среда, 4 июня 2008 г.

Inside the Googleplex

IN AMERICA a phenomenon might claim to have entered mainstream culture only after it has been satirised on "The Simpsons". Google has had that honour, and in a telling way. Marge Simpson types her name into Google's search engine and is amazed to get 629,000 results. ("And all this time I thought googling 'yourself' meant the other thing.") She then looks up her house on Google Maps, goes to "satellite view" and zooms in. To her horror, she sees Homer lying naked in a hammock outside. "Everyone can see you; get inside," she yells out of the window, and the fumbling proceeds from there.

And that, in a nutshell, sums up Google today: it dominates the internet and guides people everywhere, such as Marge, to the information they want. But it also increasingly frightens some users by making them feel that their privacy has been intruded upon (though Marge, technically, could not have seen Homer in real time, since Google's satellite pictures are not live). And it is making enemies in its own and adjacent industries. The grand moment of Marge googling herself, for example, was instantly available not only through Fox, the firm that created the animated television show, but also on YouTube, a video site owned by Google, after fans uploaded it in violation of copyright.

Google evokes ambivalent feelings. Some users now keep their photos, blogs, videos, calendars, e-mail, news feeds, maps, contacts, social networks, documents, spreadsheets, presentations, and credit-card information--in short, much of their lives--on Google's computers. And Google has plans to add medical records, location-aware services and much else. It may even buy radio spectrum in America so that it can offer all these services over wireless-internet connections.

Google could soon, if it wanted, compile dossiers on specific individuals. This presents "perhaps the most difficult privacy issues in all of human history," says Edward Felten, a privacy expert at Princeton University. Speaking for many, John Battelle, the author of a book on Google and an early admirer, recently wrote on his blog that "I've found myself more and more wary" of Google "out of some primal, lizard-brain fear of giving too much control of my data to one source."

Google itself has been genuinely taken aback by such sentiments. The Silicon Valley company, which trumpeted its corporate motto, "Don't be evil", before its stockmarket listing in 2004, considers itself a force for good in the world, even in defiance of commercial logic. Its founders, Larry Page and Sergey Brin, and Eric Schmidt, its chief executive, have said explicitly and repeatedly that their biggest motivation is not to maximise profits but to improve the world. Too many sermons

Such talk can make outsiders wince. Book and newspaper publishers, media companies such as Viacom, businesses which depend on Google's search rankings and a lengthening queue of others are tired of moralising sermons. Some feel their own livelihoods are threatened and are suing Google. Even some employees (called "Googlers") or former employees ("Xooglers") are cynical. Google is "arrogant" because it feels "invincible", says a Xoogler who left to run a start-up firm. The internal attitude toward customers, rivals and partners is "you can't stop us" and "we will crush you", he says. That "kinder, gentler" image is "mythology" and, he reckons, Google gets away with it only because of its impressively high share price.

That share price has quintupled since 2004, making Google worth $160 billion. The company has not yet had its tenth birthday. Yet Piper Jaffray, an investment bank, expects it to have revenues of $16 billion and profits of $4.3 billion this year. With so much money pouring in sceptics say it is easy to ignore shareholders and talk about doing good instead of doing well. But what happens when earnings fall short of Wall Street expectations or some other disaster strikes? Yahoo! and other rivals have gone through such crises and been humbled. Google has not. Fifty cents at a time

Google's success still comes from one main source: the small text ads placed next to its search results and on other web pages. The advertisers pay only when consumers click on those ads. "All that money comes 50 cents at a time," says Hal Varian, Google's chief economist. For this success to continue, several things need to happen.

First, Google's share of web searches must remain stable. Thanks to its brand, this looks manageable. Google's share has steadily increased over the years. It was about 64% in America in July, according to Hitwise. That is almost three times the volume of its nearest rival, Yahoo!. In parts of Europe, India and Latin America, Google's share is even higher. Only in South Korea, Japan, China, Russia and the Czech Republic does it trail local incumbents.

