Speaker:

Ladies and gentlemen: President and CEO of the Consumer Electronics Association, Mr. Gary Shapiro.

Gary:

Welcome to our last keynote presentation of the 2006 International CES. I'm so glad you're joining us. Certainly one of the most interesting and dynamic companies to survive the bursting of the dot-com bubble is Google. From humble beginnings as a graduate research project, Google today ranks among the world's most highly valued technology companies. Even with that phenomenal success, Google co-founders Larry Page and Sergey Brin still share an office at the Googleplex, the company's headquarters in Silicon Valley.

Google's mission is to organize the world's information and make it universally accessible and usable. As a first step to fulfilling that mission, Google's founders developed a new approach to online search. It took root in a Stanford University dorm room and quickly spread to information seekers around the globe. Today, Google is one of the world's more respected brands and is recognized as the world's largest Internet search engine. Google is even used as a verb. It's common to "Google" another person you want to know better. Google is one of the most innovative companies of the past decade, moving the company beyond the traditional search engine to include video, voice, wireless applications and beyond. So ladies and gentlemen, please welcome Google, and Larry Page.

Larry:

Wow. I've never seen so many cameras in my life. I'm going to talk about cameras later – I didn't realize I would have such a great introduction. It's really great to be here, it's a great honor. Before I get started I should explain what you guys were just watching: initially, you were seeing search queries over about a five-minute segment. Each little dot you saw was a query going up into space, and we're showing a sample of the actual queries. Since it was daylight in the U.S., that affects what the queries look like. And next was a movie produced by Google Earth, which you can download. The inlays were National Geographic photos that are overlaid in the right part of the globe, which is really cool.

So maybe I should explain [what I'm standing in front of.] This, for those of you who don't know, is Stanley, the robotic car – probably the first successful robotic car in the world. I was lucky enough to be maybe 60 miles from here or so in the desert when they ran the DARPA contest, which offered a $2 million prize for the first robot to drive 132 miles through the desert. Over 195 teams entered and I'm really proud that Stanley, the Stanford-based car, from my alma mater, was the winner.

I wanted to bring it here because I think it's really inspiring for the engineers and other people who work on consumer electronics. [This] is something that pretty much everybody thought was impossible: to have a car that would drive itself, avoid obstacles. It drove down a really steep, narrow mountain road and just did amazing things. The year before, none of the teams finished – and Stanley did it flawlessly, running at basically the speed limit the whole time. So I think it's really an amazing thing, and shows what we as an industry can do if we put our minds to it.

[Introduces Mike Montemerlo, one of the creators of Stanley, on stage.]

Before we get into the main presentation, I just wanted to say these guys are really heroes for me, and I'm really amazed at what they were able to do. There were about 50 people on the team working basically over a year or two to make the car really work, and I think it's just an amazing achievement, something we should celebrate.

Well, so one of the first things I want to show you, coincidentally, is a project with VW to do a prototype of Google Earth for a dashboard. [Shows image.] Isn't this just beautiful? I wish I had one of these in my living room. But this is a full dashboard. This is Daniel. He's going to do a quick demo. We're going to go from the Las Vegas Airport to the Strip, and this is gives you an idea what it might be like if you have something like Google Earth really integrated well with your car. We'd love to do something like this. One of the cool things is you can actually see things like restaurants and gas stations and things like that along your route. You can also see the route before you do it from a bird's-eye view. So this is all live. You saw the demo earlier of Google Earth, but we can really put this kind of technology into cars and we'll even show you into smaller devices in a second. Isn't that cool? So here we are going along towards the Strip. And you can see the gray 3D models of the buildings along the Strip, see different places to eat and so on. So thanks a lot Daniel, for the demo.

Now another amazing thing about this technology is that we can actually put it into telephones really well. We're going to do a quick demo of that with a real live phone, which is not usually the way you do these things. Matt's going to show us what would happen if we got too excited at CES and we overslept our flight, missed our connection and ended up in Missoula, Montana. We might actually want a place to stay, so he's going to look for a hotel near Missoula.

This is all real-time, this is something you can run on your phone right now. You can scroll around, you can get a look at different hotels, you can get directions. He's going to stay at the Hampton Inn. And you can see the different steps in the directions. I actually used this recently. I was lost someplace and I just used this. It was amazingly helpful. You can see satellite maps. You can zoom in and out just like you can on Maps.Google.com. It really, really works well. And I think these kinds of mobile devices are really starting to work, and I think that's an amazing thing.

