Slashdot Mirror
Google Considered Too Big To Fail
theodp writes "Doc Searls is worried about the way Google makes money. 'Nearly all of it comes from advertising,' he frets. 'That's what pays for all the infrastructure Google is giving to the rest of us. As our dependency on Google verges on the absolute, this should be a concern.' Have we reched Peak Advertising? Blogger Dave Winer says amen, asking if Google is already 'too big to fail.'"
Nothing is "too big to fail".
At the current rate, people will shy away from Google as it's becoming an omnipresence on the internet which is raising concern.
There are numerous examples of things that could not be that happened, like the Titanic, Yahoo and Enron.
I think we can keep recursing like this until someone returns 1
... but he probably doesn't.
Is $COMPANY "$BUZZWORD"?
$PUNDIT says $COMPANY has utilized its $PRODUCT too much and $GOVERNMENT needs to do something about it. $BUZZWORD happened to $OTHER_COMPANY and $COMPANY is on the same path.
$FLOATNG ADVERT
$CEO says $COMPANY is responsbile. $OTHER_PUNDIT disagrees.
Just because lots of people use Google doesn't mean they can't and won't switch to something.
I'll miss Google if it goes, but really I'm not dependent on it - Yahoo search and Bing search are actually OK.
If your business or life is dependent on Google, then either you accept that, or you take measures to not be so dependent.
If we've reached "peak advertising" its not Google which will suffer but TV and print...
Part of the beauty of what Google has done is made advertising cheap, quantifiable, and universal. Anyone can do it, anyone can measure it, and its cheap.
If a company wants to spend advertisement money efficiently, they spend it through Google. If they don't, they throw it away on the Superbowl, where the audience is 100M, and $3M an add, so that costs $.03 for each person who sees the add, regardless of whether they are interested, paying attention, or relevant.
Compare that with advertising through Google, where if you say, advertise on slashdot, not only is it cheaper per person, but its only geeks who may be interested in the ads presented.
Test your net with Netalyzr
That's why there's no such thing as Google for Domains. No such thing as the Google Search Appliance. Google Checkout? Figment of the imagination.
And as for advertising not being a sustainable form of revenue - you'd better tell that to all the world's television and radio stations. They think that's formed their core business for decades.
How about we just let them fail and have other more agile companies take their place? Should have happened with the banks and automakers. Those were political payoffs though. (Think Saturn. They weren't unionized, but profitable.)
--fatboy
Really? How dependent are you on Google?
For searching, you can always use Yahoo or Bing, or a few others. For replacing GMail, you can always use POP access to download your mail and keep it locally, run your own mailserver (after informing people of your new address), use your ISP's mail system, or another free email service. If you're using Google Maps for something, you could make do with Mapquest. If you're an advertiser on Google, there are lots of sites that would be happy to have you advertise on their sites instead. If you're doing SEO, you can follow Yahoo or Bing's rules at least as easily as Google's. If you had no Android phones, you'd still have iPhones. The list goes on for the vast majority of their offerings.
In all cases, Google has its dominant position not via lock-in, but by delivering services that are on par with or better than its competitors. Either that or sheer habit. But that's significantly different from, say, a Windows user's dependency on Microsoft.
I am officially gone from
Google has positioned itself to survive on the Internet once we move past point and click ads, pop-ups and direct marketed emails.
At the end of the day people need marketed to because they don't know where to go for the things they want/need. Google is positioning itself to do this directly with its overly large suite of products.
When businesses stop spending traditional advertising dollars they won't be able to bank them they'll just be forced to redirect them into Google.
Handsets, Buzz, GMAIL, Search engine data it all rolls up into a marketing profile so Google can predict what you're looking for. If Google can help get you to the right place and you buy something they will ultimately get a piece of the final sale.
Driving to work and need a coffee? Google has the data to get you to a Starbucks or a local Mom and Pop. Do you really think this will stay free for the businesses?
As a small business owner I am happy to turn them over a commission on sales I would have otherwise not received without their help.
I truly believe Google will become just another cost of doing business similar to how Visa/Mastercard charges are.
