Google isn’t the only company at war
July 3rd, 2011
I just read an article in the Washington Post about Google. The article examined the multiple fronts Google is battling in for valuable space in the digital spectrum. I enjoyed reading the article. However, I have a bone to pick with the author’s opinion that Google is the only company capable of diverting their focus on so many fronts and maintaining position as a legitimate contender. Not only that, but I believe Google is struggling to stay afloat on many of those fronts.
Google is certainly a tech giant, but they are far from alone. I believe that Google is an extraordinary company that has yet to mastern how to focus on multiple tasks. Many companies fall victim to similar traits, but they aren’t being hailed as something other than what they are. So let’s be honest and identify what Google is really doing well, and what others are doing better.
Browser: Microsoft’s Internet Explorer is the dominant player in the space. Their stranglehold has been long and overtime they have withstood new entrants such as Mozilla Firefox and Google’s Chrome. Between the aforementioned competition, Apple’s Safari, Opera Mini, and others are also jockying for position. Explorer’s position atop the hill says something about what Microsoft continues to do right.
Mobile: Google’s Android OS is a force to be reckoned with. Since debuting in 2008 it has disrupted the space, leaving a trail of destruction behind it. But this isn’t the full story. Despite having the largest marketshare, Apple is the most profitable mobile company by margins. Google actually makes very little from mobile. The Android OS is free to use and Google gains no licensing fee. As an investor I’d rather place my bet on Apple and their profitable high-end devices, or Microsoft who collects $15 for a Windows Phone license and $5 for every Android phone sold. That’s right, Microsoft makes $5 for every Android phone sold. It doesn’t stop there, Microsoft has managed to turn Android into quite the cash cow. Meanwhile, Windows Phone is growing at rates on par with Android growth 1-2 years ago. Several analysts have Microsoft passing Google in the mobile space as the leader by as early as 2013.
Search: Ah, Google’s home field. There is no dispute that Google is the king of search. Search is the backbone of the company and the service that allows them to venture out into all of these other sectors. They dominate all challengers, with ease.
Social: Facebook is the leader here. Google has attempted to enter this area with epic failures such as Google Buzz. Now they are returning with Google+ which is already being hailed as the greatest social networking site. This type of salivation is what I consider to be the hyperbole of the worst kind.
Enterprise: Google isn’t even a serious contender here. Microsoft has a death grip on PCs. IBM, Oracle and others have the services side under control. Even Apple is making more headway than Google with serious interest in the iPad. Google’s best chance to make waves in the space is with cloud services but that space is crowded as well with industry heavyweights like VMWare, F5 Networks, Cisco, Red Hat, and Citrix Systems. I don’t see Google making a dent in enterprise anytime in the foreseeable future.
Deals: Once again, Google is not a contender. Groupon and Living Social are leading the pack on local deals. Travelzoo continues to make waves on travel deals. Google is nowhere in sight. They desperately want to be a player, but seem unable to develop an effective way to enter the market. Perhaps they can develop a solution in the near term.
Taking a look at the score card, It seems to me that Google is great at search, growing in browser, in a strong position but not capitalizing on mobile, ineffective in social networking, and non-existent in enterprise. Apple is making waves in enterprise, a mobile heavyweight, growing in personal PCs, and has cornered the market in the tablet and portable player spaces. All the while maintaining huge margins. Microsoft is the king of enterprise, nearly has a monopoly in personal PCs, tops in browser, has asserted itself as arguably the most innovative gaming console maker which is a highly competitive area, and is on the rise in mobile.
Google is not the only company waging a multi-front war. They are not the only company capable of doing so. They aren’t even the company doing it the best. I enjoy Google products as much as the next person. But sometimes reality has to be a part of perspective taking. From my vantage point they are an innovative company that knows how to throw its weight around, and can excite any industry in which they dip their tows into the water. But the company hasn’t nailed pulling off the finished product. Perhaps in 1-5 years this could all change, but today that is who they are. A brilliant advertising company that has not found that second product.
July 26th, 2011 at 8:37 pm
I’ve thought a lot of these points for awhile now. Google gets credit for being this innovative, pioneering company, but they haven’t EVER invented their own product. Even things they do well, Search, Gmail, etc., they have made certain tweaks to make it appeal to users, but they’ve never made their own unique offering. They are not at all the creative company that their reputation would make the market believe, but rather followers with a lucky bank of investor sentiment.
Meanwhile, I’ll be reaping my profits from Apple and wait for the Google bubble to burst.
P.S., the site looks awesome, I’m glad I saw your plug for it on Facebook.
July 28th, 2011 at 10:44 pm
Thanks for dropping by the site.
I understand your sentiments on Google. I don’t want to take anything away from them as innovators, but I tend to agree they take existing products and improve upon them most of the time. But upon reflection, how often can an idea or product be completely original? What matters more than the idea is usually the vision of what something can be, and how to execute a strategy. Execution is something Google needs to improve on.