Second, Google must maintain or improve the efficiency with which it puts ads next to searches. And here its dominance is most impressive. In a recent analysis by Alan Rimm-Kaufman, a marketing consultant, it took a whopping 73% of the budgets of companies that advertise on search engines (versus 21% and 6%, respectively, for Yahoo! and Microsoft). It charged more for each click, thanks to its bigger network of advertisers and more competitive online auctions. And it had far higher "click-through rates", because it made these ads more relevant and useful, so that web users click on them more often.

Perhaps most tellingly, advertisers do better with Google. Mr Rimm-Kaufman found that Google's ads "converted" more often into actual sales, which tended to be larger than those originating from Yahoo! or Microsoft. This is astonishing, given that Yahoo! has just spent a year on an all-out effort, codenamed Panama, to close precisely these gaps.

But even lucrative "pay-per-click" has limits, so Google is moving into other areas. It is trying (pending an antitrust inquiry) to buy DoubleClick, a firm that specialises in the other big online-advertising market, so-called "branded" display or banner ads (for which each view, rather than each click, is charged for). And Google now brokers ads on traditional radio stations, television channels and in newspapers of the dead-tree sort.

Sceptics point out that with each such expansion, Google reduces its profit margins, because it must share more of the revenues with others. If a web surfer clicks on a text ad placed by Google on a third-party blog, for instance, Google must share the revenue with the blogger. If Google places ads in newspapers or on radio stations, it must share the revenues with the publisher or broadcaster.

Yet Google does not look at it that way. Its costs are mostly fixed, so any incremental revenue is profit. It makes good sense for Google to push into television and other markets, says Mr Varian. Even if Google gets only one cent for each viewer (compared with an average of 50 cents for each click on the web), that cent carries no variable cost and is thus pure profit.

The machinery that represents the fixed costs is Google's secret sauce. Google has built, in effect, the world's largest supercomputer. It consists of vast clusters of servers, spread out in enormous datacentres around the world. The details are Google's best-guarded secret. But the result, explains Bill Coughran, a top engineer at Google, is to provide a "cloud" of computing power that is flexible enough "automatically to move load around between datacentres". If, for example, there is unexpected demand for Gmail, Google's e-mail service, the system instantly allocates more processors and storage to it, without the need for human intervention.

This infrastructure means that Google can launch any new service at negligible cost or risk. If it fails, fine; if it succeeds, the cloud makes room for it. Thus Google can redefine its goals almost on a whim. Its official strategy recently became "search, ads, and apps"--the addition being the apps (ie, software applications). Sure enough, after a string of acquisitions, Google now offers a complete alternative to Microsoft's entrenched Office suite of programs, all accessible through any web browser. A new technology, called Google Gears, will make these applications usable even when there is no internet connection. And Google is hawking these applications not only to consumers but also to companies. Ultimately it does so because, thanks to its supercomputer, it can.

With Google's cashflow and infrastructure, the freedom to do anything it fancies gives rise to constant rumours. Often, these are outrageous. It used to be conventional wisdom that Google would build cheap personal computers for poor countries. This turned out to be nonsense, because Google does not want to make hardware. Now there is talk of a "Gphone" handset. This is also unlikely because Google is more interested in software and services, and does not want to alienate allies in the handset industry--including Apple, which shares board directors with Google and uses Google software on its iPhone.

Sometimes the rumours are both outrageous and true. Google is experimenting with new ways of bringing broadband connections to consumers, by blanketing parts of Silicon Valley with Wi-Fi networks. It is planning to enter an auction for valuable radio spectrum in America, and thinking of radically new business models to make money from wireless data and voice networks, perhaps a free service supported by ads. If it goes wrong, how?

Beyond its attempts to expand into new markets, the big question is how Google will respond if its stunning success is interrupted. "It's axiomatic that companies eventually have crises," says Mr Schmidt. And history suggests that "tech companies that are dominant have trouble from within, not from competitors." In Google's case, he says, "I worry about the scaling of the company." Google has been hiring "Nooglers" (new Googlers) at a breathtaking rate. In June 2004 it had 2,292 staff; this June the number had reached 13,786.

