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Whereas most companies try to innovate in product technologies and bring about disruptive changes, Google has incorporated the same in its revenue model. So whatever Google does must be innovative enough to sell free and still make money. That means every product Google pushes into its business process must be capable of attaining sustainabilty and scalability to earn revenue from advertisement for its survival. That is indeed a tall order considering the competative nature of market, but Google manages it all through a near monopoly on internet advertising and search.
Google has a near two third market share in search over the last three years (it was higher before) as against closest competitor Yahoo with 18% and Microsoft Bing at 11 % . It also controls 85% of the internet advertisement market that accounts for the major chunk of its $28 billion revenue per annum. So Google is perhaps sitting pretty and can afford to dole out free software and make it difficult for others to survive.
Nothing however could be far from the truth and Google knows that better than most. The company really had to work hard over the last decade to develop the internet advertisement market bit by bit. It chose a model that is extremely friendly to the advertiser and less friendly to the content provider knowing that it has to please clients not suppliers first.
But the big challenge it faces today is developing the projected $150 billion mobile search advertisement market, an area where it is having to face several closed systems like Facebook and Apple that bar entry of Google spiders. All eyes will be on how Google overcomes the challenge of mobile search and the closed loop systems that operate today
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