Google’s (GOOG) next billion dollar business: Financial Research (part 3 of 4)

avatar By: IS
Date posted: 04.08.2010 (5:00 am) | Write a Comment  (1 Comment)

Print This Post Print This Post    Email This Post Email This Post    Post a Comment

As all of you know, in the financial markets, nothing is more valuable than data. And as we discussed in the past two articles, I consider Google as second to none in terms of knowledge. In theory, they would be able to predict a lot of the trends of the US economy or for specific companies.

Already possible

Already, some of that data is available on pages like Google Trends and has been used to draw important information. For example, search for Gold and you can see a graph that will look a lot like the price of Gold in recent months. Luck of the draw? I doubt it. In theory, I think Google has the capacity to organize all of the data in a much easier way to use. For example, Google could pull in all types of queries relating to jobs such as users searching online for jobs, etc. Once that is done, they would be able to get important data relating to the US employment numbers, much faster than those that are released by the US government agencies.

Even easier would be for Google to tell you which toys are being searched for and purchased in a holiday season. You would then have an advantage in knowing which toy producer will pull off the best Q4 numbers. In fact, the possibilities are almost endless and as Google has grown, it has access to an increasing amount of data that could be used by traders and investment firms across the world.

No doubt, there would be a lot of buyers for this type of data and since the quantity and depth available could be very very large, I would imagine that Google would sell them all separately. Big investment firms would probably buy packages but even smaller players could buy data relating to a specific product or company.

Concerns

The main one of course would be privacy concerns. Many companies gather such data and then resell it but with Google being so mainstream, there is a backlash possibility where an outrage could happen.It would have to be dealt with from the start. Remember that when Google launched its email product Gmail, many consumers had huge worries about Google targetting ads according to email contents. The concerns were centered around the fact that Google would be “reading” all content. Of course, truth came out that it was robots and of course, no data that would trace email content to a specific user was stored. I would imagine that a similar strategy would need to be used when starting to sell financial data.

How big of a business could it become?

The great thing about this service is that it is a subscription paid monthly, time after time after time. The only thing required is to keep the data coming in, which would not be a problem for Google. I could see low thousand companies paying a few thousand dollars per month, an amount that would increase over time….

If you liked this post, you can consider subscribing to our free newsletters here


1 Comment

  1. Comment by Zavi — April 20, 2010 @ 3:04 pm
    avatar

    I like the idea. Financial research usually starts with a search engine and Google is a good starting point!! Online financial research is on its upward trend. So it will become more and more important. By making its intentions clear, Google’s financial research can become BIG! Companies would pay for being in the Google’s “platform”.

RSS feed for comments on this post.

Sorry, the comment form is closed at this time.



Switch to our mobile site