Its ability to get all these people has been a competitive weapon, since Google can afford to hire talent pre-emptively, making it unavailable to Microsoft and Yahoo!. Google tends to win talent wars because its brand is sexier and its perks are fantastically lavish. Googlers commute on discreet shuttle buses (equipped with wireless broadband and running on biodiesel, naturally) to and from the head office, or "Googleplex", which is a photogenic playground of lava lamps, volleyball courts, swimming pools, free and good restaurants, massage rooms and so forth.

Yet for some on the inside, it can look different. One former executive, now suing Google over her treatment, says that the firm's personnel department is "collapsing" and that "absolute chaos" reigns. When she was hired, nobody knew when or where she was supposed to work, and the balloons that all Nooglers get delivered to their desks ended up God knows where. She started receiving detailed e-mails "enforcing" Google's outward informality by reminding her that high heels and jewelry were inappropriate. Before the corporate ski trip, it was explained that "if you wear fur, they will kill you."

Google is a paradise only for some, she argues. Employees who predate the IPO resemble aristocracy. Engineers get the most kudos, people with other functions decidedly less so. Bright kids just out of college tend to love it, because the Googleplex in effect replaces their university campus--with a dating scene, a laundry service and no reason to leave at weekends. Older Googlers with families tend to like it less, because "everybody, even young mums, works seven days a week."

Another Xoogler, who held a senior position, says that by trying to create a "Utopia" of untrammelled creativity, Google ended up with "dystopia". As is its wont, Google has composed a rigorous algorithmic approach to hiring, based on grade-point averages, college rankings and endless logic puzzles on whiteboards. This "genetic engineering of their workforce," he says, means that "everybody there is a rocket scientist, so everybody is also insecure" and the back-stabbing and politics are reminiscent of an average university's English department.

Then there is the question of what all these people are supposed to do. "We kind of like the chaos," says Laszlo Bock, the personnel boss. "Creativity comes out of people bumping into each other and not knowing where to go." The most famous expression of this is the "20% time". In theory, all Googlers, down to receptionists, can spend one-fifth of their time exploring any new idea. Good stuff has indeed come out of this, including Google News, Gmail, and even those commuter shuttles and their Wi-Fi systems. But it is not clear that the company as a whole is more innovative as a result, as it claims. It still has only one proven revenue source and most big innovations, such as YouTube, Google Earth and the productivity applications, have come through acquisitions.

In practice, the 20% time works out to be 120% time, says another Xoogler, "since nobody really gets around to those projects for all their other work." The chances of ideas being executed, he adds, "are basically zero." What happens to the many Googlers whose ideas are rejected? Once their share options are fully vested they consider leaving. The same phenomenon changed Microsoft in the 1980s, when allegedly T-shirts popped up saying FYIFV ("Fuck you, I'm fully vested"). Already some are going to even "cooler" start-ups, such as Facebook or Twitter.

This week George Reyes, Google's finance chief, said he would retire. At 53, he is a multi-millionaire. Mr Reyes has maintained the company's policy of not providing guidance to Wall Street on future earnings, although his comments on growth prospects have moved its share price.

The interesint talks

Tucked away inside a 26th-floor suite of a Disney World-area luxury resort, five employees of Boomdash LLC had gathered on a balmy April evening, full of energy and anticipation for what the next day would bring.

Months of strategizing, software programming and market research would culminate in a nearly two-hour presentation and product demonstration to a room full of Boomdash's potential customers.

"It's extraordinary that things have panned out," said a calm and confident Cesar Nerys, Boomdash's founder and chief executive, as he surveyed the enormous suite.

To ward off competitors, the Ann Arbor-based company had kept a low profile, tightly guarding its plans. But now the wraps were about to come off.

The setting -- the annual convention for about 100 independent telephone directory publishers -- was ideal. Boomdash is an Internet search engine and mobile advertising company for local businesses. It plans to work with telephone directory publishers, helping them sell Internet marketing services to their thousands of customers around the country.

The company entered the convention with one customer already on board, Sunshine Pages of Metairie, La. But now it must convince other publishers that they need Boomdash's services, too.

Many small businesses encounter difficulties getting their first few customers, particularly ones like Boomdash that require customers to sign a contract. To make things even more challenging, Boomdash isn't offering major discounts to win business like some new companies do. It wants to show potential investors that it can attract paying customers.

