Thursday, November 1, 2012

Could This Be The Beginning Of The End Of Google?

Phones image from Bobby Owsinski's Music 3.0 blog
Google's most recent earnings report caused a 9% decrease in its stock price, which amounted to about $20 billion of the net worth of the company. Now in the crazy world of the stock market, just barely missing the earnings that the analysts expect can lead to negative fallout (in this case $3.95 billion in profit instead of $4.1 billion), so that's not the warning sign that Google might have peaked. In fact, instead of looking at earnings at all, we have to look into Google's core business: search.

Google makes a lot of money on search via advertising, as it's the go-to search engine for the majority of the planet. The problem is that, just like Facebook, it's having trouble making money with mobile. Google's advertisers just aren't willing to pay the same rates as they are on the desktop because the ads aren't as prominently displayed. Plus ads don't command as high a price as they do on a desktop. As mobile goes up, Google's influence wanes. Didn't we see this happen before with Yahoo?

So what might replace Google? How about Apple's Siri or some version of voice-activated search like it? Why type something into a search engine on your phone if you can just speak it? Siri already does a decent job, and hopefully it will only get better. The problem is that you won't be able to advertise on a voice-activated search engine either, so it doesn't help if Google gets into voice-activated search anyway. Of course, that's the major dilema. The industry is beginning to shift ever so subtly, but you have to begin to steer the ship now, and there's no sigh that's happening.

With technology moving so quickly, it's possible for a giant industry leader to become irrelevant very quickly. We've seen it with MySpace (once the #1 most visited site on the Internet) and Yahoo, and even with old-school industrial leaders like Kodak. We could see it again with Google, and it could happen before you know it.

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1 comment:

Dan said...

I guess you never know but I don't think Goggle will have trouble adapting. They are a very creative and innovative company. As far as voice search, I have been using the Google iPhone app for sometime with voice search (I think since siri came out). I find it to be much more accurate than siri.

BTW, Love the blog. Thank you for all you do.


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