Google’s war taking the company in many new directions

By: ispeculatornew
Date posted: 02.11.2010 (5:00 am) | Write a Comment  (2 Comments)

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Wow, Google is not getting anything easily these days and with its stock down close to 15% so far this year, you would think that Google might be looking for alliances. But it continues on its quest to gain more ground no matter who stands in front of the company. The company is now waging war on tens of different opponents with few alliances to count on. Here are a few of the current opponents of Google.

Search: Microsoft & Yahoo

This is the ultimate battle for Google obviously as it defends its ground. Search is the core of Google and a battle it will give its all to win. The problem of course is that it is facing a very determined Microsoft in this battle. The Seattle based company is spending over 2 billion per year on marketing its search engine, recently renamed Bing. Is the operation profitable? No, as you can see in the chart below. But all this money is starting to show results as Bing continues to gain ground on Google. Bing had 11.3% of search market share in January compared with 10.7% in December with other search engines including Google losing market share. How long can Microsoft keep up the spending? Too long if you are Google.

Social Search: Twitter & Facebook

We have discussed the importance of social for Google and it is attempting once again to enter the market, this time through the launch of “Google Buzz”, a social network integrated with Gmail that tries to compete especially with Twitter. Critics have not been impressed much more than they were a few months ago when Google launched “Google Wave”.  It remains  unclear what Google’s strategy is and there remains many analysts who think the only way Google can get in the game is by purchasing “Twitter” although that alternative continues to become more expensive as months go by… Facebook, which is partially backed by Microsoft, also has been gaining ground on Google in several key measures such as users and time spent on its properties.

International: China & Iran

As if Google did not have enough enemies in the corporate world, Google is also battling it out with Chinese authorities because of hacking attempts that were supported or done by the Chinese government according to Google as well as the company’s refusal to filter search results. This could give enemy Baidu major help as it could concentrate on other markets if Google pulled out of China.

And today, the Iranian government officially banned the use of Gmail, Google’s email website. Of course, Iran is a not a very big market for Google but this does create more legal and logistical complications for a company that already has a lot on its plate.

Mobile: Apple, Research in Motion, Microsoft

The launch of Nexus One a few weeks ago is a clear signal that Google does not consider its operating system “Android” to be gaining market share fast enough and in the critical mobile space, it is important for companies to gain market share right now. Hence, Google launching its own phone (built by HTC) and entering the retail space for the first time.

Software: Microsoft, Sun, etc

It is no secret. Google has been trying to push its lower cost alternatives to Microsoft Office but also offering cloud computing solutions and despite very slow growth, it continues to place a lot of energy in these solutions in the hopes of being the leader in cloud computing.

Print media: Book publishers

Through its agreement to scan an incredible number of books and allow them to be scanned, Google placed itself in a position where many publishers & authors disagree with the principle and refuse to be part of the agreement. So far, Google has been tied up in many legal issues regarding these agreements. The justice department is now involved and it is very unclear how this issue will end.

High speed networks: Verizon, AT&T & Comcast

And finally, as if Google did not have enough on its plate, Google announced today plans to build a high-speed fiber-optic network to provide a faster and better internet, thus entering in competition with other high speed internet providers. “If Google went out and started delivering a gigabit per subscriber, it would show that anybody with fiber can do the same thing.” I’m certain opponents will love to hear this.

So the question clear is: Does Google have too much on its plate? Which battles are key and which ones will require the most energy?

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2 Comments

  1. Comment by James — February 11, 2010 @ 8:44 am

    Really interesting article!! Google is a great and innovative company. Of course, Google’s successes have attracted giants in the market (MSFT, YHOO, etc.). Google had that tag line a few years ago and I think this should remain: innovate in “Search, Ads & Apps”!

  2. Comment by IS — February 11, 2010 @ 2:59 pm

    @James – Yes, I think Google decided search was too easy so it seems to be taking on every company in the tech industry!!

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