History of Google



This article covers the history of Google, the most widely used web-based search engine in the world.

The company was officially launched in 1998 by Stanford University students Larry Page and Sergey Brin, who developed a search algorithm first known as "BackRub" in 1996. Their main product, Google Search, proved successful and the expanding company moved several times before settling in Mountain View, California in 2003. Its first initial public offering was made in 2004 and quickly became one of the world's largest media companies.

Some of the products launched or acquired throughout the years include: Google News in 2002, Gmail in 2004, Google Maps in 2005, YouTube in 2006, Google Chrome in 2008, and Google+ in 2011 – among many other products.

In 2015, Google became the main subsidiary of the holding company Alphabet Inc.

Early history


Google began in March 1996 as a research project by Larry Page and Sergey Brin, both PhD students at Stanford University working on the Stanford Digital Library Project (SDLP). The goal of the SDLP was "to develop the enabling technologies for a single, integrated and universal digital library" and was funded through the National Science Foundation among other federal agencies. In search for a dissertation theme, Page considered—among other things—exploring the mathematical properties of the World Wide Web, understanding its link structure as a huge graph. His supervisor Terry Winograd encouraged him to pick this idea (which Page later recalled as "the best advice I ever got") and Page focused on the problem of finding out which web pages link to a given page, considering the number and nature of such backlinks to be valuable information about that page (with the role of citations in academic publishing in mind).

In his research project, nicknamed "BackRub", he was soon joined by Sergey Brin, a fellow Stanford Ph.D. student supported by a National Science Foundation Graduate Fellowship. Brin was already a close friend, whom Page had first met in the summer of 1995 in a group of potential new students which Brin had volunteered to show around the campus. Page's web crawler began exploring the web in March 1996, setting out from Page's own Stanford home page as its only starting point. To convert the backlink data that it gathered into a measure of importance for a given web page, Brin and Page developed the PageRank algorithm. Analyzing BackRub's output—which, for a given URL, consisted of a list of backlinks ranked by importance—it occurred to them that a search engine based on PageRank would produce better results than existing techniques (existing search engines at the time essentially ranked results according to how many times the search term appeared on a page).

A small search engine called "RankDex" from IDD Information Services (a subsidiary of Dow Jones) designed by Robin Li was, since 1996, already exploring a similar strategy for site-scoring and page ranking. The technology in RankDex would be patented and used later when Li founded Baidu in China.

Convinced that the pages with the most links to them from other highly relevant Web pages must be the most relevant pages associated with the search, Page and Brin tested their thesis as part of their studies, and laid the foundation for their search engine. By early 1997, the BackRub page described the state as follows:

Some Rough Statistics (from August 29th, 1996) Total indexable HTML urls: 75.2306 Million Total content downloaded: 207.022 gigabytes ...

BackRub is written in Java and Python and runs on several Sun Ultras and Intel Pentiums running Linux. The primary database is kept on an Sun Ultra II with 28GB of disk. Scott Hassan and Alan Steremberg have provided a great deal of very talented implementation help. Sergey Brin has also been very involved and deserves many thanks.

-Larry Page page@cs.stanford.edu

Originally the search engine used the Stanford website with the domain google.stanford.edu. The domain google.com was registered on September 15, 1997. They formally incorporated their company, Google Inc., on September 4, 1998 at a friend's garage in Menlo Park, California.

Both Brin and Page had been against using advertising pop-ups in a search engine, or an "advertising funded search engines" model, and they wrote a research paper in 1998 on the topic while still students. However, they soon changed their minds and early on allowed simple text ads.

By the end of 1998, Google had an index of about 60 million pages. The home page was still marked "BETA", but an article in Salon.com already argued that Google's search results were better than those of competitors like Hotbot or Excite.com, and praised it for being more technologically innovative than the overloaded portal sites (like Yahoo!, Excite.com, Lycos, Netscape's Netcenter, AOL.com, Go.com and MSN) which at that time, during the growing dot-com bubble, were seen as "the future of the Web", especially by stock market investors.

In March 1999, the company moved into offices at 165 University Avenue in Palo Alto, California, home to several other noted Silicon Valley technology startups. After quickly outgrowing two other sites, the company leased a complex of buildings in Mountain View at 1600 Amphitheatre Parkway from Silicon Graphics (SGI) in 2003. The company has remained at this location ever since, and the complex has since become known as the Googleplex (a play on the word googolplex, a number that is equal to 1 followed by a googol of zeros). In 2006, Google bought the property from SGI for US$319 million.

