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Mesoth.net - unidentified speaker: --afternoon and welcometo the marian miner cook athenaeum. it is always a pleasure to have an alum speakat the athenaeum, and at that, a repeat guest. jonathan rosenberg, class of 1983, is both.he oversees the teams that manage google's innovative product portfolio and go-to- marketstrategies. he directs the teams with his special focuson delivering exceptional user experience, continuous innovation and a highly relevant,accountable and untraditional marketing. prior to joining google in 2002, [microphone noise] mr.--ooh-- >>unidentified speaker: that was me! sorry!
>>unidentified speaker: okay. [everyone laughs] mr. rosenberg was founding member of @home'sproduct group and served as senior vice president of online products and services after themerger of excite and @home. prior to that, mr. rosenberg managed the eworldproduct line for apple computer. earlier, he was director of product marketingfor knight ridder information services, where he directed the development of one ofthe first commercially deployed online relevance ranking engines.mr. rosenberg graduated from cmc with a degree in economics, with honors and phi beta kappa.he has an mba from the university of chicago.
the robert day school of economics and financeis sponsoring today's talk. please join me in welcoming back jonathanrosenberg to the ath. [audience applauds] >>jonathan rosenberg: thank you!i'm particularly pleased; i have my son, josh in the audience. josh, you can wave. [laughter]his mother looks just like him. you could mistake her for a student.i was going to say that, but she's not here and i'm not going to get the credit for it. [laughter]so in january, a group of cmc students--some
of them are here--visited the google campus.and they were really uncomfortably overdressed in suits and ties, right? you remember that?but worst yet, they were painfully glum about the world's prospects, as well as their own.i thought about this, and i realized that the students' mood should really come as nosurprise. they all go to a school whose motto is--anyone?did you graduate from this school? do you remember the motto? [voice off microphone; unintelligible]no, matthew! [laughter] crescit cum commercio civitas. what does itmean?
[voice off microphone; unintelligible] we're going to give credit for that one.civilization prospers with commerce. and just as you guys all approach graduation,commerce plummets, qed civilization does not prosper.you might as well all hang out at beckett hall with a beer and bemoan to your buddies,"lilliput is doom; the ropes are too big; gulliver is too big; we're all going to die!"and--you know--the data confirms your bias. the dow is down 50%, we've got job lossesof 2.5 million in 2008. you should all be concerned about the futureprosperity of all civilizations. and to add a spark to this depressingly combustiblesituation, as the guy watching the world searches,
i assure you, i have my finger on the pulseof many people. and the apocalypse in fact may well be uponmany of us. search volume on unemployment benefits increasedfive times from over last year. major bummer! it sucks to be alive!no wonder the students who visited me were all glum! remember?so i asked the students, what did general electric, fairchild--which later spawned nationalsemiconductor and intel--apple, oracle, and amgen.what do all these companies have in common, do you remember?they were sprung out of recessions, right? ge in 1876; fairchild in 1957.and during my own career, i watched apple,
oracle and amgen all correctly navigate the1982 recession and emerge much stronger. we also talked about great innovations thatwere born during the great depression, right? what did the great depression give us?the dc-3, the commercial workhorse of aviation for many years in 1935.we did--the beer can! i said the beer can--matt (s/l pikings') personalfavorite, that kept things cold in 1935! and xerography, otherwise known as copying--whichactually was invented in 1938 by a man who was laid off from bell labs,and got tired of copying patents and patent applications at the patent office by hand.so this means that we shouldn't let this recession--no matter how severe it is--convince us thatwe can't achieve great things.
in fact, bad economic times are actually fertilegrounds for innovation. there's an old adage--i believe it's attributedto samuel johnson--"nothing focuses the mind like a hanging at dawn," or a mid-term atdawn. but no one is getting hung in the morning.there's no gallows being erected at your commencement ceremony.but i think we can use the recession to focus our minds, and i'm optimistic that if we alldo that, we'll actually come out okay. so i'm an optimist. why am i an optimist?well, because i am one of those guys from silicon valley and we drink the kool-aid oftechnological optimism. and my optimism was further inspired wheni heard president obama's inauguration speech.
