Social Enterprise

Schmidt calls tech a 4-way race: Google, Apple, Amazon, and Facebook

Google chairman Eric Schmidt sees four big platforms dominating the current technology era. See why Microsoft isn't on the list and what Schmidt thinks about the destiny of IT.

Google's executive chairman Eric Schmidt kicked off the annual D: All Things Digital conference with a bang on Tuesday night in a wide-reaching interview on the current state of the technology industry, his new role at Google, what he really thinks about privacy, and his opinions about Google's main rivals.

The most interesting part of the conversation was when Schmidt talked about his "gang of four." He said Google, Apple, Amazon, and Facebook have built platforms that are driving today's consumer revolution in technology.

"We've never had four companies growing at the scale those are, in aggregate," Schmidt said.

In the past, it has typically been one company and one big platform at the center of the technology world, Schmidt said, and he pointed to IBM and Microsoft as the leaders of previous eras.

However, he doesn't see Microsoft as one of the main players anymore. He suggested that there's a big drop-off after today's big four and it was debatable who the fifth and sixth big platform companies were. But, he mentioned PayPal and Twitter as his picks.

Schmidt did throw Microsoft a bone. He said the company still has a lot of enterprise business locked up and is doing well with Windows Server. Clearly, Schmidt lumps Microsoft in with Oracle, SAP, and others as enterprise platforms that are separate from the consumer powerhouses he sees as today's tech leaders. In fact, went a step further, suggesting that enterprise and traditional IT platforms are under attack.

"What you are seeing is the death of IT as we know it... With this new technology you don't need as much of it." Schmidt said. He sees complex enterprise systems being replaced by cloud services.

When I posted that quote on Twitter Tuesday night during Schmidt's interview, @jordanmdtx replied, "'Death' would be better described as 'transformation.'" I think Jordan is exactly right about that, but there's likely to be continued upheaval in IT during the transformation.

The other interesting thing Schmidt said was that he doesn't see all four of his big four continuing to dominate. He said, "It's unlikely one of the four will acquire another because of antitrust issues. More likely is one begins to miss the mark."

My ZDNet colleague Larry Dignan thinks Google is most likely to stumble. I think it's Facebook. Facebook has the worst platform of the four. It's the most difficult to use. It's already blown its shot at gaining users' trust. And, it's likely to come under pressure from new competitors over the next year. Plus, there's a natural cyclical phenomenon to social networks. I wouldn't be surprised to see a lot of the crowd move to something else within 24-36 months.

For more on the Schmidt interview, here is a nine-minute clip that highlights Schmidt's remarks at D9:

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About

Jason Hiner is the Global Editor in Chief of TechRepublic and Global Long Form Editor of ZDNet. He is an award-winning journalist who writes about the people, products, and ideas that are revolutionizing the ways we live and work in the 21st century.

17 comments
jfreedle2
jfreedle2

Google as a leader, only if you are a lemming.

Ionne-C
Ionne-C

Suppose this guy Schmidt is referring the IDEA of each of these players. Something archetypal rather than a specific platform build-out - the idea of the platform. Get it? Then you see categories - and they're all pretty crazy how they're built-out - but you can compare what categories of consumer platform are the players, and these names naturally pop up. Google is I want to say the individualist tech worker - there is a lot of competition in that 'consumer sector,' but Google has the four-course meal with desert and drink for $9.95 - and they fund it with the most diabolical (but technically fair) advertising scheme ever invented. PERHAPS WE CALL GOOGLE, THEN, "THE MERITOCRACY?" APPLE is the digiteratti - you know - overpriced useless curves and glass that can do nothing but detract from basic iron and plastic (industrial) functionality. Yet, knowing Jobs, they drive the evolution and sometimes revolution. So we'll assign them the YUPPIE market (or YUMPIE - both terms you haven't heard in a while.) This is the upscale formerly IKEA and Home and Garden crowd that basically makes me seriously nauseous, since they cause all the trouble in the economy. In their wake buying the seriously deficient China clones are every pre-adult fixated on thinking themselves superior if they (and their gear) only look modern. The before and after age crowds simply pick up the bargains and follow-along. Did we name this TREND SETTER? How about a more modern and useful term, like VIRAL INTELLECT? Facebook of course is for the relentless but underachieving masses. Like MySpace, half web 3.0 era tabloid, and half actual social tool - it fills in the purposeless void when you don't need a blog or a website. What this "space" does better is what human beings cannot do well at all by themselves - 'permanentizes' relationships in some form of virtual neighborhood. It is the perennial donut shop in the town you never have to leave, along with all its wisdom, familiar faces, and human stories - and less the obligations. Bam: THE DONUT SHOP SECTOR. You know, it's obvious that Microsoft only exists at the enterprise and server level. IBM, Oracle, Sun - no existence at all here. That leaves Amazon, which is an incredible pioneer in the infrastructure of meta-super-scale small business, or something like that. Adapting-evolving-re-evolving large-scale virtual infrastructure to small players, and showing the way for smaller competitors, which compared to eBay and PayPal that are breaking no new ground redefining existing infrastructure, is striving for the absolute high-ground of innovation in consumer platforms. And thus Amazon belongs on this list. This is "Small Business done on planetary scale" that Sun, Microsoft, IBM all attempt to play at, but at 100% enterprise level. As consumers we are forced to be third tier. Amazon has taken that populist, bookstore intellectual position, and repeatedly re-evolved it, straddling Google's offerings, competing with eBay and PayPal at the smaller end, and breaking new ground in server-farms and cloud infrastructure at the top, where it defines SMALL BUSINESS UNCAPPED. Except that I can't think of a catchy name for it.