Like other entrepreneurs, Boomdash's three partners -- Nerys, Doug Neal and Jack Horner -- have made a significant investment in their company. Experienced businessmen, they spent a total of about $30,000 of their own money on Boomdash's launch.

Would the publishers see the value of Boomdash's services? Would they be willing to do business with a start-up company? Would Nerys and his team leave the convention in despair or excitement?

The next day arrives all too quickly.

8:30 a.m.: Boomdash's Web site, www.boomdash.com, goes live for the first time. The company issues its first news releases.

10 a.m.: Using a 72-inch flat panel television in the suite, Nerys and Neal, Boomdash's chief operating officer, rehearse the presentation they will make this afternoon.

"The only time I'm nervous is when I'm not prepared," Neal says. "I think I feel pretty good."

Horner, the company's chief technical officer, discovers that a computer bug has infected part of Boomdash's software programs. But no need for panic. The problem can be easily fixed.

Suddenly, the men drop what they are doing, startled by the arrival of an unexpected visitor. A big turkey vulture perches on one of the balcony chairs, peering in the window.

"I think he's saying the competition doesn't stand a chance," Nerys jokes.

2 p.m.: Inside one of the hotel's medium-size meeting rooms, Neal and Horner check the audiovisual equipment and inspect the room's lighting and acoustics. They realize they need to add two more wireless connections for their laptops.

Boomdash's signs adorn the room, with dozens of goodie bags for attendees in one corner and snacks in another. Kim Corcoran, a meeting planner Boomdash hired, has placed a company brochure and news releases on the tables in front of every chair.

Twenty minutes before the presentation, Nerys, Neal and Horner go outside, huddling together to offer some last words of encouragement.

"It's just very exciting to be in this particular moment," says Nerys, a former AT&T executive.

4:16 p.m.: Neal asks everyone to take a seat, and the presentation begins in front of 29 people. Boomdash had mailed 100 invitations, and 35 publishers said they would attend.

Though the publishers face intense competition from Internet companies, the only thing most of them have done is put copies of their print directories online. But using Boomdash's services, publishers can offer their advertisers so-called Web landing pages with interactive features, such as cell phone coupons and a "call us now" button.

Boomdash's technology places these ads on prominent search engines such as Google and analyzes the results, constantly updating keywords to make the ads more effective. Most small businesses lack the time and knowledge to handle Internet ad campaigns by themselves, much less make sure the ads are working.

"This is not a defensive play folks," Nerys tells the publishers. "It's an offensive play. Take your territory back from your poachers."

During the product demonstration, Neal adds a moment of fun by giving everyone instructions on how to receive a cell phone coupon for the hotel's cafe.

Much to the relief of the Boomdash team, several publishers ask questions at the end of the presentation. Then the company holds a drawing, giving away an iPhone, iPod Classic and an iPod Nano. In Boomdash style, cell phone text messages alert the winners.

"When you come with us, we are not going to love you and leave you," Nerys tells his audience. "We look forward to engaging with each and every one of you."

Later, after the attendees have left, Nerys says happily, "Confidence was what I was trying to project. I was in a groove. I was in my zone."

6:20 p.m.: Two potential customers sign up for appointments.

6:48 p.m.: The Boomdash team enters the convention hall for a welcome reception. The company paid thousands of dollars to host the event, which features appetizers like crab cakes and meatballs. With wine and beer in hand, the team mingles with publishers.

9:02 p.m.: After a long day, the Boomdash team heads back to its suite, tired but pleased. "I just want to sit down," Neal says in the elevator.

The Boomdash signs and goodie bags now decorate the suite. Minutes later, a publisher from Michigan and some employees at Sunshine Pages, Boomdash's first customer, arrive for snacks, drinks and socializing.

9:20 p.m.: Nerys pulls out one of the bottles of champagne and toasts Sunshine Pages.

Midnight: An exhausted but hopeful Boomdash team turns in for the night.

Meeting with publishers

After a slow start the next morning, Boomdash gains momentum in the afternoon, meeting with seven publishers. Five others have set up appointments for the next day.

The publishers ask intelligent questions. Some give Boomdash new ideas. One wants a bigger share of the company's revenue.

