Monday 5 December 2016

Google's man in Ireland presses 'go-faster' button

Ronan Harris, a 43-year-old Lucan electrical engineer, has become Google's head guy in Ireland. In his first interview he tells business editor Nick Webb how he plans to grow one of the biggest tech operations in the country

Published 10/05/2015 | 16:30

Where standing still is not an option: Ronan Harris at Google
Where standing still is not an option: Ronan Harris at Google

It's day four of the Ronan Harris epoch at Google. "I haven't broken anything yet," he smiles as he prods the coffee machine in the canteen on the 12th floor of Google's headquarters in Dublin.

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"I've either been very lucky or I haven't been trying hard enough."

Harris, a 43-year-old electrical engineer or "lec-eng" in Google speak, has just taken over from long-term Google boss John Herlihy, who left the company last month after running the Irish operations for a decade. In that time Google grew from 50 employees to around 5,000 staff - direct employees and contractors - as it became one of the biggest multinationals in Ireland.

Harris, who is also a vice president or "veepee" of the global firm has added the responsibility of running Ireland's operations to his role of heading up the corporate ad sales operation for Europe, Middle East and Africa.

While Google is best known for its search engine, it is the world's biggest and most powerful advertising player, through its Google ads business.

Lucan-born Harris wasn't always in online advertising. After completing his electrical engineering degree in UCD, he travelled to the other side of the world on a FAS placement with Mitsubishi Chemicals in Japan, where he worked on optical disc research, before moving into consulting and an online payments security start-up. He also met his English-born wife Victoria out there.

The couple decided to return to Ireland after a couple of years. Their timing was poor. The dotcom bubble had burst and the 9/11 terror attacks had led to a brief recession.

"It was a very different time," Harris recalls, stirring his mug, as we sit in a sterile white meeting room next to his smallish corner office.

The views are rather good. Or they would be if the weather wasn't so horrible outside.

Harris worked with a number of start-ups, including the Fran Rooney-backed Nirvana Technologies and e-learning firm Skillspro, also chaired by the former Baltimore Technologies boss. Neither job was "a glittering success," he remembers.

Then Google tapped him on the shoulder. "I hesitated about whether or not to join because it was a big global company and I was enjoying the start-up space."

Google was mushrooming fast. It had completed a high profile IPO just over a month before. Harris ultimately joined in May 2005. Yesterday - May 9 - marked his 10th anniversary at the firm. There were about 50 or 60 people in the Irish arm back then. "We had two floors of Gordon House (an office block across the road from its present HQ) and I remember we were all looking at each other saying: 'Do we really need all this space?'

"A lot has changed since then. If you'd asked me 10 years ago when I joined, could I see Google growing to the thousands of people we have today... I would have wondered, because this is a huge number of people to go out and recruit."

Harris limbers up for the mission statement bit. More of the same but with some cool stuff added. "This is the largest operation we have outside of the US and it is the most diverse office we have outside of the US in terms of the different functions and teams that we have here. It's got an amazing reputation. We are seen as a phenomenal place for building new ideas, as a source for talent and as a launch pad for various businesses into the European market. People talk about the culture here as being one of the strongest examples of what we believe Google to be. It's important to build on that," he says earnestly.

Standing still in a place the size of Google isn't an option. You'd get your P45 pretty quick.

"One of the topics that is important to us and to Ireland over the next couple of years is innovation," he says. "I think one of the biggest focus areas for me will be to build out more of that."

Harris bristles at the suggestion that Google is just a giant big sales and marketing operation rather than something where really good technology is invented.

"I've always found that suggestion quite funny," he suggests. Google does do cutting edge R&D in Ireland. It's just not the massively sexy stuff that happens out in Google X Labs - where secretive engineering teams have been working on projects like driverless cars and Google Glass to wacky ideas like internet on balloons or contact lenses that measure glucose in tears. (Harris loves driverless cars, having been out for a spin in one in California about six months ago.)

He won't be drawn on plans for Google cars in Ireland, other than to say that there are no cars here. While so called "moon shot" or sci-fi solutions to tech problems aren't being solved in Ireland, it doesn't mean that there aren't some revolutionary new ideas being developed here.

"There's a huge amount here. There is a broader challenge that we have in Ireland and Europe and it is... what is R&D? When people think of R&D they think about people in white coats in a lab. I think that's true of some industries, but not true of ours.