We also announced today we have a version of this for the BlackBerry. I know many of you probably in the audience have BlackBerries, yes, raise your hands. Yes, so you can download this now at www.google.com/GLM – Google Local for Mobile. Thanks a lot, Matt.

Now a couple of years ago I actually came to CES for the first time and for me it was an amazing experience because being sort of a geeky kind of person, imagine the America's largest trade show is actually sort of a geek convention. Aside from just being a lot of fun and really interesting, as I was walking around, I sort of realized that you had all these devices at CES, they have screens and keyboards and outputs and inputs of various types. They don't really connect to each other. And I was walking around, I was really struck by that – and how you can really apply the techniques from the Internet to the consumer electronics world.

So you have tons and tons of devices that don't connect to each other at all – and why is that? At Google, we were really lucky to hire this guy named Vint Cerf, who was one of the architects of TCP/IP, which is how all Internet computers connect to each other. And the amazing thing is that people like Vint produced a standard that actually works. All the computers could talk to all the other computers, and it didn't matter whether they used fiber or Ethernet or serial ports or modems or even the old telephone standard, FDDI. It didn't matter. The software just worked whether the machine was next to you or all the way across the world. I think those principles can really be applied to all of the devices that you have.

The other interesting thing about the Internet is it was developed by dreamers in universities. It was based on truly open standards and was maximally flexible, with no gatekeepers anywhere in the process. And that's why we have the Web today, and why we can have things like Google.

Right now, if you look at consumer electronic devices – let's say I have a camera. They all have USB. I have a USB pocket hard drive, but I can't actually connect to that and have it store the pictures. Why not? The hardware could actually work with a little bit of modification, but the software has not been developed to do this. Now maybe two guys sitting here say, "Oh, I'll give you my photos if you give me yours." But they can't do that either – they're going to have to find a computer. So it's kind a hassle to have a computer in an auditorium like this.

Now if there are device manufacturer people here, I don't want you to say, "Oh, that's a great idea. I'll go implement it," because you won't think of all the things that you should do. That's the whole point about the Internet. People think of new things to do all the time, and you can't possibly think of all of them. So every manufacturer would have to implement every cool piece of software, and there's no point in that. You might as well have it done once. Instead, make devices flexible by supporting reasonable open standards for how they work. Imagine if you introduced a new Wi-Fi camera in 2007 and some very smart kid in Lithuania creates software so that you can actually share photos, and so all the nearby devices – telephones and different cameras around – can get the group photo so everybody doesn't have to take the photo multiple times, like all of you guys are doing. That would really save a lot of effort and would be really cool – but not every device manufacturer should have to think of that. We should really enable software people to do what they know how to do.

[Furthermore], you should be able to plug in devices anywhere and have them work. There's a lot of talk at this conference about having TVs connected to the Internet and connected to computers. Why can't you plug your TV into any convenient outlet – Ethernet, Wi-Fi, USB, whatever is handy – and have images displayed on there? Why does it matter if it's in your living room or wherever? In fact, what if you want your USB webcam to monitor your front door – shouldn't you just be able to plug it into a USB through an adapter into Ethernet, or into Wi-Fi, or whatever you happen to have in your house? It shouldn't be a big deal. It shouldn't require any software.

I'll give you just a few more examples. Why can't your Bluetooth cell phone start your car, given that your car already has a Bluetooth speakerphone built in? Why can't you use that to unlock your car instead of carrying your keys? There are a million things [like this, and] we're not going to think of all of them, but if we have good communication between these things, they'll really start to work well. The hardware we have is amazing. It can do tons and tons of stuff. Your Bluetooth car is probably near a cell phone most of the time. Why doesn't it download latest repair information automatically? It would be easy to do.

One wire should do everything possible. If you plug a wire into something, you should be able to do anything you could possibly do with that device – run software on it, charge it, power other devices from its battery, or whatever, just with that single wire. We could basically do that with the hardware we have. And it should work the same whether you plug that wire into your house, your neighbor's house, or all the way around the world.