"This has been a heck of a day," Nerys says in the early evening, breaking open another bottle of champagne. "I know we are going to be able to help these businesses."

The team gathers in the suite for a toast.

"Fabulous day!" Nerys says while the others cheer.

Google's founders discuss Yahoo advertising deal

Google's founders said they are looking forward to working closely with Yahoo in the wake of the abrupt withdrawal of Microsoft's bid for the Sunnyvale Internet company.

"We were a big partner of Yahoo a few years ago," co-founder Sergey Brin said. "It's great to be working with them again."

Brin made his remarks at a press roundtable shortly before Google's annual shareholders meeting this afternoon. Google and Yahoo are considering a deal in which Yahoo would display Google ads on its popular Web properties and share revenue from those ads with Google.

The two companies recently completed a trial run of the arrangement.

"We have had a brilliant test which was two weeks long," said Chief Executive Eric Schmidt.

Microsoft Chief Executive Steve Ballmer cited the test in his May 3 letter as one of his reasons for terminating negotations with Yahoo's board.

"We regard with particular concern your apparent planning to respond to a 'hostile' bid by pursuing a new arrangement that would involve or lead to the outsourcing to Google of key paid Internet search terms offered by Yahoo! today. In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo! undesirable to us," he wrote.

When asked whether the test with Yahoo was intended to scuttle Microsoft's bid, Brin said: "We really believe in companies having choices in their destiny. They were under hostile attack and we wanted to make sure they had as

many options as possible."

While antitrust experts believe government regulators would take a close look at a full-fledged deal between Google and Yahoo, Schmidt said any arrangement would be structured to address antitrust concerns.

YouTube's Buried Treasure

Making the most of its riches will take a lot longer than Google expected

In mid-April I spent some time at Google and YouTube. Even this far into Google's remarkable run, there's nothing quite like a sunny spring day at the Googleplex to make a print media guy's shoulders slump; to make that guy feel like a third-term Democratic senator running for reelection in the fall of 1980, just as the implications of the phrase "The Reagan Revolution" were becoming brutally clear. That's not to say everything's golden at Google, which last year took in $16.6 billion in revenue. Its great ad successes--AdSense, which places text ads across several hundred thousand partner sites, and AdWords, which displays text ads beside search results--are both simple, easily automated, and can scale to just about infinity. (Practically anyone can afford such ads and create them with a few snippets of text; you can sell truckloads without a sales force.)

Video ads on YouTube, though, do not yet lend themselves to easy automation. They're also more expensive and still primarily the province of big-name advertisers. Selling to them nearly always requires the participation of an ad agency and calls for more labor-intensive sales methods. There are high-level concerns inside Google that the excitement around YouTube--which continues to increase its share of the Web video universe--isn't readily translating into sales and ad dollars.

"It takes longer to bring in a YouTube dollar than it does to bring in a search dollar," concedes Tim Armstrong, Google's top U.S. ad-sales executive. "Can you make [that process] more efficient? We think "yes.'" He adds: "If you talked to me" about this in early '08, "I'd have been more anxious. But we're making nice progress."

Others wonder. The most successful ad format for Web video sites has been display ads that run near video clips, says Dave Morgan, founder of ad network Tacoda, which placed ads on YouTube before the Google deal. "No one is able to sell [these] display ads well in an automated way," he says. "It requires a human sales force."

Of course, Google and YouTube have a massive human sales force. And, like all big online players, Google has invested serious time and dollars (the $3.1 billion DoubleClick deal, for instance) in beefing up its display-ad capabilities.

YouTubers point out that most of their key ad formats--including the "overlay" format, which places an ad over a small portion of a video without interrupting it--have been available only since August. And, in a corollary to the saying at Google that warns "don't bet against the Internet," I wouldn't bet against Google. But it will take time, and perhaps more than the company first reckoned. (A JPMorgan Chase analyst estimated recently that YouTube will gross around $100 million this year, with the vast majority coming from display ads.)

