Google Search Is Like ‘Cigarettes or Drugs,’ Executive Said
A senior Google executive once likened the company's search advertising business to selling drugs, calling it “one of the world's greatest business models ever created” since the company can “ignore” users and focus on generating revenue from advertising.
Michael Roszak, vice president for finance at Alphabet Inc.'s Google, wrote the notes during a July 2017 training Google offered on communications.
“Search advertising is one of the world's greatest business models ever created,” Roszak wrote, adding that there were only “illicit businesses (cigarettes or drugs) that could rival these economics.”
Google's business can effectively “ignore one of the fundamental laws of economics,” Roszak wrote, supply and demand. This allowed the company to “ignore the demand side of the equation (users and queries) and only focus on supply side of advertisers.”
Because Google “made smart marketing/distribution investments to get our product everywhere,” Roszak wrote, “we could essentially tear the economics textbook in half.”
The document was used as a piece of evidence in the Justice Department's antitrust case against Google, challenging a series of contracts where Google pays web browsers and smartphone markets to be the default search engine. The government is seeking to prove that Google engaged in anticompetitive tactics to maintain its dominant position. Google denies the allegations.
Roszak testified at the Justice Department's trial last week, but the government removed from the web public access to emails, charts and internal presentations after Google protested. The agency began reposting exhibits Wednesday after Judge Amit Mehta brokered a compromise to create a procedure for their posting. Roszak's notes were only made publicly
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