All the devices at CES, as I mentioned, have keypads and screens and things like that, if you look around. Now why is there no standard for those little screens and keypads? I'd like to have the ability to buy a little touch screen. It'd probably cost about $50 and I might plug it into my computer or Ethernet and here I've just decided I want to use it as an alarm clock. Let's say I plug it into my wall and since it has Bluetooth, and it's talking to my computer and shows what time I need to wake up based on the meetings I have. Maybe it can also show you your music and let you control your stereo. But whatever the software people figure out what to do, that display should do it. It doesn't need to necessarily have a speaker built in, because maybe my computer wakes me up instead of the alarm clock. I'm amazed that we don't have devices like this – and the reason we don't is because we lack standards to do it.

Another example [slide of a pile of adapters and cords]: these are the power adapters just lying around our office. I'm sure most of you have things like this under your desk too. It's a real hazard. You could electrocute yourself – if one in a million adapters catches fire and you have a thousand adapters, it starts to be an issue. And it's also a big hassle for the manufacturers because every one of those devices now has this thing that's in the box that's specific to a country. And so they have to repackage the boxes and maintain stock for different countries. It's just silly, and also really inefficient, because guess what? They are sort of subsidized by the devices you buy, so people try to provide the cheapest ones possible. So they all suck power.

Why not instead standardize the power and have a basic [adapter device] so you can say, "I want 12 volts, 2 amps, give it to me." Then you can buy a really nice power supply that's really efficient, really small, is appropriate to the country you're in, and the consumer can pay for it instead of the device manufacturer so they'll have higher margins. Then we don't have that mess of cords. either. So I think we really, really do need standards in these areas.

So basically, most devices should be connected through adapters – and you can adapt anything to USB for like $20. (If you want to do video it's a little bit more expensive.) We have adapters for everything else already. Do you really need all these ports running around? I don't think it's necessary.

Let me show you a positive example: phones. You can plug any Bluetooth headset into any Bluetooth phone and it will work great. Here [shows slide] are some examples we found lying around the office. Charging is still an issue for these things, so you still need standard power.

So in summary, we really want to get all this stuff to work together. This is just of a personal passion of mine. What we really need are adapters like I mentioned. And also it's very important that we have standards for security, discovery, peering, and forwarding to the Internet. And we don't really have those things yet. We also need the standards, and there are some already that can be adapted for protocols. Now finally, as I mentioned, you can take USB and really do most of the things you need to do with it.

I'm going to just plead with all of you, let's get the power supply problems fixed, or let's get all these devices talking together. I think we'll get just amazing innovation, things we just totally can't predict happening, and also all of you as consumers will be a lot happier. Your devices will really just work, you'll be able to plug anything together that makes sense: if you need storage, or you need a bigger display on something, you just plug it in a display, or whatever you want to do. This is a really important thing to get done. We'd love to have help in doing this, or I'd love ideas from people. I thought I'd throw this out as something interesting to get people thinking about.

We've done a small part about this in our own town, in Mountain View [California]. We've provided Wi-Fi over Mountain View for free, and part of that is to get all these devices really talking to teach other and get a basic standard of communication in place. Most of the world does not have good access to the Internet and that's an interesting problem. How do you make that happen?

Now, in the context of standards: you can email anyone, but you can't really instant-message everyone. Guess which was developed at universities? Email was – and instant messaging has no real standard, so didn't catch on as much inside universities. Now companies have done [instant messaging], but if you run on one system, you can't talk to people on another one for reasons that don't really make sense to me. So we released Google Talk, which is an interoperable system – the idea is that anyone can talk to anyone else. We've had a whole bunch of different people develop interoperable systems for it, as you can see on the next slide [of Google Talk federation partners] .We're really, really excited about the possibilities there. Also as expansion of our partnership with AOL, we announced that our users and AOL AIM users can interoperate, which we're also really excited about, though it's kind of a separate thing.

Now the openness of Google Talk has led to a lot of interesting things. We've had people just by themselves go out and develop cool applications for it. One was that [RIM] just announced Google Talk for a BlackBerry client you can download. And also we have a voice client that Nokia developed for the Nokia 770, which is a very cool Linux-based sort of Wi-Fi Internet tablet. I kind of cool to see these things happening.

Now let me switch gears to talk about a very serious issue. About 15 per cent of the people in the world are on the Internet right now – 15 per cent. We still have a huge way to go to get everyone online. And [on our search query demo] you're seeing kind of where our queries come from. If you look at a picture of earth from space at night, you'll see that anywhere there's electric light, there's Internet,and anywhere there's Internet people are using Google. It all corresponds perfectly. But it's very sad that, for example, there are almost no queries coming from anywhere in Africa. I think that's an important thing to work on.

