Google’s End Game: The GooglePod

by Mike Levin SEO & Datamaster, 09/21/2005

Google’s intentions cannot be directly to defeat Microsoft. As a public company, their primary responsibility is to deliver value to their shareholders, and entering some sort of toe-to-toe battle is not the way. Yet, Google’s hold on success is precarious, as there’s no real commitment on the part of their customer-base. We, the googling pubic, haven’t paid money to use Google, and loyalties can change quickly if something better comes along. The advertisers driving Google to profitability through keyword bidding-frenzy would readily put their marketing dollars somewhere else, if that somewhere else was the site driving traffic. But today, Google is the site driving traffic — the global broker of sales leads. Protecting this fact long-term has got to be Google’s priority.

Google’s entire business appears contingent on continuing to be the de facto standard search, and the primary mechanism of matching buyers with sellers, and aficionados with communities. And technically, Microsoft has the ability to turn that off like a switch. They would never do it, because governments would come down on them like a sledgehammer. But don’t underestimate what Microsoft’s chokehold over the operating system and browser really means. They technically have the ability to block Google. The complete shutting-off of all ability to reach Google is technically a service-pack away. And with all our PCs set to auto update, they could do it.

But the battle has to be more subtle than that. Microsoft is using a different strategy for example with Web Services than they had with technologies in the past. In the past, they would have created a proprietary system for information interchange. But due to the very open nature of XML, and the worldwide outcry against attempts to mangle it, Microsoft was basically forced to win on the implementation. Hence, .NET and the ability to program Web Services ridiculously simply. Similarly, Microsoft will have to win on the implementation in the battle that’s brewing between them and Google. That’s not to say they’re not above their old tricks. If you have MSN set as your homepage and also have the Google Toolbar installed, open a browser and start to type your search really quickly. Notice where your highlighter moves! Right into the MSN search box (they change focus). It’s a fairly common JavaScript technique to change cursor focus when visiting a web page. But the net effect is intercepting a lot of queries bound for Google. And Microsoft can get away with that, because it’s difficult to even articulate what’s going on. It’s so nuanced, yet so important to notice. It’s the subtle battle.

So, a toe-to-toe battle with Microsoft isn’t the answer. But Google’s total control over the desktop environment poses the biggest threat to Google. Even if Microsoft takes no direct action against Google, the Microsoft tactics can be so subtle as to escape notice, but over time will have their effect. So, what’s Google to do? What could their end game be?

I’m about 35 years old, and was brought up in an age where the PC was not dominant. In fact, through my journey through the TRS-80, Apple II, Commodore 64, Macintosh, PC and so on, there was only one computer that really eally imprinted itself upon me so as to inspire loyalty — and I mean a rabid, undying and not totally rational loyalty. And that was the Commodore Amiga, circa 1987.

The Amiga was hi-color, animating and multi-tasking before anyone even heard of the word. I hesitate to even credit Commodore for this computer, because it was the ex-Atari hardware engineers (namely, the late R. J. Michel) who brought this thing into being, Electronic Arts who made the killer-app (Deluxe Paint), and NewTek breathed a few extra years of life into it. Commodore—both management and the engineers—did a semi-competent job of upgrading it over the years, but not nearly as inspired a contribution as RJ, EA and NewTek. But as Geoffrey Moore put it, the Amgia failed to cross the chasm. In fact, Geoffrey Moore specifically names the Amiga as superior to the Macintosh in the opening to his landmark book. The point is that as an Amiga fan, I know how much better computing can be. And apply 20-year newer technology, where the average cellphone has more computing power than the Amiga, we can see the next big thing coming, but only by stripping away all our core assumptions.

The term GooglePod is already being thrown around. We have the recent phenomenal success of the iPod to look at. Like the iPod, Google needs to solve a problem that every has (they don’t even need to know they have the problem — yet) better than anyone else, offer it at a good price, and have a brilliant marketing campaign behind it. The parallels I could draw to the Macintosh are unlimited. But suffice to say, I think everyone who thinks about this stuff gets it. We need wireless googling on the go.

It’s got to be cheap, convenient, and appliance-like. The phone companies have a strangle-hold on us, squeezing ridiculous premiums out of us for unlimited data services on our only semi-cool Trios, Blackberries and iPAQs, and forcing us into 2-year contracts. How quickly would you switch to a Google Pod?

The closest things to morphing into a pervasive Microsoft-free platform is the phone/telecom combo, or the cable box/cable provider combo. But the phone/telecom platform is more likely, because we’re already coming to think of these devices as disposable, and it’s easier to build wireless infrastructure than to run new cables to the house. One of the most significant and overlooked items in the news of late, I think, is the fact that the PC price-point has just dropped to $230 in India. It’s not a far stretch to imagine a Linux derivative with a killer GUI (yes, even better than OSX) to come out, but for the cost to be so incredibly offset by advertising, that for all intents and purposes, it is free.

But I speculate that they will just make it relatively low-cost, going for that magical $250 price point that moves so many MP3 players. And being their own wireless ISP won’t hurt either. And taking another lesson from Apple’s book, it will be virtually free to education, replacing text books (they have plenty of experience scanning them in). I expect Google will be taking a crack at fixing the all-time biggest UI problems with such devices — the way Apple Newton tried with handwriting recognition, Palm tried with Graffiti, and Blackberry with the tiny keyboard and scroll-wheel. Perhaps Google can get voice-recognition right, or a collapsible full-size keyboard. I think they’ll also go for an amazing battery-life, and “always on/always online” behavior. The timing with the public mood is right. And I suspect the economics just about work out by now.

As an ex-Amiga aficionado, I know that PCs—and yes, even the Mac—are not sufficiently cool to hold our hearts and minds forever. Whether we know it or not, we are just waiting for something just as good, that takes very little investment to dabble in. Remember Cialdini’s Laws. For a limited time, get a free gift. Experts agree, and all your friends are doing it. Look at how they’re used in schools and universities. Even Paris Hilton’s using it (but don’t try to hack it). And you don’t even have to switch off of your PC or Mac. Just have an extra Google Pod in each room. And this gives Google a direct connection to their customers, which cannot be disintermediated by those who control the pipeline or the box. The delivery vehicle for all that advertising is secured, and thus secures Google’s future and ability to continue delivering value to its actual customers, the advertisers.

In short, I see Google becoming the new Yellow Pages—in more than just changing our online behavior and the way the world economy works, but also in actual physical fact. In the way the Amiga ALMOST redefined what a computer was, and the way the iPod is reshaping the music industry, Google has an opportunity to create a new category of product by pricing it and marketing it to be disruptive and achieve critical mass quickly. Who wants a Google Pod? I want a Google Pod! But it doesn’t run MS Word! So what!