My gawd! Did I actually say that? I....must....shower....NOW...
Table-ized A.I.
Hold on. Let me google if Google is too big to fail...
Conscience is the inner voice which warns us that someone may be looking.
How much is Google paying you to say this? Is Yahoo, Bing, not to mention startpage not capable of filling the void?
When you search on almost anything on Google, all you get is a listing of people who sell some item with your search term in the product name. Sometimes it isn't even that. Sometimes it a page that is another advertising search page.
At least when you search for something in Wikipedia you get to a topic, not an advert. The fact that people select Wikipedia to go to so often is likely why a Wikipedia search result is almost always near the top of a Google search. Most of the time, it is the only type of information a person is looking for. 'Tell me about subject xyz', I don't want to fucking buy it, just learn about it. A lot of the time now, except when looking for product (one I have already bought) or programming forums I just search Wikipedia immediately. The articles also usually have enough external links to get me surfing for more info without needing to use Google too much.
-- I ignore anonymous replies to my comments and postings.
If, in fact, the efficacy and saleability of online ads is crumbling, then we are currently enjoying a period where assorted google services and development initiatives are being subsidized for us by the suckers at various firms with advertising budgets. Presumably, if they catch on to the fact that they aren't getting bang for their buck, that subsidy will dry up.
It is always a sad occasion to lose a subsidy that was previously benefiting you; but it is only a disaster if there aren't other ways of paying for whatever it is that you need. In the case of Google, they have already been playing with pricing schemes for enterprise versions of various of their services, and it wouldn't be rocket surgery for them to roll out retail equivalents if the ad market really tanks(Frankly, I for one would in some respects be relieved to be paying straight, rather than in personal data). Given their years of experience running their services on the comparatively thin sauce of advertising money, Google could still easily offer very competitive pricing.
The people I would be much more worried about are the huge number of random third party websites that run ads in order to more-or-less break even on bandwidth/hosting. Because Google is big, and comparatively trusted, and offers services that most of its users use more or less continually(ie. I might visit "randomwebsite.com" once, or once every few months, but I'm likely to check a gmail account or do a bunch of google searches every day to every few days). If the ad market does in fact tank, Google, and similar large entities, will be able to just start billing directly without transaction costs eating them alive. Since micropayments are still more or less a pipe dream, the little guys won't be able to do the same.
Having to pay $X/year for gmail would be a minor nuisance. Having large numbers of ideosyncratic 3rd party sites either dry up or move into walled gardens who would act as payment processors/aggregators(Hello iTunes!) would be a serious and negative change to the web.
This is particularly a concern because, while Google is quite good at what it does, most of its offerings are in substantially commodified markets. Gmail is one of the better free webmail services out there; but it is hardly the only one. Even if all free webmail services dried up, pay webmail services of quite modest cost are also a dime a dozen. Our only "absolute dependence" on Google is exactly the same dependence on any email provider, the fact that switching email addresses sucks. In search, again, Google is good at search; but switching to a different search page isn't terribly difficult. A few legacy devices/programs that depend on some search API and cannot be usefully updated might be up shit creek; but everybody else would be fine. Android would probably suffer if its primary developer/main unifying backer disappeared or defunded the project; but there would be nothing stopping the core OSS components moving forward on the devices of whoever wanted to use them. The fact that all this has traditionally been free is handy; but switching to paying for it, either from Google or from somebody else, would be doable.
It is the thousands of random little guys, occupying all the weird little unique niches, that would be more of an issue. Few of them are large enough to make subscription pricing reasonable, even if people would stand for that, and micropayment is going nowhere outside of walled gardens that aggregate the micropayments, which aren't a terribly encouraging development.
I have never used google docs, and never will.
Hey, google docs is GREAT for tracking treasure and experience points for role playing games.... but yeah, I wouldn't trust it for anything else.
If a job's not worth doing, it's not worth doing right.
How about we just let them fail and have other more agile companies take their place? Should have happened with the banks and automakers. Those were political payoffs though. (Think Saturn. They weren't unionized, but profitable.)