Gr8Music
Gr8Music

You WILL be assimilated, resistance is futile!

rob123q
rob123q

Of course he would include Google and Apple, he would be a fool not to include his company and chums. Facebook may have developed some good applications aka NoSQL and others, but they are not considered in my book as major players in IT, maybe in developing practices that hurt the image of IT but not IT as I know it. Look at MySpace, forcasted to be one of the major players in the future of IT now struggling. Not having Microsoft on the list is a joke and just goes to show that he is letting his personal feeling get in the way of his professional concerns. Love it or hate it, Microsoft is here to stay at the top (or close to it) of the pile. I would love to see someone develope an OS that would know Microsoft off its high and mighty perch but i do not see it in the next few years. There are too many corporations and home users with programs and applications grandfathered into microsoft for them to leave it. I have researched and tested several of the newest OS's and cannot get less then half the Applications we run to work and the company's developing them have no plans of making a version to work. So my top four would be 1. Microsoft 2. Apple 3. VMWare and 4. Google unles Google tries to push too hard and kills themself in the process. Facebook may come in around 15th in my book if it keeps developing open source apps but they are just a social media to me now. i am looking at companys that will improve IT in the future, not hurt it.

ActiveAvatar
ActiveAvatar

I agree with him, it is a tricky time to be a big guy in the marketplace these days - for example I think Nokia is going to find it very stormy ahead, and good old MS is going to need new vision and a better idea of what business it is in. The big ones are all very consumer focused - they lead and listen. The dinosaurs tend to fail in one then the other. There is life after being one of the big four - you just have to adjust to the relay race idea, sell the picks and shovels to the miners is still a good solid business plan. But the miners may become fickle if more visionary picks and shovels come along - iPads and all the mobile techno supported by cloud. It wasn't the pick that sold the pick, it was the salesman! Human touch

Gis Bun
Gis Bun

Schmidt always disliked Microsoft. Him saying Microsoft doesn't make this list is like saying Apple doesn't like Adobe's Flash. Google is fairly chummy with Apple and obviusly Google would be included. Facebook? Amazon?

gunnarzdad
gunnarzdad

I wouldn't put Facebook in with this "gang of four". Sure they are a big company and they've changed the way some things are done today, but they not near the tech innovation like the other companies. Is there is iFacebook cloud?

schmidtd
schmidtd

Cisco, HP, Dell, Gateway, Intel, AMD..... All the companies who make possible what the big 4 do, I guess you could add MS and VMWare to the list. On the one hand, there is no doubt, users only care about applications so I can see where he may view the big 4 as pulling the train. Then again, in the California Gold rush the miners didn't make all that much money on average, but the guys selling the picks sure did.

JCitizen
JCitizen

because the mobile market has introduced a new excitement and chaos to any ideas of the future. What will happen, in my opinion, is that Microsoft will be knocked off their throne. Who's idea will be the next big change to become king of the hill will be in question. I'm sure Apple will temporarily hold number one - but if Jobs leaves, that bet is off. After that it will all be up for grabs, as the miniaturization of mobile hardware will continue to revolutionize the web-scape. The next hugely successful OS may not be Microsoft, Apple, or Google either. Mobile could quickly change everything! Eric is right about one thing for sure - after the Arab spring; the internet will become Balkanized. However, this will be to the detriment of any country doing this. They will just get farther and farther behind.

b4real
b4real

I think these players will definitely grow in their share of what "IT" is today and moreso tomorrow. If Apple got into the hardware business more, or maybe Google or Amazon directly - that's all the IT the world may ever need. I agree with you that Facebook is most likely to stumble, primarily because the marketing machine that is being created will soon implode on itself and create a fickle evacuation by users to other mechanisms - such as Twitter or some next-gen social media outlet. The issue is that the marketing data supports Facebook as being totally successful at the moment.

jasonhiner
jasonhiner

Facebook basically created a new database (Cassandra, a.k.a. NoSQL) to handle the huge loads of millions of simultaneous users. They open sourced it and it pretty much helped fix Twitter's original load problems. Others have adopted it as well. Also, Facebook recently said that it will open up its innovative data center designs so others can learn from its experience in creating a massive Web service that virtually never goes down. I'm not a huge fan of Facebook, but I'm willing to admit that technologically (on the backend) they are extremely innovative and influential.

JonGauntt
JonGauntt

Eric Schmidt is talking about the face of changing consumer technology. Not enterprise. Not backbone. You are absolutely right that they could not do what they do without those companies, but that wasn't his subject.

b4real
b4real

They can't innovate at the rate of the others. Maybe VMware an exception, and Facebook in that list.

jasonhiner
jasonhiner

Mobile is the driving force behind a lot of the current changes that Schmidt is referring to. Obviously, the Internet itself is the other big factor.

b4real
b4real

Amazon may be the new enterprise.

JCitizen
JCitizen

will be one of the newest driving forces for the hardware end. It will be interesting to the changes that happen to motherboard design to accommodate them!

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