Last week, Venture Beat Executive Editor Owen Thomas spoke to the staff of Tigercomm about social media, energy, politics and sustainability. It was a fascinating discussion, chock full of ideas, by someone who knows what he’s talking about. This Tuesday, we posted on Scaling Green about Owen’s thoughts on marketing the cleantech sector in a “visceral” manner, not just in a dry, intellectual way. Today, we’re going to give you a flavor of Owen’s observations on why Google is interested in the energy space, and how successful it might be there.
First, a bit of background. Recall that earlier this year, Google created a subsidiary called “Google Energy,” which is “looking to buy and sell electricity on federally regulated wholesale markets.” Then, in October, came big news – Google’s investment in a “massive” offshore wind farm, “ the Atlantic Wind Connection (AWC), a plan to erect a 350-mile stretch of wind turbines 10 to 15 miles off the United States’ Atlantic coastline, where waters are relatively shallow.” With that, the firm known primarily for searching the internet has moved big-time into the energy sector. The question is, why?
Owen Thomas’ first observation appears to answer that question: “Google as a solution looking for a problem.” With Google, of course, the “solution” has been “massive amounts of computing power, database crunching like you couldn’t believe, distributed computing power around the world, massive amounts of bandwidth.” The question for Google is, what to do with all this power? According to Owen Thomas, the degree of data crunching ability that Google controls isn’t needed for most things. For instance, social applications like Groupon rely more on “creative and smart and savvy” human beings, as opposed to “algorithms.” Which means that the ongoing challenge for Google is to find a problem that can use its proprietary solution – “massive amounts of bandwidth” and all the rest.
Enter, energy. According to Owen Thomas:
Energy is interesting to Google in a couple ways. The #1 reason why Google is interested in energy, is interested in clean tech, is that they buy a lot of energy…these data centers just consume like a city’s worth of energy…
So, Google wants to control its costs, Google wants to lower its carbon footprint because they’re at heart California do-gooders, and they’re just seeing a world as a pragmatic matter where the cost of carbon rises and they don’t want their costs to rise with the cost of carbon, so they’re looking for renewable energy that’s cheaper than carbon.
Now, that’s why they’re in clean tech. Now, the question is, what do you do with all this energy? Well, with this energy you run computing power, with this computing power, well now what do you do?
…they make search faster and better. But as far as the next big thing, Google is kind of trying to figure that out. And that’s I think part of why they’re struggling. They’re really oriented around massive computing power, and they’re not oriented around creating coming up with problems that can be solved with that computing power.
In sum, Google’s getting into energy for three main reasons: 1) its own energy consumption needs (and the cost that entails); 2) its desire to lower the firm’s carbon footprint; and 3) the search for the “next big thing” – namely, a “problem” big enough to match up with Google’s massive “solution” capabilities.
Will Google succeed in this endeavor? Owen Thomas doesn’t know, and we wouldn’t venture a guess either, but it will be fascinating to watch in coming months and years. Stay tuned!