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Archive for the ‘google’ Category

The iPad, like the iPod, iPhone, and iMac isn’t a revolution in computer science, design interface, consumer packaging nor ui. It’s a revolution of the economics of those things. Now that there’s a device on the market now at 500 bucks and an unlimited data plan for 30 bucks a month it’s almost assured that the iPad type of computing and media platform will be popularized and maybe not even by apple. The hype of the technology will surely drown out the economic story for some time but in the long run the implications of the price of this technology will be the big story.

Sure we have sub 500 dollar computers and media devices. they have never been this functional or this easy. Apple has just shown what is possible so now the other competitors will have to follow suit. It really doesn’t matter in the grand scheme if it’s apple or htc or google or microsoft or Sony who wins the bragging wars each quarter – the cat is out of the bag – cost effective, easy to use, and fun computing for everyone is possible in a mass producible construction.

There are some interesting side effects coming out of this. If a business can’t make huge profits from the hardware or the connection or the applications where will the profit come from? (I’m not saying companies won’t mark good profits I just don’t think it will be sustainable – especially for companies used to big margins.)

Obviously the sales of content matters. Books, movies, games, music and so on. This computing interface makes it far more easy to buy content and get a sense that it was worth buying. If the primary access channel is through a browser I think people aren’t inclined to pay – we all are too used to just freely browsing. On a tablet the browser isn’t the primary content access channel.

The challenge for content providers is that quality of the content has to be great. This new interface requires great interactivity and hifi experiences. Cutting corners will be very obvious to users. There’s also not really some easy search engine to trick into sending users to a sub par experience. That only works when the primary channel is the browser.

If advertising is going to work well on this platform boy does there have to be a content and interaction shift in the industry. Banners and search ads will just kill an experience on this device. Perhaps more old school magazine style ads will work because once your in an app you can’t really do some end around or get distracted. Users might be willing to consume beautiful hifi ads. Perhaps the bigger problem is that sending people to a browser to take action on an ad will be quite weird.

Clicks can’t be the billable action anymore. Clicks aren’t the same on a tablet! (in fact, most Internet ads won’t work on the iPad. Literally. Flash and click based ads won’t function)

Perhaps the apps approach to making money will work. To date the numbers don’t add up. Unless users are willing to pay more for apps than they do on the iPhone only a handful of shops will be able to handle the economics of low margin, mass software. So for the iPad apps seem to be higher priced. More users coming in may change that though.

In a somewhat different vein…. Social computers will be a good source of cold and flu transmission. If we’re really all going to be leaving these lying about and passing them between each other, the germs will spread. Doesn’t bother me, but some people might consider that.

Will users still need to learn a mouse in the future?

Should we create new programming interfaces that are easier to manipulate with a touch screen. Labview products come to mind?

What of bedroom manners? The iPhone and blackberries are at least small…

And, of course, the porn industry. The iPhone wasn’t really viable as a platform. This touch based experience with big screens… Use your imagination and I’m sure you can think up some use cases…

I do think this way of interacting with computers is here to stay. It’s probably a good idea to think through how it changes approaches to making money and how we interact with each other. I’d rather shape our interactions than be pushed around unknowingly….

Happy Monday!

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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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There’s an amazing thing going on.  It’s a small little product release that few folks outside of the techworld cover.  The release and tech uproar over Google Chrome Frame.

Why do I say this?  Oh, well, some folks at Google woke up and realized there are such things as platform dependencies and you pick the platform that makes it efficient to produce and distribute your product.  So… it produced a WRAPPER for the platform most widely distributed (windows/IE) AND reduced its dev costs (produce a runtime that runs on anything.).

We could continue in this fashion, but using Google Chrome Frame instead lets us invest all that engineering time in more features for all our users, without leaving Internet Explorer users behind,” argued Lars Rasmussen and Adam Schuck of Google’s Wave team last week.

Beyond Google making such an aggressive move to stash Chrome inside IE as a stab at Microsoft, this move demonstrates  that BROWSERS determine a BIG PART of business on the Internet.  Netscape was right, just way too early.  The browser is the new OS – both in user function and business line.    All the players are pitching users on various propositions.  Do you care about security? compatibility?  native software?  cool features?  It can be bought, sold, and managed just like any other piece of commercial software.  The browsers are not immune to real business.  The require real capital to build and real support to maintain.  Firefox is hanging on… but how long does it have with its main benefactors producing competitive products and forging competitive alliances?

Basically, the browser as a community project – Free Software Thing – is losing ground to browser as front door to lots of revenue.

It’s well known, and extremely frustrating, to many software vendors that whatever ships with the computer is what wins and trying to get a mass of users to install the platform is a losing battle.  As a result Google is trying very hard to make Android and Chrome OS a default shipping system, but it’s not there yet.    If Google is to ever grow as big as MSFT it MUST own the default software on the majority of systems.

I predict eventually Google has to ship hardware – perhaps in deep partnerships (tmobile MyTouch with Google is just the beginning).  It will definitely start shipping Google branded hardware that has Google OS and Google search, Google apps capable of doing real work and real entertainment.   Apple, PC Makers, Cell Carriers and others will divorce Google slowly over time as Google takes more and more of their core business.

As a very interesting side note…. the biggest eyeball engine every created still doesn’t have enough advertising revenue growth to power long term business growth.  That’s right… SELLING ACTUAL STUFF IS STILL WHERE BUSINESS LIES.  Just hawking someone else’s stuff isn’t enough…. and so it goes.

Welcome, Internet, to long term business.  Reality bites.

OR

Maybe I’m completely wrong and this helter-skelter game of pushing open source and community projects strategically can disrupt competitors enough to keep growing and further distribute the Google eyeball engine… hmmmm….

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Check out this bit of info from the Official Google Blog!

Based on their graph of searches per hour and assuming at $5-7 eCPM on searches  and an estimate of 500,000,000-1,000,000,000 searches per day (or 21,000,000 to 42,000,000 searches per hour)* ….

Google lost over 20,000,000 queries during the inauguration or $100,000-140,000 on search.

Assuming a similar loss of general traffic across the web it cost Google an additional $40,000-60,000 in AdWords revenue.

Wow.  that’s a lot of ad revenue to lose for about a 1 hour interuption.  I suppose CNN, Facebook, and other news outlets picked up that extra ad traffic.

*Based on 2008 comscore reports and UU estimates from quantcast.

* My estimates for revenue per hour roughly equate to the quarterly earnings after you do all the math to roll it up.  So the eCPM and searchs per hour seem to be solid assumptions.

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