you see, i actually voted for mr. obama, soi wanted to listen to his speech. and for those of you who voted for the otherguy--news flash--obama won, [laughter] so you should listen to his speech--youshould have listened to his speech as well. as an american, i asked myself, "what are--?"so obama actually asserted in his speech that we'll face this challenging moment with whathe called, "new instruments and old values." values that have been the quiet force of progressthroughout history, and which must once again, define our character.so as an american, i asked myself, "what are those new instruments that he was referringto? what can i do for my country?" so i think--and this is not to go back toprofessor snortum's class--an example of maslow's
observation, that when you have a hammer,everything looks like a nail. to me, i think he was referring to the internet.the internet is the most powerful and comprehensive information tool ever developed--and you guysknow all of that. but i think we sometimes forget how earlywe are in the nascent stage of its growth. so today, what i want to do is share fourobservations on the future of the internet, and also the promises that these four trendsportend. and i also want to offer some advice on whati would do if i were like you guys in light of these trends.so for the record, i really do wish i were you and i wish i could trade places with eachof you. it's true.
observation number one: all the world's informationwill be accessible from the palm of every citizen.today we have 1.4 billion people connected to the internet.that's a quarter of the world's population and we're adding people at 200 million a year--hundredsof millions a year. 200 million new people are coming online everyyear. look at the number of servers.back in 1983--when i was here--the commercial internet consisted of just 400 servers worldwide.now, 26 years later, it's got over 600 million. what are--you see these statistics--but likewhat are these servers doing? they're storing information and they're lettingpeople access it.
so we've got all this information exploding,people can access it from everywhere. in many parts of the world, how are they accessingit? they're accessing it on their mobile phones. more than 3 billion people have mobile phones.but what's more interesting is that we're going to see more internet enabled mobilephones sold and activated in 2009, than personal computers.think about that--more phones than personal computers.does anyone remember what apple's tagline was for the mac when it first launched 25years ago? you guys were there with me. "the computer for the rest of us," right?well today, the "computer for the rest of us" is a phone.in just my professional lifetime, we've overcome
all of the issues that basically precludedcomputers and mobile devices from delivering on the promise of ubiquitous information.the marketing people used to call it--in 1980--"winki wink--" we thought it was very clever--whati need to know, when i need to know it. but you couldn't get it because you neededthe information to get online. and you needed massive processing power toindex it. and then you needed to connect by a broadbandpipe, and then you needed to layer on a browseron top of this, and you had to solve all the copyright issues.finally, we got all of that stuff solved and everybody could get the world's informationon a pc.
more recently, we've tackled battery life,fast wireless access, more readable screens and usable input mechanisms,and we can all get all of the world's knowledge on our palms, on a phone.to truly appreciate this whole secular shift of information, go back thousands of years.the library of alexandria, built in 323 bc; it was built for an educated public.that actually meant very, very few people, because the skills of literacy were withheldfrom most of the population. the first universities came about around the4th century ad. you would think that would have been a bigstep forward for everyone. but in the middle ages, professors lecturedin darkened classrooms so that students couldn't
copy and steal the notes.jerry, you could have won "most handsome professor" award in the middle ages.[laughter] the first formal encyclopedias didn't appearuntil the 16th century, and truly public libraries didn't come about until the 19th century.then the internet shows up, right? and from the most remote village on earth,down a long a dirt road in bombay, a kid can have access to all of the information in theworld's libraries. so in other words, information has completeda transition. and the transition--which is very importantif you're an economics student--is from scarce and expensive to ubiquitous and free.when it does this, we're going to see what
i call, "the true democratization of information."everyone who wants to be online will be online, and they will be able to access everything.any change in the means of production has profound implications for the relative valuethat you can add in your career. and i'll talk on that--i'll speak about thatat the end. so here's all this information. well, whatsort of information are people accessing? brings up observation number two: publish.everyone can publish, so everyone will. it's that simple.one think i've learned in the internet industry is that people have a lot to say.there are 900,000 blogs posted every day, most of them have an audience of exactly one.in the u. s., 40% of internet users upload
video on a regular basis, and the number isgoing up fast. globally, we have 15 hours of youtube beinguploaded every minute. this is equivalent to 86,000 full length moviesevery week. i mean, you guys--you guys could just getout in the world and watch youtube videos every day for the rest of your lives,if nobody uploaded another thing, and your parents would be very proud, right?publishing used to be constrained by physical limitations.you had to have a printing press and a way of distributing a newspaper or a magazine,or you had to have a transmitter or something to publish to critical mass.we had freedom of the press, for anyone who
could afford one.but today, most publishing is done by users. how many of you use twitter or facebook?right, like all of you. how many of you upload videos to youtube?how many of you make entries on wikipedia? you guys are all publishers, right?when everyone can publish, free speech becomes no longer just a right granted by law, butone imbued by technology. here's a remarkable example: january 15, theus air jet lands on the hudson river in new york.a man by the name of janis krums happens to be on an adjacent ferry, and he snaps a pictureof it. so what does he do? he could have sold itto the highest bidder.
