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Archive for December 29th, 2009

As Google grows bigger and deeper the op-eds and various critics are calling for hard core scrutiny and even regulation.

The latest piece I’ve come across is this rather drab call for “search neutrality” in the New York Times.

Without search neutrality rules to constrain Google’s competitive advantage, we may be heading toward a bleakly uniform world of Google Everything — Google Travel, Google Finance, Google Insurance, Google Real Estate, Google Telecoms and, of course, Google Books.

Really?

Does a consumer really have to use Google to find information on all these things?  No.   There are many much better providers of all those information sources.  Does Google actually make money directly on all those categories?  No.   Sure, people advertise on Google to bring people to transactions, but Google isn’t making money directly from the consumer on those ads.

The point of the op-ed relies on agreeing that Google is a gatekeeper to information access.  As a gatekeeper it unfairly restricts competition by promoting its own applications and information sources over third parties.  This is a false representation of Google.   Google is a search engine that a consumer may or may not choose to use.   It just so happens that millions of consumers choose to use Google and Google has negotiated enough deals to make it easier to choose Google.  However, hopping online does not require you to use Google at all.  There are many search engines, many mapping sites, many free email services, many in browser applications and so on.

Web search is not the ONLY way to find things online.  In fact it’s not even the number 1 way most people find information online.  Word of mouth via social networks, email, IMs is still the number 1 way people get to things online.   For websites and services that no one talks about/knows about Google is the number 1 people will find it.  That’s not a problem caused by big bad Google… in fact, the only reason businesses that can only be found via Google exist is, well, because of Google.

The author of the op-ed is a co-founder of a service called FoundEm, a price comparison site (and seller of its underlying technology).    Clearly, FoundEm has had some competitive issues with Google.  That happens.  And FoundEm should fight for its position in Google in any legal way.  However, I don’t think the experience of FoundEm is any way a justification for some regulation of Google in the form of enforced Neutrality.   Google pays to build a big fat index of the web and provide it free to consumers.  No where in that business does Google guarantee it’s the best, most authoritative source of information or way to find it.  It simple is useful enough to most people that they assume Google has it all.   Again, that’s not Google’s fault and Google should not be forced to include information and services it doesn’t think helps its clients and consumers.

There’s a more legitimate bone to pick with ISPs that hijack mistyped address and querystrings and send to advertiser only pages.  That’s an actual abuse of gatekeeper status – the consumer, in that case really doesn’t have a choice of information sources AND in many areas in the US there is only 1 ISP available.

Rather than picking on Google via regulation just out innovate them – in product and marketing.  Twitter, Facebook, Apple, Bing, LinkedIn and more have found ways to compete without Google.   In a world less and less about finding webpages and more about connecting useful information and synthesizing live data Google’s Web Search is losing relevance as a functional tool for users.  We’re a decade away from the market seeing that en masse, but it’s happening.  Web Search IS NOT a tractable problem long term and is constantly being thwarted by spam, new technologies, new presentation formats, the mobile world, and so forth.  The Google folks are very smart and forward thinking –  they are investing in NON SEARCH based products and services, knowing that the gravy train will run out eventually.

I mean think about it… what’s the web search market really worth?  Google is spinning off 20 billion in revenue, the other major competitors much less.   Let’s make a high estimate of $50 billion in direct revenue for the web search industry.  That’s not that big.  Barely a market at all in the grand scheme.  Perhaps what Google is doing is bigger than the revenues imply.  Maybe all the info they are collecting is much more of a scary thing that being a dominate #1 search engine.   Even by that measure google is probably less deep in its insights of important data compared to Facebook or even Yahoo!

Do I worry about Google?  Sure, personally I do with my own information.  As a company acting as an unfair monopoly, no, not at all.  I don’t have to use them.  I don’t have to buy ads on Google.  I can close my gmail account.  They don’t really even have aggressive retention methods like phone companies, insurance providers and ISPs (can’t cancel without 40 phone calls!).

Best way to beat a big business is to do what it grows too big to do – imagine and execute on that imagination.   Google can’t disrupt the gravy train – but small businesses can.   Build a great product, market aggressively and leave the regulation and activism to issues that really need it….

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