I have been talking for years about how Google is the most Enron-like company out there. Now I find out that Google has plans for trading energy! A quick overview of my Google/Enron arguments:
- Adwords! Google makes nearly all of their money through a process that is only completely transparent to themselves. Adwords advertising is what makes Google its money. Everything else is small change. It takes a lot of $1 clicks to turn into billions of dollars a year, but everybody I talk to says they “never click them” or “nobody clicks those ads!”
- The smartest guys in the room! This documentary film about Enron is starting to seem eerily familiar when I watch Google. Hire the smartest people you can find, so it gives the illusion that you are really doing something. Now, if anybody questions how you are able to make so much money, you can just say they are stupid because they don’t understand!
- The Black Swan! This phenomenon refers to the idea that because all the swans you see are white, black swans must be impossible. A company grows from nothing into the the most dominant force on the internet in just a few years. It must be perfect! Its stock will never go down! They have never made a mistake, so they never will! Hooray? Be careful.
I understand that Google probably uses more electricity than anybody other than the national security agency, so it makes sense that they would want to get more involved with energy trading. Google makes a lot of money, so they should be involved with banking too right?
The problem is that the public trusts Google too much.
Companies that make massive entries into new and unrelated businesses often fail spectacularly. When you get a bunch of smart people together to make money, the last thing you should do is trust them. Do you want the information Google stores about you influencing your power bill? Do you want to upgrade your thermostat to a cool new one from Google? What if it provides you with free wifi? Yes I’m joking, but Google isn’t.