but instead--that's a process that could takemaybe days or a week or so--instead, he posts it online and he sends a tweet with a link.the photo was available to the world within seconds--instantly--for free.the era of information being more powerful when it is hoarded, has passed.if you have something important, insightful or interesting to say, say it.you will be better off and so will everyone else.unless it's like some of those programs that you're putting up now, but some people watchthem. in the early days of the web, every documenthad at the bottom, what? what was at the bottom of every document 10years ago?
there's no lawyers in the room! "copyright1997, do not redistribute," right? under penalty of whatever.now, what do the same documents have at the bottom? "copyright 2009, click here to sharewith all your friends." sharing--not guarding information--has becomethe golden standard of the web. of course, a lot of what people say onlineis not important, insightful or interesting. it's sort of one of these good news, bad newsthings, right? the good news is, anyone can publish. so what'sthe bad news? the bad news is, just about anybody does,right? have you ever logged on to a stock messageboard?
"stock's going to go up tomorrow.""no, the stock's going to go down tomorrow, you idiot!""no, it's going to go up tomorrow, you idiots, idiots, idiot," right?i have this vision of like two guys in their 30s, and they live in their parents' homesin the basement, and they're like sitting on the other sideof cable modems, hiding behind the anonymity of the internet, firing salvos of mindlessdrivel at each other. well i didn't spend my career making cablemodems ubiquitous, information easy to find and publish, so that we would have to letthese losers ruin our internet. it's a serious problem. the clamor of junkthreatens to drown out the voices of quality.
and there's an obvious place where these voicesare struggling. it's called the newspaper industry.the internet's completely disrupted their business model.it used to be classified ads subsidize the rest of the paper--no more.telling example: last year, in may, a newspaper in myrtle beach announced it would no longershow classified ads. so i thought about like, "what does this mean?"it means the cost of the paper and print exceeds the amount of money they get from printingit. they took the classified ads out.i wrote an e-mail to friends and i called that, "the day print died."if newspapers don't make money from classified
ads, they're in terminal decline.and we're seeing this. last month, the rocky mountain news in denver--a150 year old paper--closed its doors. well this is a problem--this is importantbecause newspapers have historically been the backbone of quality, original reporting.if you actually read something good online--if it's an article, a blog post, or just aboutanything else-- chances are, it originated somewhere alongthe line with an old-fashioned reporter. i spent an afternoon last weekend with bobwoodward, from the washington post. and i can tell you, the world is a betterplace when we have investigative journalists, like bob.to turn this around, the whole field of news
needs to change.the experience of consuming the news on the web today is broken, because it doesn't takefull advantage of the power of technology. when i go to the new york times, it shouldknow what i'm interested in and what i've done since my last visit.if i read a story on obama's budget, 6 hours ago, the next time i go back, why isn't itjust showing me the updates that the reporter has filed since then,and the most interesting responses from informed readers and bloggers or other sources?if thomas friedman posted something, i want to read it.i always read thomas friedman, it should tell me that on the front page.reporters should pay attention to the wikipedia
model.they actually get many things right; there's a name and a unique url for each significantsubject-- the super bowl, the economic stimulus package,claremont mckenna college--and they all have links in them--links matter.and in particular, in reporting, links to original sources matter.most original sources are actually on the web--if you mention a law, or you mentionthe budget, or government spending-- why aren't there links to all these originalsources? that should be the job of the reporter. and then every edit and draft and link matters.journalism is the first draft of history and it should be much more than slapping a bitof customization on an ap or a upi feed.
