Eric Schmidt: 'Gang of four' driving innovation and growth

By on June 1, 2011, 9:00 AM

Google's Eric Schmidt sat down for an hour-long chat with All Thing D editors Kara Swisher and Walt Mossberg last night at the kick off to the D9 conference outside of Los Angeles.

Besides facing questions about privacy and U.S. antitrust investigations, the executive chairman and former CEO had some interesting comments to make about rivals, his company's failure to go social, and what he believes is a "gang of four" driving innovation and growth in the industry.

On the latter, Schmidt noted that there are four companies exploiting platform strategies very well, allowing other companies to build additional value on top of their services to the benefit of both consumers and shareholders. This gang of four, according to Schmidt, includes Google, Apple, Amazon, and Facebook.

The combined value of these four companies is more than half a trillion dollars, something unprecedented in the history of tech were single, large platform companies used to dominate -- IBM through the early 1980s, followed by Microsoft. He omitted the latter from his list because it doesn’t drive the consumer market anymore and is largely an enterprise play. Even though they have succeeded with the Xbox, Microsoft main business is still by far Windows and Office.

Furthermore, Schmidt believes that a shakeup among the gang of four could come at any time, as there's an inevitable slow-down when companies get big, middle aged and boring. Product innovation is absolutely required to avoid this and in his view Twitter and PayPal could be possible gatecrashers into the select group.

Schmidt also took responsibility for the search giant's failure to counter Facebook's explosive growth in social networking, saying he saw the threat coming but failed to counter it. He gave credit to Facebook for mastering "identity" on the web and said they tried very hard to work on a search partnership, but Microsoft ultimately won that deal.




User Comments: 8

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brianmsu said:

Boooooo. He should know that this is the real gang of four:

[link]

yukka, TechSpot Paladin, said:

Dismissing Microsoft there as no one uses Windows in the home - just the enterprise. In the consumer space its apple vs googles chromebooks - the real heavy weights.

Guest said:

Gang of four, and he happens to be tightly associated with two of them - Google and Apple? That's pretty self-serving, I must say. I use FaceBook once every week (or month), and never used Apple. I shop at Amazon once every two months, maybe. But I use Windows every day (and right now). I understand his argument, but still, the dismissal of Microsoft from the list is not justified.

Staff
Rick Rick, TechSpot Staff, said:

Guest said:

Gang of four, and he happens to be tightly associated with two of them - Google and Apple? That's pretty self-serving,

I thought the opposite: His ties to Apple aside, Google and Apple are actually competitors.. in a very direct way with Android vs iPhone.

Kind of respectful of him since one of the rules to big business is "never acknowledge your competitors"

Tanstar said:

yukka said:

Dismissing Microsoft there as no one uses Windows in the home - just the enterprise. In the consumer space its apple vs googles chromebooks - the real heavy weights.

Is this sarcasm? Or are you just that out of touch?

ramonsterns said:

Apple?

Innovation?

Does not compute.

Archean Archean, TechSpot Paladin, said:

Okay, if their 'innovation standards' are like this, I guess yes they are getting better. Beside, he seems to be delusional, when he says that MS doesn't drive consumer market. For some reasons, my feeling is Google perceive themselves to be more important then they actually are.

princeton princeton said:

Tanstar said:

yukka said:

Dismissing Microsoft there as no one uses Windows in the home - just the enterprise. In the consumer space its apple vs googles chromebooks - the real heavy weights.

Is this sarcasm? Or are you just that out of touch?

Obviously it was sarcasm...

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