There is a delicate dance between users' expectations and advertisers' desires for a site as naturally woolly as YouTube. Its tens of millions of users expect a degree of graininess, a lo-fi feel to what they see there. (Interestingly, internal research suggests that ultra-glossy ads on its front page tend to get tuned out.) And the site's free-form format, wherein user-generated videos ranging from the innocuous to the stomach-turning still mingle with copyrighted content, makes many uneasy. "Clients are concerned about adjacency to inappropriate content," says Mohan Renganathan, a vice-president at media buyer MediaVest. YouTube "is a haven for things that are not appropriate" for top brands.

There are also factors within the greater media ecosystem at play. At ad agencies, Web video ads can be subject to tug-of-wars and turf battles between TV buyers and digital buyers. An additional perversity of putting video ads on the Web: It can require agencies to take their most prized assets--the cinematic 30-second TV spot--and recut them for shorter attention spans, if not outright start over from scratch.

There are ways around these issues. YouTube is holding contests in which users upload videos to a sponsor's page and thus, ideally, generate heat and page views for ad messages. (Among others, Toyota has sponsored multiple comedy-related YouTube contests.)

There's nothing wrong with this idea, and others for "safe" advertiser sites within YouTube. But they're not a new notion that will set the world ablaze, and some ad execs sound lukewarm. "On balance, I haven't been impressed" with YouTube, shrugs one digital media buyer. "Because what they're offering is basically another venue for a micro-site"--Web pages within a larger site--"on steroids." (Such micro-sites can be had with a minimum YouTube ad buy of around $200,000.) From what I saw at YouTube, the most interesting new ad format uses an algorithm to select videos from known YouTube contributors--be they cable networks or homegrown stars--to surround an ad on a dedicated advertiser page. This capitalizes on both YouTube's vast programming archive and Google's technical underpinnings.

I'm still not convinced that this can scale to Google-esque proportions, since these still can't be automated as simply and elegantly as AdWords and AdSense. All the video, all the users, and all the data YouTube can claim as the Web's biggest video depository means there's an awful lot of treasure buried there. I'm just not sure how fast Google--or anyone, for that matter--can surface it.

Failed bid for Yahoo gives win to Google

Google Inc. is the big winner after Microsoft Corp. walked out on its bid for slumping Yahoo Inc. this weekend, analysts are saying.

The Internet search and advertising leader is no longer facing a merger of its two biggest competitors, with Yahoo shares expected to plummet today and software giant Microsoft left with an unprofitable online division.

"I think it's hard to analyze the situation and not see Google as a winner, no matter what happened," said Doc Searls, a technology writer and fellow with the Berkman Center for Internet and Society at Harvard University.

A Yahoo/Microsoft deal would have taken Google's top search competitor "out of the market" and started a long integration process, he said. Disgruntled employees would be likely to leave the combined company.

Without the deal, "You basically have a hobbled Yahoo," Mr. Searls said Saturday on the Gillmor Gang, a conference call of technology writers and analysts.

Redmond, Wash.-based Microsoft pulled the plug Saturday on its plans to acquire Sunnyvale, Calif.-based Yahoo after upping its initial offer by $5 billion to $47.5 billion, or $33 per share, according to a letter from Microsoft Chief Executive Officer Steven A. Ballmer to Yahoo CEO Jerry Yang. The Yahoo board had insisted on at least $37 per share, or about $53 billion, the letter said.

Yahoo shares were trading at $19.18 when Microsoft first made its offer three months ago. On Friday, shares closed at $28.67 on the Nasdaq.

Mr. Ballmer cited Yahoo's recent test of Google's search-based advertising technology - suggesting a future partnership - as a reason for forgoing a hostile takeover. He noted that Yahoo might take steps to make itself less attractive in the meantime.

"In our view, such an arrangement with the dominant search provider would make an acquisition of Yahoo undesirable to us," Mr. Ballmer said.

Mountain View, Calif.-based Google was used for 67 percent of U.S. Internet searches in March, according to online traffic-tracking firm Hitwise. Yahoo received 20 percent compared with Microsoft's MSN service at nearly 7 percent.

Google also leads U.S. online advertising with a 24 percent market share at the close of 2007, according to market research firm IDC. Together, Microsoft and Yahoo would have represented a 17 percent slice of that market.

Outsourcing some search advertising to Google could be one of Yahoo's best options, analysts say. Some have speculated that the company might acquire Time Warner Inc.'s AOL. Others say Yahoo might be acquired by another firm.

