Two Stanford biz students, Matt and Julio, have been interviewing some of the biggest names in the Valley on a podcast called iinovate. They posted an interview with Eric Schmidt yesterday, in which they tell Eric that Google is becoming more of a content company. To this he takes exception:

You used the term content company. We don't use that term. Google is an infrastructure company that enables content. Google is not in the content business. We have many partners that produce content. We are a distribution mechanism and a monetization mechanism for our partners. This is an important line that we've decided not to cross.

Any questions?

Now to the Google Grid, as David Scott Lewis terms it (see comments on this post). Schmidt describes it in terms of datacenter (which I think is the same thing as David's Grid):

Google is much more capital-intensive than our competitors and we're much further along in the datacenter. We have a competitive advantage because we have the cheapest and most scalable architecture. We hope that in the course of innovation, we will be able to build products that are impossible for our competitors to replicate. Virtually all of our capital expenditures go into the datacenter.

Not a lot of technical detail there, but it gives a good sense of why Google will become the Microsoft of its generation (not in the sense of anticompetitive practices but in the sense of "owning the stack"). Just as nobody could write Windows apps like Microsoft because they simply knew much more about the OS than anybody else, in the future, noone will be able to touch Google in Interet apps. They will deploy their products on architectures so much higher-performing, with less network latency, more scalable, more reliable, etc., that as Schmidt says, they can't be touched. To beat them you would have had to invest hundreds of millions and had years to build out and have had your pick of the best engineers - and that's what Google has quietly been doing.

The guys asked Eric where the opportunity is for new biz school grads.

The opportunity is in targeted advertising. That's essentially the business model of Google. I'm quite convinced that targeted advertising will be a very rich area for many years to come.

He added that the trillion dollar advertising business can be transformed by the targeted advertising approach. He sees not only the "advertising business" per se, but all of the ad-intensive businesses, like cars, as ripe for getting Googlized in a big way.

He would probably object to the term "Googlization." After all, he thinks its the net, not Google itself, that is changing American business.

Google is an example of an iconic company around a set of changes that are systematic, which are quite significant. It's really the Internet that is changing companies, and google is a representative of the internet.

So nice job, Matt and Julio. I'll subscribe to your podcast.