The Google search engine attracted a loyal following among the growing number of Internet users, who liked its simple design. In 2000, Google began selling advertisements associated with search keywords. The ads were text-based to maintain an uncluttered page design and to maximize page loading speed. Keywords were sold based on a combination of price bid and click-throughs, with bidding starting at $.05 per click. This model of selling keyword advertising was pioneered by Goto.com (later renamed Overture Services, before being acquired by Yahoo! and rebranded as Yahoo! Search Marketing) While many of its dot-com rivals failed in the new Internet marketplace, Google quietly rose in stature while generating revenue.

Google's declared code of conduct is "Don't be evil", a phrase which they went so far as to include in their prospectus (aka "S-1") for their 2004 IPO, noting, "We believe strongly that in the long term, we will be better served — as shareholders and in all other ways — by a company that does good things for the world even if we forgo some short term gains.

Financing and initial public offering
The first funding for Google as a company was secured on August 1998 in the form of a $100,000 contribution from Andy Bechtolsheim, co-founder of Sun Microsystems, given to a corporation which did not yet exist.

On June 7, 1999, a round of equity funding totalling $25 million was announced; the major investors being rival venture capital firms Kleiner Perkins Caufield & Byers and Sequoia Capital.

While Google still needed a lot of funding for their further expansion, Brin and Page were hesitant to take the company public even though that would basically solve most of their financial issues. They were not ready to give up their control over Google. After borrowing the $25 million venture capital money from Kleiner Perkins Caufield & Byers and Sequoia Capital, Sequoia forced Brin and Page to hire a CEO or else they would take back that borrowed $12.5 million. Finally, Brin and Page gave in and hired Eric Schmidt as Google’s first CEO in March 2001 and the company went public three years later.

In October 2003, while discussing a possible initial public offering of shares (IPO), Microsoft approached the company about a possible partnership or merger. However, no such deal ever materialized. In January 2004, Google announced the hiring of Morgan Stanley and Goldman Sachs Group to arrange an IPO. The IPO was projected to raise as much as $4 billion.

On April 29, 2004, Google made an S-1 form SEC filing for an IPO to raise as much as $2,718,281,828. This alludes to Google's corporate culture with a touch of mathematical humor as e ≈ 2.718281828. April 29 was also the 120th day of 2004, and according to section 12(g) of the Securities Exchange Act of 1934, "a company must file financial and other information with the SEC 120 days after the close of the year in which the company reaches $10 million in assets and/or 500 shareholders, including people with stock options."Hollands, Melanie. "Analysis: Will Wall Street turn its back on Google?" Manager's Journal May 21, 2004. Google has stated in its annual filing for 2004 that every one of its 3,021 employees, "except temporary employees and contractors, are also equity holders, with significant collective employee ownership", so Google would have needed to make its financial information public by filing them with the SEC regardless of whether or not they intended to make a public offering. As Google stated in the filing, their, "growth has reduced some of the advantages of private ownership. By law, certain private companies must report as if they were public companies. The deadline imposed by this requirement accelerated our decision." The SEC filing revealed that Google turned a profit every year since 2001 and earned a profit of $105.6 million on revenues of $961.8 million during 2003.

In May 2004, Google officially cut Goldman Sachs from the IPO, leaving Morgan Stanley and Credit Suisse First Boston as the joint underwriters. They chose the unconventional way of allocating the initial offering through an auction (specifically, a "Dutch auction"), so that "anyone" would be able to participate in the offering. The smallest required account balances at most authorized online brokers that are allowed to participate in an IPO, however, are around $100,000. In the run-up to the IPO the company was forced to slash the price and size of the offering, but the process did not run into any technical difficulties or result in any significant legal challenges. The initial offering of shares was sold for $85 a piece. The public valued it at $100.34 at the close of the first day of trading, which saw 22,351,900 shares change hands.