To try to help this, something we've been supporting is the MIT $100 Laptop Project. I just have a little model here of that. It's a very cool project and they have very ambitious goals for it. They want to actually get 100 million of these out in the hands of children worldwide. It's also a very cool device, with a half a gigahertz processor, 128 megs of RAM and 500 megs of flash. And they're also doing a lot of cool things to get the price down. But I think it's really important to get devices like that out there in the world to give people greater access.

Another big part of access is the Internet part — so another thing we've supported is Current Communications, a company that [provides] broadband power lines. So you can just take a little box like this and plug it in on your wall and you've got broadband wireless (or wired) Internet access.

Now, I'll switch gears again and talk about a problem that probably many of you have had, similar to the device problem. I imagine you have lots of software on your PCs. I recently installed a printer and 400 megabytes of software on my machine, which took quite some time. It's very difficult in this day and age to keep your computer maintained, to keep the right software on it, to have protection from viruses and problems with the Internet and to also just have the right kind of stuff, like a PDF reader and good browsers and things like that. Users are just frustrated by this, and we had a team that was really excited to solve this problem.

So we're announcing Google Pack right now, which I think is an amazing product. It's something that makes basically having the right software on your computer as easy as going to the Google homepage. It's not fuss at all.

Now, let me just cover a few of the things we have in Google Pack. In one click you can download a whole bunch of different software: safety and security for Ad-Aware and Norton Antivirus. Find things with Google Desktop and Google Earth. Manage your photos using Picasa. Browse PDFs using Adobe Reader 7. Get Firefox to browse the Web better. And you can also have a great photo screensaver. And how much does this cost? It's free. Yes. Now let's do a quick demo of this because I want to show you how easy it is really to get done.

[Demo of Google Pack.] Right now, you can download Google Pack, those of you with laptops out there. There's [only] one legal message – you should read that very carefully, of course. Basically you'll get a tiny little installer program that will take a very short amount of time to get over a modem, and then it will start downloading all of your programs in the background. And it's smart. It doesn't use all of your bandwidth, so you can actually still use your computer to read your email or surf the Web or whatever you want to do.

We've also enforced some guidelines on the software makers so that they don't annoy you. [Google Pack] doesn't bring up dialogue boxes asking you for things or step on other software settings, which you may have had happen on your machine. I think it's really a great thing. Even during the demo here, a very short amount of time, we've already made this one computer work much better.

Now, Google Pack would probably be enough for us to announce here, but we have one more thing. We launched Google Video about a year ago in beta, and it was kind of weird and innovative – weird because it was called Google Video, but you couldn't actually watch any video. And it was innovative because the way you searched TV programming, which you couldn't search before. We learned a lot from that – that the video was really interesting and useful, but you really need to have access to it, which is not surprising.

Then we launched the Google Video Upload program which is also weird and innovative. It was weird because we made two Chinese teenagers really famous, (but it had to do with the Backstreet Boys also). And it was innovative because anyone could upload anything, and we just covered hosting and all the hard details of making that really work well.

I was just in Ethiopia, and on a whim I searched Google Video for "Ethiopia," and we have all these films of protests there, which are from the front lines. So it's been an amazing tool for us – every day there are more and more things being uploaded there. But for a lot of providers, it cost them a lot of money to make their video. I don't know if that's surprising to people, but they really need ways to monetize this. And the users also need a way to watch the information. When we had Google Video initially, you couldn't watch all the TV shows because there's no way to pay for them, no way for the content producers to make that available to the users.

What we're announcing today is the Google Video Store. It's weird and innovative like the previous versions in that it lets anyone sell video, from the largest studios to the smallest independents. And it puts the content producers in charge. They can decide what to charge for their video. I do encourage you to think about what other people are willing to pay for your video, because it might not be the same amount that you want. But in any case, the content producers can decide whether they want the videos for rental or for download. So we've already got thousands of videos up online to buy, and it's very simple and easy to install.

I guess we wouldn't want to announce the Video store without a whole bunch of great video, right? So we have a lot of great video from a whole bunch of partners, including historic news footage from ITN, interviews from Charlie Rose, music videos from Sony BMG, and cartoon classics like Rocky and Bullwinkle – yeah. And for basketball fans, we're delighted the NBA has agreed to permit us to allow users to download NBA games 24 hours after they're broadcast.

