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Google Winning By Losing?
eldavojohn writes "The CEO of a small search company wrote an interesting piece for Search Insider about Google's unique strategy. It notes that Google has yet to become a leader in any technology other than search — but that its mostly unsuccessful attempts to branch out all end up bolstering its brand, and thus its search ad revenue. Is the new recipe for success to do one thing unbelievably well and several other things indifferently? Does this remind you of strategies from any other companies?" From the article, "Some of Google's non-search projects are really extensions of its search monetization, and are likely to succeed. But others projects mean entering areas where Google doesn't have much experience, and is taking a risk. With regard to those riskier areas, the key question for Google's future is whether it can realize that losing is really one of the best assets the company has."
Search, Gmail, Google Earth, Google Maps, Picasa
Google has several interesting and best of breed web based applications. Not all of their products are going to be the best at what they do. This should hardly be news to anybody.
Most companies have some MBA types sitting at the top working out how "the street" is going to respond to their every action and pushing that advice down the tree to tell developers what to do. As such, analysts (like this guy) are always trying to figure out what these MBA types are thinking, and why they are doing certain actions. This isn't how Google works. The developers are basically set free to do whatever the hell they want and they get rewarded when the company does well from it. Is it any surprise to find that the analysts are confused by Google?
How we know is more important than what we know.
What will determine Google's business success in the long run is a) the moats it can build around its businesses, and b) whether they can overcome their competitors' moats. (A moat is some advantage that protects the company from competition. In the tech industry this is usually called "stickiness")
In some of the businesses mentioned in the article, such as IM and email, moats exist, but unfortunately Google is on the wrong side of those moats. AIM and Y! Mail are on the inside, and Google is on the outside trying to get in. These moats are not that strong (very few are in technology), but it doesn't look like Google is making too much headway. If anyone should be scaring Yahoo Mail and AIM, it's Facebook and Myspace. Those guys already have a list of your friends, which eliminates a major switching cost, and they have already shown that contextualized communication wins. (Most college kids don't use email anymore -- they use fb.) I'm convinced that only business-related email is saving email as a paradigm in the next 10 years, but who knows what can happen in that time?
I have been trying to identify Google's moats and I can think of a few. The first is the brand name. Google is cool because they release a bunch of cool technology and they win the evangelizers, who are really important when it's only a matter of picking among similar-quality search engines. The second is that they have supposedly assembled a really amazing team. This is not so easy to do, even with a large amount of money, as MSN Search has shown. Finally, the infrastructure has to be given some credit. Not just the hardware farms, but the gigantic databases that have been assembled over time which might make Google a better-informed and therefore better-results-producing search.
The above moats -- both google's and competitors' -- are only fair, not permanant. The upside is that Y! and AIM's moats can be destroyed. So it is conceivable that in the long run, Google chips away and evenutally wins those markets through tough-nosed competition. They'll have to make much better sites before we get to that point.
The downside is that these moats are not as strong as platform lock-ins. Technologies are so interdependent that platforms (something other companies are truly dependent on) naturally form monopolies, and those monopolies naturally give birth to other monopolies. Microsoft is a perfect example. And it is not hard to imagine them using their browser platform to become the winner in search. Unfortunately, google has not yet been able to form a platform (gmaps mashups don't count). I think they are really trying to do this by becoming what we used to call a portal (before 2.0 was cool). The problem is that nobody is dependent on any of their pieces. Web search isn't a dependency or a launching point, except to the extent that people used to use the search engine as their homepage (who needs that when we have search boxes in the browser?).
MS doesn't even need to make MSN as good as Google.. they just have to get it "good enough" such that it isn't worth people's time to switch away from the default search in IE. The whole idea espoused by the article of "winning by losing" is ridiculous. The fact is that Google is winning bigtime in search -- so big that they can afford to lose elsewhere. But they certainly aren't losing on purpose, or solely to promote the google brand. And they have little room for error in search.
Gootube's protection has nothing to do with Telcoms/common carrier and everything to do with the DMCA.
before the DMCA you could in fact be sued for having infringing material posted to your service. now you cannot be if you comply with a porperly sent DMCA takedown letter, or never recieve a properly sent DMCA takedown letter
Snowden and Manning are heroes.
Do it well and don't try to drive too much revenue and they will keep coming back. The aim of good search engine site will be simply to keep users returning and making use of the other more profitable areas of content portal web sites.
Chaos - everything, everywhere, everywhen
Interesting real world example of "The Long Tale" effect?
I just did a side by side. Yahoo Maps Beta was slower, jerkier, and takes a long time to reload images after I zoom extensively.
I'm a Google fan, but when a better product comes along, I'll use it. Yahoo Maps isn't there yet.
An important change for education.