Automotive, maybe. Banks are a trickier proposition, because so many other businesses rely on them for lines of credit, and their model was so incestuous that one or two big failures would bring down a lot of others, and while the banks might have deserved that, the customers arguably didn't. Not shoring up banks is a great way to sit back and watch your economy tank because nobody has the liquidity to move goods and services around.
Yo momma so fat, Obama said she's too big to fail.
BING is a recursive acronym. Bing is not google.
sed -e 's/Chuck Norris/Rajnikant/g' joke > fact
It all seems rather unlikely, I can imagine someone slowly taking away google's advertisign business but I don't see that advertising will suddenly disapear which is what this article seems to be based on
(Think Saturn. They weren't unionized, but profitable.)
Uhh, Saturn was unionized (UAW) and was only profitable for 1 year out of its entire existence (1993).
Not to say that the union was the problem, but not having a union does not give you the able to ignore trends, consumer demands, and quality controls and still have a successful company.
-Rick
"Most people in the U.S. wouldn't know they live in a tyrannical state if it walked up and grabbed their junk." - MyFirs
LOL
you forgot to mention the grinding pain and poverty of the general population because of that for years
your attitude seems to be "malaria? well then lie in the bed with fevers and chills until its over. forget this quinine crap, suffer like a man! walk it off!"
you bail these companies out to save a lot of common people who did nothing to create this horrible mess form a lot of financial pain
THAT'S the point of the bailouts
not because we like to save banking asshats from themselves
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
Read "Natural Born Clickers, the ComScore study referenced in the article. "Only 8% of Internet users now account for 85% of all clicks". And that 8% has lower than average income and doesn't buy much on line.
The basic problem with Google's business model is not a killer problem for Google. It's for all those sites sucking off the "Google Content Network" teat. Ads on search results have value because they're presented at when the user is looking for something. Random ads on web pages aren't that valuable to advertisers. Most advertisers run them because Google's AdWords systems bundles them with search ads. (Advertisers can opt out, but the opt-out checkbox is hidden and doesn't opt you out of everything.) Worse, Google charges the same price for a click on a search result ad and a Google ad on some random site, while studies show that the search result ad is worth maybe 20x the value of the ad on some random site.
Amusingly, Google offers a lower price for the "content network" ads, but they only tell advertisers about it when they try to opt out of the "content network" program.
The big advertisers have figured this out. Note how few Google ads on random web sites are for major brands. Google tries to keep advertisers from developing metrics to measure click-through value; the AdWords contract prohibits advertisers from sharing their click stats. But enough information has leaked out that advertisers are getting wise to this. There's now a Content Network Cleanser product to kick bottom-feeder sites out of an advertiser's campaign. But it's retrospective; you pay for useless clicks, then find out about them and block those sites.
A shakeout is coming. As more advertisers get wise to the uselessness of the "Google Content Network", they'll opt out, while keeping their search ads. Google will have to cut the price for ads on third-party sites. This will put the screws on all the sites whose entire revenue stream comes from those ads. (Like Slashdot.)
This won't kill Google, but it may cut into their revenue.
and while the banks might have deserved that, the customers arguably didn't.
Right. That's why the government set up the FDIC long ago, to protect bank account holders in case of a run on the banks.
If we're just going to bail out the banks when they screw up, then what's the point of having an FDIC?
All those car factories would still have existed, just with new owners now. They could still make cars, or perhaps something else. They would have needed workers, and would have been in a position to offer a fair, but less ridiculous salary and benefits package for factory work.
A real bankruptcy and liquidation is that, stuff gets sold, the new owners use it. Stockholders would have been taught a lesson that they need to do due diligence on their executive employees better, management would have learned you can't be stupidly top heavy, and the rank and file boys would have realized they need to not expect as much as they think they are worth, not in a global economy.. So all around, it would have been better for that to happen, long range.
I feel the same away about those bloated tick parasite casino banks, they should have been allowed to go bankrupt, then we could have sorted out what all those scam paper financial products are really worth, which is..not near as much as they contend now. I think society has hit "peak wealth leeching" with those guys.