browsing newspapers needs to be rewardingand serendipitous online, like it is offline. and the way to fix that is technology.the same thing is true of other experts. the web only gets better if we get more informationfrom scientists, doctors, scholars, engineers, professors, architects--everyone can benefitfrom their work. the question is, "how?"that leads to my third observation: when data is abundant, intelligence will win.when you put the power to publish and consume content into the hands of more people andmore places, what does it mean? it means that everyone starts conversationswith facts. with facts, negotiations are no longer aboutwho yells louder, right? i'm very good at
that.but they become about who has the stronger data. the data becomes an equalizer that enablesbetter decisions and more civil discourse. let me give you a couple of examples: thesuri tribe in the amazon used google earth to identify, for government officials,where illegal logging was occurring at the boundaries of their territory. they stoppedthe logging. let me give you another example: senator clintonclaimed during the 2008 campaign, she came under fire on the tarmac in bosnia--you rememberthat? well, youtube videos of her lovely greetingceremony on the tarmac quickly refuted that claim.information transparency helps people decide
who is right and who is wrong, and determinewho is telling the truth. when politicians talk, we should have likea little lever on our chat boards, and people should be able to vote,and it should be clear from the online community whether or not they're telling the truth.and if they're lying, it should go like, [makes an alarm sound] nope she didn't dothat. information and the truth is like an oyster.it has its greatest value when fresh. and soon the truth and updates will be nearlyinstant. value of data is even more transformationalwhen you think about businesses, than it is for politics.coal fueled the industrial revolution; data
is fueling business today.one of the largely unheralded byproducts of the whole internet generation is how the powerof sophisticated, analytical tools are now available to the smallest businesses.let's say you have a blog or a website, right? how many people go, and what do they do, andwhere do they come from, and what time of day do they come in, whatpages do they visit, how often do they actually buy something?a few years ago, an analytics package for that would cost thousands of dollars.today, it's free and it's better. data leads to intelligence and the intelligentbusiness or blogger will be the successful business, regardless of its size.this is why president obama has promised to
do our business in the light of day, and whythat's important. because transparency empowers the populousand demands accountability as its immediate offspring.finally, observation number four: the vast majority of computing will occur in the cloud.if you don't know the technical jargon of silicon valley, the "cloud" is where all ofyour content is--the computer resources that you can access by the web.raise your hand if you use a web-based e-mail system--aha! i'm sort of cheating becauseyou guys all use gmail, but keep them up! how many of you store your photos online--someplacelike picasa or flickr? you--my wife's hand should be up!how many of you access your calendar on both
your phone and your pc? ooh, way to go! hon,you're the future, along with the rest of these people, right?within the next decade, people everywhere will use their computers completely differently.all their files, all their correspondence, all their contacts, all their pictures, alltheir videos will be stored and backed up in the network cloud.access to this data and content will be seamless and more importantly, it will be device agnostic.it's nice that we can keep all our stuff in the cloud, because that means you don't loseeverything when you like drop your pc, or lose your phone, or spill coffee on it.but the real potential of the cloud is not in taking the stuff that used to live on yourpc and putting it online,
but it's the things that we can do that previouslywould have been impossible. for example, computer mediated transactions;computers mediate virtually every commercial transaction;they record it, they collect data, they allow you to process it.why does that matter? monitoring is what makes for better contracts.if you shipped grain in the mediterranean in 8000 bc, before there was written language,how did they make sure that you consummated the contract correctly?you didn't pay attention at the british museum when your parents took you around there whenyou were a kid? okay, clay tokens--they were called bollae--andbasically what you did was you matched the
number of tokens to the grain loaded on theship, you sealed the tokens in a hollow clay envelope,you stuck a stamp on it, you baked the clay in a kiln, you sent it with the shipment.at the other end, the other guy broke open the envelope, counted the number of tokensto the quantity of grain in the ship, and he knew if he got what he was supposedto, or if they ship's captain stole any grain. we've come a long way since then, but theresults are the same. better monitoring means better contracts.cash registers showed up in 1883. have you ever thought about why they had a bell?or why they actually then evolved so that there was tape that recorded all of the transactions?same thing was true in the 90s, with semi
trucks and vehicular monitoring.same thing was true when rental video first came out; it was too expensive for the blockbustersto buy the movies from the studios, but the computer systems in between allowedthe studios to just give them to the blockbusters for free, and only get paid when people rentedthem. online ads is the same thing. since googlegot started, advertisers have only had to pay if the user clicks.and ultimately, they could only pay if there's a conversion. you can think of amazon andlots and lots of other examples. but think about the contracts that could beenforced better today, through computer mediated transactions in the cloud.how many times a day do you interact with
