Google, Unlike its Competitors, is Staying Away from Web3
This article was written by Aishwarya Jagani for Arweave News.
While ex-Twitter CEO Jack Dorsey was vocal about his fascination with Bitcoin and blockchain in general (and the new CEO, Parag Agarwal, seems equally keen on the technology), and Facebook has its own crypto division, Google has seemed reluctant to dip more than a toe into the waters of web3.
This is the first time the company, which has been quick to experiment with new technology like Augmented and Virtual Reality, Artificial Intelligence, and more, has stayed away from a hot internet trend.
With Web3 becoming something of a tech ‘buzzword’, even among crypto-virgins, so to speak, all but one of the big 5, Facebook, Apple, Amazon, Netflix and Google, have been quick to dive in.
Facebook was one of the first on the bandwagon, with its stablecoin Diem (formerly Libra), which was launched in 2019. Twitter is set to formally launch a crypto team, which will aim to be ‘a center of excellence for all things blockchain and web3,’ the company says.
The company plans to accept crypto payments for its future services such as Ticketed Spaces, create opportunities for creator monetization and attempt to decentralize its social media platform. “Twitter truly “gets” crypto (hello bitcoin tipping & NFTs!) but there’s so much more to explore here,” lead engineer Tess Rinearson tweeted in November.
Even Amazon is in, with rumors of the company launching a crypto token in 2022 doing the rounds.
But Google’s parent company Alphabet, has stayed on the sidelines so far, opting to wait and watch rather than dive in headlong. The company’s characteristically cautious approach to things has worked out well so far, but when it comes to web3, waiting could mean getting left in the dust as its competitors race ahead.
Google is Treading Cautiously…and With Good Reason
Web3 is inherently decentralized and community-controlled, an approach that stands in stark contrast to the business models of companies like Google, that make money by monopolizing users’ experiences and serving ads. The prospect of decentralized browsers, search engines and email providers is quite a threat to the likes of Google, which would stand to lose control over the massive amounts of user data they now have, in a decentralized universe.
“Web 2.0 tech giants have built their world-beating business models from creating an attention economy, commodifying users, surveilling their usage, and owning the data,” says SingularDTV in a Medium post.
The prospect of decentralized platforms that put control back into the hands of users, pose a threat to the Big 5 of technology, but most of all to Google.
Besides the obvious disconnect between decentralized technology and centralized technology companies like Google, most Web3 platforms don’t involve advertising, which is Google’s primary source of revenue.
Decentralized search engines like Almonit, Presearch, and Blockscan do not collect any identifiable analytics data and provide a more attractive alternative than Google to privacy-conscious users. Presearch has integrated NFT searches into its platform and is already aspiring to be the ‘Google…for the Web 3 era of decentralization’, according to founder Colin Pape.
In addition, Google has also been enmeshed in regulatory troubles, including with the European Union over forcing manufacturers to use Google Assistant as the default virtual assistant on Android devices, and with the government of Turkey over ads in Google’s search results.
The company is also facing multiple antitrust probes in Asian countries, including in India and China.
Given its regulatory troubles, it makes sense for Google to stay away from blockchain and cryptocurrencies, which have governments across the world flip-flopping between wanting to adopt and regulate the technology to wanting to ban it outright.
Plus, the company’s zero-emission targets also clash with the energy-intensive nature of most cryptocurrencies, although with more proof of stake, proof of capacity, and proof of consensus cryptocurrencies in development, that could change.
Taking Baby Steps
But Google isn’t entirely satisfied sitting on the sidelines either and has been making cautious inroads into blockchain. In 2020, the company signed up as Network Validator for blockchain video network, Theta. Theta rewards network participants for relaying video content to other users using their spare bandwidth and computing resources. As an external validator, Google would be helping with security and governance of the network.
“I can’t offer specifics about the technical direction Theta will take, but I can say that we’ll be a good partner,” Google Cloud developer advocate Allen Day said as part of the announcement.
More recently, in September 2021, Google announced a partnership with Dapper Labs Inc., a Canadian startup and NFT platform that supports some of the most popular NFT collections such as NBA Top Shot and CryptoKitties. Google Cloud will act as a network operator, supporting the Flow network as part of the deal.
And that isn’t the extent of it. Google is also on the governing council of enterprise-grade distributed ledger network Hedera Hashgraph, and is a block producer for Block.one, the originator of EOSIO, an open-source blockchain tool that ‘provides developers and businesses with the tools to build the infrastructure of tomorrow’, as their website puts it.
Google Cannot Afford to Stay Cautious for Too Long
Google’s competitors have big plans for blockchain in 2022, with Twitter getting ready to accept crypto payments, Facebook aiming for ‘deep compatibility’ with blockchain technology, and Amazon potentially launching its own token. How long the company continues to be cautious and stay on the sidelines remains to be seen.
Tech employees at companies like Google, Amazon and Apple are quitting their jobs to join crypto startups at an alarmingly fast pace, as tech giants struggle to retain them. “It’s the perfect storm,” Sandy Carter, ex-Vice President of Amazon’s cloud computing unit, who quit her job to join a crypto technology company, told The NY Times. “The momentum we’re seeing in this space is just incredible.”
The wave of executives and engineers leaving traditional tech companies for crypto startups has included former Google executive Sridhar Ramaswamy, former Lyft CFO Brian Roberts, former Twitter CEO Jack Dorsey, and David Marcus, ex-head of Facebook’s cryptocurrency division.
Google cannot continue to be wary of crypto and blockchain for too long, especially if it doesn’t want to fall behind as its competitors embrace decentralization with open arms.