"When people ask me what I do, I answer in all seriousness, ' I'm building a start-up," says Google Israel country manager Meir Brand. "I took up my post in 2005, and there were just two of us. Today, there are more than 100 employees working at our two R&D centers in Haifa and Tel Aviv." Brand was answering questions from businessman and veteran technology entrepreneur Yossi Vardi during a panel session at the recent Silicom Ventures conference in Tel Aviv.
Even if Brand himself feels he is building start-ups, Google would hardly fit that description. Having become a multi-faceted organization with a global reach, Google now faces the challenge of maintaining its organizational culture. A $165 billion company, in spite of everything, is no fledgling start-up.
Vardi asked Brand what Google was doing in Israel as far business development and R&D is concerned. "Google Israel is a mirror of our business in the US, and the reason Google opens R&D centers in many countries is to localize products and be closer to consumers and advertisers, with the aim of helping them understand how the Internet can be used to leverage business," he replied.
"As far as R&D is concerned, we’re focusing on advertising, search technology, and applications, and we're working in cooperation with centers in other countries," Brand added, and gave an example of a product developed in Tel Aviv - Google Trends, which provides information on search preferences, the terms most popularly used, and through them, the topics that people are most interested in. Another product developed in Haifa, enables layers of textual content to be overlaid on video clips broadcast on YouTube, with the aim of creating an enhanced interactive viewing experience (a similar product is being developed by PLYmedia).
Vardi asked Brand whether there has been any change in the size of the online advertising segment in Israel's advertising market, to which he answered, "We've made a lot of progress, but we still have a way to go. Four years ago, the online advertising segment amounted to 2-3% of the total advertising market in Israel, and this has since grown to more than 10%. It has happened because there has been a change in consumer behavior. For some people, the Internet is the central arena in their lives, and telecommunications and searches are the two most popular services online." Brand added, "advertisers realize the enormous potential inherent in the creation of interaction with consumers on the web, and this is also a very quantifiable tool."
Vardi asked Brand what the most expensive search term is in Israel. "It's quite dynamic," he answered. "Overseas, names of drugs, for example, are very expensive. In the UK, the word 'mortgage' costs ₤20 per click, while in Israel the price ranges from $1-2 per click." Brand was also asked by another panel member why Google's cost-per-click had risen "even faster than the price of oil" and whether this was set to continue. "Yes it will. Like the financial world, there are arbitrage gaps in the media market as well," replied Brand. "The price advertisers pay to reach a customer on the Internet is much lower than in other media. So advertisers are putting more and more money into the Internet. This trend will continue until the gaps narrow. It won't necessarily create a preference for large sites with a lot of money for advertising, but rather for those with the highest conversion rate."
As for cellular Internet and Google's "Android" mobile platform, Brand said, "Cellular Internet is still a closed garden like the Internet was when it first started, and that is not conducive to innovation in the field. Nokia has issued a forecast, which predicts that in ten years time, two-thirds of the world's population will have cellular handsets, and in emerging markets people will have handsets before they get computers. We believe in having an operating system that is open and free, and the longer people spend browsing through cellular Internet, the larger the volumes of advertising that will move from the Internet to mobile. I'm certain we won't be the only ones to initiate something in this field."
Published by Globes [online], Israel business news - www.globes-online.com - on July 21, 2008
© Copyright of Globes Publisher Itonut (1983) Ltd. 2008