Google Energy: It’s about the grid

by David on January 10, 2010

Google is making it tough to keep up. There is so much innovation in so many areas that tech journalists have been complaining they can’t digest it all. As an entrepreneur I’m trying to see where there is opportunity to dive in and where there is a higher likelihood to get crushed (been there, done that… GoTo).

Google Energy if you take Google at its word

I don’t know about you but I never take Google at its word. I don’t buy the do no evil stuff. I’ve talked to Larry Page.

Google claims that it is searching for cheap, reliable, renewable energy to power its massive server farms. Google has a lot of servers and needs more every day so that sounds reasonable on the surface.

Google is about data and analysis. I am constantly amazed that Google Chrome knows either the search phrase or the website I am looking for based on what I type in the browser address bar… even before I know what I’m really looking for. That is based on a massive amount of data and excellent analysis. I give credit to Google for a big win.

So Google may be trading energy on the open market to get data about energy rates, energy sources (especially renewable vs. fossil fuels) and whatnot. But I suspect there is more to it.

Google PowerMeter

Google insists that Google Energy is not tied to Google PowerMeter a project to help consumers measure the power usage of their home down to individual appliances. While that puts information / power in the hands of consumers, it is really only after Google gathers that data and analyzes it.

Is your refrigerator using more than the average amount of power (based on Google’s analysis)? May we suggest a new fridge that meets your household’s needs? Google Products.

Think about how far that goes. It’s still not enough of a conspiracy theory for me. I think there is more to it. Note that I rarely think that companies do this type of analysis and work in such an integrated manner. Microsoft was never able to achieve this as the Department of Justice found. All of my friends at Microsoft have confirmed that groups work independently of each other. I think that Google is different. I think there are plans.

Google Grid

Google’s power plans have to do with the Smart Grid, the way that consumers can begin to use renewable energy sources in their homes and find more efficient appliances.

That makes a lot of sense.

Experian & PriceGrabber

In 2005 I correctly predicted that Experian would acquire PriceGrabber. My logic was sound even if history and Experian have not seen it happen the way I said it would.

Experian knows life events. It knows your life events. New children, marriage, death, new job, unemployment… anything that has monetary implications goes through Experian. Imagine if Experian could market to you based on that.

Of course Experian did not either for technical or regulatory reasons integrate its databases from credit reporting and comparison shopping. Oh well. Again, most big companies / conglomerates can’t integrate acquisitions or even new product lines. [I still contend that Skype was a great fit with eBay.]

Google gets this one. What’s the problem with a comparison shopping engine like Google Products? You don’t know about conversions. Well, you will know more about conversions from search to purchase if you also process payments (Google Checkout) and have an affiliate network (Google Affiliate Network, formerly Performics).

Chrome OS, meet Google Energy

Last month I wrote about Google’s Chrome OS and the implications it had for your home. I missed a lot. Google Energy ties in with all of this and again I have to say that I do think Google can bring all of this together.

The Smart Grid can be incredibly smart with the right analytics. But why does everyone who is talking about this stop with energy analysis?

What is at the end of power lines? It’s not just appliances. It’s computers. While it would be nice to give computers cheaper, cleaner power (I am finally getting a UPS for each room that needs it now that computers and electronics are burning out in my house from the crappy power), isn’t it nice that power lines are ubiquitous to just about every location that has a computer?

Clay Johnson of the Sunlight Foundation recently tweeted “So power line networking actually works. Huh.” Yes, it does and Google knows it. Why bother with the hassles of Ethernet or the pipe dream of fiber optics and rewiring homes? Why deal with WiFi routers that spaz out? we all have power lines and they work for networking. Yes, Google Products can find what you need for a power line network.

I tried this a few years ago. It was a great solution. Then I wired the new house I was building for Ethernet. It was more difficult than it should have been. The electrician understood settling up the power plugs better than Ethernet.

The logical extension is Google as an ISP.

Google ISP?!?

You think I’m nuts with this one, right? Why would Google want to be an ISP? Data! Desktop! Home! Control! Also take a look at Google’s Nexus One and Android.

Put all of these pieces together. Chrome OS powers the devices in your home enabling you to have better power, simpler devices doing what you need and disappearing, full integration of your entertainment systems and appliances, networking as simple as plugging a device into the power socket…. that a single plug to get power AND connectivity!!!

What’s the price we pay for this? Google might just give this away for free. The price is data. Google is the preferred search engine and now can see if you get to the checkout page of stores and if you purchase. Google might even see you track your packages at FedEx or UPS. Google might get to the point of predicting what you need. (We might finally get a refrigerator that knows what we buy, if we need more of it and then place the order at the market.)

As you can see, Google Energy isn’t about energy and isn’t about Google becoming the next Enron as some are predicting in the blogosphere. It’s partly about Google getting data to have cleaner, cheaper, more reliable power for it’s server farms and it’s for Google to reach every single aspect of your computing life. That’s all.

[FTC Disclosure: If you don't believe me about Google being an ISP, Google is providing free WiFi service to me on a Virgin America flight as I type this via Google's Chrome browser which was also provided at no charge.]

{ 3 comments… read them below or add one }

jeff_molander January 12, 2010 at 4:09 pm

David…
Brilliantly laid out and argued. At the heart of your argument (but perhaps not vital to Google's ultimately rolling out such services) is a reliance on Google — an acceptance of what we (the consuming public) have already shown all but a complete willingness to participate in. A massive Ignorance Economy where we make trade-offs for everything from novelties to, yes, truly valuable services. We trade privacy and data for the candy. We're already doing it: ie. businesses buy media from the same company that analyzes the ROI in exchange for free, world class Web analytics dashboards.

Ironically, I think much of what powers the chatter you refer to (re: becoming the next Enron/big energy company) is based purely on the *perception* of Google being a science-minded company. I'm not saying that they're not but I am suggesting that what you've laid out is far more logical/well-reasoned in terms of where this is going NEXT.

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Juan Pablo Pellat January 20, 2011 at 11:56 pm

Hey, do you have any thoughts on the possibility of google acquiring a carrier such as Sprint to offer free LTE or any other carrier for that matter?

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thedavidlewis January 21, 2011 at 12:05 am

Juan, that’s an interesting thought but I don’t think so. If Google is interested, it could lease Clearwire’s 4G network just like Sprint.

This post is about Google getting into homes, not mobile. Google obviously has made an investment in mobile with Android, although some claim it is too hands off. It also has the Nexus phones but seems to have pulled back on that. It will be interesting to watch how this all unfolds.

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