrealistic.

Having said that, this oops moment does perhaps point to a larger problem. Silicon Valley is horribly white. Actually it’s white and Asian, by which I mean mostly Indian Asian. There is a sprinkling of Latinos and about 2% African American. In short, Silicon Valley is a privileged white, first-generation, super-educated immigrant mix. I don’t recall ever seeing a black face in a meeting. Companies like Google promote diversity, but any visitor to their cafeteria (a fantastic place BTW) will be struck by the mass of pencil-necked geeks and button-down collar-wearing senior nerds and the phalanx of Indians (the Indian food there is first class BTW).

If all the diversity you have is white and green card, it’s less likely that anyone is even thinking about checking things like algorithms for culturally disastrous mistakes like this one. Nobody looks like them, so nobody checked. I guarantee that there are special routines built in to check for things like Native American vs. Indian sub-continent. I wouldn’t be surprised if there is special code to try to differentiate various Asian groups, but clearly not black.

It’s a problem without an easy fix. Graduation rates, etc. are lower in some communities, but companies like Google could invest in urban tech programs. Maybe fund a few charter schools in cities that aren’t San Francisco. At the very least, they could check modules like the one in question for obviously offensive situations like this one. If you live in a bubble, this kind of thing is likely to keep happening.

Google Accused… Again

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There are some arguments that just won’t go away. The “Google is skewing their results” argument has been kicking around for several years, and a new version has just popped up. I’ve commented multiple times on this deathly dull topic, but let’s review for old time’s sake.

Google skews its results. It’s a simple fact. They have done it for years. For example, if you use SafeSearch, it will skew away from adult content. When you make a local search, it skews results to fit your location. Nobody complains about that kind of skewing; it’s the type where they favor their own results or partners in reference to a competition that causes concern.

The FTC investigated this a year or more back in the US and found no fault. It’s unlikely to revisit this challenge, in part because it’s tricky to prove and in part because Google has a monster lobbying engine and the tech jobs issue (much like guns) is a third rail issue. The equivalent of the FTC in Europe is looking at taking on Google. Those EU guys hate Google with a passion and are always on the lookout for a stick with which to beat them.

This latest stick comes from a study commissioned and paid for by Yelp. That in of itself probably makes it worth less than the paper it’s printed on, but it’s an interesting study nonetheless. Essentially, they showed Google search presentations with and without the Google “Focus on the User Listing” OneBox container. In their testing, they found that users clicked on the plain results rather than the optimized version 45% more frequently. Their conclusion was that Google is deliberately sabotaging the end user by making the results less easy to use, forcing users to search again or…what, give up in tears? For a complaint of this kind to prosper, you have to show harm, and their version of harm here is a lower click through rate.

They aren’t claiming that a Google OneBox business being preferred is actually benefitting Google financially. Rather, by featuring OneBox registered businesses, Google is harming the end user. The overall claim is at best paper thin.

There are several quite good reasons why Google often prefers OneBox results. To start with, OneBox businesses have taken the time to validate their business, confirm the info is correct and, in many cases, create a nice business profile page that the searcher may well click through to. Either way, what does seem to be clear is if this is annoying users, it’s doing so to the extent where they are changing their search engine. Most people have bigger fish to fry.

Search and how that search is presented (much like the weather) is a big, complicated topic. If you stare hard enough, you are bound to find things that might look a bit off. Keep staring and it will change. Complaining about it to an FTC which has been bought and sold by Google won’t get you very far. I imagine these researchers will be mailing their results to the EU commissioners right away.