Can Clever Can Backfire in the Google, PayPal Affair?

May 28, 2011

I read “PayPal-Google Lawsuit Reveals More About How Android Market Deal Went Awry.” The article did a good job of summarizing how one giant company did what appears to be standard Silicon Valley recruitment and another big outfit’s letting legal eagles do their flapping and screaming.

Job hopping in America is as much a part of the American way as the Indy 500 where a team can pay to get a driver in the race or donate to Mother Teresa to make her focus her attentions on some other target. (Keep in mind that Ryan Hunter-Reay failed to quality, but we will be in the race because of the “replacement rule”, Mario Andretti, and, of course, his “pull”.)


Is the Google PayPal dust up just a case of Mother Teresa’s approach being applied in a Silicon Valley context? My view: An unfortunate misunderstanding with no relation to the hiring matter of Kai Fu Lee in 2005. See

In most cases, I would ignore the issue. Google is an online ad outfit which, after 12 or 13 years, is somewhat clumsily trying to diversify its revenue base. After so many fits and starts, I check out the GOOG every two or three days, leaving the day-to-day roll outs (Scribe) and product terminations (Google Translate API) to the writers who contribute stories to Beyond Search and Inteltrax and my other Web logs.

And PayPal? My efforts to make sure PayPal has one version of my name which variously appears as Steve, Stephen, or the fascinating Stephene has driven me from the service. Navigation of PayPal out Facebooks Facebook is weird access methods. I have permanently blocked anything with the string paypal due to my ISP’s inability to cope with the stream of spam sent by whoever likes PayPal more than I.

I must make an exception this morning, however. In the “Awry” article, I noted this passage:

What we had heard prior to the lawsuit from sources connected to the deal is that Google had wanted to white-label Paypal inside Android Market — a condition which would have been absurd for Paypal to accept. There was also internal tension over which group, Tilenius’ commerce team or Andy Rubin’s Android team, would have control over any payments solution inside the app store.

If accurate, this is a cake-and-eat-it-too tactic, and it is very clever. Learn stuff, get the juices flowing, and then consider the question, “Heck, why don’t we just build out own”?

What was left out of the write up was a reference to the Google Yahoo (Overture) dust up prior to Google’s initial public offering. My recollection is that Google settled an allegation of improperly obtaining inspiration from the Overture (formerly online ad system. The number $1.0 billion is zooming across my radar. Suffice it to say, if I remember an antecedent to the PayPal allegation, it went away after the application of that American folk medicine, money.

With online advertising going up again, if ClickZ is right in its assertion that “Internet Ad Revenues Soar 23 Percent in Q1”, the Google has plenty of cash to hire anyone it wishes to hire, pay almost any amount to make an allegation take a vacation in Capetown, South Africa, and move forward with the Google revenue diversification efforts.

My question: “Why after about 12 years of effort, has Google NOT been able to diversify its revenue base?”

And a related questions: “Why get snarled in another messy, high profile matter where ‘clever’ wanders toward to the line separating Mother Teresa and Arkadi Gaydamak?”


What marks will these probably unfounded allegations against Google leave on the company’s flawless skin? See

I had a Calvert Course teacher in Brazil in the 1950s who told me, “I would prefer as friend a good man ignorant than one more clever who is evil too.” This sounds like a statement from a drug crazed poet or malaria stricken American earning pinga money by tutoring.

Clever, though. That’s why I prefer old fashioned methods such as a physical wallet and cash money in my pocket.

Stephen E Arnold, May 28, 2011

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