Google's initial public offering took place on August 25, 2004. A total of 19,605,052 shares were offered at a price of $85 per share. Elgin, Ben. "Google: Whiz Kids or Naughty Boys?" Business Week. August 19, 2004. Retrieved on February 25, 2007. Of that, 14,142,135 (another mathematical reference as √2 ≈ 1.4142135) were floated by Google and 5,462,917 by selling stockholders. The sale raised US$1.67 billion, and gave Google a market capitalization of more than $23 billion. Webb, Cynthia L. "Google's IPO: Grate Expectations." The Washington Post. August 19, 2004. Retrieved on February 25, 2007. The vast majority of Google's 271 million shares remained under Google's control. Many of Google's employees became instant paper millionaires. Yahoo!, a competitor of Google, also benefited from the IPO because it owns 2.7 million shares of Google. Kuchinskas, Susan. "Yahoo and Google Settle". internetnews.com. August 9, 2004. Retrieved on February 25, 2007.

The company is listed on the NASDAQ stock exchange under the ticker symbol GOOG.

Growth
In February 2003, Google acquired Pyra Labs, owner of Blogger, a pioneering and leading web log hosting website. Some analysts considered the acquisition inconsistent with Google's business model. However, the acquisition secured the company's competitive ability to use information gleaned from blog postings to improve the speed and relevance of articles contained in a companion product to the search engine Google News.

At its peak in early 2004, Google handled upwards of 84.7% of all search requests on the World Wide Web through its website and through its partnerships with other Internet clients like Yahoo!, AOL, and CNN. In February 2004, Yahoo! dropped its partnership with Google, providing an independent search engine of its own. This cost Google some market share, yet Yahoo!'s move highlighted Google's own distinctiveness, and today the verb "to google" has entered a number of languages (first as a slang verb and now as a standard word), meaning, "to perform a web search" (a possible indication of "Google" becoming a genericized trademark).

After the IPO, Google's stock market capitalization rose greatly and the stock price more than quadrupled. On August 19, 2004 the number of shares outstanding was 172.85 million while the "free float" was 19.60 million (which makes 89% held by insiders). In January 2005 the number of shares outstanding was up 100 million to 273.42 million, 53% of that was held by insiders, which made the float 127.70 million (up 110 million shares from the first trading day). The two founders are said to hold almost 30% of the outstanding shares. The actual voting power of the insiders is much higher, however, as Google has a dual class stock structure in which each Class B share gets ten votes compared to each Class A share getting one. Page says in the prospectus that Google has, "a dual class structure that is biased toward stability and independence and that requires investors to bet on the team, especially Sergey and me." The company has not reported any treasury stock holdings as of the Q3 2004 report.

On June 1, 2005, Google shares gained nearly four percent after Credit Suisse First Boston raised its price target on the stock to $350. On that same day, rumors circulated in the financial community that Google would soon be included in the S&P 500."Google Shares Rise on New Price Target". Los Angeles Times. June 1, 2005. When companies are first listed on the S&P 500 they typically experience a bump in share price due to the rapid accumulation of the stock within index funds that track the S&P 500. The rumors, however, were premature and Google was not added to the S&P 500 until 2006. Nevertheless, on June 7, 2005, Google was valued at nearly $52 billion, making it one of the world's biggest media companies by stock market value.

On August 18, 2005 (one year after the initial IPO), Google announced that it would sell 14,159,265 (another mathematical reference as π ≈ 3.14159265) more shares of its stock to raise money. The move would double Google's cash stockpile to $7 billion. Google said it would use the money for "acquisitions of complementary businesses, technologies or other assets".Gonsalves, Antone. "Google Seeks Second Stock Offering." Information Week. August 18, 2005.

On September 28, 2005, Google announced a long-term research partnership with NASA which would involve Google building a R&D center at NASA's Ames Research Center, and on December 31, 2005 Time Warner's AOL unit and Google unveiled an expanded partnership—see Partnerships below.

Additionally in 2005, Google formed a partnership with Sun Microsystems to help share and distribute each other's technologies. As part of the partnership Google will hire employees to help in the open source office program OpenOffice.org. Brown, James. "Sun partners with Google". vnunet.com. October 5, 2005.