a computer? a mobile device in your car orat the bank? every time you make a purchase at a storeor on a laptop--let me give you an example: would you accept a 30% discount when you renteda car, if you knew the car rental agency could record whether or not you exceeded the postedlimit? maybe, maybe not, but it's your choice. youcould be better off having that choice. so convergence isn't something that's happeningat the device level--that was the vision we all had in the 90s--and it was wrong.devices are proliferating in all sorts of directions and everything is converging inthe cloud. in the near future, the cloud is where allof your stuff--not to mention civilization's
knowledge--will live, and it will change theway we do business. so what does this mean for you in practicalterms? these trends that i gave you are going toform the context of your career. a whole lot has changed since i graduatedin 1983--we didn't have cordless phones, remember--we didn't even have--never mindcell phones--[voice off microphone; unintelligible]-- yeah, i had a computer and you know what?it had two floppy drives and you had to boot off the floppy drives,and then i went to business school and i worked all summer to buy a 10-megabyte everex harddrive, and i had to like flip the dip switches tostick it in the computer
and i had to then borrow from my father tobuy the diablo daisy wheel print--clackity clack--printer that i took to business schoolwith me. i mean, it sounds like a long time ago.but the context for my career at that point was very different from yours today.what did i do? i had a simple observation and insight that information was power.there was a revolution in internal information systems in the 80's, so i went to a companythat was working on software for many computers. then it became clear that pcs and externalinformation were going to become ubiquitous, and so i went to dialog.the problem was, they lived in a proprietary world of closed standards and expensive information,and it was very difficult for users to get
at the information.so i went to apple, where we made a user interface that made getting information easier.it was called eworld, and then i went to @home, where we built the infrastructure for fastaccess, and finally to google, which really takes advantage of pretty muchleveraging all of the above. but many of the aspects of how i approachedmy career are just as true today as they were then.i've given you advice before--some of my original rules from past visits--which i will reviewvery quickly. jonathan 101: don't go into a profession thatonly scales with the number of hours that you put into it. you want to do things thathave leverage.
don't be a dentist, don't be a consultant,don't be a lawyer--unless it's contingency-based--don't be a massage professional.a prostitute is also a yucky career choice! [laughter]careers are like surfing--i gave you a whole lecture on that--it's not enough to be great at what you do, you have to catch one great wave and thatonly happens in growing industries. if you haven't heard my talk on that, youcan ask. i can go do a whole sermon. but it's why i focused on technology.and know the value of a solid liberal arts education. [laughter]learn to learn. there's too much accumulated
knowledge today, to learn everything in college.newton used to say he stood on the shoulders of giants. well the giants are too tall.you can't learn everything anymore, so just learn to learn. you'll use that for the restof your life. so what would i do differently today if iwere you, preparing for a career in this future with ubiquitous information?four things: be open, we're in the midst of a period of innovation and it's driven largelyby openness. our chief economist, hal varian, calls it"combinatorial innovation." there's this availability of different componentparts and innovators can combine them--or recombine them--to create fabulous new inventions.if you think about it, this is what drove
history's great periods of innovation.in the 1800s, it was interchangeable parts that drove the industrial revolution.in 1900, it was the gasoline engine and improvements in manufacturing.and then in the 1960s, it was integrated circuits. but today, the components of innovation arefound in cloud computing. it's got abundant apis, it's got open sourcesoftware, everything is low cost, it's all pay-as-you-go.the components are available to anyone who can get online. they're bits, protocols andlanguages. and note that it costs next to nothing togrow the next great website or software application, or to build online maps, models or mashups.or if you create the world's next great tv
show or movie, you can distribute it quicklyto the entire world. with software, there's no inventory problems,no issues shipping and distributing around the world, working in parallel, and no bigtime to manufacture issues. in this model--which we call "combinatorialinnovation--" individual components have to be compatible with the rest of the system,they have to be complimentors. so these new technologies don't exist in avacuum. companies have to focus on their collaboratorsas much as their competitors. in this environment, open systems win.advice number two: assume a supercomputer. how does that change the way you think oryour career when you assume that storage,
bandwidth and processing are all basicallyfree? when google started, larry and sergey couldn'tactually do the work that they needed the search engine to do,because the processing power that they needed to do it wasn't there.but they just said, "oh well, in a few years, it will be."chad hurley, when he started youtube, had similar observations.we didn't have enough cell phones that had video on them--the bandwidth to actually dovideos wasn't there. the client's software was required to downloadthem and he saw, "no, you'll be able to do this in a browser;we'll be able to do this in an open way, and
these cell phones will be out there."and now, we've got 15 hours of video being uploaded a minute on youtube.there's no limit to the ability of these technical tools that are going to be at your disposal.if the technology doesn't exist today, it will very soon.do a simple moore's law thought exercise; if processing power doubles in 18 months,in five years, it increases by a factor of 10; in ten years, 100; in 15 years, 1000.your kids--which hopefully you won't have in 15 years, maybe make it 20--10,000.imagine what that means in the power of your hand.advice number three: become a data samurai! why? the sexy job in the next ten years isgoing to be statisticians.