Kenny Smith:

[Enters from audience to stage.] Oh, oh, wait a minute, wait a minute. Larry, Larry, what's going on? I've got to figure this out. This is a big deal, man. You've got to tell me, you've got to explain this to me.

Larry:

Who the heck are you?

Kenny Smith:

Kenny Smith, two NBA championships inside the NBA...

Larry:

Oh, yeah, yeah, yeah, I remember now.

Kenny Smith:

Now, you telling me now that I could download NBA games 24 hours after and watch them?

Larry:

Yeah.

Kenny Smith:

Why didn't you have this when we were winning championships? I would have been watching myself all the time, every day, all day on my computer, on my laptop, everywhere. Well, you know what? I'm going to go see if I can get the guys to download my old games, put ‘em on Google so everybody can see the championships and then I can make fun of Charles [Barkley] too. [So]

All right, thanks a lot. [Exits.]

Larry:

Now we're really excited to be working with all of these [video] partners, but as we roll out this new endeavor, we couldn't be happier to have one more: a premiere partner that creates some of the world's most popular content – CBS. Beginning today, CSI, Survivor and CIS and more will able available for download for $1.99 each. Archive classics from Star Trek to My Three Sons to the Brady Bunch will also be available. This is the very best content there is on broadcast television, some of the most popular programming in the world, and it's coming to Google video. This is truly a historic meeting of established and new media, and we're very proud to have with us here today, to celebrate this terrific first, the new President and CEO of the CBS Corporation, a man who needs no introduction, and who defines creativity in the media business, Leslie Moonves.

Leslie Moonves:

Thank you, Larry. It is truly great to be here and be part of this amazing presentation. Google and CBS. CBS and Google. Who would ever have thought those two brands would be together on the same stage at the same time? It's pretty amazing. One, CBS, is the most established name in traditional media. The other, Google, is writing new media history every single day. And yet today's unprecedented coming together of these two great names is, in a way, what our media universe is all about: the marriage of content with new ways of getting that content where it matters to people. CBS and Google, we're each number one in what we do. Each of us needs the other to take the next leap forward.

Earlier this week, we at CBS split from Viacom and established a new independent company, a company dedicated to driving the very best content across all platforms, to reach the greatest number of people. That's our mission. Now as the week as a new corporation comes to a close, I could think of no better exclamation point than to partner with a company that operates the world's leading search engine. Suddenly at home, at the office, or now almost everywhere, on a wireless laptop, fans can access what is already some of the most watched programming on television. CSI, Survivor whenever you want it. All you need is a PC. And for the first time, content, as Larry mentioned, from CBS and Paramount's huge library is being made available for download as well. From I Love Lucy to Star Trek to the Brady Bunch, our archive of timeless classics and cult favorites are ripe for video search. And so we're very, very pleased that Google not only is, but will remain, a Very Brady place.

I want once again to thank you, Larry, for letting us join you today in this huge presentation. If you'll stick around, he's going to show you how this thing works. Thank you.

Larry:

Thank you so much. We're really honored to have Les with us today to make that announcement. Now let me show you how easy this really is to do. So we'll have a quick demo here with Peter to show you Google Video. So we'll first show an NBA clip. And this is – if you go to Google Video, this is what you'll see. You can quickly watch your basketball clips, for example. You can see the first 30 seconds for free of these programs [shows program clip].

Then let's go to like a Charlie Rose clip for a second. [Shows program clip.] You can actually see here that you can download to your video iPod or your Sony PSP with the non-copy protected contents on here. Yeah. Now let's go to Survivor – why don't we purchase this one, to show how easy that is. You can actually buy it while you're watching the preview, which is kind of cool. Then it will confirm the purchase, and then you can download it.

[Shows screen.] This is the new Google Video Player, which is very simple and easy to use and it actually has a very cool feature. You can actually only watch [the parts you want to watch] of, say, Survivor. See the quality is really good, and it's really easy to use. It's exciting to see this quality of content available in this easy and intuitive way. Thank you, Peter, for the demo.

I couldn't be more excited about this release of Google Video with all this amazing premium content in it and I also wanted to make sure we left some time for questions.

end of session