With Google's increased size comes more competition from large mainstream technology companies. One such example is the rivalry between Microsoft and Google.Dvorak, John C. "A Google-Microsoft War". PC Magazine. November 16, 2004. Microsoft has been touting its Bing search engine to counter Google's competitive position. Furthermore, the two companies are increasingly offering overlapping services, such as webmail (Gmail vs. Hotmail), search (both online and local desktop searching), and other applications (for example, Microsoft's Windows Live Local competes with Google Earth). In addition to an Internet Explorer replacement Google is designing its own Linux-based operating system called Chrome OS to directly compete with Microsoft Windows. There were also rumors of a Google web browser, fueled much by the fact that Google is the owner of the domain name "gbrowser.com". These were later proven when Google released Google Chrome. This corporate feud is most directly expressed in hiring offers and defections. Many Microsoft employees who worked on Internet Explorer have left to work for Google. This feud boiled over into the courts when Kai-Fu Lee, a former vice-president of Microsoft, quit Microsoft to work for Google. Microsoft sued to stop his move by citing Lee's non-compete contract (he had access to much sensitive information regarding Microsoft's plans in China).

Google and Microsoft reached a settlement out of court on December 22, 2005, the terms of which are confidential.Vise, David A. "Microsoft, Google Both Claim Victory". The Washington Post. September 14, 2005, p. D05.

Click fraud has also become a growing problem for Google's business strategy. Google's CFO George Reyes said in a December 2004 investor conference that "something has to be done about this really, really quickly, because I think, potentially, it threatens our business model."Crawford, Krysten. "Google CFO: Fraud a big threat". CNN. December 2, 2004. Some have suggested that Google is not doing enough to combat click fraud. Jessie Stricchiola, president of Alchemist Media, called Google, "the most stubborn and the least willing to cooperate with advertisers", when it comes to click fraud.

While the company's primary market is in the web content arena, Google has also recently began to experiment with other markets, such as radio and print publications. On January 17, 2006, Google announced that it had purchased the radio advertising company dMarc, which provides an automated system that allows companies to advertise on the radio.Levingston, Steven. "Google Buys Company To Expand Into Radio". The Washington Post. January 18, 2006. This will allow Google to combine two advertising media—the Internet and radio—with Google's ability to laser-focus on the tastes of consumers. Google has also begun an experiment in selling advertisements from its advertisers in offline newspapers and magazines, with select advertisements in the Chicago Sun-Times.Gonsalves, Antone. "Google Confirms Testing Ads in Sun-Times Newspaper". Information Week. January 10, 2006. They have been filling unsold space in the newspaper that would have normally been used for in-house advertisements.

During the third quarter 2005 Google Conference Call, Eric Schmidt said, "We don't do the same thing as everyone else does. And so if you try to predict our product strategy by simply saying well so and so has this and Google will do the same thing, it's almost always the wrong answer. We look at markets as they exist and we assume they are pretty well served by their existing players. We try to see new problems and new markets using the technology that others use and we build."

After months of speculation, Google was added to the Standard & Poor's 500 index (S&P 500) on March 31, 2006.Staff Writer. "Google shares up on joining S&P 500 index". Associated Press. March 23, 2006. Google replaced Burlington Resources, a major oil producer based in Houston that had been acquired by ConocoPhillips.Francisco, Bambi. "Google to be added to S&P 500 Index". MarketWatch. March 23, 2006. The day after the announcement Google's share price rose by 7%.Mercury News Wire Services. "Closing bell: Tech stocks advance; Google surges 7 percent". San Jose Mercury News. March 24, 2006.

Over the course of the past decade, Google has become quite well known for its corporate culture and innovative, clean products, and has had a major impact on online culture.

Name
The name "Google" originated from a misspelling of "googol,"Koller, David. "Origin of the name, "Google." Stanford University. January, 2004. Hanley, Rachael. "From Googol to Google: Co-founder returns." The Stanford Daily. February 12, 2003. Retrieved on August 26, 2010. which refers to the number represented by a 1 followed by one-hundred zeros. Page and Brin write in their original paper on PageRank. "We chose our systems name, Google, because it is a common spelling of googol, or 10100 and fits well with our goal of building very large-scale search engines."

However, Enid Blyton used the phrase "Google Bun" in The Magic Faraway Tree (published 1941) The Folk of the Faraway Tree (published 1946),The Enid Blyton Society. "The Enchanted Forest and Folk of the Magic Faraway Tree by Enid Blyton Retrieved on May 17, 2011 and called a clown character "Google" in Circus Days Again (published 1942),The Enid Blyton Society. "Circus Days Again by Enid Blyton Retrieved on May 17, 2011 and there is also the Googleplex Star Thinker from Douglas Adams' The Hitchhiker's Guide to the Galaxy.