Ya, it would have sucked a little for a couple of years, but the resulting economy would have been MUCH better. Less stupid overpaid fatcats sucking out of the system, more middle class actual productive wealth creation jobs back.
As it is now, all they have done is reward those who failed in the first place, and given them incentive to just follow the same failed policies. Quite dumb really. Slap this generation and the next several in debt for this to happen, too. That's not dumb, that's outright criminal.
i am not arguing that saving banking asshats is fair. i'm saying the banking asshats are so embedded, that it is impossible to make them suffer and only them suffer
if you are saying suffering by everyone is inevitable because of what the bankers did, i'm not buying that. nothing's inevitable. we can still suffer in 5 more years, or maybe not. you take it as act of faith that we have only forestalled the inevitable rather than actually cured the disease
what do i believe? perhaps we have only forestalled the inevitable. i have an open mind about the future, we might not have solved the problem. meanwhile, if you are telling me with CERTAINTY we have only forestalled the inevitable, then you are just announced yourself as a brainwashed partisan hack. no one knows the future, including you
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
the tragedy we are living in is this great mass of ignorants, propagandized into fighting that which will only help and save them
in the healthcare townhall "debates" last summer an old deranged lady shouted "keep your socialist hands off my medicare!"
that about sums up the "principled" opposition to braindead obvious simple progress in this country. its demagogues, in the employ of big business, and the lobbyists buying off their representatives, who are selling the american people a state of impoverishment. because they should be afraid of "socialism"
pathetic, tragic, sad
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
the '20s was a bubble, you idiot
just like the one we are crawling out of now. hello?
the roaring twenties was borrowing against the future, the bubble collapsed, and we suffered, horribly, for a decade
that you should be celebrating such financial ignorance and irresponsibility as "a great time to be an american", you are only announcing your abject ignorance. it is because of thinking like yours that we are in the current mess we are in. thanks a lot, shortsighted asshole
intellectual property law is philosophically incoherent. it is your moral duty to ignore it or sabotage it
One of the biggest concerns about Google is that it would be another Excite@Home.
The @Home corporation took down Excite right about the time of the Tech Bubble Burst. If anyone remembers having an Excite email address, when Excite had all these free services to store some of your information online, you probably remember Excite having to delete all of your stuff as the company meltdown thanks to their business partners at @Home.
To call Google a company that is too big to fail would definitely be an understatement, especially if like Excite, they had no plan of action in the event the company collapses.
Companies like Google need some kind of living trust, much like a person who in the event of their death, can hold on to the property (physical or intangible), the data can be transfered to a smaller company that can take care of the data Google's customers asked them to hold on to.
Another Idea would be to create a government agency similar to the FDIC that instead of insuring money, insures data, either provides a backup of the data that you have posted online that you and only you can access it if the company you use to hold that data bellies-up, and provides compensation if that data is lost.
The only problem with having the federal government create such an agency is the fact that they are the Federal Government. There is information about yourself that they have that you can't access unless you are either a member of law enforcement or part of the agency that collects all that data about you. Which is stupid, considering if you want to know everything about yourself, including things that you don't know about that may prevent you from getting a loan or a job, you can never learn more about yourself to do anything positive or constructive that could offset the things in the past, or that you are doing, that can prevent you from living a better life that could help you be a better person.
If there is something about you that you want to know, it should never be a secret from you. And if there is stuff that you want to save, you shouldn't have to lose it because the company you entrusted to hold on to it was too big to fail.
The Rapture is NOT an exit strategy.
Marketing is one of the defining features of an advanced economy. It isn't some temporary stage that you shrug off as you get to the next stage of development. So far there is no next stage of development. ... We are no where near a post-marketing society.
That's an insightful remark. The cost of marketing many products and services now exceeds the cost of providing them. Long-distance phone service, for example. Note that there's very little marketing of long-distance phone service now, while it was once heavily promoted. Now, it's typically bundled with something else, to cut the marketing cost. It's worth asking what other products and services may go through that transition.
Rather, Dave Winer is considered too stupid for us to read the click-bait drivel he throws up on his blog.