"I've hundreds of people here who are doing really sophisticated R&D on a daily basis - but in things like data or business process or business modelling," he says. "Not Google X stuff. We focus on the core business here. It's the interface with the 99.9pc of users, publishers and advertisers."

Google has been hiring some serious talent. The focus on innovation means that Google has recruited heavy hitters for its research function in Ireland. "We've always hired the best," he says. "Over 50pc of people here have Masters or PhDs."

Google hoovers up "smart creatives". Winning the RepTrak most reputable company in Ireland gong last week doesn't hurt recruitment either. The trip up to Harris's office in the lift indicates that most googlers have beards and wear skinny jeans... apart from the women, of whom there are an increasing number.

The company has close relationships with the "thriving" start-up community too. Google is the largest acquirer of start-ups in Europe. Last week it emerged that it had bought Trinity College-founded start-up Thrive, which works on sound surround technology. Previously it bought video tech firm Green Parrot.

Google will work with about 1,500 Irish start-ups through various programmes run out of its Dublin office this year.

"We're a great launch pad for Google in Europe. We're the site where the rubber hits the road in terms of Google's users, consumers, publishers or advertisers. We're talking to these people every day, if we can focus on the insights that this gives us then there's a great opportunity to build out business services, new products or other things that can add real value to the end user," he says.

One of Google's most recent hits has been its creation of an export hub. Given that the Irish operation houses so many trade experts and language specialists, it was able to mesh this together with Google search insights to first show potential advertisers of demand for their product in other countries, and secondly how to sell to new markets.

Google can show customers the number of people searching for anything from stout-flavoured dog biscuits to leprechaun manikins or Aran jumpers anywhere in the world. These search patterns indicate that there's a demand for the product, which means a whole new market full of customers. Crucially, it also shows customers how to monetise these search leads. "It's a great idea that came out of Dublin."

The move from desktop to mobile is also driving Harris's growth plans for Google and Ireland. "It's a trend across the globe. The world is moving towards apps. There is a massive app economy building. One of the things we have developed here is the EMEA App Hub. This is an idea a team had going back to the beginning of the year, that if we could pull together the power of our cloud technology and our infrastructure, our app development expertise and the expertise around helping developers go out and find customers, it would help drive engagement. Other publisher teams can help these developers to monetise these apps. If we can pull it all together into a single entity it would provide a one-stop shop for these start-ups."

In other words, Google helps app developers tool up for commerce, helping them find customers and sell the product. Google research has pinpointed the most promising space for this new business.

"Gaming would probably be one of the biggest sectors. You develop a game. How do you scale it? How do you monetise it, make income off it....we provide that in a one-stop shop. We are seeing a rapidly accelerating stream of some of Europe's best app developers coming through Dublin to get access to that expertise." The next Flappy Bird could get wings in Dublin.

While a pathfinder team of 15 Googlers has been working on this project since the start of the year, the initial response from the market means that "we'll be expanding it and building it out." Ideas like the export hub and the app hub help keep Dublin at the centre of Google's eco-system. "There are a lot of other things... but nothing I can talk about."

Google is getting bigger in Ireland. It has just inked a deal to expand into Ken Rohan's Grand Canal Plaza office block. Harris points out the building from his office window. Apart from Kennedy Wilson, the REITS and a few private equity funds, Google is the biggest single buyer of Irish property since the crash. Google has spent €365m buying Irish property since the end of 2010, dropping €99.9m on the Dublin's tallest office block - the Montevetro building - in February 2011. It spent €200m on two other neighbouring buildings and its vast data Centre in Grangecastle in west Dublin. Last year Google bought the Grand Canal Mill building for almost €65m.

That's quite a vote of confidence in the Irish economy. Even for a company with $65bn in cash on its balance sheet.

With interest rates so low, Google may get better returns by spending its money. "Ireland continues to be a location that's viable for us in terms of data centres," Harris says, but declines to elaborate.

The move by bitter rival Apple to create a monster €850m data centre in Galway has heightened interest in the sector. Powering these energy hungry centres is also a consideration, with Apple thought to be looking at wind farms to fuel its operations. Google has invested heavily in wind power and renewable energy, taking stakes in operators or else agreeing long term power deals.