Having found its way increasingly into everyday language, the verb, "google," was added to the Merriam Webster Collegiate Dictionary and the Oxford English Dictionary in 2006, meaning "to use the Google search engine to obtain information on the Internet."Harris, Scott D. "Dictionary adds verb: to google]." San Jose Mercury News. July 7, 2006. Archived at the Internet ArchiveBylund, Anders. "To Google or Not to Google." The Motley Fool via MSNBC. July 5, 2006. Retrieved on July 7, 2006. The use of the term itself reflects their mission to organize a seemingly infinite amount of information on the web. In November 2009, the Global Language Monitor named "Google" No. 7 on its Top Words of the Decade list.Top Words of the Decade In December 2009 the BBC highlighted Google in their "Portrait of the Decade (Words)" series."A portrait of the decade." BBC. December 14, 2009. Retrieved on April 15, 2011.

Philanthropy
In 2004, Google formed a non-profit philanthropic wing, Google.org, giving it a starting fund of $1 billion."About the Foundation." Google.org. Retrieved on October 11, 2007. The express mission of the organization is to help with the issues of climate change (see also global warming), global public health, and global poverty. Among its first projects is to develop a viable plug-in hybrid electric vehicle that can attain 100 mpg.Hafner, Katie. "Philanthropy Google’s Way: Not the Usual." New York Times. September 14, 2006. Retrieved on October 11, 2007.

Acquisitions


Since 2001, Google has acquired several small companies, often consisting of innovative teams and products. One of the earlier companies that Google bought was Pyra Labs. They were the creators of Blogger, a weblog publishing platform, first launched in 1999. This acquisition led to many premium features becoming free. Pyra Labs was originally formed by Evan Williams, yet he left Google in 2004. In early 2006, Google acquired Upstartle, a company responsible for the online collaborative word processor, Writely. The technology in this product was combined with Google Spreadsheets to become Google Docs & Spreadsheets.



On October 9, 2006, Google announced that it would buy the popular online video site YouTube for $1.65 billion.La Monica, Paul R. "Google to buy YouTube for $1.65 billion". CNN. October 9, 2006. Retrieved on October 9, 2006. The brand, YouTube, will continue to exist, and will not merge with Google Video. Meanwhile, Google Video signed an agreement with Sony BMG Music Entertainment and the Warner Music Group, for both companies to deliver music videos to the site.Staff Writer. "Google buys YouTube". Side-Line Magazine. October 9, 2006. Retrieved on October 9, 2006. The deal was finalized by November 13.Staff Writer. "Google closes $A2b YouTube deal". The Age. November 14, 2006. Retrieved on November 25, 2006.

On October 31, 2006, Google announced that it had purchased JotSpot, a company that helped pioneer the market for collaborative, web-based business software to bolster its position in the online document arena.Staff Writer. "Google acquires Web applications pioneer JotSpot". October 31, 2006. Retrieved on November 25, 2006.

On March 17, 2007, Google announced its acquisition of two more companies. The first is Gapminder's Trendalyzer software, a company that specializes in developing information technology for provision of free statistics in new visual and animated ways"A world in motion" from the Official Google Blog. On the same day, Google also announced its acquisition of Adscape Media, a small in-game advertising company based in San Francisco, California."Let the passion continue! We're acquiring Adscape" from the Official Google Blog.

Google also acquired PeakStream Technologies.

Partnerships
Google has worked with several corporations, in order to improve production and services. On September 28, 2005,Google announced a long-term research partnership with NASA which would involve Google building a 1,000000 sqft R&D center at NASA's Ames Research Center. NASA and Google are planning to work together on a variety of areas, including large-scale data management, massively distributed computing, bio-info-nano convergence, and encouragement of the entrepreneurial space industry. The new building would also include labs, offices, and housing for Google engineers.Lewis, Laura; Fox, Lynn. "NASA Takes Google on Journey into Space." National Aeronautics and Space Administration, Press Release. September 28, 2005. In October 2006, Google formed a partnership with Sun Microsystems to help share and distribute each other's technologies. As part of the partnership Google will hire employees to help the open source office program OpenOffice.org.