why? because once we all have access to freeand ubiquitous data, what is the scarce factor? the scarce factor now becomes the abilityto understand that data and to extract value from it.the democratization of data that i talked about means, those who can analyze it when.and think about the robert day school--it's exactly the type of program a samurai of datawould take. the courses are meant to prepare, in manyways, a student to be something like a quant jock on wall street,but you would take the same courses to be called a "data samurai."if i taught it, it would be called "data mining for fun and profit."
and you would take statistics, data visualizations,communication, machine learning and scripting. that's what google, yahoo, ebay and amazonall need, but more importantly, it's what all the companies,who live in the ecosystem of advertising and publishing online, will need.my own new line, data is the sword of the 21st century. those who wield it well, thesamurai. [makes sound like a swinging sword] remember that! [laughter]fourth observation: think big and solve the biggest problems.so you've got a supercomputer, you've got
data, you're a samurai and you know how touse it, you have open systems through which you canharness the power of the crowd, so why solve a small problem when you can solve a largeone? shortly after we started running ads on google,some people came up with the idea that ads on google search results could be copied,and this set of engineers could run those same ads on other web pages.and they said, "you know--there's hundreds of millions of web pages--hundreds of millionsof searches a day, but there's billions of web pages, we should go after like all ofthose." and today, adsense is a very large, successfulpart of our business.
even if you don't get the outcome that youexpect, if you aim to solve the biggest problem, there's a good chance you'll solve small onesalong the way. take christopher columbus--he was stuck waitingfor eight years for queen isabella to drive the moors out of southern spain, before hecould get funding for his big, big vision. his big vision was--?" find india, right?what did he find? america! who would call him a failure for having found that--not foundthe route to india? when i graduated from business school in 1985,ronald reagan said, "we live in a time ã¢â‚¬ëœlit by lightning,'" and that's what set the tonefor the era in which my career evolved.
today, you guys have come of age in an evenmore remarkable time. facing amazing challenges and armed with theseinstruments that president obama believes you need to surmount them.so i want to conclude by offering my final career advice for all of you today: don'tworry about the recession. don't sit on the sidelines, crying in yourbeer, singing mike and the mechanics', "every generation blames the one before."you can spend your life a critic of those who ruined your shot at making crescit cumcommercio civitas, or you can remember the words of the presidentwho best embodied the spirit that we need today. his name was teddy roosevelt and hesaid,
"it is not the critic that counts, nor theman who points out how the strong man stumbles, or where the doer of deeds could have donethem better. for the credit belongs to the man or womanin the arena, whose face is marred by dust and sweat and blood, who strives mightily,only to err and come up short again. his place or her place shall never be with those coldand timid souls, who will know neither victory nor defeat."now if you're not a fan of presidents and teddy roosevelt, maybe you're partial to pinkfloyd, who sang, "if you should go skating on the thin iceof modern life, don't be surprised if a crack in the ice appears under your feet."so students, don't be roosevelt's "timid soul."
jump through that crack in the ice.come on in, i can assure you the water is freezing! [laughter]thank you!