NEW YORK (AdAge.com) -- Nathan Myhrvold, Microsoft Corp.'s former chief strategist and chief technology officer, thinks Google did the right thing in its mega-acquisition of YouTube this week. By purchasing YouTube for $1.65 billion, he said, Google is "tapping into a stream of popularity."
A Look Over the Horizon With Nathan Myhrvold and Marissa Mayer
But, he cautioned, the "only way to know if a deal is good or bad is in retrospect."
The New Yorker's Ken Auletta had Mr. Myhrvold and Marissa Mayer, Google's director-consumer products, under the microscope this morning during a breakfast at Bryant Park Grill hosted by the S.I. Newhouse School of Public Communications. New York's media cognoscenti, including former Time editor Norm Pearlstein, CBS Digital's Larry Kramer, and Mr. Auletta's boss, David Remnick, were present to hear how, in effect, Google plans to stay on top.
Does Google have Microsoft in its sights? "Yes," said Mr. Myhrvold. "In search, we're direct competitors."
Despite Google's tremendous lead, Ms. Mayer noted how far search still needs to go, calling current techniques "super-primitive," and said the rate of advancements over the past five years has been "really disappointing."
At the risk of offending privacy advocates, Ms. Mayer said the personalization and customization of search are ripe areas for improvement. "I don't know what search [engines] will know about you in 2026, but it will know more about you than it does now."
To discuss how top companies can avoid stumbling, Mr. Auletta pointed to once high-flying AOL and Yahoo, but Mr. Myhrvold seemed to include Microsoft in that fateful group. "There was a time when people thought Microsoft could do no wrong." Alluding to his former employer's legal battles with the government, he added: "When you're on top, people gang up on you."
When Larry Aidem, president-CEO of the Sundance Channel, asked Ms. Mayer about the place of brands in a GoogTube world, she said: "Brands will matter. ... There is an [opportunity] for brands to flourish."
Mr. Myhrvold actually managed to chill the room on several occasions: Once, when discussing content ownership, he warned Mr. Kramer and his kin, "You could have a period of distribution when you won't get paid." He later said: "If the world doesn't have a simple way for people to be honest, they'll steal it."
In response to the copyright issues being raised by the YouTube grab, Ms. Mayer said: "We do believe we are in compliance. The team and service they built is really phenomenal"
Perhaps not surprisingly, Google is unsatisfied with the more than 65,000 videos uploaded to YouTube every day. Partnerships that Google is pursuing with media, technology and product companies will greatly increase that number, Ms. Mayer said.