Time Warner's AOL unit and Google unveiled an expanded partnership on December 21, 2005, including an enhanced global advertising partnership and a $1 billion investment by Google for a 5% stake in AOL.Rosenbush, Steve. "AOL-Google: Who Gets What?" BusinessWeek. December 21, 2005. As part of the collaboration, Google plans to work with AOL on video search and offer AOL's premium-video service within Google Video. This did not allow users of Google Video to search for AOL's premium-video services. Display advertising throughout the Google network will also increase.

In August 2003, Google signed a $900 million offer with News Corp.'s Fox Interactive Media unit to provide search and advertising on MySpace and other News Corp. websites including IGN, AmericanIdol.com, Fox.com, and Rotten Tomatoes, although Fox Sports is not included as a deal already exists between News Corp. and MSN.Staff Writer. "Google signs $900m News Corp deal". BBC News. August 7, 2006. Retrieved on August 8, 2006."Google, News Corp. Ink Deal Over MySpace.com Ads". Fox News. August 8, 2006.

On December 6, 2006, British Sky Broadcasting released details of a Sky and Google alliance. This includes a feature where Gmail will link with Sky and host a mail service for Sky, incorporating the email domain "@sky.com".

In 2007, Google displaced America Online as a key partner and sponsor of the NORAD Tracks Santa program.

In January 2009, Google announced a partnership with the Pontifical Council for Social Communications, allowing the Pope to have his own channel on YouTube.Krause, Flavia. (January 23, 2009) Pope Benedict Debuts on YouTube to Reach Out to Catholics. Bloomberg.com. Retrieved on May 29, 2011.

New mobile top-level domain
In coordination with several of the major corporations, including Microsoft, Nokia, Samsung, and Ericsson, Google provided financial support in the launch of the .mobi top level domain created specifically for the mobile internet, stating that it is supporting the new domain extension to help set the standards that will define the future of mobile content and improve the experience of Google users. dotMobi Investors." .mobi. Retrieved on October 14, 2007. In early 2006, Google launched Google.mobi, a mobile search portal offering several Google mobile products, including stripped-down versions of its applications and services for mobile users. Vencat, Emily Flynn. "Gadgets: The Mobile Web." MSNBC. July 17, 2006. Retrieved on October 14, 2007. On September 17, 2007, Google launched, "Adsense for Mobile", a service to its publishing partners providing the ability to monetize their mobile websites through the targeted placement of mobile text ads. Google AdSense for Mobile unlocks the potential of the mobile advertising market." Google. September 17, 2007. Retrieved on October 14, 2007. Also in September, Google acquired the mobile social networking site, Zingku.mobi to "provide people worldwide with direct access to Google applications, and ultimately the information they want and need, right from their mobile devices."Niccolai, James. "Google Buy Mobile Social Network Zingku." PC World. September 29, 2007. Retrieved on October 14, 2007.

Gonzales v. Google
On Wednesday, January 18, 2006, the U.S. Justice Department filed a motion to compel in United States district court in San Jose seeking a court order that would compel search engine company Google Inc. to turn over, "a multi-stage random sample of one million URL’s", from Google’s database, and a computer file with, "the text of each search string entered onto Google’s search engine over a one-week period (absent any information identifying the person who entered such query)."Gonzales v. Google, Inc. January 18, 2006. Google maintains that their policy has always been to assure its users' privacy and anonymity, and challenged the subpoena. On March 18, 2006, a federal judge ruled that while Google must surrender 50,000 random URLs, the Department of Justice did not meet the necessary burden to force Google to disclose any search terms entered by its users.

Bedrock Computer Technologies, LLC vs. Google, Inc
A jury in Texas awarded Bedrock Computer Technologies $5 million in a patent lawsuit against  Google. Idiotic Anti-Linux & Google Patent Decision. ZDNet. Retrieved on May 29, 2011./ Media – Google loses Linux patent lawsuit. Ft.com (April 23, 2011). Retrieved on May 29, 2011. The patent allegedly covered use of hash tables with garbage collection and external chaining in the Red Hat Linux kernel. The judgment was later vacated by the court.ORDER granting 829 Stipulation of Dismissal.