An open letter to Eric Schmidt : Why we fear Google

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Mathias Döpfner, CEO of Axel Springer SE, explains to Eric Schmidt, why the fear of Google is qualified Bild: dpa

Here for the first time, a German manager confesses his company’s total dependence on Google. What publishers are experiencing today is a sign of things to come: We will soon all belong to Google. An open letter to Eric Schmidt.

          14 Min.

          Dear Eric Schmidt,

          In your text “Die Chancen des Wachstums” (English Version: “A Chance for Growth”) in the Frankfurter Allgemeine Zeitung, you reply to an article which this newspaper had published a few days earlier under the title “Angst vor Google” (“Fear of Google”). You repeatedly mention the Axel Springer publishing house. In the spirit of transparency I would like to reply with an open letter to highlight a couple of things from our point of view.

          (Deutsche Fassung: „Warum wir Google fürchten“ - Mathias Döpfners offener Brief an Eric Schmidt)

          We have known each other for many years, and have, as you state, had lengthy and frequent discussions on the relationship between European publishers and Google. As you know, I am a great admirer of Google’s entrepreneurial success. In just a few short years, starting in 1998, this company has grown to employ almost 50,000 people worldwide, generated sixty billion dollars in revenue last year, and has a current market capitalization of more than 350 billion dollars. Google is not only the biggest search engine in the world, but along with Youtube (the second biggest search engine in the world) it also has the largest video platform, with Chrome the biggest browser, with Gmail the most widely used e-mail provider, and with Android the biggest operating system for mobile devices. Your article rightly points out what fabulous impetus Google has given to growth of the digital economy. In 2013, Google made a profit of fourteen billion dollars. I take my hat off to this outstanding entrepreneurial performance.

          Google doesn’t need us. But we need Google

          In your text you refer to the marketing cooperation between Google and Axel Springer. We were also happy with it. But some of our readers have now interpreted this to mean that Axel Springer is evidently schizophrenic. On the one hand, Axel Springer is part of a European antitrust action against Google, and is in dispute with them regarding the issue of enforcement of German ancillary copyright prohibiting the stealing of content; on the other hand, Axel Springer not only benefits from the traffic it receives via Google but from Google’s algorithm for marketing the remaining space in its online advertising. You can call it schizophrenic – or liberal. Or, to use one of our Federal Chancellor’s favorite phrases: there is no alternative.

          We know of no alternative which could offer even partially comparable technological prerequisites for the automated marketing of advertising. And we cannot afford to give up this source of revenue because we desperately need the money for technological investments in the future. Which is why other publishers are increasingly doing the same. We also know of no alternative search engine which could maintain or increase our online reach. A large proportion of high quality journalistic media receives its traffic primarily via Google. In other areas, especially of a non-journalistic nature, customers find their way to suppliers almost exclusively though Google. This means, in plain language, that we – and many others – are dependent on Google. At the moment Google has a 91.2 percent search-engine market share in Germany. In this case, the statement “if you don’t like Google, you can remove yourself from their listings and go elsewhere” is about as realistic as recommending to an opponent of nuclear power that he just stop using electricity. He simply cannot do this in real life – unless he wants to join the Amish.

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