"Nobody expects it to remain an independent entity," Mr. Searls said.

Microsoft recognizes the explosive growth in Internet advertising as opposed to software, said CNET Editor in Chief Dan Farber.

"This search-advertising thing is like printing money," Mr. Farber told the Gillmor Gang. "And I think that's what Microsoft recognizes; there's a transition going on and they were dominant in the old world, and in the new world they absolutely recognize that things are changing. It's about selling ads, it's about subscriptions, it's about social networking."

Microsoft could come back to the table and make another bid if Yahoo fails to rebound.

U tube and ...

Internet search firm Google Inc launched an India-specific version of its free video hosting site YouTube on Wednesday, aiming to be a traffic generator for everyone from media companies seeking new markets to small-time music bands seeking global glory.

Like its other offerings, the localised site (http://www.youtube.co.in) will differentiate content using its search technologies to throw up content relevant to India, which is the 20th in the series of country-specific YouTube sites that Google has launched. The global YouTube site already has 5 million Indian users.

It is not clear yet how YouTube will make money from its site which has established itself as the leading global hub for amateur videos.

For the moment it is experimenting with revenue-sharing with established media companies like Rajshri Films and UTV on a trial basis, while also carrying out in-house experiments on unobtrusive overlay advertisements on the videos. Revenue sharing is not available now for amateurs.

The challenge for Google is to evolve a mechanism to perfect revenue-sharing and payments, like it has done for its search-based ads and content for its Blogger.com site.

"Once we get to a point where we are comfortable, we'll get there in a heartbeat," Sakina Arsiwala, YouTube's Mumbai-bred International Manager, told Hindustan Times in an interview.

YouTube, which is a company acquired by Google, is building volumes, while Google's own video site (http://video.google.com) is focused on video search, Arsiwala said.

To help protect the copyrights of established media players and at the same time track users in a manner that could generate advertisement-friendly data, Google has developed audio and video "fingerprinting" technologies that can catch intellectual property thieves.

YouTube is for video streaming, not downloads, and has not evolved digital rights management (DRM) technologies that could help content generators make money by selling their videos through YouTube.

Google and microsoft and yahoo )) thats fun!

Google executives convened an emergency meeting last night to discuss the implications of a possible revived deal between Yahoo! and Microsoft.

The pair are understood to be negotiating a deal concerning the control of advertisements that are displayed next to internet search results, a market that is dominated by Google. The joint venture could be sealed in the next few days.

Speaking at the Google Zeitgeist conference in Hertfordshire, hosted by the internet company's founders Larry Page and Sergey Brin, Eric Schmidt, the chief executive, said: "After this press conference the three of us will meet and decide what our response is."

The three companies are fighting over online advertising, which is thought to be worth about $40 billion a year and is expected to double by 2010.

Over the past few days, Microsoft contacted Yahoo! about acquiring part of the internet company, but said that it had not ruled out a full takeover for the whole group. It is thought that Microsoft also wants to take a minority, passive stake in Yahoo!.

The renewed talks were triggered by Carl Icahn, the billionaire activist shareholder, who last week threatened to try to dismisss ten of Yahoo!'s directors and replace them with his own nominated executives. Mr Icahn is trying to use his 4 per cent shareholding in Yahoo! to force it to reopen talks with Microsoft.

At the end of January, Microsoft approached Yahoo! with a hostile takeover approach valuing the group at more than $40 billion. Two weeks ago, it raised its offer to $47.5billion. Both were rejected by Yahoo! as too low.

Mr Brin said yesterday that he would give Jerry Yang, the chief executive of Yahoo!, refuge within Google if investors were to push him out. Mr Schmidt and Google's co-founders added that they believed that Google was recession resilient, saying that search advertising was attractive to advertisers. Mr Brin added that Google had not yet ruled out a tie-up with Yahoo! Google recently ran a small trial of its technology on Yahoo!'s site in the US which was widely seen as offering Mr Yang a way to escape a Microsoft takeover.

Yahoo! failed to return calls yesterday and Microsoft could not be reached. Mr Icahn failed to return calls.