Harris is cagey about whether Google Ireland could be set to own some windmills. "It's definitely an area that Google is looking at. I think we would love it if all of our places were powered by renewables," he says.

While Ireland's temperature is just right for Google's data centres, the political and economic climate here is also fine. At the moment. But like the weather here, things can change fast and not always for the better.

Harris cautions against complacency. "I think we've been very focused on getting our house in order over the last couple of years and I think we are starting to look forward - further into the future rather than just the next quarter. I think that we have to be very aware of the competition that Ireland Inc faces from other countries," he says.

"I think that the market place that Ireland Inc plays in is becoming increasingly competitive. Other markets and people are very jealous of what Ireland has done, and they'd like a piece of the action."

Long-term planning for Ireland and its future workforce is of paramount importance.

"There a lot of people who want to make sure that they win a bigger share of what's going to be the next big industry. We've got to look at our position across a whole range of criteria and make sure that we are competitive. And we've got to be sure we continue to produce a high calibre of very flexible talent. It's an area that we've been focused on in Ireland with our partnership with Trinity.

"We put a lot of investment there to get 1,000 teachers through the STEM (Science Technology Engineering and Maths) programme," he says. The first batch of these super highly qualified teachers came through the system last week.

"Are we doing the things today that will ensure that in five or 10 years our kids are at the top end of the education system? I worry when I don't see computer science as a core thing on the curriculum, yet I see some of the aggressive and more advanced digital economies around the world put that as a core tenet of education strategy. I feel that we are a little bit slow to move on some of that stuff. It's an area we could do more in."

Over to you, Education Minister Jan O'Sullivan. Time to get moving.

Having talent is one thing, but Harris feels that Ireland will also need to have the right industries - we've got to have the next big thing. With the top 20 data and tech firms all having European headquarters in Dublin, the opportunity is enormous.

"We've got to be on the front foot. We've got to be thinking about what we can do to lead. There's been a lot of talk about data. We have this amazing opportunity with all the European headquarters of all these companies here -but have we the most advanced and progressive data regime here? I think we are making progress but we need to figure out how to stimulate that," he says.

"Dublin has the opportunity to become the Lourdes of the 21st century, with business owners coming here on a digital pilgrimage. They come to Dublin to spend time with the likes of Google to learn the latest and the greatest, then take it back to their own country and create jobs. But this is where the expertise lies," he says, waving his arms.

Around 35,000 visitors from around Europe have arrived in Google Ireland over the last two years to find out what's happening in digital, he adds.

Having the right regulatory regime and the right talent is a huge draw for Google - but so is tax. Paying as little of it as possible. Google Ireland had revenues of €17bn last year...but paid tax of just €27m. It's either one of the lowest margin businesses on the planet, or else there's some clever accountancy work at play. Much of the costs related to royalty payments paid to other Google entities, some with Bermuda parents.

"We pay all of the tax we are legally required to pay. A lot of this rhetoric comes from people who think that all we have in Dublin is just a brass plate."

But morally should Google pay more tax?

"We are very clear. We play by whatever rules are set. We don't set the rules. They are set by Ireland and the EU. We feel that the rules are very complex. We'd love someone to come and simplify them. We think that what is happening at the OECD level is absolutely the right thing. Let's get something that everybody signs up to and move on from this."

Google is one of the biggest spenders on lobbying in Europe, according to the EU lobbyist register, so it will have the ear of those trying to come up with new tax regimes.

While Google pays very little tax here, its employees are absolutely hammered by punitive income tax rates.

"On a personal level, I pay a lot of tax," he says. "It is higher than in other locations in Europe and that is an issue. I think keeping Ireland competitive in terms of personal tax is a really important thing to keep an eye on. But we're not out of the woods yet, so we can't be flaithulach in terms of spending, or driving up costs, or slashing tax rates. We've got to be careful we remain competitive on both fronts."

I start sniggering. There's an election coming in less than a year. A "mad" vote-grabbing budget with spending hikes and tax cuts is coming down the tracks, I suggest.

"There's going to be mad stuff happening and it frightens me a little bit. If we find ourselves in a couple of years with our cost base having gotten out of control, it makes my job of going out and winning more growth opportunities for Ireland more difficult," he warns.

"I want to make sure that when we look at our competitiveness matrix that Ireland stays at the top of that."

Having committed so much capital to Ireland, it's clear that Google is keen on staying. And growing.

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